Non-FIDIC Standard Form Construction Contracts

This is an Insight article, written by a selected partner as part of GAR's co-published content. Read more on Insight


It is often said that disputes arising from construction projects tend to share certain characteristic features, such as complexity (both factual and legal), technical content (often the subject of expert evidence) and oppressive volumes of documentation.[2] To these may be added a further typical attribute: a putative majority of arbitral disputes within the construction industry arise from standard forms of construction contracts.

These forms of contract have been in use since the 19th century[3] and have, over time, become a norm and trade practice of the construction industry.[4] The inherent risk and complexity of building and engineering projects requires clarity and predictability of contract terms. As one commentator has noted, the ‘commonality of processes and management arrangements across projects in the construction and engineering industry encourages the use of standard terms and conditions’.[5] Indeed, as compared with bespoke or special contracts, the use of standard contracts in construction projects has several obvious benefits. These include, among other things, reductions in time and cost, allocation of risk in a fair and recognisable way, comprehensive coverage of the usual pitfalls surrounding contractual relations in the construction industry, and reflection of insights and best practices accrued over time.[6]

Each construction project is unique but most follow one of the recognised methods of procurement. In a traditional building project, the owner engages an architect, engineer or designer to prepare the design of a building or other structure for construction by a contractor, who is engaged separately and who may be subject to the supervision of a construction professional selected by the owner (who acts as the owner’s agent and may also be the architect or designer).[7] This approach is referred to as traditional, or conventional, in part because it has been the dominant form of procurement for building projects in the United Kingdom, the United States, Australia, Hong Kong, Singapore and other countries for more than a century.[8]

Not surprisingly, standard forms of construction contracts organised around the traditional procurement method have proliferated. The traditional approach is, for example, well reflected in the first form of contract published by the American Institute of Architects in 1888, for use between an owner and a contractor,[9] the first standard building contract published by the Joint Contract Tribunal (JCT) in 1931[10] and the initial form of international engineering contract published by the International Federation of Consulting Engineers (FIDIC) in 1957,[11] among others.

A hallmark of the traditional procurement route is the distinction between the role of the architect or engineer responsible for the design of the works and the role of the contractor responsible for building what was designed. Starting from the second half of the 20th century, however, that distinction has become less relevant as contractors have taken on greater responsibility for design and contract management in many projects.[12] These trends have, over time, given rise to various alternative forms of construction procurement and associated contractual arrangements that are not structured around a professional, such as an architect or engineer, who provides the design or supervises the contractor.[13]

Among these, the design-and-build procurement route has emerged as the most common alternative to the traditional procurement approach within the construction industry. For example, surveys conducted in the United Kingdom by the Royal Institute of British Architects (RIBA) and the National Building Specification (NBS) have repeatedly found that the vast majority of construction projects follow either traditional or design-and-build procurement routes (and not infrequently a mixture of both).[14]

A design-and-build contract is an agreement between an owner and a contractor under which the contractor accepts contractual responsibility for both the design and the construction of the relevant building or other structure.[15] From the owner’s perspective, a primary advantage of design-and-build over traditional construction contracts is the benefit, at least in theory, of ‘single point responsibility’ for problems arising from design, construction, or both. Another benefit of design-and-build contracts to owners is the fact that they typically take the form of lump sum or fixed price contracts, which provides greater certainty about the price of the project.[16]

Although there tends to be great continuity between the terms and conditions of a traditional construction contract and those of a design-and-build contract, the structure of the latter is typically adjusted to provide for the contractor to build to its own design to satisfy the owner’s or the employer’s stated requirements.[17] Variations can be instructed by the owner or the employer, but are typically made by way of changes to the employer’s requirements. As the contractor under a design-and-build contract will typically be responsible for the resulting structure being fit for its purpose, disputes about defective design as opposed to defective workmanship tend to be irrelevant in defective structure cases.[18]

With the emergence of additional forms of procurement during the second half of the 20th century, new types of standard forms of construction contracts have followed and publishers of standard form construction contracts have developed suites of forms geared to various situations and approaches. The principal types, in addition to traditional contracts, are design-and-build and management contracts but there are also standard forms for subcontracting and for inter­mediate or minor works, among many other varieties on offer.[19]

A multitude of standard forms of construction contracts are now in widespread use in various parts of the world. Among these, the forms of contract issued by FIDIC continue to enjoy pride of place in many international construction projects, particularly where the parties are from different jurisdictions.[20] In this chapter, some key examples of standard construction contracts other than the FIDIC forms are briefly surveyed. In view of space limitations, the discussion focuses on the standard forms issued by the Joint Contracts Tribunal (JCT) and two standard forms developed by the Institution of Civil Engineers (ICE): the ICE Conditions of Contract and the New Engineering Contract (NEC).[21] These have been selected for their historical influence within the construction industry (JCT and ICE) or for distinctiveness of approach (NEC). Collectively, they reflect various approaches that have been taken in regard to standard forms of construction contracts in the United Kingdom, where the use of FIDIC forms has traditionally been far less common than in many other jurisdictions, in large part because of the success of these home-grown alternatives.[22]

In the remainder of this chapter, a short summary of the basic structure and approach of these forms is presented along with brief comments on a few noteworthy features and points of comparison with the corresponding FIDIC forms.

JCT contracts

The JCT contracts are a series of standard contract forms published by the JCT[23] and in widespread use throughout the United Kingdom. Since its founding in 1931, the JCT has produced standard contract forms to provide a standard framework for defining the roles, responsibilities, obligations and rights of the parties involved in a construction project, including the employer (client), the contractor and sometimes the architect or other professionals. These contracts cover a range of project aspects (including design, construction, payment, variations, completion and dispute resolution), and help to manage the relationships and interactions among these stakeholders in both public and private projects. The current suite of JCT contracts was first published in 1998, with subsequent editions appearing in 2005, 2011 and, most recently, in 2016. The next edition will reportedly be published in 2024.[24]

The oldest and most well-known JCT contract, the Standard Building Contract (SBC), is noted for its ‘long history of being updated in reaction to legislation, court rulings, and changing industry practices, and it is commonly used as a benchmark against which other standard forms and bespoke contracts are measured’.[25] Reflecting its development as a suite of construction contracts for use primarily within the United Kingdom, the JCT forms are geared towards, and regularly updated for conformity with, applicable laws pertaining to the construction industry in the United Kingdom.[26] Although this specificity may be viewed as limiting the utility of JCT contracts in other jurisdictions, it is undeniably a factor that contributes to the confidence placed in it by users within the United Kingdom. The JCT is celebrated by its users as ‘industry standard and tested in the courts’, ‘fair, equitable and well understood’, a ‘standard lump sum contract understood by the industry’ and ‘simple and familiar’.[27] Yet, notwithstanding this dominant position within the United Kingdom’s construction industry,[28] it remains the case that JCT contracts are markedly less familiar to users in many other parts of the world, particularly in comparison with FIDIC contracts, which are developed and promoted by an international organisation and are used globally in various regions and countries for a wide range of construction and infrastructure projects.

The approach of JCT contracts to risk allocation is broadly similar to that of FIDIC contracts: the basic idea is that risk should be allocated in a fair, balanced and efficient manner, generally to the party that is in the best position to manage the risks. Although that approach often leads to predictable outcomes in regard to known and typical risks of the construction process – JCT contract provisions having been tested over the years in UK courts – it naturally leads parties to prioritise their own interests over those of the project and is less effective when unknown risks arise.

Composition and structure

JCT contracts are organised into a number of contract ‘families’ tailored to specific project types, sizes and procurement methods. Those having the greatest relevance for major projects are briefly described below.

Standard Building Contract

The JCT Standard Building Contract (SBC) is designed for large or complex construction projects procured via the traditional method and requiring detailed contract provisions. In a project conducted under an SBC, the employer is typically responsible for the design, which is usually supplied to the contractor by the architect or design team working on the employer’s behalf. However, optional provisions for a ‘contractor’s designed portion’ are available if the appointed contractor is to be responsible for the design of specific parts of the work. An SBC is normally administered by a professional selected by the employer, whether the architect, contract administrator or quantity surveyor. Depending on the type of SBC, the employer (through its advisers) will need to provide drawings and specifications, work schedules or bills of quantities to specify the quantity and quality of work at the tender stage.

There are three distinct types of SBCs that differ in respect of price and payment structures.

Standard Building Contract With Quantities

Under a Standard Building Contract With Quantities (SBC/Q), the employer must provide drawings and bills of quantities to specify the quantity and quality of work. The price and payment structure of an SBC/Q is based on a lump sum with monthly interim payments. A contractor under an SBC/Q is required to ‘carry out and complete the Works in accordance with the Contract Documents’[29] at the agreed lump sum price.[30]

Standard Building Contract Without Quantities

Under a Standard Building Contract Without Quantities (SBC/XQ), the employer must provide drawings with a description of the work, and either a specification or work schedules at the tender stage. However, no bills of quantities are required under an SBC/XQ (as the project at issue is usually not sufficiently complex as to require them). As with the SBC/Q, the price and payment structure of the contract is based on a lump sum with monthly interim payments.

Standard Building Contract With Approximate Quantities

In contrast to the foregoing, the Standard Building Contract With Approximate Quantities (SBC/AQ) is a remeasurement contract. At the tender stage, the employer must provide drawings and approximate bills of quantities. On that basis, the contractor will prepare a tender sum representing an estimate of the likely price of the work. On completion, the provisional price is converted to a final sum based on remeasurement and valuation of all work. The final sum can deviate from the tender sum depending on such factors as changes in the cost of materials, labour or the effects of ‘relevant matters’.[31] Interim payments are based on the contractor’s tender sum and are made monthly.

Design and Build Contract

The JCT Design and Build Contract (DB) is designed for construction projects where the contractor is responsible for both the design and the construction work. A DB can be used for projects of various sizes and complexity but is geared towards design-and-build projects for which detailed provisions are needed.[32]

Under a DB, the contractor will, in theory, have ‘single point design responsibility’ in the sense that it will have been tasked with (1) designing the work based on the employer’s requirements (or adopting designs or concepts prepared on behalf of the employer via a novation arrangement), (2) producing ‘contractor’s proposals’ for achieving those requirements, and (3) completing the work in exchange for the agreed lump sum. In practice, however, achieving that result requires amendment of various default provisions of the DB (e.g., to shift responsibility for inadequacies or omissions in the employer’s requirements (including any design contained in them) to the contractor).[33] With respect to the contractor’s own design work, the contractor’s liability under the DB (and other JCT contracts) does not extend to the provision of a fitness-for-purpose warranty, but only a warranty that it has exercised reasonable skill and care in its design as if it were an independent architect or other professional designer directly employed by the employer and claiming to be competent to undertake work of the relevant type.[34] Consequently, in the event of poor design, the employer under a DB must prove negligence to prevail.[35]

Similar to the SBC/Q and SBC/XQ, the price and payment structure under a DB is based on a lump sum with interim stage or periodic payments. The contract sum includes not only construction costs but also design costs, providing the employer with a single, comprehensive price for the entire project. Payments are linked to progress milestones and completed work (again, similar to the SBC).

Other JCT contracts

Other widely used JCT contracts include Major Project Construction Contract,[36] the JCT Intermediate Building Contract, JCT Intermediate Building Contract with Contractor’s Design, JCT Minor Works Building Contract, JCT Minor Works Building Contract with Contractor’s Design, and JCT Management Building Contract, among others.

Most JCT contracts follow a common structure consisting of:

  • articles of agreement indicating the contract date and identifying the parties;
  • recitals describing the nature of the project and work, as well as key contract documents, such as bills of quantities, activity schedules, contract drawings or contractor’s design proposals (as applicable);
  • articles setting out key project information such as contract sum and contractor-designed portion (if applicable) as well as identification of relevant dramatis personae;[37]
  • contract particulars specific to the project, which are to be selected, designated or filled in as appropriate;[38]
  • conditions – the core substantive terms and conditions of contract – which are typically broken down into nine sections;[39] and
  • schedules.[40]

Some noteworthy features

As one reflection of the JCT forms’ grounding in construction laws of the United Kingdom, the payment provisions of JCT contracts are typically based on the requirements of the 1996 Housing Grants, Construction and Regeneration Act and involve interim payments and a final accounting process based on a final statement prepared after practical completion. In practice, the final accounting stage is where many disputes arise.[41]

In comparison with some other standard forms, including FIDIC, it could be said that the JCT has been somewhat more proactive in its incorporation of provisions for dealing with issues relating to sustainability, with default supplementary provisions on health and safety, sustainable development and environmental conditions, among others, being applicable unless deleted in the contract particulars.[42] That being said, these provisions do not go very far and one expects them to be improved and supplemented in the 2024 edition. Furthermore, the JCT was the first contract authoring body to provide specific guidance on building information modelling (BIM) and construction contracts, publishing various practice notes and integrating specific BIM provisions into JCT contracts, starting with the 2016 edition.[43]

With respect to dispute resolution provisions, JCT contracts typically provide for the following dispute resolution mechanisms: negotiation, mediation and adjudication, followed by legal proceedings (litigation) or arbitration as necessary. Among these, adjudication is a contractual right under most JCT contracts (as well as a statutory right in England and Wales and various other jurisdictions). Negotiation and mediation are normally voluntary and non-binding but can result in a legally enforceable settlement agreement. Where adjudication, negotiation or mediation are not used, or where adjudication has been tried but a party is dissatisfied with the adjudicator’s decision, parties under a JCT contract can refer their dispute to arbitration if they have selected that option in the contract particulars.[44] In the absence of an agreement to arbitrate, the dispute will be determined by legal proceedings (i.e., court litigation) as the default final dispute resolution mechanism under most JCT contracts. The foregoing approach under JCT contracts differs from that under FIDIC forms in that it does not make provision for any dispute avoidance/adjudication board, and in specifying the Construction Industry Model Arbitration Rules in the case of arbitration.

ICE Conditions of Contract

The ICE Conditions of Contract (the ICE Conditions) is a suite of standard form contracts developed by the Institution of Civil Engineers (ICE) for use in civil engineering projects.[45] First published in 1945 by Thomas Telford Publishers on behalf of ICE, the Association of Consulting Engineering (ACE) and the Civil Engineering Contractors Association (CECA), the ICE Conditions predate the first standard forms published by JCT and FIDIC.[46] Between 1945 and 2001, as many as seven editions of various ICE Conditions were published. During that period, the ICE Conditions became the dominant form of contract for heavy civil engineering works, not only in the United Kingdom but in other jurisdictions as well. According to the author of the leading commentary on the ICE Conditions, ‘[t]he strength of the Conditions is their consistency and continuity and by any standards they must be regarded as one of the most successful standard forms ever published’.[47]

The ICE Conditions comprise the following standard form contracts (last published version in parentheses): Measurement Version (seventh), Design and Construct (second), Term Version (first), Minor Works, (third), Partnering Addendum, Tendering for Civil Engineering Contracts, and Agreement for Consultancy Work in respect of Domestic or Small Works. Among these, the Measurement Version and Design and Construct are worthy of special mention. Whereas the former reflects a traditional procurement approach, the latter is geared towards design-and-build projects and is arguably the ICE form that has the greatest relevance for international construction projects.[48]

The key characteristics of the ICE Conditions include (1) valuation by remeasurement, (2) engineer responsibility for design (unless expressly stated otherwise), (3) engineer as the impartial certifier and valuer, and (4) engineer’s decision as the first stage of dispute resolution.[49]

With the emergence of the NEC forms of contract developed by ICE in the late 1980s (as discussed below), the ICE Conditions have receded in importance and are no longer the mainstream standard form in the civil engineering industry.[50] Following its formal endorsement of NEC contracts, ICE transferred its part ownership of the ICE Conditions to ACE and CECA, which in 2011 published a new standard form, the Infrastructure Conditions of Contract, based on the last published version of the ICE Conditions.[51] Although ICE, ACE, and CECA continue to hold reference copies of the last published version of the ICE Conditions, the ICE forms are no longer available for purchase.[52] The ICE Conditions are reportedly still used in some projects, but it is expected that their use will diminish over time.[53]

The following section considers the NEC contract form published by ICE.


In 1986, the newly formed legal affairs panel of ICE commissioned leading UK project management consultant Martin Barnes to draft ‘a radical new contract which would stimulate and not frustrate the application of good project management’.[54] The first edition of the resulting NEC standard form contract was published in 1993, the second edition (NEC2) in 1995, the third edition (NEC3) in 2005, and the fourth edition (NEC4) in 2017.

True to its original objectives, the current NEC family of standard contracts is said to possess the following characteristics:

  • Stimulus to good management: The NEC stimulates good management and the relationship between the two parties to the contract by promoting a forward-looking contract management philosophy that aims to manage problems proactively rather than allowing them to escalate into formal disputes.
  • Flexibility: The NEC can be used in a wide variety of commercial situations, for a wide variety of types of work, in any location.
  • Clarity and simplicity: The NEC comprises clear and simple documents using plain language and a structure that is straightforward and easily understood.[55]

In general, the changes made to the NEC4 were intended to be evolutionary rather than revolutionary, addressing some of the previous concerns raised with respect to the NEC3.[56] However, the NEC4 offers several new features and contract forms including a new Design, Build, and Operate Contract and a new Alliance Contract for use on large projects.

The style and purpose of the NEC forms is summarised well by Sir Vivian Ramsey in his foreword to the first edition of Keating on NEC:

The NEC form of contract uses language which has deliberately departed from that which has been familiar in other industry standard forms and which developed from forms of contract used in the nineteenth century.[57] . . . The contract has sought to introduce a detailed management system which brings disputes to the surface at any early stage and which avoids the need for the parties to revert to the traditional battle at final account stage.[58]

This underscores the distinctive approach taken by the NEC to risk management. In contrast to standard forms such as FIDIC and JCT that take a more traditional, risk allocation, approach, the NEC requires (and arguably enables) a more proactive and collaborative approach to managing risk.[59] Not only do the NEC forms require the parties to work together in good faith[60] but they also promote greater transparency in the form of an early warning process and a requirement that an up-to-date accepted programme remain in place at all times.

The NEC is now widely used in domestic UK infrastructure projects and for many public sector projects in Hong Kong. It has also been used for major construction projects in various other countries, including Australia, New Zealand, India and South Africa.[61]

Composition and structure

The NEC4 family comprises a variety of contracts,[62] among which the Engineering and Construction Contract (ECC) and the Professional Service Contract (PSC) are the most commonly used forms. We focus on the ECC form, as it has the greatest relevance for major projects.

The NEC4 permits a mix-and-match approach, providing great flexibility by allowing the parties to select the clauses that are fit for their particular project. Each of the NEC4 forms is composed of core clauses,[63] (one of the sets of) ‘main option’ clauses (pricing), (one of the sets of) dispute resolution clauses (Option W), secondary option clauses (Option X) and bespoke clauses (Option Z). The secondary option clauses include a range of optional clauses such as price adjustment for inflation, delay or performance shortfall damages, key performance indicators and limitations of liability. The last section of the NEC4 forms is the contract data, which is in two parts: the data provided by the employer, and the data provided by the contractor.[64]

In contrast to FIDIC and JCT, which provide separate forms for various traditional and design-and-build procurement methods, the flexible approach of the NEC4 ECC can be adapted to the requirements of the project at hand and allows for different levels of contractor design responsibility. Design obligations and liabilities are not mentioned in the core clauses, but these can be dealt with by means of secondary option clauses or bespoke clauses.[65]

Some noteworthy features

Project manager

The project manager[66] has a pivotal role in project management under the NEC4 and in promoting the NEC philosophy of openness, mutual trust and collaboration. The project manager is vested with extensive authority to act on the contractor’s behalf. This includes, inter alia, overseeing project delivery so that the project will be completed on time and within the agreed budget; administrating the contract, which involves issuing instructions; assessing and certifying payments; managing changes in the scope of work; issuing early warnings; assessing and administrating compensation events; ensuring good and effective communication; and resolving any claims or disputes that may arise; among other things.[67]

Early warning

Similar to the new early warning provisions of Clause 8.4 of the 2017 FIDIC Yellow Book, the ECC requires the contractor and the project manager to give early warning of any event that could increase the total of the prices, delay completion, delay meeting a key date, or impair the performance of the work in use.[68] The project manager prepares a first early warning register within one week of the starting date, and regular early warning meetings take place, commencing within two weeks of the starting date.[69] During early warning meetings, the contractor and the project manager will cooperate in making and considering proposals for how the effects of the event at stake can be avoided and deciding on the actions to be taken and who will take them to resolve the event.[70]


The NEC4 provides six main options dealing with pricing:

  • Option A: priced contract with activity schedule (ECC/PSC)
  • Option B: priced contract with bill of quantities (ECC)
  • Option C: target contract with activity schedule (ECC/PSC)
  • Option D: target contract with bill of quantities (ECC)
  • Option E: cost reimbursable contract (ECC/PSC)
  • Option F: management contract (ECC)

Option A is similar to a lump sum contract, whereby a fixed contract price is agreed between the parties, and the total lump sum at the contract date is broken down in the activity schedule included in the contract data provided by the contractor. Under Option A, the contractor bears the risk of changes to quantities during the work since the payment of the contract price linked to an activity will be paid to the contractor so long as the activity is achieved, regardless of the changes in quantities.[71] Option B works as a remeasurable contract, which allows the contractor to receive a contract price based on the actual amount of work performed.

Options C and D are ‘target cost’-type contracts that provide a financial incentive to a contractor who is able to complete the work for less than a target price, in addition to a disincentive for going over the target price. Similar to Options A and B, these target contracts are linked with the activity schedule or the bill of quantities, respectively. Options C and D are typically adopted where the scope of work is uncertain, or a fixed-price contract is otherwise unsuitable.

Under Option E, the contractor can recover the costs incurred in carrying out the work. The contractor should be able to substantiate its cost and demonstrate that it is both cost within the ‘schedule of cost components’ and that it does not fall into the category of ‘disallowed cost’. Finally, Option F is a cost-reimbursable management contract mostly used for a management contractor who oversees a number of different pieces of work carried out by other contractors.

Dispute resolution

With respect to dispute resolution procedure, the NEC4 offers three different W options. Options W1 and W2 now include a tiered dispute resolution process under which the parties first refer the dispute to a senior representative of each party. If the matter is not resolved, the dispute is then referred to adjudication and, if necessary, to a court or arbitral tribunal. Reference of disputes to senior representatives is mandatory under Option W1 but not under Option W2, which is used for cases where the Housing Grants, Construction and Regeneration Act 1996 (the Act) applies. Under Option W1, each party submits to the other its statement of case within a 10-page limit[72] and the senior representatives will have multiple meetings within a period of three weeks to resolve the dispute.[73]

Option W3, newly adopted under the NEC4, introduces a dispute avoidance board (DAB) for dealing with disagreements before they develop into formal disputes. As with Option W1, Option W3 can be selected for cases where the Act does not apply, meaning that these options are more suitable for international projects. Option 3 provides for (1) a standing impartial DAB agreed by the parties, having one or three members to be appointed under the NEC Dispute Resolution Service Contract and (2) regular site visits by the DAB members so that they can become familiar with the project and become aware of any potential dispute. This is quite clearly a respectful nod to the DAAB mechanism under the FIDIC forms. It will be interesting to see the extent to which Option 3 is adopted by users and how successful the resulting DAB system will be in managing disputes in practice.


It will have been apparent from the foregoing brief tour of JCT, ICE and NEC forms of construction contracts that the range of available standard form options is extensive and includes specialised forms geared towards particular types of projects and procurement approaches, as well as highly adaptable forms that can be used with appropriate modifications in virtually any project. Identifying a standard form that is suitable for the type of project and procurement approach at issue, and then adapting that form as necessary and appropriate to meet the particular requirements of the project, requires both skill and care. In particular, where the use of any of these forms outside the United Kingdom is considered, competent legal advice should be obtained at an early stage in the process to minimise the risk of error.


[1] Matthew J Christensen and Dami Park are senior foreign attorneys and Jae Ha Kwon is a foreign attorney at Kim & Chang.

[2] See, e.g., International Chamber of Commerce, Commission on Arbitration and ADR, ‘Construction Industry Arbitrations: Recommended Tools and Techniques for Effective Management’ (2019 update), at p. 8.

[3] Keating on Construction Contracts (11th Edition), 21-003.

[4] Sundra Rajoo, Standard Forms of Building Contracts Compared, p. 2.

[5] ibid.

[6] See Joint Contract Tribunal (JCT), ‘Why a standard form?’ under ‘About our Contracts’ ( (accessed 8 September 2023)).

[7] Julian Bailey, Construction Law, Volume I (Third Edition, London Publishing Partnership, 2020), p. 27.

[8] ibid.

[9] See American Institute of Architects, ‘The History of AIA Contract Documents’ ( (accessed 18 September 2023))

[11] This document, the ‘Form of contract for works of Civil Engineering construction’, was based on the ‘ACE Form’, an international version of the fourth edition of the Institution of Civil Engineers (ICE) form – the principal UK domestic engineering contract of its day – and is recognised as the predecessor of the Red Book. See Ellis Baker, et al., FIDIC Contracts: Law and Practice (5th Edition, Informa, 2009), pp. 4–5. See also Nael Bunni, The FIDIC Forms of Contract (3rd Edition, Blackwell Publishing, 2005), pp. 71–73.

[12] Wilmot-Smith on Construction Contracts (4th Edition), 2.03; see also Hudson’s Building and Engineering Contracts (13th Edition), 3-002 (‘[i]t is now almost universal in large projects for at least some areas to be designed by specialists, and it is common for the Contractor to undertake the design and coordination of the works as a whole’).

[13] Wilmot-Smith on Construction Contracts (4th Edition), 2.03; see also Hudson’s Building and Engineering Contracts (14th Edition), 3-001 (“[the traditional form of construction contract] was said in previous editions to apply to the most important projects. This is no longer the case. It is still frequently used, but important employers – UK government departments and local authorities, the oil majors, large industrial and retail concerns, and large developers, are increasingly using new and different methods of contracting”).

[14] See Royal Institute of British Architects (RIBA), ‘RIBA Construction Contracts and Law Report, 2022’, pp. 7-8, in which 56 per cent of respondents reported using traditional procurement most often whereas 34 per cent reported using design-and-build most often. The traditionally procured projects were divided between those that involved a contractor-designed or subcontractor-designed element (40 per cent) and those that did not (16 per cent). Meanwhile, 53 per cent of contractor respondents reported using design-and-build procurement most often ( (accessed 18 September 2023)). See also National Building Specification (NBS), ‘National Construction Contracts and Law Report, 2018’, pp. 10–11, in which 46 per cent of respondents reported traditional procurement and 41 per cent of respondents reported design-and-build as the procurement method most frequently used in projects they were involved in ( (accessed 18 September 2023)).

[15] Julian Bailey, Construction Law (Volume I) (3rd Edition, London Publishing Partnership, 2020), p. 28.

[16] id., at p. 29.

[17] Wilmot-Smith on Construction Contracts (4th Edition), 2.94–2.95.

[18] id., at 2.96–2.97 (citing Greaves & Co Ltd v. Beynham Meikle [1975] 1 WLR 109; and IBA v. EMI and BICC (1980) 14 BLR 1). As noted below, this is not quite the result under the JCT Design and Build Contract.

[19] id., at 2.05. More recently, partnering or alliancing agreements requiring collaboration between the parties have appeared and are becoming increasingly important within the construction industry.

[20] The FIDIC forms are addressed in a dedicated chapter of this guide.

[21] It should also be noted that public works projects in many jurisdictions are carried out under standard form construction contracts issued by relevant government authorities. Although these are often adapted from standard forms in widespread use within the private sector, they often include jurisdiction-specific features and are beyond the scope of this discussion. Nor does space permit consideration of certain standard forms that have proven very successful in other jurisdictions, such as the AIA forms in the United States or VOB in Germany. For a brief overview of these and other standard forms not covered here, see Chapter 13 in Lukas Klee, International Construction Contract Law (2015).

[22] See, e.g., RIBA, ‘RIBA Construction Contracts and Law Report, 2022’, op. cit. note 14, p. 17, in which only 6 per cent of respondents reported having used FIDIC contracts during the past 12 months as compared with 71 per cent who reported using JCT contracts, 31 per cent who reported using NEC contracts, and 23 per cent who reported using bespoke contracts.

[23] Founded in 1931 by RIBA and the National Federation of Building Trades Employers, the JCT is currently composed of seven constituent bodies representing a cross-section of key interest groups within the UK construction industry: British Property Federation, Contractors Legal Group Limited, Local Government Association, National Specialist Contractor’s Council, Royal Institute of British Architects, Royal Institute of Chartered Surveyors, and the Scottish Building Contract Committee Limited ( (accessed 18 September 2023)).

[24] See James Ladner, ‘New JCT construction contract suite expected in spring 2024’ (20 July 2023) ( (accessed 18 September 2023)).

[25] Sundra Rajoo, Standard Forms of Building Contracts Compared, p. 24.

[26] As an example of how the JCT forms are regularly updated for conformity with applicable laws in the United Kingdom, the new set of JCT contracts to be issued in 2024 will reportedly reflect current provisions of the UK Housing Grants, Construction and Regeneration Act 1996, the UK Corporate Insolvency and Governance Act 2020, and the Building Safety Act 2022 (among many others and including related secondary legislation), as well as relevant UK court judgments such as the Supreme Court decision in Triple Point Technology, Inc v. PTT Public Company, Ltd [2021] UKSC 29 (i.e., to clarify that where works are not complete at termination, liquidated damages can be levied up to termination and only general damages for delay can be claimed after that). See James Ladner, ‘New JCT construction contract suite expected in spring 2024’, op. cit. note 24.

[27] JCT press release of 28 July 2022: ‘RIBA report shows JCT is dominant contract provider and “industry standard”’ ( (last visited on 8 September 2023).

[28] And adoption to a lesser degree in jurisdictions with close connections to English law, such as Singapore, Hong Kong and Malaysia.

[29] These are defined in Clause 1.1 of the Conditions to include ‘the Contract Drawings, the Contract Bills, the Agreement and the Conditions’.

[30] Clauses 1 and 2. The contract sum is determined up front based on the quantities of work and unit rates specified in the bills of quantities. Other sums may be payable by adjustment of the contract sum in accordance with various other clauses, but these adjustments are subject to certain contractual rights of the respective parties to the contract, and are distinguished from the contractual lump sum of the work originally agreed by the parties.

[31] ‘Relevant Matters’ are listed in Clause 4.22 of the Standard Building Contract (SBC) and involve situations where the progress of the work is materially affected by reasons attributable to the employer. Relevant matters entitle the contractor to recovery of direct loss and expense but not necessarily to an extension of time. These are to be contrasted with ‘Relevant Events’ under clause 2.29, which entitle the contractor to an extension of time but not necessarily to recovery of loss and expense (unless the relevant event also constitutes a relevant matter).

[32] In contrast to, e.g., projects carried out under the Major Project Construction Contract. However, the design requirements and responsibility of the contractor under a design-and-build contract tends to be more comprehensive or extensive than under an SBC involving a contractor’s designed portion.

[33] For example, amendment or disapplication of Clause 2.11, which states that (subject to certain exceptional cases under Clause 2.15 dealing with divergence from statutory requirements) ‘the Contractor shall not be responsible for the contents of the Employer’s Requirements or for verifying the adequacy of any design contained in them’. Where Clause 2.11 is left unaltered, the result is that the Employer will generally be responsible for errors or inadequacies in the Employer’s Requirements (or designs contained in them), including the costs of rectifying such errors or inadequacies, which is handled as a Change. The exceptions arise in relation to divergences from Statutory Requirements, in which case the Contractor can be held responsible for the cost of rectifying discovered divergences between the Employer’s Requirements and Statutory Requirements unless certain exceptions apply. See JCT, DB/G 2016, Design and Build Contract Guide 2016, at paras. 38–40.

[34] Clause 2.34.1. See also JCT, DB/G 2016, Design and Build Contract Guide 2016 , at para. 41.

[35] In practice, however, defective design is typically found to be negligent design, suggesting the possible existence of a distinction without a difference on this point. See Wilmot-Smith on Construction Contracts (4th Edition), 2.92.

[36] The Major Project Construction Contract (MP) is designed for large-scale design-and-build construction projects involving major works. It was designed for projects where the Employer, Contractor, Consultants and other interested parties are experienced in undertaking large commercial projects, and have well-defined procedures for dealing with the various aspects of this type of work. The publication of the MP came in response to demands from users involved in larger contracts who were accustomed to making extensive alterations to the current JCT Standard Contracts to reflect their own bespoke practices or to transfer risks to other parties and who wanted a stripped-down contract form that allowed more freedom for such adjustments without the need for extensive amendment of existing clauses. The resulting contract is much shorter than the DB or SBC and leaves many matters – e.g., detailed provisions on subcontractor payment or insurance requirements – to the discretion of the parties, with the assumption that they will be dealt with by the insertion of bespoke clauses, rather than by amendment of existing provisions. See Roland Finch, ‘JCT Major Project Construction Contract’ at ( (last visited on 8 September 2023).

[37] For example, the architect or contract administrator, quantity surveyor, principal designer, and principal contractor under the SBC, and employer’s agent, principal designer and principal contractor under the DB (these last two are for the purposes of the Construction (Design and Management) Regulations 2015 and may be the contractor or another person or entity).

[38] These include key dates (e.g., base date, date for completion of the work (including for sectional completion), date of possession, first interim valuation date where applicable), identification of employer’s requirements, contractor’s proposals and the protocol for building information modelling (BIM protocol) (where applicable), certain liability limits, liquidated damages rates, advance payment amounts, details of bonds and guarantees, required insurance coverage levels, master programme and whether the critical path must be shown, and importantly, whether disputes are to be referred to arbitration instead of the default option of legal proceedings, and if so, the identity of the appointing authority, the default option being the president or a vice president of RIBA.

[39] In SBC and DB, these comprise the following: Section 1: Definitions and Interpretation; Section 2: Carrying out the Works (e.g., contractor’s obligations, requirements for completion, lateness and liquidated damages, etc.); Section 3: Control of the Works (e.g., access, subcontracting, employer’s instructions); Section 4: Payment (e.g., interim payments, calculation of sums due, loss and expense provisions, final statement and final payment); Section 5: Changes (referred to in DB as Variations); Section 6: Injury, Damage, Insurance; Section 7: Assignment, Performance Bonds and Guarantees, Third-Party Rights and Collateral Warranties; Section 8: Termination; and Section 9: Settlement of Disputes. However, in some JCT forms, such as the MP, the conditions are greatly streamlined and shortened into definitions/interpretation, general obligations, time, control, valuation and payment, indemnities and insurance, assignment and third party rights, performance bonds and guarantees, default and dispute resolution.

[40] e.g., design submission procedure, variation and acceleration quotation procedures (DB), insurance options, third party rights, forms of bonds, and JCT fluctuation option.

[41] See, e.g., NBS, ‘National Construction Contracts and Law Report, 2018’, op. cit. note 14, p. 25, in which 45 per cent of respondents reported having experienced disputes about the valuation of final accounts within the past 12 months (second only to disputes about extensions of time, at 50 per cent). See also RIBA, ‘RIBA Construction Contracts and Law Report, 2022’, op. cit. note 14, p. 24, in which 30 per cent of respondents identify valuation of the final account as a main issue in dispute during the past 12 months (fourth after extension of time at 50 per cent, defective work at 41 per cent, and loss and expense at 31 per cent).

[42] See, e.g., Supplemental Provisions in Contract Particulars for SBC/Q and DB.

[43] See, e.g., Clause 1.1 of Contract Particulars in DB and SBC/Q, allowing parties to designate a BIM protocol as part of the contract documents where applicable. (See also (accessed 18 September 2023)).

[44] Clause 9.3 of the SBC and DB provide as a default rule for arbitration to be conducted in accordance with the JCT 2016 edition of the ‘Construction Industry Model Arbitration Rules’. Consistent with its guiding approach of leaving many matters to the parties, the MP does not contain default provisions for arbitration.

