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By Roelf Nel (Director) and Daniellé Giannico (Associate)
The JBCC Minor Works Agreement is intended to be used where the works are not complex and the intended construction period does not extend beyond nine (9) months. The JBCC Minor Works Agreement makes no provision for the appointment of Subcontractors.
This article is going to look at the three most important aspects when you are appointed on a JBCC Minor Works Agreement, namely, the role of the Principal Agent, how extensions of time claims work under the JBCC Minor Works Agreement, and where the major differences in the final account process lie.
Clause 6.0 – Principal Agent
Under the JBCC Nominated/Selected Subcontract Agreement (NSSA) the Contractor would be the bridge between the Subcontractor and the Principal Agent, in terms of the JBCC Minor Works Agreement, there is no bridge and you will be dealing directly with the Principal Agent. The Principal Agent in the Minor Works agreement takes a much more hands-on approach than would normally be the case in terms of the JBCC PBA and these duties are clearly defined in the agreement.
Under the JBCC Minor Works Agreement, the Principal Agent is not only responsible for administering the agreement, he has the further duty of ensuring that regular meetings take place between the Contractor and agents in order to monitor the progress of the works and to deal with any technical or coordination issues that arise. He is further responsible for issuing the contract information timeously and where the Contractor requires guidance as to the interpretation and direction of the standard of work and state of completion required it is the Principal Agent who must provide this guidance. Lastly, the Principal Agent has the standard duties of issuing final accounts, practical and final completion certificates, as well as interim and final payment certificates and adjusting the contract value and preparing the final account.
Clause 17.0 – Revision of the date for Practical Completion
The process for claiming a revision to the date for Practical Completion is similar to that in the PBA and the NSSA, with one crucial difference, there is no time bar for the submission of a notice of intention to claim for a delay.
In terms of the NSSA, you would be required to submit your notice of intention to claim for a delay within 15 working days from the date on which you became aware or ought reasonably to have become aware of the circumstances giving rise to the delay, failing which the Subcontractor forfeits his right to submit a claim. The PBA has a similar provision, albeit that the Contractor has a 20-working day period within which to notify of his intention to claim for a delay.
The process in terms of the Minor Works Agreement is contained in clause 17 thereof and provides that the Contractor is required to give notice at the next site meeting of the cause of such delay and the working days claimed and the expense and loss incurred where applicable. Importantly, the Minor Works Agreement does not state that where the Contractor fails to give notice accordingly he will forfeit his right to such a claim. This then creates the situation that even if the notice is not submitted at the next site meeting, you will still be entitled to claim for the revision to the date for Practical Completion with or without an adjustment to the contract value, provided that you are entitled to do so in terms of the agreement.
It must be highlighted that a notice is a defined term in the JBCC suite of agreements and despite it seeming that the submission the required notice at a site meeting would be a somewhat informal procedure, the notice must still be in writing for it to be proper notice in terms of the agreement.
Clause 20.0 – Adjustment to the Contract Value and Final Account
In terms of the JBCC Minor Works Agreement, the Principal Agent is required to determine the value of adjustments to the contract value in cooperation with the Contractor in the preparation of the Final Account. The basic make up of this clause remains the same across the three JBCC contracts under consideration in this article, it is only in the NSSA that the Principal Agent must determine the value of the adjustments to the subcontract value in cooperation with both the Contractor and the Subcontractor.
Under the JBCC Minor Works Agreement, the Principal Agent shall prepare and issue the final account to the Contractor within thirty (30) working days of the date for Practical Completion. Whereafter the Contractor is required to accept the final account or object with substantiated reasons within fifteen (15) working days receipt thereof, failing which the final account shall be deemed accepted. The contract thereafter provides for a period of 10 working days within which to resolve any objections made to the final account, failing which the Contractor will have the right to issue a notice of disagreement and continue in terms of the dispute resolution clause.
The main difference between the Minor Works Agreement, the PBA, and the NSSA is most apparent in the time periods allowed for in the various contracts under the final account clause. In terms of the PBA, the Principal Agent shall issue the final account within sixty (60) days of the date for Practical Completion and the Contractor will have thirty (30) working days within which to object thereto. In terms of the NSSA, the Principal Agent will have thirty (30) working days within which to issue the subcontract final account, and the Subcontractor will have twenty (20) working days within which to object thereto.
The JBCC Minor Works agreement requires the principal agent to take a very active role in the day to day administration of the contract. If you are appointed on a JBCC Minor Works Agreement make sure that you engage with the principal agent regularly during the execution of the works.