Week 10

13 Nos JCT Contracts

 In this session

Mapping JCT
Standard forms of
JCT contracts contracts to
contract
procurement routes
 Standard Form(s) of Contract

Why do we need a standard form of contract?

The procurement route will to a large extent influence the choice of

standard form of contract.

The contracts used in the UK construction industry are in the main

not bespoke documents, but instead are standard
documents/forms drafted by organisations drawn from the
industry and professions.

There are provisions within the standard forms to adapt them

to suit particular projects by completion of articles of agreement
and appendices.
 % used % used
Contract Family by by
number value

JCT 79.3 61.5

ICE 1.2 2.1
NEC 7.7 14.0 Types of standard
GC/Works 6.1 2.9 contracts in use
ACA 2.2 5.5
Prime Contracting
Agreement 0.1 9.4

Other standard
forms 0.9 2.8

Other contracts 2.5 1.8

 JCT Contracts
JCT is an acronym for Joint Contracts Tribunal

JCT is comprised of seven member bodies. The members of the company represent
those sectors of the construction industry who are the key participants in a
construction project.
• the British Property Federation
• the Local Government Association
• the Royal Institute of British Architects
• the Royal Institution of Chartered Surveyors
• the Contractors Legal Group Limited
• the National Specialist Contractors’ Council Limited;
• the Scottish Building Contract Committee Limited.

JCT contracts are aimed at the mainstream commercial construction market in

the UK, rather than other sectors such as civil or process engineering.

We will focus on the JCT, Joint Contracts Tribunal

 What are the JCT Contracts available?

1 JCT Standard Building Contract (SBC) 2016 Edition With Quantities

2 JCT Standard Building Contract (SBC) 2016 Edition Without Quantities
3 JCT Standard Building Contract (SBC) 2016 Edition With Approximate
Quantities
4 JCT Intermediate Contract (IC) 2016 Edition; including an option for
With Contractors Design
5 JCT Intermediate Contract (IC) 2016 Edition With Sub-Contractors
Design
6 JCT Minor Works Contract (MW) 2016 Edition
7 JCT Minor Works Contract (MW) 2016 Edition; including an option for
With Contractors Design
8 JCT Design and Build Contract (D&B) 2016 Edition
9 JCT Major Project Construction Contract
10 JCT Management Building Contract
11 JCT Construction Management Contract
12 JCT Prime Cost Contract
13 JCT Measured Term Contract (MTC)
 JCT Standard Building Contract (SBC 16)

• The SBC is designed for use when the traditional procurement

route has been chosen and is intended for larger projects where
detailed contract provisions are necessary.
– However, there is option for Contractor’s Designed Portion
(CDP)

• The ‘with Quantities’ and ‘without Quantities’ versions are both

fixed price lump-sum contracts with monthly interim payments to
the contractor. The only difference between the two being
whether bills of quantities are used to define the quantity and
quality of work.

• The ‘with Approximate Quantities’ version is a re-measurement

contract, as an approximate bill of quantities is used to define the
quantity and quality of work which is then re-measured. The price
and payment structure of the contract is based on a tender figure
which is converted to a final sum on re-measurement and
valuation of all work. Interim payments are monthly.
 JCT Standard Building Contract (SBC 16)

1. With Quantities (JCT/SBC/Qs):

• This edition is for use where the design team is able to fully detail the
project and the time available for a detailed bill of quantities to be
prepared.

2. Without Quantities (JCT/SBC/XQs):

• This edition is for use when a bill of quantities is not to be part of the
contract documentation, primarily due to lack of time or detailed
information. Nevertheless, a set of drawings and specification is provided.

• The contractor is required to submit a schedule of rates as a basis of valuing

the works and variations specifications
 JCT Standard Building Contract (SBC 16)

3. With Approximate Quantities (JCT/SBC/AQs):

• Is similar to the With Quantities but is for use on projects where it is necessary
to make an early start and for which adequate contract documents cannot be
prepared before tender stage.

• No lump sum price can be given for the work, but a tender sum indicating the
anticipated final price can be calculated based on approximate measurement
of likely work involved.

• As the contract progresses, the work is completely remeasured and the

remeasurement priced on the basis of the rates set out in the bills of
approximate quantities.

• The only difference between the bills of approximate quantities and bills of firm
quantities is that they are prepared from less complete design information and
so can be produced at an earlier stage.
 JCT Standard Building Contract (SBC 16)

In addition to the three main Standard Building Contracts, the JCT

also publish a number of sub-contracts for use with the Standard
Building Contract

• Standard Building Sub-Contract (SBCSub)

• Standard Building Sub-Contract with Sub- Contractor’s Design

(SBCSub/D)
 JCT Intermediate Building Contract (JCT/IC)

JCT/IC is designed for use when the traditional procurement route has been chosen.
Developed to help fill the gap between the detailed and lengthy provisions of the
SBC and the relative simplicity of the Minor Works Building Contract

Available with or without quantities: the employer must provide drawings and
either a bill of quantities, specification, or work schedule to specify the quantity
and quality of work. Contract is a lump-sum contract.

