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Introduction Of JCT and NEC Contracts in Construction Industry
This research paper is going to understand the JCT contract and NEC contracts with the construction industry to complete a project by taking the full process delivery facility. Contracts play a crucial role in construction projects since they offer major contractors, subcontractors, and building employers crucial protection against conflicts. Contrasts ensure the quality of the work, the payment, and the resolution of any disputes (Gould, and Liang, 2022). JCT contracts are known as Joint Contract Tribunal which confirms the contract for construction guidance and other documentation in the construction industry in the United Kingdom. This contract is required to set out the responsibility for the construction process and the obligation of the party. The member of JCT according to 2014, is 7 where the members. NEC contract defines the New Engineering Contract which designs the contract to manage a project, particularly in civil engineering projects. NEC provides good project management principles by practicing legal relationships. Fair and sustainable allocation of risk, alignment of interest, timely resolution of problems, and increased confidence in outcome are observed in this NEC contract with one source of trust in project status and cost.
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Aims
The aim of the study is to identify changes in management in JCT and NEC contracts with suite moves.
Objectives
- To find out the importance of JCT contracts and NEC contracts.
- To compare the JCT contracts and NEC contracts.
- To analyze which country should be adapted for projects.
Development of a balanced perspective
The task is important as JCT contracts provide traditional methods but many people depend on these contracts in the UK they pray for mostly JCT contracts but NEC has adopted a new approach with the time or generation gap along with the facility of the international approach of contract (Swai, 2021). Therefore, it is required to understand which one should be better for the project to change the management of contracts.
Analysis and synthesis of the task
Discussion
JCT has a standard procedure to form a construction contract in the construction industry. The UK construction industry is mostly dependent on JCT providing contract documents. JCT provides a wide range of construction activities and ensures flexibility and board portfolio by constructing large-scale projects. As considered by Hansen, (2020), JCT set a standard document to use for willing industry truth development and delivery of the project. JCT has a much approach to abortion of risk in such a way that the procurement process will reflect appropriately.
JCT contracts follow to service keys to proceed with:
(i) It minimizes the transaction cost to enter the contract
(ii) and also provide benchmark provisions to maintain the standard form contract.
The main reasons to follow the JCT contracts as it saves time and minimizes transaction cost, reduces risk, and is recognizable. As recommended by Alqahtani et al. (2022), the standard form has been designed in a comprehensive way that covers most of the pitfalls and maintains a contractual relationship with the building industry. Standard forms reflect the benchmark provisions and accept the position of practice. JCT contracts have been successful because of the guidance of consultant’s contractors’ specialists and service contractors who are mostly involved in the development of the contracts.
NEC is a collaborative contract body that motivates the contract parties via providing mutual trust of spirit and cooperation for the work. The main focus of NEC is the positive change in behavior and mindset, and focus on the creation of creativity in the work environment so that it would be enjoyable for employees (Randall, 2021). construction parties who are engaged in the constructive period need their successful collaboration such as suppliers, subcontractors, and stakeholders and so many are also maintaining relationships. This contracting body helps to involve every party to make beta performance by facing the challenges constructively by making good decisions as per the requirement. Joint management in the construction project risks and development at the units to proceed with effective mitigation by addressing the changes with fear dealing. Leadership and communication skills can increase trust and cooperation.
As the collaborative approach is the trusting body, it first ensures the development of the right business relationship. The relationship with the people is the customers who are facing real difficulties. This NEC helps to solve the problem together and helps to increase the real potential of the group such as people and also the companies by focusing them to achieve the common goal so that the improvement in every step of the journey is complete. Though collaboration is difficult because focusing on the same goal as companies and people do not have the same focus so engagement between them is tough.
Collaborative contracts can be effective when they reflect on the work and the behavior of the contractors and customers. Collaborative construction requires a whole project focused on the aim of achieving a "win-win" outcome so that every one of the constructive stakeholders' suppliers is involved in considering their needs (Symons, 2021). Collaboration is involved in adopting and giving values of everyone's opinion and focusing to design the construction is also a major concern in removing waste. The project team needs to improve the construction design with the effectiveness of dialogue with open communication and ongoing communication to establish trust and to maintain the collaborative Ethos. Each and every party needs to be committed to helping them to achieve the goal.
