May 30, 2023

JCT vs NEC: Which is the right contact for you?

News Article

If you need a construction contract, you may be confused about the most suitable option. There are two main types of contract and with our advice, we can help you select the correct choice for your project.

Joint Tribunals Contract (JCT)

JCT contracts include provisions for dealing with issues such as delays, changes to the project, and disputes that may arise during the construction process.

They aim to balance the interests of both the employer and the contractor and provide a fair and transparent framework for the construction project.

There are several different types of JCT contracts, each tailored to different types of construction projects and procurement methods. For example, there are contracts for traditional procurement, design and build, management contracting, and more.

Overall, JCT contracts provide a widely recognised and accepted standard for building contracts in the construction industry, and can help to reduce confusion, disputes, and project delays.

Not having a Joint Contracts Tribunal (JCT) contract in place for your renovation project can indeed expose you to various risks.

Some potential consequences of not using a JCT contract include:

  • Lack of clarity and control: Without a standard form of building contract, you might end up working with your contractor’s terms and conditions or relying on common law. This can result in unclear responsibilities and expectations for both parties.
  • Financial risks: When there’s no contractual agreement outlining payment terms, disputes, and insurance, you might experience unexpected additional costs or disputes about payments. This can lead to financial strains and even jeopardise the project’s completion.
  • Delays and increased costs: Projects without a contract tend to experience delays and cost overruns, as there is no clear outline for project milestones, completion dates, and budgets.
  • Difficulty holding parties accountable: When responsibilities and deliverables are not explicitly defined, it becomes challenging to hold contractors or other parties accountable for their work.
  • Dispute resolution challenges: Without a pre-defined resolution process, disputes can escalate and may even lead to legal battles, further delaying the project and increasing costs.
  • Vulnerability to unscrupulous contractors: You might find yourself dealing with a contractor who takes advantage of the lack of a contract to demand higher payments or apply pressure on you, especially if your property is half-finished and your funds are running low.
  • To mitigate these risks, it is highly recommended that you use a JCT contract or another standard form of building contract for your renovation project. This will provide a framework to ensure that the project is delivered on time and on budget, with clear responsibilities and expectations for all parties involved.

New Engineering Contract (NEC)

NEC contracts are based on a collaborative approach to project management. The contracts are designed to encourage all parties involved in a project to work together towards a shared goal.

This means that if something goes wrong, instead of pointing fingers and blaming each other, the parties work together to find a solution.

NEC contracts also place a strong emphasis on communication. They require regular meetings between all parties involved in the project and provide a clear framework for reporting and decision-making.

One of the key features of NEC contracts is their flexibility. They can be used for a wide range of projects, from small-scale renovations to large-scale infrastructure projects.

The contracts can also be tailored to suit the specific needs of each project.

If you need help or advice on issues such as contracts or competitive tendering, please contact us today.