The Committee is representative of building owners and developers, professional consultants and general and specialist contractors who contribute their knowledge and experiences to the compilation of the JBCC documents that:. Courses presented across SA — relevant to employers, contractors and members of the professional team including, principal agents, architects, quantity surveyors, etc. The global construction industry is spending more and more on resolving disputes, with financial costs in the past two decades reaching billions of dollars. The construction sector is of significant strategic importance to many countries in Africa, especially South Africa, where the total expenditure on construction works and related activities alone is valued to be more than R With such a high amount being spent on construction projects, any disputes that arise must not be a drain on business resources by dragging on for months, or in some cases years.

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Published by: Cliffe Dekker Hofmeyr on 13 May We look at a situation where washing your hands and sterilising surfaces may not be enough. COVID and the consequential lockdown period in South Africa are unprecedented circumstances which no party to any construction contract has ever had to deal with, until now.

The construction sector and the work performed, in general, was not regarded as an essential service, being the only types of services capable of being rendered during the initial and extended Alert Level 5 national lockdown. This led to the suspension of the works for most construction projects throughout the country, invariably causing delay to completion of projects.

Under the current Alert Level 4 conditions, most construction projects except for public works projects, road and bridge projects, and critical maintenance and repairs, are still not permitted to resume. According to the Schedule of Services: Draft Framework for Sectors published on 25 April , commercial building projects will only be permitted to resume operations once the country reaches Alert Level 3 and private residential projects only when Alert Level 2 is reached.

This would mean that activity would, in a large portion of the construction sector, still be suspended until, at the earliest, the transition to Alert Level 3. No date has, at the time of publishing this article, been forecast for the transition to Alert Level 3.

However, while works have been suspended at most construction sites until Alert Level 3 is reached, what is not yet clear is how Contractors and Employers are going to deal with the contractual aftermath once operations resume.

Revised Practical Completion Date: How long can the extension be and will I need to pay for the delay? It is inevitable that the suspension of the works will result in the need for parties to revise the date for the practical completion of a project.

Clause In order to claim for the revision of the practical completion date, a Contractor would need to comply with the notification and claim provisions set out in clauses In short, the Contractor must:. Once the claim is submitted the Principal Agent has 20 working days to respond either granting, in full or in part, or refusing the claim.

It is accordingly imperative that all parties comply with the JBCC Agreements in submitting and analysing claims relating to the extension of time. In an advisory note, the JBCC suggests that parties ought to consider sharing these costs amicably between them as fault would seemingly not be attributed to either party in the circumstances.

Termination under clause The applicability of this clause is thus largely dependent on regulatory time periods which have yet to be determined. So, is it? Parties may argue that it is not necessarily the COVID disease itself that is stopping activities on site, for example due to a large number of infected workers, but rather that it is the lockdown which would be the main cause of the temporary suspension of the works.

However, it can be further argued that the disease, and the possible effects on the construction sector generally, fits into this definition as it could not have been foreseen at the time of contracting, it would be beyond the control of the parties to the JBCC Agreements and could not reasonably be overcome except for, ironically, ceasing to work and self-isolating.

However, it would seem that very few contracting parties could have predicted the far-reaching effects of the disease which emanated on the other side of the world. This would in itself be both indicative and persuasive. In terms of clause 17 of the JBCC Agreements the Principal Agent may issue contract instructions to the Contractor regarding the compliance with the laws and regulations.

The Principal Agent therefore has a discretion in this regard. The JBCC, in its advisory note, is of the opinion that the Contractor has an overarching statutory and contractual obligation to comply with the law. It is accordingly unnecessary for the Principal Agent to issue a contract instruction regarding compliance with any extension to the lockdown, the Act and its accompanying Regulations.

During these uncertain times, Contractors and Employers alike should strive for more innovative methods to conduct their business. In South Africa, the current Regulations under the Act permit businesses to operate if they are supplying an essential service. Moreover, construction firms who are able to undertake projects which meet the definition of an essential service will be able to operate during various Alert Levels.

This should be seen as an opportunity for parties to JBCC Agreements to innovate, contribute to the market and add value to society during these unprecedented times. To ensure clarity going forward, parties to future JBCC Agreements should consider the effects that future pandemics and government interventions may have on a project and tailor their contracts accordingly.

This will ultimately ensure certainty, and minimise risks and costs associated with future disputes and litigation. This article was first published HERE. Related Firms Cliffe Dekker Hofmeyr. Related Jurisdictions South Africa.


JBCC rescue – How to get paid for change instructions and variations on your project

The three agreements are supported by a set of standard forms that simplify the administration of the contract. In addition to being a legal document the content has been structured as a checklist to administer the execution of the works and to minimise potential disagreement — to effectively use expensive man-hours of all the role players in a building project The Agreement is signed between the employer and the contractor — in conjunction with the Contract Data in which all contract variables are recorded, initially by the employer to solicit offers from contractors, and completed by the contractor and submitted as the form of tender. For state contracts a separate form of tender in the CIDB format will have to be completed. The contractor specialist agent must highlight the subcontract performance criteria. The Agreement is dived into seven sections comprising 22 clauses.


Quick Guide

This is a common concern for many contractors. In the JBCC terms, we refer to these circumstances as events which cause an adjustment to the contract value. Furthermore, b how do you eventually include these amounts in your payment certificates? In response the standard form construction contracts all provide a mechanism for the Contractor to vary its price making an adjustment to the contract value and the time within which he is to provide the work in the light of the changes requested by the Client. Some clients are so focussed on their right to change their mind that they often forget the contractual consequences. Yes Mr.

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