JCT Clause 38

Standard Form of Building Contract 1998 Edition incorporating Amendments 1 to 4

' Private versions

- - - . _ _

Contents

38 Contribution, levy and tax Page fluctuations Private Edition With Quantities 1 Private Edition Without Quantities 5

39 Labour and materials cost and tax fluctuations Private Edition With Quantities Private Edition Without Quantities Private Edition With Approximate

Quantities

9 75 27

40 Use of price adjustment formulae Private Edition With Quantities Private Edition Without Quantities Private Edition With Approximate

Quantities

List of amendments incorporated in this reprint

FS:P 98 (03/03) CD The Joint Contracts Tribunal Limited 2003

JCT Standard Form of Building Contract 1998 Edition

Oeemed calculation of Contract Sum - types and rates of contribution etc.

increases or decreases in rates of contribution etc. -payment or allowance

Persons employed on site other than 'workpeople'

Clause 38 - For use with the Private Edition With Quantities

38

38.1

Contribution, levy and tax fluctuations

The Contract Sum shall be deemed to have been calculated in and shall be subject to adjustment in the events specified her

38.1 .1 The prices contained in the Contract Bills are contribution, levy and tax payable by a perso which at the Base Date are payable by the CO in clause 38.1.2 referred to as a 'tender type' an

38.1 .2 If any of the tender rates other th f the Industrial Training Act 1964 is increased or or if a new type of contribution, I capacity as an employer becomes pa the net amount of the diff pay in respect of

n in any such case ctually pays or will

.2 . I workpeople engaged upon orks either on or adjacent to the site, and

.2 -2 workpeople directly e who are engaged upon the production o fmte r ia l connection with the Works and

site and to the extent that they are so engaged

eople and what he would have paid of contribution, levy or tax not become id to or allowed by the Contractor.

38.1 .3 There shall b ount paid to or allowed by the Contractor u?der rson employed by the Contractor who is engaged

ither on or adjacent to the site and who is ' in clause 38.6.3, the same amount as is

unt to a whole working day;

rase "the same amount as is payable or allowable in respect of a

. .

wage, emolument or other expense for a craftsman, shall refer t o the amount in respect of a craftsman employed as aforesaid to whom the highest rate is applicable; and

the phrase "the employed by the Contractor" shall mean an employment to which the Income Tax (Employments) Regulations 1993 (the PAYE Regulations), or any amendment or re-making thereof, apply.

PW (381 98 (OW31 0 The Joint Contracts Tribunal Limited 2003

Refunds end premiums

Contracted out employment

Meaning of contribution etc.

Materials - duties and taxes

2

38.1 *5

38.1 *6

38.1 -7

38.1 *8

38.1 *9

The prices contained in the Contract Bills are based upon the types and rates of refund of the contributions, levies and taxes payable by a person in his capacity as an employer and upon the types and rates of premium receivable by a person in his capacity as an employer being in each case types and rates which at the Base Date are receivable by the Contractor. Such a type and such a rate are in clause 38.1.6 referred to as a 'tender type' and a 'tender rate'.

If any of the tender rates is increased or decreased or if a tender type ceases to be payable or if a new type of refund of any contribution, levy or tax payable by a person in his capacity as an employer becomes receivable or if a new type of premium receivable by a person in his capacity as an employer becomes receivable after the Base Date, then in any such case the net amount of what the Contractor actually receives or will receive in respec referred to in clauses 38.1-2.1 and 38.1.2.2 or because of h workpeople and what he would have received had the alt type of refund or premium not become effective shall, as to or allowed by the Contractor.

The references in clauses 38.1.5 and 38.1.6 to premi meaning all payments howsoever they are descri virtue of an Act of Parliament to a person in his affect the cost to an employer of having person

Where employer's contributions are payable by workpeople as referred to in clauses 38.1 contracted-out employment wi the Contractor shall for the pur deemed to pay employer's con out employment.

The references

howsoever the

taxes shall be construed as ity as an employer which are imposed under

cost to an employer of

38.2 The Contract Sum s and shall be subject

lated in the manner set out below ied hereunder.

38.2 -1

38-2 *2

h x p e s and rates of duty, if any, and tax, if any hich is treated, or is capable of being treated, as

soever payable which at the Base Date are , appropriation, processing, use or disposal of materials taken from the site as waste or any the execution of the Works by virtue of any

pe and a rate so payable are in clause 38.2.2 referred to as a

If, to y aterials or goods or any electricity or fuels or materials taken from he site as w e or any other solid, liquid or gas necessary for the execution of

g temporary site installations for those Works, a tender rate is

,then in any such case the net amount of the difference between what the

or any other solid, liquid or gas and what he d the alteration, cessation or imposition not paid to or allowed by the Contractor. In clause uty or tax" includes an additional duty or tax any of the above in respect of which no duty

or tax whatever was previously payable (other than any value added tax which is treated, or is capable of being treated, as input tax by the Contractor).

0 The Joint Contracts Tribunal Limited 2003

38.3 Fluctuations - work sub-let - Domestic Sub-Contractors

Sublet work - incorporetion of provisions to like effect

Sub-let work - fluctuations - payment to or allowance by the Contractor

Written notice by Contractor

Timing and effect of written notices

Agreement - Quantity Surveyor and Contractor

Fluctuations added to or deducted from Contract Sum

n

38.3 -1 If the Contractor is obliged by clause 19.3, or shall decide subject to clause 19-2, to sub-let any portion of the Works to a Domestic Sub-Contractor he shall incorporate in the sub-contract provisions to the like effect as the provisions of

clause 38 (excluding clause 38.3) including the percentage stated in the Appendix pursuant to clause 38.7

which are applicable for the purposes of this Contract.

38.3 -2 If the price payable under such a sub-contract increased above or decreased below the price operation of the said incorporated provisions, then the or decrease shall, as the case may be, be paid to or allo this Contract.

38.4 to .6 Provisions relating to clause 38

38.4 -1 The Contractor shall give a written notice to th the events referred to in such of the following purposes of this Contract:

38.4

*1

-1

.1

-1

-1

*2

.1 clause 38.1.2;

-2 clause 38.1-6;

-3 clause 38.2.2;

-4 clause 38.2.3; f i (

0, \ .5 clause 38.3.

Any notice required reasonable time and

38.4 .4 An am rom time to time becomes payable to or allowable by the C tr tor y e f clauses 38-1 and .2 or clause 38.3 shall, as the case may be, b ad d o d ducedfrom:

-4 *1 (?&; and

to the Contractor and which are calculated in accordance

to which clause 38.4.4 refers shall be subject to the of clauses 38.4.5 to .4.7.

as is reasonably practicable the Contractor shall provide such evidence and 9 putatr s as the Architect or the Quantity Surveyor may reasonably require to enab h amount payable to or allowable by the Contractor by virtue of clauses 38.1 an -2 or clause 38.3 to be ascertained; and in the case of amounts payable to or allowable by the Contractor under clause 38.1-3 (or clause 38.3 for amounts payable to or allowable by the Domestic Sub-Contractor under provisions in the sub-contract to the like effect as clauses 38.1-3 and 38.1.4) -employees other than workpeople -such evidence shall include a certificate signed by or on behalf of the Contractor each week certifying the validity of the evidence reasonably required to ascertain such amounts.