4. There is the option to use the Intermediate Building Contract with Contractors
Design, ie IC/D, which allows the contractor to design discrete parts of the works

5. In addition to the two versions of the Intermediate Building Contract, the JCT also
publish a number of sub-contracts for use with the Intermediate Building
Contracts
– Intermediate Sub-Contract (ICSub/D)
– Intermediate Sub-Contract with Sub-Contractor’s Design (ICSub/D)
 JCT Minor Works Contract
(JCT/MW)
Appropriate/used when:
• Traditional procurement route is selected i.e. the work is designed on behalf of
the employer.

• Work involved is relatively simple in character or has a small value

• Contract is a fixed price lump-sum contract when employer is to provide
drawings, specification, or work schedule to define adequately the
quantity and quality of the work i.e. no BoQ

Not suitable when:

• bills of quantities are required
• provisions are required to govern work carried out by the named specialists
• detailed control procedures are needed

6. If design input is required, use the Minor Works with Contractors Design,
MW/D, which allows the contractor to design discrete parts of the works.

7. In addition to the two versions of the Minor Works Building Contract, the JCT
also publishes a Minor Works Sub- Contract with Sub-Contractor’s Design
(MWSub/D) and Short Sub-Contract (ShortSub).
 8. JCT Design and Build (JCT/D&B)

Appropriate:
• Where the contractor is not only to carry out and complete the works but
also complete the design (design and build procurement route)
• Where detailed contract provisions are necessary, and the Employer’s
Requirements have been prepared and provided to the contractor.
• Contract is based on a fixed price lump-sum with stage or periodic
payments to the contractor.

Where the contractor is restricted to design small discrete parts of the

works and not made responsible for completing the design for the whole of
the works, consideration should be given to using one of the JCT SBC
contracts that provide for such limited design input by the contractor.

For use with the Design and Build Contract, the JCT publishes the Design and
Build Sub-Contract (DBSub)
 9. JCT Major Project Construction Contract (MP)

• JCT/MP is designed for use where the design and build procurement route
has been chosen.

• to be used on large scale construction projects where major works are

involved, and contractors have with the experience and ability to take
greater risk than would arise under other JCT contracts.

• enables the employer to transfer to the contractor (via a novation) any

members of the design team (e.g. an architect) that the employer initially
engaged for the project.

• Is based on fixed price lump-sum contract, but the parties can agree on a
range of payment options e.g. interim valuations, stage payments, scheduled
payments

• Is shorter and simpler than the JCT Design and Build Contract

• For use with the Major Project Construction Contract, the JCT publishes the
Major Project Sub-Contract (MPSub).
 10. JCT Management Building Contract (MC) 2011

JCT/MC is designed for use where management contracting procurement route has
been chosen. Based on next tier up (i.e employer and construction manager), the MC
may be appointed based on a % fee (cost reimbursable) or lump sum - client & MC which
in-turn when all the packages have been let and agreed converts to lump sum".
– Large scale projects requiring an early start on site.
– Where the works are designed by the Employers design team
– Where it is not possible to prepare full design information before the works
commence
– Where much of the detail design may be of a sophisticated nature requiring
proprietary systems or components to be designed by specialists
– Where the employer is to provide the management contractor with drawings
and specification
– Where a management contractor is to administer the conditions

• Besides Management Contract between the employer and management

contractor, the JCT also publishes the form of Works Contract between the
management contractor and works contractors (MCWC)
 11. JCT Construction Management
Contracts

The price of the contract is based on a lump sum or the CM may be

appointed based on a % fee (cost reimbursable) or lump sum. (client &
subcontractors)

JCT’s suite of Construction Management contracts is designed for use where

the Construction management procurement route has been chosen.
– Where the client is to enter into direct separate trade contracts
– Where a construction manager is appointed under the client

Two standard forms:-

– Construction Management Trade Contracts (CM/TC): between an
employer and a trade contractor
– Construction Management Appointment (CM/A): between an
employer and a Construction Manager
 12. JCT Prime Cost Contract (PCC)

Designed for use when:

• Prime Contracting procurement route is selected and can also be used for
Framework agreement.

• Contract is a cost reimbursement or cost plus

• Employer wants the earliest possible start.

• urgent repair work (such as fire damage, leakage in water retaining structure,
damage to key infrastructure utilities).

• Insufficient time to prepare detailed tender documents

• It is not possible to accurately define the scope of work necessitating the

appointment of a contractor simply on the basis of an estimate of the total cost.

• The contractor is paid the prime cost of the works, as well as a contract fee in
respect of its non-site overheads and profit. Therefore, there is a higher risk for the
employer in terms of cost.
 13. JCT Measured Term Contracts (MTC)

• Designed for use when:

• A long-term relationship between a client and a contractor.

• Suitable for projects procured via the traditional, using a measurement payment
structure.

• Appropriate for use by employers who have regular flow of maintenance and
minor works, including improvements

• to be carried out by a single contractor over a specified period of time and all
under a single contract.

• This is a measured/re-measured contract. The price of the contract is based

on the measurement and valuation of each order according to the prices in
an agreed schedule of rates.
End of Lecture