It has long been known that JCT would be updating its suite of contracts to include references to recent changes in law, particularly those stemming from the Building Safety Act 2022 and changes in the Building Regulations. As may have also been expected, the updates relating to the changes to the Building Regulations sit alongside the existing provisions on the CDM regulations at clause 3.16 of the contract, but it is important to analyse if the approach taken really reflects what the parties may want it to do or helps from a practical perspective.
The Building Regulations changes
The revised terms allow for the details of the principal designer and principal contractor for Building Regulations purposes to be inserted, with the default being that the Contractor is appointed if no other party is selected. The amendments set out the parties’ obligations as to the Building Regulations by reference to the various regulations – for the principal contractor and as a contractor and designer, it refers to the specific parts of the relevant obligations the Contractor must comply with (regulations 11F, 11J, 11K, 11L and 11N of the Building Regulations) whereas, with regards to the principal designer, it simply refers to compliance with the relevant “duties”.
Issues
The first point which comes to mind is that whilst the default position in the contract particulars is that the Contractor will be the principal designer, we do not know why specific reference to the underlying duties that the principal designer must satisfy could not be referred to in clause 3.16 (as has been set out for the principal contractor’s duties).
It may have been to avoid making too many amendments to the contract; however, we think it would have been prudent to be more specific - especially considering that in many design and build contracts it seems highly unlikely anyone other than the Contractor can fulfil the principal designer role (unlike the CDM Regulations, the principal designer has to be a designer).
Secondly, the changes do not really add too much. Whilst they cover off the basic requirement of highlighting the existence of the regulations, the need for compliance, and who is responsible, the changes merely reference the underlying regulations.
Given that the only requirement for appointment of the principal contractor and principal designer is for it to be in writing, the same effect could have been achieved by relying on the obligation in clause 2.1.2 that the Contractor must comply with all statutory requirements and simply appointing the Contractor as principal contractor/designer by a written instruction.
While we would advise against duplicating wording in regulations into a contract for the sake of it, from our recent experience, many Employers (and indeed Contractors) remain unaware of the new Building Regulations regime and the steps required for obtaining the Building Regulations Completion Certificate.
We therefore believe it would be beneficial to outline the Contractor’s role in obtaining the Completion Certificate and providing necessary notices to the Building Control Approver (formerly the Approved Inspector). For example, within five days of completion of the relevant works subject to Building Regulation approval, the principal designer and principal contractor must submit a notice stating that they have complied with their obligations, with a further notice to come from the Employer (as Client under the regulations) confirming that, to the best of their knowledge, the works comply with the Building Regulations. Communication between the parties is therefore critical and we would suggest that the Employer may want to see an obligation on the Contractor to liaise with the Building Control Approver where necessary and keep the Employer up to date as to when it is likely the relevant notices need to be issued. This is particularly relevant when the Employer may be based offshore or is a special purpose vehicle.
Some may perceive this as a shift in risk profile for the Contractor; however, we believe it is more reflective of the expectations of a well-organised Contractor acting as both principal designer and principal contractor. Further, we are not of the opinion such amendment would alter the risk profile, as the Relevant Event which allows the Contractor to claim an extension of time where there is a delay in receipt of any approval from a statutory body (clause 2.26.14) remains unchanged. Therefore, provided the Contractor does what they need to do, they are not taking on the risk of a Building Control Approver itself causing the delay (although it may be helpful to clarify that the actions of a Building Control Approver carrying out the role of the local authority would fall under this Relevant Event). Further, if the Employer themselves cause the delay by not issuing its notice in time, this would be an impediment and open the door to the Contractor claiming both time and money.
Conclusions
In short, for those not familiar with the new Building Regulations regime, we would urge parties to exercise caution when using the new JCT in unamended form without giving thought to practical realities in achieving compliance. Simply relying on the contract itself does not obviate the parties' need to understand how the new regulations work.
Finally, it is worth noting that the new JCT does not specifically deal with Higher Risk Buildings, but points to the guidance. This seems sensible. Given the complexity and potential consequences of not complying with the Higher Risk Buildings regime, it is unlikely that there will be a “one size fits all” approach that can be reflected in an off the shelf contract.
About the authors: Robert Tunningley is a partner and Anna Dyde is a solicitor in Irwin Mitchell’s Construction and Engineering Department
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