A week after the JCT launched the first part of its 2005 suite of contracts, construction lawyers have warned that the staggered publication dates of the remaining forms could lead to confusion.
Helen Garthwaite, a partner at law firm Taylor Wessing, said the JCT’s roll-out of contracts this summer could mean contractors have problems completing the 2005 Minor and Intermediate Works contracts, published last week.
Garthwaite predicts problems using the new contracts where other JCT documents are not available yet, such as the subcontracts and collateral warranties. She said if the new contracts are used with old JCT documents the project risk may not be passed properly down the supply chain. This could result in banks refusing to fund projects.
She said: “A contractor could find its building contract and its suite of documentation don’t hang together well and risks are not appropriately addressed. If developers go to their bank they may find that funding could be prejudiced.”
Garthwaite also warned that design provisions would have to be amended. She said full design adoption, when contractors take over the employer’s pre-contract design and underwrite it, is not covered – although it could be modified.
She also said the clients’ copyright licence rule would be seen as a “ransom provision” that no bank would accept. Under the contracts, the contractor could revoke the copyright licence for the building’s design at any stage if there was a dispute over money owed.