On 15 May 2024, the JCT released new editions of its Minor Works agreements, the second tranche of new building contracts in its much-anticipated 2024 suite.
A stalwart of small-scale projects such as refurbishments and extensions, the contract replicates many of the changes featured in its more substantial sibling, the Design and Build Contract (DB 2024).
The 2024 Edition includes:
- Minor Works Building Contract (MW 2024);
- Minor Works Building Contract with contractor's design (MWD 2024); and
- Minor Works Sub-Contract with sub-contractor's design (MWSub/D 2024).
In addition, the JCT has published an accompanying guidance note and a series of model template forms specifically for use with Minor Works contract administration which include the following:
- Extension of Time
- Non-completion
- Notice of Intention to Deduct Liquidated Damages
- Practical Completion Certificate
- Certificate of Making Good
- Architect/Contract Administrator’s Instruction
- Interim Certificate
- Pay Less Notice
- Final Certificate
- Valuation (which can be used with the Interim Certificate, Final Certificate and Pay Less Notice)
The Minor Works family of agreements
MW 2024 is a standard form building contract that is intended for use in connection with smaller construction projects where the works are of a relatively simple nature. Broadly speaking, this means that the works will be completed within 12 months and have a value of less than £500,000. The client is responsible for procuring the design: including the drawings, a specification or work schedules. The JCT has an almost identical form (MWD 2024) for use where the contractor is responsible for designing specific parts of the works.
What has changed?
As expected, many of the changes included in MW 2024 are similar to those we reported on in our article on the JCT Design and Build Contract 2024 (DB 2024). Of these, the most significant are:
Electronic execution and notices
MW 2024 explicitly states that it may be executed electronically. There is also an amended notices clause that allows the service of notices under the contract by email, and the contracting parties are invited to provide email addresses for the service of notices in the recitals of the contract. This is a welcome development that provides clarity and security to the parties and also reflects market practice.
Building Safety
As with the DB 2024, MW 2024 contains limited provisions that deal with the appointment of the Building Safety Principal Designer and Building Safety Principal Contractor under Part 2A of the Building Regulations 2010. These provisions were introduced last year by The Building Regulations etc. (Amendment) (England) Regulations 2023.
These roles are intended to oversee Building Regulations compliance, and any party undertaking them must have the demonstrable skills, knowledge, experience and behaviours to fulfil them. A new article has been added in MW 2024 and clause 3.9 has been extended to cover these new obligations.
The new MW contracts do not, however, deal with the new building control framework introduced by the Building Safety Act 2022 for higher-risk buildings in England, including the 'gateways', the 'golden thread' information and the reporting requirements. In addition,the forms do not specifically deal with the extended limitation periods which now apply in relation to the amended Defective Premises Act 1972.
Any developments which include higher risk buildings will require specific amendments to the MW forms of building agreement to be added to deal with these requirements.
Fluctuations
The Fluctuations provisions that appeared in Schedule 2 in the 2016 edition are no longer included within MW 2024. If the new JCT Fluctuations Option for use with MW or MWD is required, it is now to be found on the JCT website. Unless deleted or another provision is stated to apply, the JCT Fluctuations Option applies by default.
Liquidated Damages
The contract now makes it clear (clause 2.8.4) that, where the contractor's employment is terminated, liquidated damages (if applicable) will only apply up to the date of termination and, following the date of termination, the employer's further entitlement will be via a claim for general damages.
Insolvency
In Section 6, which deals with termination, the definition of "Insolvent" has been expanded to include the new grounds of insolvency created by the Corporate Governance and Insolvency Act 2020 (the moratorium and restructuring plan).
Termination Payment
Also in Section 6, the termination accounting and payment provisions have been amended to reflect the requirements of the Housing Grants, Construction and Regeneration Act 1996 (a due date for the final payment after termination has been added). A new definition of Termination Payment has been added which applies in the event of either contractor or employer default or insolvency.
Design Obligations
If the contractor's obligations include an element of design and MWD 2024 is used, the design-related clauses have been updated in a similar fashion to the DB 2024 (to remove any potential liability for fitness for purpose).
Conversion of Supplemental provisions
In the previous edition of the two Minor Works Contracts, the parties could opt to include 'supplemental provisions' concerning collaborative working, sustainability and environmental considerations and the early negotiation and settlement of disputes. These provisions have now been moved into the body of the contracts and are no longer optional provisions.
Some of the changes included in DB 2024 have not been carried over to MW 2024 and MWD 2024, by virtue of the fact that the MW building contracts are simpler forms of agreement. As the extension of time clause is much simpler in MW 2024 and MWD 2024, the new relevant events that appear in DB 2024 have not been added.
What is missing?
In addition to the absence of provisions dealing with building safety in higher-risk buildings, the new requirements of the Procurement Act 2023 have not been catered for in the new JCT contracts. The Act, which will come into force in the autumn, implies several terms into public sector contracts. This includes implied rights of termination where a contracting party has become 'excluded' or 'excludable' (under Schedule 6 and 7 of the Act). Parties will therefore need to consider the provisions of the Act, how their application should be handled and whether bespoke contractual amendments may be required.
In our article on DB 2024, we observed that the JCT had opted for a fairly light touch response to several of the developments in the construction sector during the eight years since its last iteration. A consensus is crystallising to the effect that this generation of JCT contracts represents 'more of an evolution than a revolution' when viewed against its predecessors.
