Guide to RIBA Domestic and Concise Building Contracts 2018
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Guide to RIBA Domestic and Concise Building Contracts 2018

Sarah Lupton

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eBook - ePub

Guide to RIBA Domestic and Concise Building Contracts 2018

Sarah Lupton

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About This Book

This latest title from the author provides comprehensive guidance to RIBA's two updated building contracts: the RIBA Domestic Building Contract 2018 and the RIBA Concise Building Contract 2018.

Introducing the contracts' features and benefits and covering all aspects of their use, from choosing and forming the right one for your project to guiding the parties through all its various stages, the Guide has been expanded with increased assistance on choice of form, tendering and contract formation. Additional detail on role and liabilities of contract administrator has been added, along with a new section on practical completion and completion, including certification. Assuming no current knowledge of the law or contract administration, this acts as a standalone guide for new users of the RIBA contracts, as well as a valuable update for previous users. It is an ideal companion for anybody using the latest building contracts.

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1.1 In November 2014 the Royal Institute of British Architects (RIBA) launched two new building contracts: The RIBA Concise Building Contract 2014 and the RIBA Domestic Building Contract 2014. The contracts featured in this book are the second editions of these contracts, published in January 2018.
1.2 The 2014 forms were not the first contracts to be published by the RIBA. In fact, the very first UK standard form of building contract was published by the RIBA jointly with the Institute of Builders and the National Federation of Building Trades Employers of Great Britain and Northern Ireland in 1902 (and cost one shilling!). In 1931 the Joint Contracts Tribunal (JCT) was formed, and the drafting and publishing of the contract became a pan-industry project. It continued to be called the RIBA Standard Conditions of Contract until 1963, when it was republished as the JCT Standard Form of Building Contract.
1.3 The JCT now publishes an extensive suite of contracts. However, the RIBA had identified a need, through feedback from its members, for short, easy-to-read and flexible contracts that would be suitable for less straightforward projects than those catered for by the JCT Home Owner contracts and that could be used on domestic and commercial works. It therefore published two new forms, designed for use in conjunction with the RIBA’s architect/consultant appointment agreements.
1.4 The 2018 editions were revised to respond to user feedback, and to changes in legislation and industry practice. Although essentially the same forms, there are a significant number of changes, many of which are more than simply tidying up or minor drafting adjustments; in fact, most clauses have been revised to some extent. The most significant changes are outlined at paras. 1.27 and 1.28 below. The new forms are fully compatible with the new suite of RIBA Professional Services Contracts, also published in 2018.

Features of the RIBA Building Contracts

1.5 According to its guidance notes, the RIBA Concise Building Contract 2018 (CBC) is intended for use on ‘all types of simple commercial building work’. It can be used in both the private and public sectors, as it includes optional provisions dealing with official secrets, transparency, discrimination and bribery as normally required by public sector clients (item Y and cl. 24). The RIBA Domestic Building Contract 2018 (DBC), as its name suggests, is intended for domestic work, including renovations, extensions, maintenance and new buildings. Its guidance notes state that this is limited to ‘work carried out on the Client’s home’, i.e. to contracts that fall under the ‘residential occupier exception’ in the Housing Grants, Construction and Regeneration Act 1996, as amended by Part 8 of the Local Democracy, Economic Development and Construction Act 2009 (hereafter referred to as the Housing Grants Act) (see para. 1.21). DBC is endorsed by the HomeOwners Alliance.
1.6 Both contracts are available in hard copy and digital format (using the RIBA Contracts Tool), and can be purchased from:
1.7 Key features of the RIBA Building Contracts are:
  • collaboration provisions: pre-start meeting, advance warnings, joint resolution of delay,
  • proposals for improvements and costs savings;
  • flexible payment options;
  • provision for contractor design;
  • optional provisions for a contractor programme;
  • optional provisions for client-selected suppliers and subcontractors;
  • mechanisms for dealing with changes to the project which allow for agreement and
  • include specified timescales;
  • option for commencement and completion in stages;
  • terms compliant with the Consumer Rights Act 2015 for consumer clients;
  • inclusion of guidance notes on use and completion, together with a user checklist;
  • client cancellation form included in DBC.
1.8 All of these features are discussed at various points throughout this Guide.

