Stuart Byles is director at fit-out and refurbishment contractor Pexhurst
The Building Safety Act (BSA) 2022 has now been in force for almost a year. However, the release of the JCT Design and Build Contract 2024 in April has highlighted a significant disconnect between standard-form construction contracts and the comprehensive BSA requirements.
“Some suggest the change to the fabric of the design ethos signals the end of design and build contracts”
There were high hopes that while redrafting its contract suite, published in 2016, the Joint Contracts Tribunal (JCT) would provide some clarity. But this has not transpired, and unanswered BSA questions are still confusing professionals across the industry.
While JCT has made some effort to address building-safety concerns, the new contract falls short of fully incorporating the BSA’s extensive provisions, particularly for higher-risk buildings (HRBs).
An example of where the JCT 2024 contract does include a change related to building safety is the new dutyholder regime, introduced by Part 2A of the 2010 Building Regulations. The new contract also provides for the appointment of a principal designer and principal contractor via the inclusion of articles, and requires parties to comply with their respective obligations under the Building Regulations.
But these additions are relatively limited in scope and do not address many critical aspects of the BSA. One of the most glaring omissions is the lack of provisions specifically dealing with HRBs, which are subject to a new building-control regime overseen by the Building Safety Regulator.
The new contract does not address key elements of this regime, such as the gateway approval process, the creation and maintenance of the ‘golden thread’ of building information, or the relationship between practical completion and obtaining gateway 3 approval. This disconnect means that parties using the JCT 2024 contract for HRBs will need to make significant amendments to account for BSA requirements. For example, they will need to consider how to handle potential delays caused by the gateway regime; who bears responsibility for preparing and submitting building-control applications; and how to manage the golden-thread information requirements.
Having reviewed JCT’s commentary on this issue, it appears to see the minutiae of these items being dealt with by way of amendments to the standard form. However, there is a feeling across the industry that JCT could have been more proactive and set out a stall, which would bring some clarity to the issues.
Mismatch creates risks
The limited scope of building-safety provisions in the JCT 2024 contract reflects the challenges of incorporating a complex and evolving regulatory landscape into standardised contract forms. The BSA introduces numerous new obligations and processes that do not easily fit into existing contractual frameworks. This mismatch creates potential risks and uncertainties for project participants, who may find themselves subject to statutory duties that are not fully reflected in their contractual arrangements.
Some commentators within the industry are suggesting that this change to the fabric of the design ethos signals the end of design and build contracts. As a result of more stringent design parameters and the importance of the golden thread, it may become more common for clients to revert to a more traditional form of contract where schemes are fully designed and developed by the same team throughout the lifecycle. Despite the JCT updating the design and build wording this year, it may ultimately end up falling behind other forms in the same suite of contracts.
The disconnect between the latest JCT design and build contract and the BSA underscores the need for ongoing collaboration between contract drafters, regulators and industry stakeholders to develop more comprehensive and aligned contractual solutions.
