Legal update ––––– February 2016

Projects and Construction

JCT 2016 Edition – a new era?
——— Pioneering ———— Bahrain ———— Construction ———— Public sector ———— Energy ———— Real estate ———— London ———— Tax ———— IT ———— Dubai ———— Manchester
onnecting ———— Knowledge ———— Pragmatic ———— Malaysia ———— Exeter ———— Thought leadership ———— Housing ———— Agile ———— Creative ———— Connecting ———— Priva
Local government ———— Manchester ———— Environment ———— Focused ———— Islamic finance ———— Projects ———— Abu Dhabi ———— Corporate finance ———— Passionate ————
— Employment ———— Regulation ———— Procurement ———— Expertise ———— Specialist ———— Planning ———— Investment ———— Committed ———— Delivery ———— IT ———— Gov
—— IP ———— Corporate ———— Infrastructure ———— Value ———— Development ———— Private wealth ———— Oman ———— Governance ———— Birmingham ———— Corporate finance —
— Dynamic ———— Pensions ———— Dispute resolution ———— Insight ———— Banking and finance ———— Arbitration ———— Diverse ———— Regeneration ———— Care ———— Communic

The Joint Contracts Tribunal (JCT) has
provided further details on its upcoming JCT
2016 Edition suite of contracts which is due to
launch later this year.
The JCT was established in 1931 but has risen to
prominence through the publication of its suite of
standard form construction documents, including its
popular JCT Design and Build Contract which is often
stated to be the most popular form of standard building
contract used in England and Wales.
 Public Contracts Regulations – the 2016 Edition
will include provisions for use by employers
(including public bodies and housing associations)
which are covered by the Public Contracts
Regulations 2015. These changes will likely reflect
the bespoke amendments relating to termination
and payment already in use by these bodies.

Previous JCT editions have been released every 6-7

years (with the current 2011 Edition replacing the 2005
Edition which replaced the 1998 Edition). The 2016
Published by
Trowers & Hamlins Edition will be release piecemeal over the year with the
first release being the Minor Works suite of contracts. Source: Fotolia
Trowers & Hamlins LLP
3 Bunhill Row
London What are the changes?  Payment – the payment provisions will likely see
EC1Y 8YZ
At the time of press only the headline details of the the greatest change in the JCT 2016 Edition with
t +44 (0)20 7423 8000 changes in the 2016 Edition have been released. These the introduction of aspects of the government's
f +44 (0)20 7423 8001
are mainly as expected and are a mixture of statutory Fair Payment Charter. This includes Interim
www.trowers.com updates and changes to reflect current initiatives in BIM Valuation Dates which operate at main contract,
and Fair Payment. The changes will include: sub-contract and sub-sub-contract and/or supplier
Trowers & Hamlins LLP is a levels. Payment procedures will also be simplified
limited liability partnership  CDM Regulations – the suite will incorporate the with a new procedure for assessing loss and
registered in England and
Wales with registered changes under the Construction (Design and expense claims.
number OC337852 whose
registered office is at 3
Management) Regulations 2015. These changes
Bunhill Row, London EC1Y
8YZ. Trowers & Hamlins
are currently included in separate amendment  Security documents – we expect that most forms
LLP is authorised and sheets issued by the JCT in March 2015. of contract in the JCT 2016 suite will include
regulated by the Solicitors
Regulation Authority. The provisions for the contractor to provide
word "partner" is used to
refer to a member of Trowers
 BIM – following the issue by the JCT of its practice Performance Bonds and Parent Company
& Hamlins LLP or an note "Building Information Modelling (BIM), Guarantees as is already common practice. The
employee or consultant with
equivalent standing and Collaborative and Integrated Team Working" the amendments will also likely include options for
qualifications or an individual
with equivalent status in one JCT 2016 Edition will see the introduction of obtaining collateral warranties or third party rights
of Trowers & Hamlins LLP's
affiliated undertakings. A list
specific contract options in relation to BIM and its from sub-contractors.
of the members of Trowers &
Hamlins LLP together with
use in projects. Details on how BIM will be
those non-members who are
designated as partners is
incorporated into the suite of contracts are  Insurance – the biggest change in relation to the
open to inspection at the currently unclear but the JCT practice note only insurance provisions will be the extension of
registered office.
covers up to BIM Level 2 so it is yet to be seen Insurance Option C (insurance by the Employer of
Trowers & Hamlins LLP has
taken all reasonable
how far the provisions will extend in the JCT 2016 existing structures and works to them) to allow
precautions to ensure that
information contained in this
Edition. tenants to procure such insurance from the
document is accurate but
stresses that the content is
landowner. We also expect amendments to clarify
not intended to be legally the interaction between the general insurance
comprehensive.
Trowers & Hamlins LLP provisions and Insurance Options A and B.
recommends that no action
be taken on matters covered
in this document without
taking full legal advice.
Projects and Construction Legal update February 2016

A new era?
As with all new editions of standard form contracts there
is likely to be a transitional period where the new and
previous editions are used simultaneously by clients
and users who are reluctant to move away from editions
which they are familiar with. In addition, it is unlikely that
contracts currently being negotiated or procured under
an on-going framework will be changed to the 2016
Edition.

Clients will also need to update their standard form

documents to reflect the new editions and users of the
documents will need to be trained in their use.

Expect to see plenty of comment and analysis on the

JCT 2016 Edition over the coming year as the industry
gears up to the new form.

January 2016 © Trowers & Hamlins

For more information please contact

Christopher Pedder
Partner
t +44 (0)20 7423 8208
e cpedder@trowers.com

Mark Pantry
Associate
t +44 (0)20 7423 8464
e mpantry@trowers.com