Embracing a modern contract – progression since Latham?

2010-02-25T13:41:27Z (GMT) by Wayne E. Lord
Sir Michael Latham and Sir John Egan in their reports “Constructing the Team”, “Rethinking Construction” and “Accelerating Change” identified substantial changes in the culture and structure of UK construction being required. These also included changes in the relationships between companies. The choice and form of contract can play a significant role in the governance of such relationships. Sir Michael Latham suggested that contract writing bodies could amend existing standard forms to meet some of the concerns further urging the industry to embrace a Modern Contract. The forms of contract, and the changes to them over time, can influence culture change. This paper compares and contrasts the principal provisions of the contracts published by the Joint Contracts Tribunal (“JCT”), Institution of Civil Engineers (“ICE”) and the New Engineering Contract (“NEC”) against Sir Michael Latham’s 13 requirements for a Modern Contract. Where relevant, subcontract and consultant forms are also considered within the contractual matrix. The JCT and ICE forms of contract were found to have retained the principle features more conducive to promoting an adversarial relationship as opposed to the modern requirements for a collaborative and trusting relationship. Some attempts have been made by the JCT and ICE to promote collaborative working and to incorporate the features of a Modern Contract but this relies heavily on overarching documents which, in the main, are non binding on the parties and simply exhort collaborative behaviour. The single, most notable, exception to this was the JCT Constructing Excellence Contract. On the other hand. the NEC family of contracts were found to have embraced virtually all the requirements for a Modern Contract in an integrated way and, could be argued, were the most conducive to assisting with implementation of the various drivers for change.