JCT Design and Build Contract 2024– What’s New?

The Joint Contracts Tribunal (JCT) produces standard forms of contract, guidance notes and other standard documentation for use in the construction industry in the United Kingdom. On the 17 April 2024, the JCT published the 2024 editions of its Design and Build (DB) Contract and Design and Build Sub-Contract, along with associated guides. The JCT DB Contract is used for projects where the contractor is required to complete the design and carry out the works.

The previous suite of contracts published by the JCT was in 2016, so in this article we highlight some of the main differences between the 2016 and 2024 editions of the JCT DB Contract.

Building Safety Act 2022

There have been amendments to the JCT DB 2024 to deal with the changes brought in by the Building Safety Act 2022 (the Act). The Act applies (in the most part) to projects in England and Wales only and as such, the amendments to the JCT DB 2024 in respect of the Act are not applicable for projects in Northern Ireland. The Royal Society of Ulster Architects has confirmed that amendments to deal with the impact of the Act are deleted in the Northern Ireland Adaptation Schedule that it produces for the JCT DB 2024. However, if the proposed legislation comes into force in Northern Ireland to bring it in line with England and Wales, then the Building Safety Act clauses will need to be reinstated.

Design Liability

Clause 2.17.1 has been amended to include an express provision stating that the Contractor’s liability for design shall be no greater than a duty to exercise the reasonable skill and care of a qualified and experienced architect (or other appropriate designer) and shall under no circumstances be a liability that any design shall be fit for its purpose (to the extent permitted by statute). This is a welcome amendment for contractors and reflects a commercial reality in the market that contractors are unlikely to accept a fitness for purpose design obligation (and unlikely that professional indemnity insurers would provide cover for this).

In the JCT DB 2024 the contract particulars relating to professional indemnity insurance have also been amended to allow the parties to agree sub-limits within the overall level of cover and any exclusions from the insurance policy. This is reflective of the market where insurance for cladding and fire safety claims (where available) is often offered as a sub-limit in an annual aggregate amount and subject to restrictions and exclusions.

Asbestos, contaminated material or unexploded ordnance

The JCT DB 2024 expands clause 3.15 (previously just dealing with antiquities) to address other items such as asbestos, contaminated material or unexploded ordnance that may be found during excavations. This amendment is supplemented by changes to the applicable Relevant Event (which allows the contractor additional time) and Relevant Matter (which allows the contractor loss and expense) that entitle the contractor to relief in relation to clause 3.15 (albeit that relief will not be granted where the material was already identified in Contract Documents or brought onto the site by the contractor).

Under the JCT DB 2016 Contract, the contractor would likely have been liable to deal with asbestos and contamination at its own expense if the risk of it was reasonably foreseeable by an experienced contractor. Now that the risk appears to have been passed to the employer, the new provisions will therefore need to be reviewed on the behalf of employers, to see if they are prepared to accept this risk.

Epidemics and changes in law

The lists of Relevant Events and Relevant Matters now include relief to the contractor in relation to epidemics and changes in law. There are now two new Relevant Events to cover epidemics and the publication of any guidance that may affect the execution of the works where the unavailability of labour and materials affects the contractor’s ability to progress the works. The Relevant Matters are, however, optional with the parties indicating whether they are to apply in the Contract Particulars. Parties can therefore choose as to whether contractors are to receive both time and money (or just time) in relation to these aspects.

Termination

In relation to termination, the JCT DB 2024 has introduced a new defined term “Termination Payment”, together with the mechanisms for calculating the due date for the Termination Payment, with rights for termination payment notices and pay less notices. There is also a new clause which introduces a new payment mechanism for amounts that are payable on or following termination depending on the circumstances in which the contract was terminated. This provides for a more structured approach to the final payment when a contract is terminated.

Following case law and to reflect the decision in Triple Point Technology Inc -v- PTT Public Company Ltd [2021] UKSC [1], a new clause has been included in the JCT DB 2024 which provides that where the contractor’s employment has been terminated before the practical completion date the employer’s right to liquidated damages applies up to the date of termination. Thereafter, the employer can claim general damages in the usual way.

Carson McDowell View

Despite the JCT including in the JCT DB 2024 a new article 3 which requires that the parties are now required to specifically work in a collaborative and co-operative manner, it will still be the case that parties seek to negotiate the terms of the contract that they enter into and it remains to be seen as to whether switching over to the 2024 suite will reduce the number of bespoke amendments required.

The JCT has only just released the 2024 editions of its Design and Build Contract and Design and Build Sub-Contract. The Minor Works 2024 suite and Short Form Sub-Contract have also been issued and it is expected that the remaining suites of contracts (including, for the first time, a target cost contract and sub-contract) will be released over the coming months on a piecemeal basis. There is likely to be a transition period where the 2016 versions of the JCT will continue to be used, and this will be particularly the case for projects in Northern Ireland where legislation equivalent to the Building Safety Act 2022 is yet to be introduced.

For more information on the above changes or if you have any queries the Construction team at Carson McDowell would be happy to help.

*This information is for guidance purposes only and does not constitute, nor should be regarded, as a substitute for taking legal advice that is tailored to your circumstances.

[1]For an article on that case, please see Post-Termination and Liquidated Damages | Carson McDowell (carson-mcdowell.com)