No elteration to Contractor's profit

38.4 .6 No addition to or deduction from the Contract Sum made by virtue of clause 38.4.4 shall alter in any way the amount of profit of the Contractor included in that Sum.

PW 138) 98 103/03) (B The Joint Contracts Tribunal Limited 2003 3

Position where Contractor in default over completion

38.4 e7 Subject to the provisions of clause 38.4.8 no amount shall be added or deducted in the computation of the amount stated as due in an Interim Certificate or in the Final Certificate in respect of amounts otherwise payable to or allowable by the Contractor by virtue of clauses 38.1 and .2 or clause 38.3 if the event (as referred to in the provisions listed in clause 38-4.1) in respect of which the payment or allowance would be made occurs after the Completion Date.

38.4 .8 Clause 38.4.7 shall not be applied unless:

Work etc. to which 38.5 clauses 38.1 to .3

38.5 not applicable

38.5

38.5

38.5

Definitions for use 38.6 with clause 38

38.6

38.6

38.6

-8 -1 the printed text of clause 25 is unamended and forms part of the Conditions; and

.2 the Architect has, in respect of every written notificatio clause 25, fixed or confirmed in writing such Completi be in accordance with clause 25.

.8

Clauses 38.1 to -3 shall not apply in respect o f

.1

-2

work for which the Contractor is allowed daywor

work executed or materials or goods supplied Nominated Supplier (fluctuations in relation to Nominated Suppliers shall be dealt with under which may be included in the appropriate sub-c

-3 work executed by the Contractor for w e u c l a u s e 35.2 has with under any

.4 changes in the rate of of goods or services

.1 the expression in the Appendix;

In clause 38:

-2 the expressio e timber used in formwork but do not

rsons whose rates of wages and other re governed by the rules or decisions or Joint Council or some other wage-fixing

lays down recognised use 38, 'recognised terms n comparable employment which the employer in

ent or award to which oyers' associations and independent trade unions which

or in the district in question, as the case may be) a substantial ployers and of the workers in the trade, industry or section description to which the agreement or award relates.

uation payments or allowances

the amount paid to or allowed by the Contractor under:

.1 e3 clause38.1.6,

-1 .4 clause 38-2.2

the percentage stated in the Appendix.

4 (B The Joint Contracts Tribunal Limited 2003

Deemed calculation of Contract Sum - types and rates of contribution etc.

Increases or decreases in rates of contribution etc. - payment or allowance


JCT Standard Form.of Building Contract 1998 Edition

Clause 38 - For use with the Private Edition Without Quantities

38

38.1

Contribution, levy and tax fluctuations

The Contract Sum shall be deemed to have been calculated in and shall be subject to adjustment in the events specified he

.1 38.1 The Contract Sum is based upon the types and rates of payable by a person in his capacity as an emp payable by the Contractor. A type and rate so as a 'tender type' and a 'tender rate'.

38.1 .2 If any of the tender rates other t f the Industrial Training Act 1964 is increased or or if a new type of contribution, I capacity as an employer becomes pa the net amount of the difference be

en in any such case ctually pays or will

pay in respect of

-2 .1 workpeople engaged either on or adjacent to the site, and

connection with the Works and nd to the extent that they are

e of contribution, levy or tax not become aid to or allowed by the Contractor.

38.1 .3 There shall ount paid to or allowed by the Contractor under

in clause 38-6.3, the same amount as is

rase "the same amount as is payable or allowable in respect of a

ractor (or by any Domestic Sub-Contractor under a sub-contract to which

ction Industry Joint Council or other wage-fixing body and, where the d rules or decisions or agreements provide for more than one rate of

wage, emolument or other expense for a craftsman, shall refer to the amount in respect of a craftsman employed as aforesaid to whom the highest rate is applicable; and

the phrase "employed by the Contractor" shall mean an employment to which the Income Tax (Employments) Regulations 1993 (the PAYE Regulations), or any amendment or re-making thereof, apply.

PWO (38) 98 (03/03) (0 The Joint Contracts Tribunal Limited 2003 5

Refunds and premiums

Contracted-out employment

Meaning of contribution etc.

Materials - duties and taxes

38.1 .5 The Contract Sum is based upon the types and rates of refund of the contributions, levies and taxes payable by a person in his capacity as an employer and upon the types and rates of premium receivable by a person in his capacity as an employer being in each case types and rates which at the Base Date are receivable by the Contractor. Such a type and such a rate are in clause 38.1-6 referred to as a 'tender type' and a 'tender rate'.

38.1

38.1

38-1

38.1

38.2

38.2

38-2

.6 If any of the tender rates is increased or decreased or if a tender type ceases to be payable or if a new type of refund of any contribution, levy or tax payable by a person in his capacity as an employer becomes receivable or if a new type of premium receivable by a person in his capacity as an employer becomes receivable after the Base Date, then in any such case the net amount of the what the Contractor actually receives or will receive in re referred to in clauses 38.1.2.1 and 38.1-2.2 or because of workpeople and what he would have received had the al

-8 Where employer's contributions are p

the Contractor shall for the purpose deemed to pay employer's contr out employment.

The references in clause 38

e under clause 38.1 be ent were not contracted-

.9

calculated in the manner set out below and shall be subj

-1 The Contract

nts specified hereunder.

and rates of duty, if any, and tax, if any

le, appropriation, processing, use or disposal of Is, materials taken from the site as waste or any

or goods or any electricity or fuels or materials taken other solid, liquid or gas necessary for the execution of ry site installations for those Works, a tender rate is

,then in any such case the net amount of the difference between what the

en from the site as waste or any other solid, liquid or gas and what he id in respect of them had the alteration, cessation or imposition not as the case may be, be paid to or allowed by the Contractor. In clause ession "a new type of duty or tax" includes an additional duty or tax

and a duty or tax imposed in regard to any of the above in respect of which no duty or tax whatever was previously payable (other than any value added tax which is treated, or is capable of being treated, as input tax by the Contractor).

or actually pays in respect of those materials, goods, electricity, fuels,

6 (0 The Joint Contracts Tribunal Limited 2003 PWO (36) 98 (03/03)

38.3 Fluctuations - work sub-let - Domestic Sub-Contractors

Sub-let work- incorporation of provisions to like effect

Sub-let work - fluctuations - payment to or allowance by the Cont rector


Timing and effect of written notices



n

38.3 .1 If the Contractor is obliged by clause 19.3, or shall decide subject to clause 19.2, to sub-let any portion of the Works to a Domestic Sub-Contractor he shall incorporate in the sub-contract provisions to the like effect as the provisions of

clause 38 (excluding clause 38.3) including the percentage stated in the Appendix pursuant to clause 38.7

which are applicable for the purposes of this Contract.

If the price payable under such a sub-contract as referre increased above or decreased below the price in such s operation of the said incorporated provisions, then the or decrease shall, as the case may be, be paid to or alto this Contract.

38.3 .2

38.4 .1

38.4 to .6 Provisions relating to clause 38

The Contractor shall give a written notice to th the events referred to in such of the purposes of this Contract:

.1 .1 clause38.1.2;

38.4

-2 clause 38.1.6;

-3 clause 38.2-2;

.4 clause 38.2.3;

shall be a condition precedent to any respect of the event in question.

r may agree what shall be deemed for all e net amount payable to or allowable by the e of any event such as is referred to in any of

or allowable by the hall, as the case may be,

ts payable to the Contractor and which are calculated in accordance lause 28.4.3.1.

n or deduction to which clause 38.4.4 refers shall be subject to the of clauses 38.4.5 to -4.7.

sonably practicable the Contractor shall provide such eviden'ce and the Architect or the Quantity Surveyor may reasonably require to nt payable to or allowable by the Contractor by virtue of clauses

e of amounts payable to or allowable by the Contractor under clause 38.1.3 (or clause 38-3 for amounts payable to or allowable by the Domestic Sub-Contractor under provisions in the sub-contract to the like effect as clauses 38.1.3 and 38.1.4) -employees other than workpeople - such evidence shall include a certificate signed by or on behalf of the Contractor each week certifying the validity of the evidence reasonably required to ascertain such amounts.

No alteration to Contractor's profit

38.4 .6 No addition to or deduction from the Contract Sum made by virtue of clause 38.4.4 shall alter in any way the amount of profit of the Contractor included in that Sum.

PWO 1381 98 (03/031 The Joint Contracts Tribunal Limited 2003 7


38.4 -7 Subject to the provisions of clause 38.4.8 no amount shall be added or deducted in the computation of the amount stated as due in an Interim Certificate or in the Final Certificate in respect of amounts otherwise payable to or allowable by the Contractor by virtue of clauses 38.1 and .2 or clause 38.3 if the event (as referred to in the provisions listed in clause 38.4.1) in respect of which the payment or allowance would be made occurs after the Completion Date.

38.4 -8 Clause 38.4.7 shall not be applied unless:

.8 -1 the printed text of clause 25 is unamended and forms part of the Conditions; and

.8 -2 the Architect has, in respect of every written clause 25, fixed or confirmed in writing such be in accordance with clause 25.

Work etc. to which clauses 38.1 to .3

38.5 Clauses 38.1 to .3 shall not apply in respect of:

not applicable 38.5 a 1 work for which the Contractor is allowed daywork -*i; r

38.5 .2 work executed or materials or goods supplied Nominated Supplier (fluctuations in relation to Nominated Suppliers shall be dealt with under which may be included in the appropriate sub-

lause 35.2 has been accepted (fluctuations in re provision in the accepted tender

e dealt with under any

38.5 .4 changes in the rate of value ad ply of goods or services

Definitions for use 38.6 In clause 38: with clause 38

38.6 .1 the expression

e timber used in formwork but do not include other c

ndustry Joint Council or some other wage-fixing he building industry;

y' shall mean a body which lays down recognised

or section of trade or industry, in which the employer in ich have been settled by an agreement or award to which rs' associations and independent trade unions which

kers of the description to which the agreement or award relates.

be added to the amount paid to or allowed by the Contractor under:

.1 -3 clause38.1.6,

-1 4 clause 38.2.2

the percentage stated in the Appendix.

8 0 The Joint Contracts Tribunal Limited 2003 PWO (381 98 (03B3)

Deemed calculation of Contract Sum - rates of wages etc.


- Clause 39 - For use with the Private Edition With Quantities

39

39.1

Labour and materials cost and tax fluctuations

The Contract Sum shall be deemed to have been calculated in and shall be subject to adjustment in the events specified her

39.1 -1 The prices (including the cost of employer's liabil insurance) contained in the Contract Bills are bas other emoluments and expenses (including holid the Contractor to or in respect of

e 1 -1 workpeople engaged upon or in connectio adjacent to the site, and

-1 .2 workpeople directly employed b production of materials or goods who operate neither on nor adjac

ith the Works and to the extent that they are

so engaged

in accordance with:

-1 .3 therulesor ry Joint Council or other wage- sand which have been

oductivity Incentive Schemes and/or he Construction Industry Joint Council Incentive Schemes and/or aforesaid Council to which Rule 1.16

Civil Engineering Annual and Public Holidays

credits) are in accordance with the rules or decisions of a other than the Construction Industry Joint Council) which will

he Works and which have been promulgated at the Base Date; W

3 9 . y

increase or decrease in the cost of employer's liability insurance, of third patty insurance and of any contribution, levy or tax payable by a person in his capacity as an employer shall, as the case may be, be paid to or allowed by the Contractor.

PW (391 98 ~03hl3) Q The Joint Contracts Tribunal Limited 2003

. . ._

9

Persons employed on site other than

39.1 -3 There shall be added to the net amount paid to or allowed by the Contractor under clause 39.1.2, in respect of each person employed by the Contractor who is engaged upon or in connection with the Works either on or adjacent to the site and who is not within the definition of 'workpeople' in clause 39.7.3, the same amount as is payable or allowable in respect of a craftsman under clause 39.1.2 or such proportion of that amount as reflects the time (measured in whole working days) that each such person is so employed.

'workpeople'

39.1 .4 For the purposes of clauses 39.1.3 and 39.2-3:

no period of less than 2 whole days in any week shall be taken into account and periods of less than a whole working day shall not be agg a whole working day;

Contractor (or by any Domestic Sub-Contractor clause 39.4 refers) under the rules or decisions

wage, emolument or other expenses for a in respect of a craftsman employed as afo applicable; and

Regulations), or any

Workpeople - wage-fixing body - reimbursement of fares charges list submitted by

nd incurred by the Contractor capacities referred to in

eimbursable by the Contractor to ities referred to in clauses 39.1.1.1 r decisions of the Construction

r emoluments and expenses are governed by the e-fixing body other than the Construction dance with the rules or decisions of such other

ent of fares is increased or decreased by reason of any

which at the Base Date are payable by the Contractor. A type and a rate so payable are in clause 39.2.2 referred to as a 'tender type' and a 'tender rate'.

10 CB The Joint Contracts Tribunal Limited 2003

39-2 -2

39.2 -3

39.2 *4

39.2 *5

39.2 -6

39.2 *7

If any of the tender rates other than a rate of levy payable by virtue of the Industrial Training Act 1964 is increased or decreased or if a tender type ceases to be payable or if a new type of contribution, levy or tax which is payable by a person in his capacity as an employer becomes payable after the Base Date, then in any such case the net amount of the difference between what the Contractor actually pays or will pay in respect of workpeople as referred to in clauses 39.1.1.1 and 39-1.1.2 or because of his employment of such workpeople and what he would have paid had the alteration, cessation or new type of contribution, levy or tax not become effective shall, as the case may be, be paid to or allowed by the Contractor.

There shall be added to the net amount paid to or allowed by the Contractor under clause 39.2.2, in respect of each person employed by the upon or in connection with the Works either on or adjace not within the definition of 'workpeople' in clause 39.7.3, payable or allowable in respect of a craftsman under clau proportion of that amount as reflects the time (measure that each such person is so employed. The provisions o clause 39.2.3.

The prices contained in the Contract Bills are ba refund of the contributions, levies and taxes an employer and upon the types and r capacity as an employer being in each are receivable by the Contractor. Such

t the Base Date

referred to as a 'tender type' and a 'tend mW If any of the tender rates is incr payable or if a new type of refu

nder type ceases to be or tax payable by a or if a new type of oyer becomes receivable

of his employment of such alteration, cessation or new as the case may be, be paid

5 to premiums shall be construed as e described which are made under or by in his capacity as an employer and which

aving persons in his employment.

yable by the Contractor in respect of

Construction Industry Joint Council or of some other wage-fixing ibutions to such occupational pension scheme are within the

nd allowance provisions of clause 39.1.

nces in clauses 39.2.1 to 39.2.5 and 39.2.7 to contributions, levies and I be construed as meaning all impositions payable by a person in his

as an employer howsoever they are described and whoever the recipient posed under or by virtue of an Act of Parliament and which affect the

mployer of having persons in his employment.

U

PW (39) 98 (03/03) 0 The Joint Contracts Tribunal limited 2003 1 7

Materials, goods. electricity and fuels

Sub-let work - incorporation of provisions to like effect

Sub-let work - fluctuations - payment to or allowance by the Contractor


39.3 The Contract Sum shall be deemed to have been calculated in the manner set out below and shall be subject to adjustment in the events specified hereunder.

39.3 .I

39.3 -2

39.3 -3

The prices contained in the Contract Bills are based upon the market prices which were current at the Base Date of the materials, goods, electricity, fuels or any other solid, liquid or gas necessary for the execution of the Works, and upon the duty or tax payable at that Date on the disposal of waste from the site.

If after the Base Date the market price of any of the above things increases or decreases, or the duty or tax on the disposal of waste from the site increases or decreases, then the net amount of the difference shall, as the case may be, be paid to or allowed by the Contractor.

The references in clauses 39.3.1 and 39.3.2 to 'market pric including any duty or tax (other than value added tax whi of being treated, as input tax by the Contractor) by whom payable under or by virtue of any Act of Parliament on t appropriation, processing, use or disposal of any of the mv 39-3.1.

39.4 Fluctuations - work sub-let - Domestic Sub-Contra or9

39.4 -1

39.4 .2

39.5 to .7

39-5 .1

.1

.1

If the Contractor is obliged by clause 19- sub-let any portion of the Works to a D in the sub-contract provisions to the li

o clause 19.2, to

clause 39 (excluding clause Appendix pursuant to cleus

red to in clause 39-4.1 is increased abov operation of the sat or decrease shall, as t to or allowed by the Contractor under this Contract.

39.3.4.2;

39.4.2.

required to be given by clause 39.5.1 shall be given within a reasonable time after the occurrence of the event to which the notice relates and the giving of written notice in that time shall be a condition precedent to any payment being made to the Contractor in respect of the event in question.

12 PW (39) 98 l03/03) 0 The Joint Contracts Tribunal Limited 2003

Agreement - Quantity Surveyor 8nd Contractor


Evidence end computations by Contractor

No alteration to Contractor’s profit


Work etc. to which clauses 39.1 to .4 not applicable

39.5 .3

39.5 .4

.4

.4

39.5 .5

39.5 -6

39.5 .7

39.5 .8

*8

.8

The Quantity Surveyor and the Contractor may agree what shall be deemed for all the purposes of this Contract to be the net amount payable to or allowable by the Contractor in respect of the occurrence of any event such as is referred to in any of the provisions listed in clause 39.5.1.

Any amount which from time to time becomes payable to or allowable by the Contractor by virtue of clauses 39.1 to .3 or clause 39.4 shall, as the case may be, be added to or deducted from:

-1 the Contract Sum; and

-2 any amounts payable to the Contractor and which are calculated in accordance with clause 28.4.3.1.

The addition or deduction to which clause 39.5.4 refers sh provisions of clauses 39.5.5 to e 5 . 7 .

As soon as is reasonably practicable the Cont computations as the Architect or the Quantity enable the amount payable to or allowable by 39.1 to -3 or clause 39.4 to be a allowable by the Contractor und to or allowable by the Domestic to the like effect as clauses 39.1. such evidence shall include a ce each week certifying the validit such amounts.

No addition to or deduction fr shall alter in any way the amo

y virtue of clause 39.5.4 included in that Sum.

t shall be added or deducted in nterim Certificate or in the Final to or allowable by the 9.4 if the event (as referred to in

which the payment or allowance would be made occu

IS unamended and forms part of the Conditions;

f every written notification by the Contractor under in writing such Completion Date as he considers to

39.6 Clau t apply in respect of:

39.6 a 1 w& for d k d h e k o n t r a c t o r is allowed daywork rates under clause 13.5-4;

d Suppliers shall be dealt with under any provision in relation thereto y be included in the appropriate sub-contract or contract of sale);

39.7 .2 the expressions ‘materials‘ and ‘goods’ include timber used in formwork but do not include other consumable stores, plant and machinery;

PW 139) 98 (03AXV 0 The Joint Contracts Tribunal Limited 2003 13

39.7 -3

39.7 *4

the expression 'workpeople' means persons whose rates of wages and other emoluments (including holiday credits) are governed by the rules or decisions or agreements of the Construction Industry Joint Council or some other wage-fixing body for trades associated with the building industry;

the expression 'wage-fixing body' shall mean a body which lays down recognised terms and conditions of workers. For the purposes of clause 39 'recognised terms and conditions' means terms and conditions of workers in comparable employment in the trade or industry, or section of trade or industry, in which the employer in question is engaged which have been settled by an agreement or award to which the parties are employers' associations and independent trade unions which

14 The Joint Contracts Tribunal Limited 2003 PW (39) 98 (03/03)


Deemed calculation of Contract Sum - rates of wages etc.


39

39.1


The Contract Sum shall be deemed to have been calculated i and shall be subject to adjustment in the events specified he

party insurance) is based upon the rates of wage expenses (including holiday credits) which will b respect of

adjacent to the site, and

who operate neither on nor ad so engaged

in accordance with:

to the extent that they are

ry Joint Council or other wage- s and which have been

ing Incentive Schemes and/or the aforesaid Council to which Rule 1.16

ivil Engineering Annual and Public Holidays reements to similar effect in respect of

Works and which have been promulgated at the Base Date;

to, the rates of wages and other emoluments and expenses (including edits) referred to herein.

said rates of wages or other emoluments and expenses (including its) are increased or decreased by reason of any alteration in the said ns or agreements promulgated after the Base Date, then the net

increase or decrease in wages or other emoluments and expenses day credits) together with the net amount of any consequential crease in the cost of employer's liability insurance, of third party of any contribution, levy or tax payable by a person in his capacity as hall, as the case may be, be paid to or allowed by the Contractor.

PWO 139) 98 (03#3) 0 The Joint Contracts Tribunal Limited 2003

. _. .

15


39.1 .3 There shall be added to the net amount paid to or allowed by the Contractor under clause 39.1.2, in respect of each person employed by the Contractor who is engaged upon or in connection with the Works either on or adjacent to the site and who is not within the definition of 'workpeople' in clause 39-7.3, the same amount as is payable or allowable in respect of a craftsman under clause 39.1.2 or such proportion of that amount as reflects the time (measured in whole working days) that each such person is so employed.

39.1 -4 For the purposes of clauses 39-1.3 and 39.2.3:

no period of less than 2 whole days in any week shall be taken into account and periods of less than a a whole working day;

the phrase "the same amount as is payable or allowa

clause 39.4 refers) under the rules or decisio Construction Industry Joint Council or other aforesaid rules or decisions or agreements wage, emolument or other expenses for a in respect of a craftsman employed as afor applicable; and

amendment or re-making thereof

Workpeople - 39.1 .5 The Contract Sum is based up0 wage-fixing body - reimbursement of fares the transport charges re

the Contractor and att either of the capacities referred

to in clause 9.1. -1 and VAT\ reimbursable by the Contractor to cities referred to in clauses 39.1.1.1

rules or decisions of the Construction applicable to the Works and which have or, in the case of workpeople so engaged

er emoluments and expenses are governed by the ge-fixing body other than the Construction

the rules or decisions of such other ave been promulgated as aforesaid.

ent of fares is increased or decreased by reason of any said rules or decisions promulgated after the Base Date or by

tual increase or decrease in fares which takes effect after the Base Date,

mount of that increase or decrease shall, as the case may be, be paid by the Contractor.