[45] Founded in 1818, the Institution of Civil Engineers (ICE) is an independent professional society of civil engineers based in the United Kingdom that provides support to its more than 95,000 members in the United Kingdom, China, Russia, India and 140 other countries. It offers professional qualifications, publishing, contracting, training, recruitment and other similar services ( (accessed 8 September 2023)).

[46] Though not, as noted above, the uniform contract published by the American Institute of Architects in 1888.

[47] Brian Eggleston in the Preface to ICE Conditions of Contract (7th Edition, 2001).

[48] Jane Jenkins, International Construction Arbitration Law (2nd Revised Edition), p. 11.

[49] Brian Eggleston, ICE Conditions of Contract (7th Edition, 2001).pp. 1–2 (as summarised in the Introductory section of the Guidance Notes to the Seventh Edition of the ICE Conditions: “[l]ike all previous editions of the ICE Conditions of Contract, the Seventh Edition is based on the traditional pattern of Engineer-designed, Contractor-built Works with valuation by admeasurement. The traditional role of the Engineer in advising his client, designing the Works, supervising construction, certifying payment and deciding what are now called matters of dissatisfaction is fully maintained’).

[50] Sundra Rajoo, Standard Forms of Building Contracts Compared, p. 27.

[51] As the 2011 edition of the ICC Conditions sparked sufficient demand for use in heavy civil engineering work, particularly for the United Kingdom’s national rail network, a substantially reorganised and revised version of ICE Conditions of Contract was published in 2014. Further discussion of these new ICC conditions lies beyond the scope of this chapter but see Chapter 21 of Keating on Construction Contracts (10th Edition) for detailed discussion and commentary (N.B., a shorter commentary may be found in Chapter 22 of the 11th Edition).

[52] Sundra Rajoo, Standard Forms of Building Contracts Compared, p. 27.

[53] Jane Jenkins, International Construction Arbitration Law (2nd Revised Edition), at footnote 12.

[55] Keating on NEC (2nd Edition, Sweet & Maxwell, 2022), p. 1.

[56] Three key objectives were cited: providing greater stimulus to good management, supporting new approaches to procurement that improve contract management, and inspiring increased use of NEC in new markets and sectors. See Keating on NEC, op. cit. note 55, p. 1.

[57] Sir Vivian goes on to observe: ‘The use of language which generally avoids words of obligation and, instead, uses statements in the present tense to impose obligations, has led to criticism by commentators and judges. It shows that the underlying purpose of the form is not to seek to mirror traditional language but to take a different approach to the way in which contractors and employers carry out projects.’

[58] Sir Vivian Ramsey, Foreword in Keating on NEC (1st Edition, Sweet & Maxwell), p. xi.

[59] See Rob Gerrard, ‘A Comparison of NEC and FIDIC’ (2014) ( (accessed 18 September 2023)).

[60] See, e.g., Clause 10.1 of the Engineering and Construction Contract (ECC), which requires that ‘the Parties, the Project Manager, and the Supervisor shall act as stated in the contract’ (emphasis added). The use of the word ‘shall’ in this clause – the only such use in NEC4 – makes compliance with other clauses of the ECC mandatory. See also Clause 10.2 of the ECC, which requires the parties to act ‘in a spirit of mutual trust and cooperation’.

[61] See (accessed 15 September 2023).

[62] These forms include the ECC, Engineering and Construction Subcontract, Engineering Construction Short Contract, Engineering and Construction Short Subcontract, Professional Service Contract, Professional Service Subcontract, Professional Service Short Contract, Term Service Contract, Term Service Subcontract, Term Service Short Contract, Supply Contract, Supply Short Contract, Design Build and Operate Contract, Alliance Contract, Framework Contract and Dispute Resolution Service Contract.

[63] These clauses cover the parties’ main obligations, the programme, the project manager and the supervisor, early warning, quality management, compensation event, termination, etc.

[64] This section contains project-specific details, such as starting date, completion date, defect correction period, payment details, compensation events, etc.

[65] For example, OptionX15 provides for a lower level of design liability for the contractor than fitness for purpose as it requires ‘reasonable skill and care’ and allows a compensation event to be recognised if the contractor corrects a defect for which it is not liable.

[66] Although the project manager’s role is focused on the administrative side of the project, the supervisor administers the technical side of the project by overseeing tests and inspections carried out by the contractor or third parties, instructing the contractor to search for defects, notifying defects discovered within the defect correction period, issuing a ‘defects certificate’ at the end of the defect correction period, etc.

[67] In Imperial Chemical Industries Ltd v. Merit Merrell Technology Ltd, the legal status of assessments made by the project manager was tested, with the court deciding that a project manager’s assessment is not conclusive as to the rights of the parties but is of powerful evidential weight. See [2018] EWHC 1577 (TCC), [67–69].

[68] ECC, Clause 15.1.

[69] id., Clause 15.2.

[70] id., Clause 15.3. The importance of this clause is that if the contractor fails to give an early warning, then any cost that could have been avoided if early warning had been given will be disallowed under Main Options C to F. See Keating on NEC, op. cit. note 55, 2-178 Early Warning; ECC, Clause 11.2(26).

[71] Keating on NEC, op. cit. note 55, 1-003 Option A: Priced Contract with Activity Schedule.

[72] ECC, Option W1(2).

[73] id., Option W1(3).

Unlock unlimited access to all Global Arbitration Review content