The most recent version of the JCT suite of contracts is 2016. In this video, we will explain the Management JCT contract options. The traditional or conventional JCT contracts are still, by far, the most used contracts.
The traditional contracts are still, by far, the most used JCT contracts and we will cover each of them in this article.
Management Building Contract
The price is based on Prime cost of the project plus a management fee for the management contractor. Interim payments are monthly unless otherwise stated.
The contract is divided into two periods, the Pre-Construction Period and the Construction Period. The Management Contractor should be appointed early so as he can co-operate with the Architect or Contract Administrator, Quantity Surveyor and other members of the Professional Team on such matters as the Project programme; formulating and agreeing construction methods.
In the Construction Period, the Management Contractor will be required to set out, manage, organise, supervise and secure the carrying out and completion of the project through the Works Contractors, who are directly contracted to them. Although the Management Contractor is responsible for operating the terms of the contract, the consequences of any default by a Works Contractor do not fall upon the Management Contractor if they comply with such terms.
This contract is most appropriate for large-scale projects requiring an early start on site but where it is not possible to prepare full design information before the works commence.
Construction Management Appointment
This contract is used when the employer is looking to appoint a construction manager to work on behalf of the employer. The cost of the construction manager is based on the construction managers fee plus certain reimbursable costs such as fuel
Construction Management Trade Contract
This contract is to be entered into between the Employer and the Trade Contractor in conjunction with the Construction Management Appointment and because it is a direct contractual arrangement, it is not a sub-contract but more akin to a main contract. The Construction Manager acts as agent for the Employer in issuing instructions, making decisions and preparing certifications.
Price is based on either lump sum or complete remeasurement. Interim payments are either monthly or at pre-determined stages.
Format & Structure
It would also be wise to show you the format and structure of a JCT contract. The standard format is;
· Articles of Agreement
· Contract Particulars: these contain project-specific information
· Conditions of Contract; and
With the main sections consisting of
· carrying out the works
· control of the works;
· injury, damage and insurance
· assignment, third party rights and collateral warranties
· termination and
· settlement of disputes
Watch our video on The JCT Management Contract here: