The Joint Contract Tribunal’s new JCT 2024 Design and Build edition (JCT24DB) introduces various changes that affect the approach to both dispute avoidance and resolution (DA/DR). In summary, parties:

• are now required to “work with each other and with other project team members in a co-operative and collaborative manner, in good faith and in a spirit of trust and respect. To that end, each shall support collaborative behaviour” and address [uncollaborative behaviour] (Article 3);
• must (subject to a right to adjudicate) notify the other party promptly of any matter that appears likely to give rise to a dispute or difference following which the “senior executives”, as nominated in the Contract Particulars, are to meet as soon as possible for direct, good faith negotiations to resolve the matter (clause 9.1); and
• can nominate an adjudicator or adjudicator/arbitrator nominating body (clauses 9.3.1/9.5.1).

JCT24DB will be used widely and these changes are as much about establishing practices to avoid disputes as encouraging prompt, effective DR. Clearly, however, while the JCT’s mandate of collaborating in good faith [etc] is significant and intended to change both the standard form’s ethos and parties’ approach to contracting and DR negotiations, what is less clear is what “collaboration in good faith” means in practice.

There is no general doctrine of good faith in English law – the courts will analyse/apply express duties of good faith depending on the facts. Clear drafting is, therefore, the best way of [trying to] ensure that a good faith clause is upheld. Such drafting relies on establishing common goals, budget restraints and expectations for the project early. JCT’s drafting is sparse but, given that the JCT took inspiration for its new approach from the public sector-focused Construction Playbook (Playbook) and its private sector equivalent, the Trust and Productivity: the private sector construction playbook, we might conjecture that the examples in these playbooks are a good starting point. 

The Playbook approach prioritises project success over corporate goals and promotes effective supply chain relationships to align commercial objectives, avoid conflict and deliver the project smoothly. It requires early engagement of key personnel and supply chain, standard form contracts (like JCT), establishing a collaborative culture; aligning and setting defined goals from the outset; fair allocation of risk; financial checks on suppliers; and setting protocols for collaborative working. 

The private playbook follows the Playbook’s cue on collaborative contracting. It offers guidance “tailored to the private sector” and prioritises “increased productivity”, thereby focusing businesses on effective partnerships, longer-term contracting and trust-based relationships. 

Inevitably, the extent of party collaboration will depend on available funds and what is proportionate/appropriate in each case. Adopting some of the following should help ease those unfamiliar with the playbooks into collaborative working for both DA and DR purposes:

• Ensure senior management team involvement – and access – throughout the project.
• Check competency and financial standing before awarding contracts.
• Agree project goals and expectations.
• Convene/request early introductory project team meetings to ensure understanding of who is doing what and when.
• Organise social events to build relationships and improve cooperation.
• Train the project team (including the supply chain where appropriate) on the project goals, the contract terms and DR provisions, including the new dispute notice process.
• Drill home the importance of taking prompt action and reporting issues that arise on site.
• Encourage transparency and avoid a “blame culture” by establishing prompt, effective support.

This article was first published by Construction Law on 3 June 2024.