.

m shall be deemed to have been calculated in the manner set out below ject to adjustment in the events specified hereunder.

ct Sum is based upon the types and rates of contribution, levy and tax a person in his capacity as an employer and which at the Base Date are

actor. A type and a rate so payable are in clause 39.2.2 referred to as a 'tender type' and a 'tender rate'.

16 (0 The Joint Contracts Tribunal Limited 2003 PWO (39) 98 103/03)

39.2 -2

39.2 *3

39.2 .4

39.2 -5

39.2 -6

39.2 .7

If any of the tender rates other than a rate of levy payable by virtue of the Industrial Training Act 1964 is increased or decreased or if a tender type ceases to be payable or if a new type of contribution, levy or tax which is payable by a person in his capacity as an employer becomes payable after the Base Date, then in any such case the net amount of the difference between what the Contractor actually pays or will pay in respect of workpeople as referred to in clauses 39.1-1.1 and 39.1.1.2 or because of his employment of such workpeople and what he would have paid had the alteration, cessation or new type of contribution, levy or tax not become effective shall, as the case may be, be paid to or allowed by the Contractor.

There shall be added to the net amount paid to or allowed by the Contractor under clause 39.2.2, in respect of each person employed b upon or in connection with the Works either o not within the definition of 'workpeople' in cla payable or allowable in respect of a craftsman proportion of that amount as reflects the time (meas that each such person is so employed. The provisions clause 39.2.3.

The Contract Sum is based upon the types and r m & c & r i b u t i o n s ,

being in each case types and rates which at Contractor. Such a type and such a rate are type' and a 'tender rate'.

If any of the tender rates is increase payable or if a new type of r person in his capacity as an premium receivable by a pe after the Base Date, then in

if a tender type ceases to be or tax payable by a or if a new type of oyer becomes receivable

se of his employment of such the alteration, cessation or new all, as the case may be, be paid


aving persons in his employment.

yable by the Contractor in respect of .1.1.1 and 39.1.1.2 whose employment is

occupational pension scheme, by reference to membership of ent of workpeople is contracted-out employment, is established

Construction Industry Joint Council or of some other wage-fixing ibutions to such occupational pension scheme are within the

and allowance provisions of clause 39.1.

nces in clauses 39.2.1 to 39.2.5 and 39.2.7 to contributions, levies and rued as meaning all impositions payable by a person in his oyer howsoever they are described and whoever the recipient

imposed under or by virtue of an Act of Parliament and which affect the employer of having persons in his employment.

U

PWO 09) 98 f03/03) 0 The Joint Contracts Tribunal Limited 2003 17

Materials, goods, electricity and fuels

Sub-let work - incorporation of provisions to like effect

Sublet work - fluctuations - payment to or allowance by the Contractor


39.3 The Contract Sum shall be deemed to have been calculated in the manner set out below and shall be subject to adjustment in the events specified hereunder:

-1 The Contract Sum is based upon the market prices which were current at the Base Date of the materials, goods, electricity, fuels or any other solid, liquid or gas necessary for the execution of the Works, and upon the duty or tax payable at that Date on the disposal of waste from the site.

39.3

39.3 -2 If after the Base Date the market price of any of the above things increases or decreases, or the duty or tax on the disposal of waste from the site increases or decreases, then the net amount of the difference shall, as the case may be, be paid to or allowed by the Contractor.

-3 The references in clauses 39.3.1 and 39.3.2 to 'market p including any duty or tax (other than value added tax w of being treated, as input tax by the Contractor) by who payable under or by virtue of any Act of Parliament on th appropriation, processing, use or disposal of any of the t

39.3

39.3.1.

39.4 Fluctuations - work sub-let - Domestic Sub-Contra

in the subcontract provisions to the li

clause 39 (excluding clause Appendix pursuant to claus

which are applicable for the

red to in clause 39.4.1 is sub-contract by reason of the

39.5 to -7 Provisions re1

39.5 .1 The notice to the Architect of the occurrence of any of e following provisions as are applicable for the

to be given by clause 39.5-1 shall be given within a reasonable time after the occurrence of the event to which the notice relates and the giving of written notice in that time shall be a condition precedent to any payment being made to the Contractor in respect of the event in question.


39.5 -3 The Quantity Surveyor and the Contractor may agree what shall be deemed for all the purposes of this Contract to be the net amount payable to or allowable by the Contractor in respect of the occurrence of any event such as is referred to in any of the provisions listed in clause 39.5.1.

18 Q The Joint Contracts Tribunal Limited 2003 PWO (391 98 (03/03)


Evidence and computations by Contractor

No alteration to Contractots profit

Position whet Contractor in default over comoletion

39.5 .4 Any amount which from time to time becomes payable to or allowable by the Contractor by virtue of clauses 39.1 to -3 or clause 39.4 shall, as the case may be, be added to or deducted from:

-4 -1 the Contract Sum; and

.4 .2 any amounts payable to the Contractor and which are calculated in accordance with clause 28.4-3.1.

The addition or deduction to which clause 39.5.4 refers shall be subject to the provisions of clauses 39.56 to 5.7.

-5 As soon as is reasonably practicable the Contractor shall computations as the Architect or the Quantity enable the amount payable to or allowable by 39.1 to .3 or clause 39.4 to be ascertained; and in allowable by the Contractor under clause 39.1-3 (or c to or allowable by the Domestic Sub-Contractor under to the like effect as clauses 39.1.3 and 39.1.4) - such evidence shall include a certificate signe each week certifying the validity of the eviden such amounts.

39.5

39.5 .6 No addition to or deduction from of clause 39.5.4 shall alter in any way the amount

73 39.5 .7 Subject to the provisions of clause II be added or deducted in Certificate or in the Final

the event (as referred to in the payment or allowance

the computation of the amount st Certificate in respect of amou Contractor by virtue of clause the provisions listed in cla would be made occurs aft

39.5 .8 Clause 39.5.7

-8 .1 the printe ed and forms part of the Conditions;

ry written notification by the Contractor under iting such Completion Date as he considers to

Work etc. to which 39.6 Clauses 39.1 to

39.6 -1 rates under clause 13.5-4; clauses 39.1 to .4 not applicable

terials or goods supplied by any Nominated Sub-Contractor or (fluctuations in relation to Nominated Sub-Contractors and shall be dealt with under any provision in relation thereto d in the appropriate sub-contract or contract of sale);

e Contractor for which a tender made under clause 35.2 has tions in relation to such works shall be dealt with under any

in the accepted tender of the Contractor);

n the rate of value added tax charged on the supply of goods or services ontractor to the Employer under this Contract.

sion the 'Base Date' means the Date stated in the Appendix;

-2 the expressions 'materials' and 'goods' include timber used in formwork but do not include other consumable stores, plant and machinery;

.3 the expression 'workpeople' means persons whose rates of wages and other emoluments (including holiday credits) are governed by the rules or decisions or agreements of the Construction Industry Joint Council or some other wage-fixing body for trades associated with the building industry;

7

W O 139) 98 lOW03) CD The Joint Contracts Tribunal Limited 2003 19

. . . . -_ - .. - - . . ... - . . .

39-7 -4 the expression 'wage-fixing body' shall mean a body which lays down recognised terms and conditions of workers. For the purposes of clause 39 'recognised terms and conditions' means terms and conditions of workers in comparable employment in the trade or industry, or section of trade or industry, in which the employer in question is engaged which have been settled by an agreement or award to which the parties are employers' associations and independent trade unions which represent (generally, or in the district in question, as the case may be) a substantial proportion of the employers and of the workers in the trade, industry or section being workers of the description to which the agreement or award relates. '

39.8 Percentage addition to fluctuation payments or allowances

-1 -1 clause 39.1.2,

-1 -2 clause 39.1.3,

-1 -3 clause 39.1.6,

-1 -4 clause 39.2.2,

-1 -5 clause39.2.5,

-1 -6 clause 39.3.2

20 Q The Joint Contracts Tribunal Limited 2003 PWO 139) 98 (03%')


Deemed calculation of prices in the Contract Bills - rates of wages etc.

Clause 39 - For use with the Private Edition With Approximate Quantities

39

39.1


The prices in the Contract Bills shall be deemed to have been set out below and an adjustment shall be made in calculatin in the events specified hereunder.

39.1 -1 The prices (including the cost of employer's lia insurance) contained in the Contract Bills are b

-1 .1 workpeople engaged upon or in connecti adjacent to the site, and

production of materials or g who operate neither on nor so engaged

in accordance with:

e extent that they are

-1 -3 the rules ry Joint Council or other wage- s and which have been

y agreement under the provisions of ule (Productivity Incentive Schemes and/or les of the Construction Industry Joint Council

refers) or provisions on incentive schemes and/or ntained in the rules or decisions of some other

the rates or amounts of any contribution, levy or tax which will be payable ntractor in his capacity as an employer in respect of, or calculated by to, the rates of wages and other emoluments and expenses (including edits) referred to herein.

es of wages or other emoluments and expenses (including increased or decreased by reason of any alteration in the said

(including holiday credits) together with the net amount of any consequential increase or decrease in the cost of employer's liability insurance, of third party insurance and of any contribution, levy or tax payable by a person in his capacity as an employer shall, as the case may be, be paid to or allowed by the Contractor.

PWA 139) 98 (03D3) 0 The Joint Contracts Tribunal Limited 2003 21


39.1 .3 There shall be added to the net amount paid to or allowed by the Contractor under clause 39.1.2, in respect of each person employed by the Contractor who is engaged upon or in connection with the Works either on or adjacent to the site and who is not within the definition of 'workpeople' in clause 39.7.3, the same amount as is payable or allowable in respect of a craftsman under clause 39.1.2 or such proportion of that amount as reflects the time (measured in whole working days) that each such person is so employed.

39.1 .4 For the purposes of clauses 39.1.3 and 39.2.3

no period of less than 2 whole days in any week shall be taken into account and periods of less than a whole working day shall not be agg a whole working day;

the phrase "the same amount as is payable or allowa craftsman" shall refer to the amount in respect of a Contractor (or by any Domestic Sub-Contrac clause 39.4 refers) under the rules or decisio Construction Industry Joint Council or other aforesaid rules or decisions or agreements wage, emolument or other expenses for a in respect of a craftsman employed as afor applicable; and

Regulations), or any

Workpeople - 39.1 -5 The prices contained in the Cont wage-fixing body - reimbursement of fares

e capacities referred to in

ferred to in clauses 39.1.1.1 ions of the Construction the Works and which have

e-fixing body other than the Construction with the rules or decisions of such other ich have been promulgated as aforesaid.

ent of fares is increased or decreased by reason of any said rules or decisions promulgated after the Base Date or by

ual increase or decrease in fares which takes effect after the Base Date,

t amount of that increase or decrease shall, as the case may be, be paid ed by the Contractor.

ontract Bills shall be deemed to have been calculated in the manner an adjustment shall be made in calculating the Ascertained Final Sum ified hereunder.

The prices contained in the Contract Bills are based upon the types and rates of contribution, levy and tax payable by a person in his capacity as an employer and which at the Base Date are payable by the Contractor. A type and a rate so payable are in clause 39-22 referred to as a 'tender type' and a 'tender rate'.

22 0 The Joint Contracts Tribunal Limited 2003

~. . .

PWA (391 98 (03/03)

39.2 *2

39.2 -3

39.2 *4

39.2 -5

39.2 .6

39.2 -7

If any of the tender rates other than a rate of levy payable by virtue of the Industrial Training Act 1964 is increased or decreased or if a tender type ceases to be payable or if a new type of contribution, levy or tax which is payable by a person in his capacity as an employer becomes payable after the Base Date, then in any such case the net amount of the difference between what the Contractor actually pays or will pay in respect of workpeople as referred to in clauses 39.1.1.1 and 39.1.1.2 or because of his employment of such workpeople and what he would have paid had the alteration, cessation or new type of contribution, levy or tax not become effective shall, as the case may be, be paid to or allowed by the Contractor.

There shall be added to the net amount paid to or allowed by the Contractor under clause 39-2.2, in respect of each person employed by the

that each such person is so employed. The provisions of clause 39.2.3.

refund of the contributions, levies and an employer and upon the types and r capacity as an employer being in each

If any of the tender rates is i payable or if a new type of r

er type ceases to be

referred to in c of his employment of such alteration, cessation or new


avrng persons in his employment.

are payable by the Contractor in respect of ses 39.1.1.1 and 39.1.1-2 whose employment is in the meaning of the Pension Schemes Act 1993,

ubject to the proviso hereto, for the purpose of recovery or

cupational pension scheme, by reference to membership of of workpeople is contracted-out employment. is established truction Industry Joint Council or of some other wage-fixing

s an employer howsoever they are described and whoever the recipient posed under or by virtue of an Act of Parliament and which affect the

PWA (39) 98 (03/03) 0 The Joint Contraas Tribunal Limited 2003 23

Materials, goods, electricity and fuels

Sublet work - incorporation of provisions to like effect

Sublet work - fluctuations - payment to or allowance by the Contractor


39.3 The prices in the Contract Bills shall be deemed to have been calculated in the manner set out below and an adjustment shall be made in calculating the Ascertained Final Sum in the events specified hereunder:

39.3 .1

39.3 -2

39.3 -3

The prices contained in the Contract Bills are based upon the market prices which were current at the Base Date of the materials, goods, electricity, fuels or any other solid, liquid or gas necessary for the execution of the Works, and upon the duty or tax payable at that Date on the disposal of waste from' the site.

If after the Base Date the market price of any of the above things increases or decreases, or the duty or tax on the disposal of waste from the site increases or decreases, then the net amount of the difference shall, as the to or allowed by the Contractor.

The references in clauses 39.3.1 and 39.3.2 to 'market including any duty or tax (other than value added ta of being treated, as input tax by the Contractor) by w payable under or by virtue of any Act of Parliament o appropriation, processing, use or disposal of any m-3 of clause 39.3.1.

