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The Joint Building Contracts Committee® - NPC

Principal Building Agreement
Edition 6.2 – June 2024
JBCC®
The Joint Building Contracts Committee® NPC (JBCC®) is representative of building owners and developers, professional
consultants and general and specialist contractors who contribute their knowledge and experience to the compilation of
the JBCC® documents. The JBCC® documents portray the consensus view of the constituent members and are published
in the interests of standardisation and good practice with an equitable distribution of contractual risk

For more information about the JBCC®, frequently asked questions, where documents may be purchased as well as
training courses visit www.jbcc.co.za. The JBCC® does not sell directly to users but may be contacted at info@jbcc.co.za

Principal Building Agreement structure

The agreement clauses follow the project execution sequence. The documents aim to set out clear, balanced and
enforceable procedures, rights and obligations which, when competently managed and administered, protect the
employer, contractor and subcontractors alike. The following additional documents form part of the suite of contract
agreements

• The JBCC® Principal Building Agreement - Contract Data that incorporates specific employer and contractor
requirements;

• The JBCC® General Preliminaries that generally covers all aspects of preliminaries for most types of projects;

• The JBCC® Nominated/Selected Subcontract Agreement that replicates the JBCC® Principal Building Agreement
with common clauses retaining the same numbering; and

• A comprehensive set of certificate forms and support documents for use in the administration of the agreement

Warning!
The JBCC® Principal Building Agreement Edition 6.2 has been coordinated with the JBCC® Nominated/Selected
Subcontract Agreement Edition 6.2, the JBCC® General Prelimnaries and the JBCC® certificate forms and support
documents. Forms from previous editions are not compatible with the JBCC® Principal Building Agreement Edition 6.2

This contract ought not to be used where interim payments would be required. In that instance, a different JBCC contract
ought to be used (refer to JBCC Quick Guide)

Persons entering into or preparing contracts using the JBCC® suite of contract agreements and support documents are
warned of the dangers inherent in modifying any part of it

Experience has shown that changes drafted by others, including members of the building professions, often have
unintended results that may be prejudicial to either, or both, parties

This contract ought not to be used where interim payments would be required. In that instance, a different JBCC contract
ought to be used (refer to JBCC Quick Guide)

Disclaimer
While the JBCC® aims to ensure that its publications represent best practice, it does not accept or assume any liability or
responsibility for any events or consequences which derive from the use of the JBCC® documents

Copyright reserved
The name ‘The Joint Building Contracts Committee® NPC’, the abbreviation JBCC®, the electronic version e-JBCC® and
the JBCC® logo are registered trademarks. The JBCC® claims authorship of this work. All rights are reserved. No part of
this publication may be reproduced, stored in any retrieval system or transmitted in any form or by any means, electronic,
mechanical, photocopying, scanning, recording, or otherwise, without the prior permission in writing of the JBCC®

Unauthorised reproduction of the work is an infringement of the copyright. Judicial proceedings can and will be instituted
to obtain relief and recovery of damages

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Actions by the parties / principal agent within a given time

Clause Time period Party Purpose

2.4 1WD-7 CD parties or principal agent notices deemed to be received

6.4 5 WD contractor > principal agent non-performance of an agent i.t.o. this agreement
6.5 10 WD employer appoint another agent/contractor may object
10.6 10 WD notice contractor > employer failure to insure - notice – insure + recover expense
11.1 15 WD contractor provide guarantee for construction
11.2.1 20 WD contractor replace securities
11.5.1-2 15/20 WD employer provide / replace guarantee for payment
11.6 10 WD notice contractor > employer no security, contractor notice to suspend works
11.8 10 WD parties return original/replacement security forms
12.2.2 15 WD contractor submit priced document
12.2.6 15 WD contractor submit programme
14.4.2 15 WD guarantee contractor > subcontractor provide guarantee for payment to nominated subcontractor
14.5 5 WD proof payment employer (principal agent) pay nominated subcontractor on default by contractor
14.6 5 WD notice contractor + subcontractor termination of subcontractor appointment on default
15.4.2 15 WD guarantee contractor > subcontractor provide guarantee for payment to selected subcontractor
15.5 5 WD proof payment employer (principal agent) pay selected subcontractor on default by contractor
17.3 5 WD contractor proceed with a contract instruction, where practical
19.2.2 5 WD contractor > principal agent works ready for inspection
19.4 5+5 WD contractor > principal agent no ‘list’ > notice > deemed practically complete
19.6 5+agreed WD principal agent > contractor employer occupies portion of the works, list for completion, fix defects
21.3.1 10 WD contractor inspect before expiry of defects liability period
21.3.2 5 WD contractor > principal agent invite PA to inspect list for completion
21.5 5 WD notice contractor > principal agent inspect > list for final completion > certificate
21.6 10 WD notice principal agent > contractor no list for final completion > notice > complete
21.7.3 5 WD notice principal agent > contractor inspect > list for final completion > certificate
21.9 5+5 WD contractor > principal agent no list for final completion / deemed final completion
23.4.2* 20 WD notice contractor > principal agent notice of a possible delay, no details yet
23.5 40 WD claim contractor > principal agent delay ceased, details of delay and expenses
23.7 20 WD award principal agent > contractor assess claim – accept/reduce/reject
25.2 date [CD] principal agent > contr/empl issue payment certificate and support forms
25.10 14 CD payment employer pay contractor make payment from date of payment certificate
25.11 21 CD contractor pay employer make payment i.t.o. schedule from principal agent
25.13 7 CD payment contractor pay subcontractor pay subcontractors i.t.o. schedule from principal agent
25.14 5 WD notice contractor > employer no/partial payment > suspend etc
25.15 7 CD payment principal agent > contractor final payment certificate after acceptance of final account
26.5* 20 WD notice contractor > principal agent notice of possible expense and loss
26.6 40 WD claim contractor > principal agent substantiated claim
26.7 20 WD award principal agent > contractor assess claim = accept/reduce/reject
26.10 60 WD issue FA principal agent > contractor issue final account
26.11 30 WD accept FA contractor > principal agent accept final account
26.12 10 WD notice contractor + principal agent agree final account or deemed acceptance
27.2.9 5 WD notice notice to contractor remedy default before next recovery statement
28.1 10 WD notice contractor > employer list of defaults to be remedied > suspend works
28.2 notice contractor > employer suspension of works where defaults not remedied
29.2 10 WD employer > contractor intention to terminate if defaults not remedied
29.3 notice employer > contractor default not remedied, termination forthwith
29.14 notice contractor > employer intention to terminate if guarantee for payment not provided/maintained
29.15 10 WD notice contractor > employer intention to terminate if defaults not remedied
29.16 forthwith contractor > employer default not remedied, termination forthwith
29.17.1 forthwith contractor > subcontractor termination where PBA terminated
29.17.2 10 WD notice contractor remove construction equipment, temporary works, etc
29.21 10 WD either party intention to terminate > impossible to complete
29.24.3 10 WD contractor remove construction equipment
29.25.2 20 WD principal agent prepare status report
29.25.4 60 WD principal agent complete final account
30.2 10 WD either party disagreement not resolved > dispute
30.3 10 WD aggrieved party refer to adjudication
30.6.4 10 WD aggrieved party dissatisfied with adjudication
30.6.5 10 WD aggrieved party no adjudication/not accept adjudication ruling > arbitration

Abbreviations: WD = working days CD = calendar days, *No notice, forfeits the opportunity to claim

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SCHEDULE OF CHANGES TO PREVIOUS EDITION

Legend
New A clause has been added The clause has been renumbered
Amended The clause has been changed 10.2/7 The sequence of the clause 10.2 to 10.7
Deleted The clause has been removed No clause No retained or inserted to avoid
renumbering or provide alternatives
Redrafted The clause has been reworded
[] Clause reference has been added or
changed

Clause Revision
3.1 Redrafted
3.3 Redrafted
25.14 Redrafted

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PRINCIPAL BUILDING AGREEMENT

TABLE OF CONTENTS

Section Clause No Description Page

INTERPRETATION 1.0 Definitions and interpretation 2

2.0 Law, regulations and notices 5
3.0 Offer and acceptance 5
4.0 Cession and assignment 6
5.0 Documents 6
6.0 Employer’s agents 6
7.0 Design responsibility 7

INSURANCES AND SECURITIES 8.0 Works risk 7

9.0 Indemnities 8
10.0 Insurances 8
11.0 Securities 9

EXECUTION 12.0 Obligations of the parties 10

13.0 Setting out 12
14.0 Nominated subcontractors 12
15.0 Selected subcontractors 14
16.0 Direct contractors 15
17.0 Contract instructions 15

COMPLETION 18.0 (Interim completion = n/s subcontract agreement) 16

19.0 Practical completion 16
20.0 Completion in sections 17
21.0 Defects liability period and final completion 17
22.0 Latent defects liability period 18
23.0 Revision of the date for practical completion 19
24.0 Penalty for late or non-completion 20

PAYMENT 25.0 Payment 21

26.0 Adjustment of the contract value and final account 22
27.0 Recovery of expense and/or loss 23

SUSPENSION AND TERMINATION 28.0 Suspension by the contractor 25

29.0 Termination 25

DISPUTE RESOLUTION 30.0 Dispute resolution 27

AGREEMENT Agreement 30

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INTERPRETATION

1.0 DEFINITIONS and INTERPRETATION

1.1 Definitions
A word or phrase in bold type in this agreement shall have the meaning assigned to it in these definitions
A word or phrase not in bold type shall be interpreted in the context of its usage

AGENT: An entity [CD] appointed by the employer to deal with specific aspects of the works

AGREEMENT: The completed JBCC® Principal Building Agreement and JBCC® contract data, the contract
drawings, the priced document and any other documents reduced to writing and signed by the authorised
representatives of the parties

BILLS OF QUANTITIES: The document drawn up in accordance with the measuring system [CD]

BUDGETARY ALLOWANCE: An amount included in the contract sum for work intended for execution by
the contractor, the extent of which is identified but not detailed

