Contracts

Question 1

Jct conditions

Answer 1

The JCT Conditions of Contract are the core legal terms that govern how the project is to be carried out. These conditions are standardised clauses and form the main body of the contract. While the exact clause numbers and titles vary depending on the specific JCT form (e.g., Design and Build, Standard Building Contract, Minor Works), the main sections (conditions) generally cover the same key topics.

Here’s a typical breakdown of the JCT Conditions:

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1. Definitions and Interpretation
   • Sets out key definitions and rules for interpreting the contract.

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2. Carrying Out the Works
   • Contractor’s obligations
   • Possession of the site
   • Use of materials, workmanship standards
   • Sub-contracting
   • Practical completion

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3. Control of the Works
   • Role and authority of the Architect/Contract Administrator
   • Instructions
   • Contractor’s design responsibilities (if applicable)

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4. Payment
   • Interim payments
   • Valuations
   • Retention
   • Final account
   • VAT and payment notices

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5. Variations
   • How changes to the works are instructed and valued

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6. Injury, Damage and Insurance
   • Liability for personal injury, property damage
   • Insurance responsibilities
   • Indemnities

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7. Assignment, Third Party Rights and Collateral Warranties
   • Rights to assign the contract
   • Third-party rights provisions
   • Warranties to funders/purchasers/tenants

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8. Termination
   • Grounds for termination by either party
   • Procedures for termination
   • Payments after termination

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9. Settlement of Disputes
   • Adjudication
   • Arbitration
   • Litigation

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Question 2

Best certificate

Answer 2

+4
A vesting certificate should clearly identify the materials or goods, confirm their ownership transfer, and detail associated conditions like insurance and storage. It typically includes a detailed description of the items, proof of payment, and confirmation that they are free from encumbrances.

Question 3

Materials off site- contract conditions

Answer 3

Clause 4.14.1 (JCT IC 2016)

This clause allows the contractor to be paid for materials or goods off-site, provided certain conditions are met:

Key Requirements:
1. Listed in an Interim Payment Application
• The contractor must clearly identify these materials in their application.
2. Valuation and Approval by the Architect/Contract Administrator
• The Architect/CA must be satisfied that the employer will receive title (ownership) in the materials or goods.
3. Satisfactory Evidence of Ownership and Insurance
• The contractor must provide evidence of title and ensure the goods are adequately insured.
• This often includes a vesting certificate confirming ownership passes to the employer, even while the goods remain off-site.
4. Location and Protection
• Materials must be stored in a secure, identifiable location (often segregated and labelled as property of the employer).

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Additional Considerations:
• It’s good practice to use a vesting agreement to formalise the transfer of ownership.
• The risk typically remains with the contractor until delivery, unless otherwise agreed.
• The Architect/CA may withhold payment for such materials if the conditions aren’t met.