Argument and comparison for change in management
Generally, NEC contracts aim to focus on engineering projects but it can adopt the building works easily. JCT contracts are focused on building work rather than the engineering project and can adopt both. JCT contracts follow the traditional methods whereas NEC contracts focus on prominent contracts which are applicable with the variation of time. NEC drafted for international projects also where JCT is not out of the UK. JCT traditionally encourages a contract management approach and exceptions in the construction excellence contract. NEC encourages collaboration to approach management. NEC philosophy is an early warning register by the project manager identifying the potential weeks and concluding to reduce and avoid the risk in the construction period (Ross et al. 2022). Project manager's updated by early warning registered and even by impacting the cost on the performance and program of the work. JCT allocates risk to the employer and contractors before the contract. NEC contracts give flexibility in the court clause and also with the optional clause which allows the party to adopt the contract with particular requirements but JCT contracts do not have such flexibility in the contract.
JCT contractors claim extra additional time for delay of work with relevant events such as variation and changes and errors in instruction inadequacy divergence in the contract documents. NEC contractors can take the ECC and cause the compensation event in the contractor to claim the extra time.
Express the development idea of change in management
JCT contracts can be used when employers prefer to retain a great level of control delivery of projects and domestic commercial developers are preferred for the project. The NEC contract is usually preferred in the flexibility of the procurement method as it adapts easily to pricing structure and design for use domestically in the UK and also abroad (Hughes, 2020). The short contract with NEC by adopting ECC option A of price contract with activity schedule and ECC option E for cost-reimbursable formal work.
JCT advantage because the clients have a single point of responsibility and go to know about what is the procedure and how the work would be done by whom and when that will be finished according to the bounded time of the long-term process.
The management needs to change to save time and money and any dispute during the construction period or for the construction purpose the owner should not be disposable and the projector would be responsible for all the construction design. It will help the owner to make the best project from the beginning of the project with the base design by contracting work together. Depending on the project the contract body needs to be chosen so that the traditional or new contracts can be applied along with the design and time.
Conclusion
From the above discussion, it can be concluded that contracts are important in construction projects because they provide important protection for main contractors, subcontractors, and building employers to prevent disputes. Contracts guarantee educated work and payments and if a dispute arises how to solve the issues. As per the opinion of Hansen, (2020), the contracts of JCT and NEC gives advantages on NEC contracts allow for flexibility in the court clause and optional clause, which enables the party to adopt the contract with certain conditions, whereas JCT contracts do not. While JCT is not working on a global initiative, NEC is also drafted.
The terms and conditions of the contract need to be clear so that it will not be harmful in the further procedure. They are for the construction project and procurement is required with the agreement. Therefore, it is very much important when a building is needed to be constructed and should analyze all the legal procedures so that any further risk or damage cannot stop the procurement as the big investment by the parties is done for new construction or renovation.
Referencess
Alqahtani, F.K., Alabduljabbar, A., Alsaqer, T. and Abotaleb, I.S., 2022, May. Evaluation of using building information modelling in green building in Saudi Arabia construction contracts. In IOP Conference Series: Earth and Environmental Science (Vol. 1026, No. 1, p. 012053). IOP Publishing.
Gould, N. and Liang, O., 2022. Conflict Avoidance and Alternative Dispute Resolution In the UK Construction Industry. Series 2 Vol. 4 Amicus Curiae, p.155.
Hansen, S., 2020, May. Does the COVID-19 outbreak constitute a force majeure event? A pandemic impact on construction contracts. In Journal of the civil engineering forum (Vol. 6, No. 1, pp. 201-214). Petra Christian University.
Hughes, K., 2020. Understanding the NEC4 Professional Service Contract: A Practical Handbook. Routledge.
Randall, J., 2021. FORCE MAJEURE: COVID AND THE CONSTRUCTION INDUSTRY. Plymouth Law & Criminal Justice Review, 14.
Ross, S., Lopez, J., Pigott, A., Adams, S., Bell, G., Knight, E., Mort, J. and Robinson, L., 2022. Construction Law Quarterly. Proceedings of the Institution of Civil Engineers-Management, Procurement and Law, 175(4), pp.177-186.
Swai, L., 2021. Development of a Conceptual Framework for Enhancing Payment Practices in the UK Construction Industry.
Symons, A.W., 2021. Integrated Design, Design Management and the Delivery of Major Hospitals (Doctoral dissertation, UCL (University College London)).
