Connor Guinea is an associate at Brodies LLP
On 17 April 2024 the JCT published the first of its new edition of standard contracts – JCT 2024 – starting with the Design and Build Contract (DB2024).
New relevant events and optional relevant matters
DB2024 has extended the list of relevant events to cover delays caused by epidemics and changes in law or the publication of statutory guidance affecting the works. These relevant events are also listed as optional relevant matters.
“It is easy to foresee a scenario where a client and contractor dispute the necessity of the information sought by the client”
The inclusion of epidemics is both prospective and retrospective, covering an epidemic that occurs after the base date, and an epidemic that occurs before the base date whose effects change after the date and that change affects the execution of the works. The epidemic must, however, limit the availability or use of labour or persons engaged in providing services for the works where such labour or persons are necessary for the proper carrying out of the works; or prevent or delay the contractor in securing goods, materials or services necessary for the proper carrying out of the works.
The exercise of a statutory power (including a change of law and the publication of guidance) will be a relevant event under the DB2024 if it affects the execution of the works. Regarding the issue of “guidance”, DB2024 provides that the guidance is that published by the Construction Leadership Council or its successor, perhaps allowing for swift action to be taken where necessary.
In addition, Clause 3.15 of DB2024 has been extended to include the discovery of asbestos, contaminated material and unexploded ordnance devices. Delay caused by these risks are now included as both relevant events and relevant matters, except to the extent that the presence of asbestos or contaminated materials has been identified within the contract documents and/or any such material has been brought on to the site by the contractor or any contractor’s person.
Extensions of time
DB2024 has shortened the time period for a client to notify its decision on an extension of time following receipt of notice and particulars from twelve to eight weeks.
However, it also provides for a separate timetable where the contractor gives notice of a material change in the estimated delay or in any other particulars. In those circumstances, a decision is required eight weeks from receipt of the material change notification (albeit, the client will remain obliged to issue its decision with regard to the original notice and particulars within eight weeks of those being given). This requirement for assessments to be made according to separate timescales is designed to improve the efficiency of the decision-making process.
If, upon receiving notice by the contractor of a delay to progress and/or particulars, the client considers that it requires further information reasonably necessary to enable it to reach a decision on an extension of time, DB2024 now places an obligation on the client to notify the contractor stating the further information required not later than 14 days from receipt of the particulars or notification (or notification of a material change). The contractor is then obliged to supply the information. Where the parties follow this procedure, the client’s decision is then due not later than eight weeks from the date of receipt of the further information required under Clause 2.24.4.
In principle, the mechanism introduced in DB2024 offers certainty to the contractor that no further information should be sought by the client after 14 days (contrary to DB2016, where further information could be sought “at any time”). For clients, the risk arises where a failure to request such information could see them lose the right to obtain it, calling into question how any subsequent extension of time awarded could be curtailed due to a lack of available information.
However, by intertwining this mechanism with the date on which the client is required to issue its decision, the mechanism could provide a breeding ground for disputes. It is easy to foresee a scenario where a client and contractor dispute the necessity of the information sought by the client to enable it to reach a decision. Until such time as that dispute has been resolved, a client could hold the position that it is under no obligation to reach a decision until it is in receipt of the information requested from the contractor. The ultimate effect would be to delay the decision-making process, which is presumably the opposite intention of its introduction.
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