JCT 2024 – what do we know so far?

The next suite of JCT contracts – JCT 2024 – was announced by JCT at its annual Construction Industry Parliamentary Reception held at the House of Commons on Friday 16 June 2023.

The main features of the JCT 2024 suite have been reported, which include updates and changes corresponding with the following workstreams:

1. Modernising and streamlining:

a. In a welcome move, JCT has reported that the new editions will take a progressive approach with the adoption of gender-neutral language, differing from previous editions' use of male pronouns only.

b. JCT have also confirmed that the new editions will include provisions for notices to be sent electronically, as well as allowing for contracts to be signed electronically.

2. Extensions of Time:

a. The 2024 Edition of JCT will; introduce new relevant events to cover epidemics, update how "statutory powers" are to be considered and redefine "Statutory Undertakers" to "Statutory Providers".

b. In addition to the above, the period of time for an Employer to assess an interim extension of time will be reduced from 12 weeks to 8 weeks from receipt of a Contractor's Particulars.

3. Loss and Expense:

a. It has been reported that the Contract Particulars will be updated to provide optional additional grounds for the contractor to claim loss and expense. Such optional grounds will reflect the newly introduced relevant events – i.e. epidemics and the exercise of statutory powers directly affecting the works. It is also reported that the relevant event dealing with antiquities will be extended to deal with unexploded bombs, contamination and asbestos.

4. Liquidated Damages and Termination:

a. JCT has taken on board the Supreme Court's decision in Triple Point Technology Inc v PTT Public Company Ltd, confirming that liquidated damages clauses apply up to the termination of a contract – but not after. Where works are not complete at termination, LDs can be levied up to termination and general damages for delay can be claimed thereafter. Clear wording will be required should the parties wish to agree a different approach.

b. A due date for the final payment after termination will be added – removing the uncertainty as to when the final payment after termination will in fact fall due.

5. Disputes:

a. The new editions will introduce a requirement for the parties to notify potential disputes and for senior executives to meet early to seek a negotiated settlement, in an approach similar to that set out in NEC 4. Importantly, this will not cut across either party's right to refer a dispute to adjudication at any time.

b. Parties will now be able to choose their own nominating body or appointer for Adjudication and Arbitration as opposed to them being required to choose from the original shortlist.

6. Fluctuation:

a. Price uncertainty has been one of the key issues facing the construction sector in recent years. JCT have recently introduced a Fluctuations Hub, offering guidance on the Fluctuation Options within its contracts. It also plans to increase the prominence and accessibility of the provisions by moving them to an online document.

7. Legislative Changes:

a. It is reported that JCT 2024 will contain major updates in respect of the Building Safety Act and its secondary legislation (once finalised). Changes will also be implemented in light of the new insolvency grounds introduced under the Corporate Insolvency and Governance Act 2020.

8. Future proofing:

a. The new editions will include changes to reflect the objectives of the Construction Playbook, and the incorporation of previously optional supplemental provisions relating to collaborative working, sustainable development and environmental considerations, into the main document.

9. New Form of Contract:

a. It has been announced that JCT 2024 will introduce a new contract family – JCT Target Cost Contract, which will comprise a main contract, sub-contract and guide.

More details about the new edition and main changes will be released by JCT in the coming months. We will continue to update this article as and when further information becomes available.