Suitability for different procurement routes

1.9 Both of the RIBA Building Contracts are suitable for projects that are procured on what is normally referred to as a ‘traditional’ procurement route, (or ‘design-bid-build’), i.e. one where the client engages at least one, and possibly several, firms of consultants to prepare a design and complete full technical documentation before the project is tendered to contractors. Traditional procurement is widely used – in the 2018 NBS survey,1 46 per cent of respondents stated it was the method used most often on their projects (the equivalent figure for design and build procurement was 41 per cent).
NBS National Construction Contracts and Law Report 2018.
1.10 With traditional procurement, it is common practice that some parts of the design are completed by the contractor or by specialist subcontractors (this version is sometimes referred to as ‘traditional plus contractor design’). The client, through its consultant team, remains responsible for providing the majority of the design, and for overall design integration, but limited and carefully delineated sections are delegated to the ‘supply chain’. The RIBA Building Contracts would be suitable in this situation, with either the main contractor or a subcontractor (client selected, if required) undertaking the design.
1.11 The RIBA Building Contracts are not intended for use in design and build procurement, i.e. where the contractor is responsible for both the design and the construction of the project. It would be possible to adapt them for this use, but there would still be a need for a contract document giving full details of the design requirements, and for an appointed contract administrator (not usual in design and build contracts). In addition, all the provisions relating to design would require amendment, and more detailed provisions regarding submission and approval of the developing design would have to be added.
1.12 The contracts are also not intended to be used with management contracting or construction management arrangements (where the project is tendered as a series of packages to separate firms, with work progressing on a rolling programme basis after the first package is let). Management procurement arrangements are normally used on very large projects; however, on a smaller scale, clients who wish to manage projects themselves sometimes adopt a similar system and engage a number of separate companies (often referred to as ‘separate trades’). The RIBA Building Contracts might be suitable for some of the larger work packages, but thought should be given as to how all the separate contracts are to be coordinated. This is not an easy task, and the apparent savings achieved by cutting out the main contractor’s mark-up may be more than offset by the amount of time the client has to spend managing the process, or by the additional fees charged by consultants if they undertake this role.
1.13 However, within the traditional plus contractor design route, the RIBA Building Contracts would be suitable for a wide range of projects, from very small-scale alterations and refurbishment works, to moderately sized projects relating to existing or new buildings. As mentioned above, CBC’s guidance notes refer to ‘simple’ work, and generally it is the level of complexity, rather than the value, that should be the key determinant in the choice of contract.
1.14 Although the RIBA Building Contracts have many useful features (see para. 1.7), which mean they are flexible, some of the provisions lack the detail to be found in larger contracts. Examples are those relating to design submission and approval procedures and insurance clauses. Other provisions commonly found in larger contracts are not included, such as fluctuations clauses and contractor bonds – if these are required then other standard contracts should be considered.

Differences between the concise and domestic contracts

1.15 As a result of the redrafting in the 2018 editions, several of the differences between the two versions have been removed, and they are now much closer in layout and content. Immediately obvious is that all the idiosyncratic (and in many cases unnecessary) differences between clause numbering and wording have been removed. In addition, some of the unique provisions in each contract have been removed (the effect of these changes is discussed further below). There are still, however, a number of important differences, largely reflecting the intended use of DBC with consumer clients. A list of the differences between the two versions is set out in Table 1.1.
1.16 DBC has an option whereby the client may elect to act as contract administrator (cl. 19). It also has a provision allowing the client to cancel the contract within 14 days (cl. 12.11), and includes a cancellation form for this purpose.
1.17 A key difference relates to the dispute resolution procedures: in DBC adjudication is an optional provision, whereas in CBC adjudication is stated to be a contractual right (ensuring compliance with the Housing Grants Act, see Appendix 1).
Table 1.1 Key differences between CBC and DBC
1.18 CBC includes optional clauses that provide for advance payment. It also includes an optional clause dealing with collateral warranties and third-party rights (see para. 2.29). These are usually provided to future purchasers or tenants, or to funders. The DBC does not provide for collateral warranties as such warranties do not normally arise in a domestic context. In the unlikely event that the client’s bank requires a warranty, then an additional provision would need to be introduced. Finally, CBC includes public sector clauses, which will enable it to be used by public bodies such as local authorities.
1.19 Some of the differences between the forms arise from legislation, and its impact on contracts in the intended context for DBC and CBC. (The implications are outlined briefly below, and the legislation discussed in more detail in Appendix 1.)

Use by domestic and commercial clients

1.20 DBC is obviously intended for domestic projects, and CBC for commercial ones. However, identifying the precise differences between different categories of users is not quite as simple as it might appear – this stems from the different definitions used in legislation that may apply to construction contracts and/or contracts with consumers.
1.21 A key issue in such cases is whether the client is a ‘residential occupier’ for the purposes of the Housing Grants Act 1996. If the client is not a ‘residential occupier’, then the Housing Grants Act 1996 provisions regarding payment (including payment and pay less notices) and the right to adjudication are required by law and, conversely, they are not needed where the client is a residential occupier. The RIBA has made adjudication an optional provision in DBC, but has included all the Housing Grants Act payment requirements in both versions of the contract. Some thought should be given as to whether a residential occupier client would wish to include these provisions or would prefer a simpler payment regime, in which the requirement to issue pay less notices, etc. could be omitted.
1.22 A further distinction is whether the client is a ‘consumer’ for the purposes of the Consumer Rights Act 2015 and the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013.
1.23 DBC includes the right of the client to cancel the contract within 14 days of signing it (cl. 12.11), something required by the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013. This right is not included in CBC. Where CBC is being used with a consumer client, it might be wise to add this provision, or to make it clear that the client would in any case have this right under the Regulations.
1.24 The law affords special protection to persons who enter into a contract as a ‘...

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