39.4 Fluctuations -work sub-let - Domestic Sub-Contradqrs c/ / 39.4 .1

39.4 *2

39.5 to -7

39.5 *1

-1

If the Contractor is obliged by clause 1 n u t o -3, or sha deci clause 19.2, to sub-let any portion of the Works in the sub-contract provisions to

ctor he shall incorporate sions of

tage stated in the clause 39 (excluding clause Appendix pursuant to cl

as referred to in clause 39.4.1 is in such sub-contract by reason of the then the net amount of such increase to or allowed by the Contractor under

n notice to the Architect of the occurrence of any of he following provisions as are applicable for the

Any notice required to be given by clause 39-5.1 shall be given within a reasonable time after the occurrence of the event to which the notice relates and the giving of written notice at that time shall be a condition precedent to any payment being made to the Contractor in respect of the event in question.

24 OThe Joint Contracts Tribunal Limited 2003 PWA 1391 98 103/031


39.5 .3 The Quantity Surveyor and the Contractor may agree what shall be deemed for all the purposes of this Contract to be the net amount payable to or allowable by the Contractor in respect of the occurrence of any event such as is referred to in any of the provisions listed in clause 39.5-1.

a4 Any amount which from time to time becomes payable to or allowable by the Contractor by virtue of clauses 39.1 to .3 or clause 39.4 shall be taken into account in

Fluctuations taken 39.5 into account in calculating the Ascertained Final calculating: Sum

-4 -1 the Ascertained Final Sum; and

-4 -2 any amounts payable to the Contractor and which with clause 28-4-31.

The calculation to which clause 39.5.4 refers shall be clauses 39.5.5 to .5.7.

Evidence and computations by Contractor

No alteration to Contractor's profit

Position where Contractor in default ovar completion

39.5 .5 As soon as is reasonably practicable the Contr computations as the Architect or the Quantity

allowable by the Contractor under cl to or allowable by the Domestic Sub contract to the like effect as clauses 3 workpeople -such evidence shall inc

sonably required to

39.5 -6 No calculation made by virtue profit of the Contractor due to Sum.

t shall be added or deducted in nterim Certificate or in the Final to or allowable by the Certificate in r

of which the payment or allowance

39.5 -8 Clause 39.5.

is unamended and forms part of the Conditions;

ect of every written notification by the Contractor under r confirmed in writing such Completion Date as he considers to with clause 25.

Work atc. to which 39.6 Chu t apply in respect of: clauses 39.1 to .4 not applicable

ontractor is allowed daywork rates under clause 13.5.4;

ted or materials or goods supplied by any Nominated Sub-Contractor or Supplier (fluctuations in relation to Nominated Sub-Contractors and Suppliers shall be dealt with under any provision in relation thereto

y be included in the appropriate sub-contract or contract of sale);

d by the Contractor for which a tender made under clause 35.2 has d (fluctuations in relation to such works shall be dealt with under any he accepted tender of the Contractor);

changes in the rate of value added tax charged on the supply of goods or services by the Contractor to the Employer under this Contract.

Definitions for with clause 39

39.7 -1 the expression the 'Base Date' means the Date stated in the Appendix;

39.7 -2 the expressions 'materials' and 'goods' include timber used in formwork but do not include other consumable stores, plant and machinery;

PWA (391 98 (OW31 0 The Joint Contracts Tribunal Limited 2003 25

39.7 -3 the expression 'workpeople' means persons whose rates of wages and other emoluments (including holiday credits) are governed by the rules or decisions or agreements of the Construction Industry Joint Council or some other wage-fixing body for trades associated with the building industry;

39.7 -4 the expression 'wage-fixing body' shall mean a body which lays down recognised terms and conditions of workers. For the purposes of clause 39 'recognised terms and conditions' means terms and conditions of workers in comparable employment in the trade or industry, or section of trade or industry, in which the employer in question is engaged which have been settled by an agreement or award to which the parties are employers' associations and independent trade unions which

39.8 Percentage addition to fluctuation payments or allowances

-1 -1 clause 39-1.2,

. I .2 clause 39.1.3,

-1 -3 clause 39.1.6,

.1 -4 clause 39.2.2,

e 1 4 clause 39.2.5,

.1 .6 clause 39.3.2

26 @The Joint Contracts Tribunal Limited 2003 PWA 139) 98 (03/031

... - .

Adjustment of Contract Sum - price adiustment formulae for building contracts - Formula Rules

Amendment to clause 30 - interim valuation8

Fluctuations - articles manufactured outside the United Kingdom


Clause 40 - For use with the Private Edition With Quantities

40

40.1 .1 -1 The Contract Sum shall be adjusted in accordance w 40 and the Formula Rules current at the Base Date is by the JCT (hereinafter ca!led the 'Formula Rules').

.2 Any adjustment under clause 40 shall be to s and nothing in clause 40 shall affect in any w the VAT Agreement.

Use of price adjustment formulae

-1

40.1

40.1

2 The Definitions in rule 3 of the Formula Rules s

-3 The adiustment referred to in clause 40 shall b payment issued under the provisions of R-

40.1 .4 If any correction of amounts of a included in previous certificates is required followin correction shall be given effect

Formula Rules, such ent to be issued.

40.2 Interim valuations shall be ma

deemed to have be

les applies the Contractor shall insert rice of the article in sterling (that is the

ses or decreases then the net amount of the the market price inserted in the aforesaid ractor and current when the article is

e construed as including any duty or tax (other or is capable of being treated, as input tax by

Power to agree - Quantity Surveyor and Contractor

whichever Part is

the determination of any adjustment payable by the Contractor to any sub-contractor.

PWl40198 lo;vo31 0 The Joint Contracts Tribunal Limited 2003 27

. . . . .

Position where Monthly Bulletins are delayed, etc.

40.6 -1 If at any dme prior to the issue of the Final Certificate under clause 30.8 formula adjustment is not possible because of delay in, or cessation of, the publication of the Monthly Bulletins, adjustment of the Contract Sum shall be made in each Interim Certificate during such period of delay on a fair and reasonable basis.

40.6 -2 If publication of the Monthly Bulletins is recommenced at any time prior to the issue of the Final Certificate under clause 30.8, the provisions of clause 40 and the Formula Rules shall apply for each Valuation Period as if no delay or cessation as aforesaid had occurred and the adjustment under clause 40 and the Formula Rules shall be substituted for any adjustment under clause 40.6.1.

40.6 .3 During any period of delay or cessation as aforesaid the Contra shall operate such parts of clause 40 and the Formula Rules amount of formula adjustment due to be readily calculated of publication of the Monthly Bulletins.

Formula adjustment - failure to complete

adjustment of the Contract Sum under Certificates issued after the aforesaid C

.1 .2 If for any reason the adjustment Certificate which is or has been i

40.7 .2 Clause 40.7.1 shall not be appli

s part of the Conditions; and

cation by the Contractor under pletion Date as he considers to

28 0 The Joint Contracts Tribunal Limited 2003 PW (40) 98 i03/03)

Adjustment of Contract Sum - price adjustment formulae for building contracts - Formula Rules



40

40.1 .1 -1 The Contract Sum shall be adjusted in accordance with t


40 and the Formula Rules current at the Base Date issu by the JCT (hereinafter called the 'Formula Rules') adjustment shall be made unless the Contract Doc to which rule 11 b of the Formula Rules refers.

-1 -2 Anv adiustment under clause 40 shall be to s - o k e A d e d tax and noihing in clause 40 shall affect in any v/ay JlGTperqdoppf cl&e 15 and

k "Ls)40 . 40.1 -2 The Definitions in rule 3 of the Formula Rules sh I appl o

the VAT Agreement.

40.1 -3 The adjustment referred to in clause 4 n - i f i c a t e s hall be for payment issued under the provisions

40.1 -4 If any correction of amounts of included in previous certificates is required followin correction shall be given effe

he Formula Rules, such payment to be issued.

Amendments to 40.2 -1 Interim valuati each Interim Certificate, and clause 30 -interim accordingly th iders them to be necessary" valuations

shall be deeme


40.2 -2 The Contractor shall pr n of the Schedule referred to in clause

40.3 For any article to in a list attached

e Formula Rules applies the Contractor shall insert ments the market price of the article in sterling

nt at the Base Date. If after that Date the oresaid list increases or decreases then the

ever payable under or by virtue of any Act of e, sale, appropriation or use of the article specified as

urveyor and the Contractor may agree any alteration to the methods and ascertaining the amount of formula adjustment to be made under clause ounts ascertained after the operation of such agreement shall be deemed ses of this Contract to be the amount of formula adjustment payable to he Contractor in respect of the provisions of clause 40. Provided always:

that no alteration to the methods and procedures shall be agreed as aforesaid unless it is reasonably expected that the amount of formula adjustment so ascertained will be the same or approximately the same as that ascertained in accordance with Part I or Part II of Section 2 of the Formula Rules whichever Part is stated to be applicable in the Contract Documents; and

40.5 -2 that any agreement under clause 40.5 shall not have any effect on the determination of any adjustment payable by the Contractor to any sub-contractor.

PWO (401 98 (OW3) OThe Joint Contracts Tribunal Limited 2003 29

Position where Monthly Bulletins

40.6 -1 If at any time prior to the issue of the Final Certificate under clause 30.8 formula adjustment is not possible because of delay in, or cessation of, the publication of the Monthly Bulletins, adjustment of the Contract Sum shall be made in each Interim Certificate during such period of delay on a fair and reasonable basis.

are delayed, etc.

40.6 .2 If publication of the Monthly Bulletins is recommenced at any time prior to the issue of the Final Certificate under clause 30.8, the provisions of clause 40 and the Formula Rules shall apply for each Valuation Period as if no delay or cessation as aforesaid had occurred and the adjustment under clause 40 and the Formula Rules shall be substituted for any adjustment under clause 40.6-1.

40.6 -3 During any period of delay or cessation as aforesaid the Cont

of publication of the Monthly Bulletins.

Formula 40.7 -1 .1 If the Contractor fails to complete the Works by adjustment - adjustment of the Contract Sum under clause 4 failure to complete

Date falls.

be corrected to comply with that clause.

40.7 -2 Clause 40.7.1 shall not be applied

part of the Conditions;

.2 -2 the Archit ification by the Contractor under pletion Date as he considers to

30 0 The Joint Contracts Tribunal Limited 2003

. . -- --

PWO (40) 98 (03#3)

Adjustment of Ascertained Final Sum -price adjustment formulae for building contracts - Formula Rules


Power to agree - Quantity Surveyor and Contractor


Clause 40 - For use with the Private Edition With Approximate Quantities

40

40.1 .1 .1 In calculating the Ascertained Final Sum adj accordance with the provisions of clause 40 the Base Date issued for use with clause 40 'Formula Rules').


.1 .2 Any adjustment under clause 40 shall be to and nothing in clause 40 shall affect in any the VAT Agreement.

40.1

40.1 -3 The adjustment referred to in clause 4 payment issued under the provisions

-2 The Definitions in rule 3 of the Formula Rules s

40.1 .4 If any correction of amounts of certificates is required followin correction shall be given effect

mula Rules, such

40.2 [Number not used1

40.3 For any article to wh in a list attached t o t

ies the Contractor shall insert e article in sterling (that is the

arket price inserted in the aforesaid and current when the article is

ted, or is capable of being treated, as input tax by under or by virtue of any Act of Parliament on or use of the article specified as aforesaid.

f formula adjustment to be made under clause operation of such agreement shall be deemed

nce with Part I or Part II of Section 2 of the Formula Rules whichever Part is

under clause 40.5 shall not have any effect on the determination any sub-contractor.

PWA 140) 98 103/031 Q The Joint Contracts Tribunal limited 2003 31

Position where Monthly Bulletins ere deleved, etc.

40.6 a1 If any time prior to the issue of the Final Certificate under clause 30.8 formula adjustment is not possible because of delay in, or cessation of, the publication of the Monthly Bulletins, adjustment shall be made in each Interim Certificate during such period of delay on a fair and reasonable basis.

40.6 -2 If publication of the Monthly Bulletins is recommenced at any time prior to the issue of the Final Certificate under clause 30.8, the provisions of clause 40 and the Formula Rules shall apply for each Valuation Period as if no delay or cessation as aforesaid had occurred and the adjustment under clause 40 and the Formula Rules shall be substituted for any adjustment under clause 40.6.1.

40.6 -3

Formula 40.7 -1 adjustment -failure to complete

.1

40.7 -2

.2

During any period of delay or cessation as aforesaid t shall operate such parts of clause 40 and the Formula amount of formula adjustment due to be readily calcu of publication of the Monthly Bulletins.

.1 If the Contractor fails to complete the Works adjustment under clause 40 shall be effected after the aforesaid Completion Date by refer applicable to the Valuation Period in wh

If for any reason the adjustment included Certificate which is or has been issued aft not in accordance with clause 40.7.1.1, s

-2

comply with that clause. n W Clause 40.7.1 shall not be applied unl ss’ !A\ .1 the printed text of clause part of the Conditions;

and

cation by the Contractor under pletion Date as he considers to

32 0 The Joint Contracts Tribunal Limited 2003 PWA (40) 98 103/03)

Fluctuation clauses: Private versions

This reprint incorporates the following amendments.

A Amendment 2. January ZOO0 Sundry arnendrnenta (Incorporated August2001)

1. clauw38 clauses 38.2.1 and 38.2.2 amended clauso 38.2.3 deleted clause 38.6.2 amended

2. Clause39 cleuses 39.3.1.39.3.2 and 39.3.3 amended clause 39.3.4 delated ,

clause 39.7,2 amended

Amendments 1. 3 and 4 did not affect the fluctuation cIau58s.

E Updating (incorporated Februery 2003)

1. Statutory rdsrencra Income tax end pension scheme references updated

0 The Joint Contracts Tribunal Limited 2003 FS:P 98 (OW03)

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I

For the purpose of inserting the relevant fluctuation clause after clause 37 in Part 3 of the Main Contract fin accordance with footnote [tt] to clause 371, the parties to the contract may take the clause from this booklet by extraction or photocopy. Fluctuations

Standard Form of Building Contract 1998 Edition incorporating Amendments 1 to 4

Fluctuation clauses for use with t Private versions

Published for the JCT by 1-3 Dufferin Street, Lond

@The Joint Contra

fssued by The Joint Contracts Tribunal Limited

Members Association of Consulting Engineers Limited British Property Federation Limited Construction Confederation Local Government Association National Specialist Contractors Council Limited Royal Institute of British Architects The Royal Institution of Chartered Surveyors The Scottish Building Contract Committee