CALENDAR DAYS: Twenty-four (24) hour days commencing at midnight (00:00) which include Saturdays,
Sundays, proclaimed public holidays and recorded contractor’s annual holiday periods [CD]

CERTIFICATE OF FINAL COMPLETION: A certificate issued by the principal agent to the contractor with
a copy to the employer stating the date on which final completion of the works, or of a section thereof, was
achieved

CERTIFICATE OF PRACTICAL COMPLETION: A certificate issued by the principal agent to the contractor
with a copy to the employer stating the date on which practical completion of the works, or of a section
thereof, was achieved

COMPENSATORY INTEREST: Interest due to the contractor at the ruling rate of interest on amounts
certified after thirty-one (31) calendar days of the date of practical completion, compounded monthly until
the date of payment

CONSTRUCTION EQUIPMENT: Equipment and/or plant provided by or belonging to the contractor and/or
subcontractors and used during the construction period

CONSTRUCTION INFORMATION: All information issued by the principal agent and/or agents including this
agreement, specifications, drawings, schedules, notices and contract instructions required for the execution
of the works

CONSTRUCTION PERIOD: The period commencing on the intended date [CD] of possession of the site by
the contractor and ending on the date of practical completion

CONTRACT DATA: The document listing the project specific information

[CD]: The notation used where project specific information is recorded in the contract data

CONTRACT DRAWINGS: The drawings listed [CD]

CONTRACT INSTRUCTION: A written instruction issued by or under the authority of the principal agent to
the contractor that may include drawings, photographs and other construction information

CONTRACT SUM: The accepted tender amount inclusive of tax [CD], not subject to adjustment

CONTRACT VALUE: A monetary value initially equal to the contract sum, subject to adjustment in terms of
this agreement
CONTRACTOR: The party [CD] contracting with the employer for the execution of the works

DEFAULT INTEREST: Interest at six (6) percentage points per annum above the ruling rate of interest where
payment has not been received within the stipulated period, compounded monthly from the due date for
payment until the date of payment

DEFECT: Any aspect of materials and workmanship forming part of the works that does not conform to the
agreement and/or construction information

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DIRECT CONTRACTOR: An entity appointed under separate agreement by the employer to do work on site
prior to practical completion [CD]

EMPLOYER: The party [CD] contracting with the contractor

FINAL ACCOUNT: The document prepared by the principal agent that reflects the final contract value of
the works at final completion or termination

FINAL COMPLETION: The stage of completion as certified by the principal agent where the works, or a
section thereof, has been completed and is free of defects

FINAL PAYMENT CERTIFICATE: The certificate issued by the principal agent after the issue of the
certificate of final completion and after the final account has been agreed

FORCE MAJEURE: An exceptional event or circumstance that:

• Could not have been reasonably foreseen
• Is beyond the control of the parties, and
• Could not reasonably have been avoided or overcome

Such an event may include but is not limited to:

• Acts of war (declared or not), invasion and/or hostile acts of foreign enemies
• Insurrection, rebellion, revolution, military or usurped power and terrorism
• Civil commotion, disorder, riots, strike, lockout by persons other than the contractor’s employees or
his subcontractors
• Sonic shock waves caused by aircraft or other aerial devices and ionising or radioactive contamination
• Explosive materials, except where attributable to the contractor’s use of such technology
• Natural catastrophes including earthquakes, floods, hurricanes or volcanic activity

FREE ISSUE: Materials and goods provided at no cost to the contractor by the employer for inclusion
in the works [CD]

GUARANTEE FOR ADVANCE PAYMENT: A security in terms of the JBCC® Guarantee for Advance
Payment form, obtained by the contractor from an institution approved by the employer
GUARANTEE FOR CONSTRUCTION: A security in terms of the JBCC® Guarantee for Construction form,
obtained by the contractor from an institution approved by the employer [CD]
GUARANTEE FOR PAYMENT: A security in terms of the JBCC® Guarantee for Payment form, obtained by
the employer from an institution approved by the contractor [CD]

INTEREST: The bank rate applicable from time to time to registered banks borrowing money from the Central
or Reserve Bank of the country [CD]. The ruling bank rate on the first calendar day of each month shall be
used in calculating the interest due for such month
JBCC®: The Joint Building Contracts Committee® NPC
LATENT DEFECT: A defect that an inspection of the works by the principal agent and/or agents would not
reasonably have revealed
LAW: The law of the country [CD]
LIST FOR COMPLETION: A list that may include marked up drawings and photographs issued by the
principal agent where practical completion has been certified, listing defects and/or outstanding work to
be completed
LIST FOR FINAL COMPLETION: A list for completion that may include marked up drawings and
photographs issued by the principal agent after the inspection of the works for final completion, where final
completion has not been achieved, listing defects and/or outstanding work to be completed to achieve final
completion

LIST FOR PRACTICAL COMPLETION: A comprehensive and conclusive list that may include marked up
drawings and photographs issued by the principal agent after the inspection of the works for practical
completion, where practical completion has not been achieved, listing the defects and/or outstanding work
to be completed to achieve practical completion

MATERIALS AND GOODS: Unfixed materials, goods and/or items fabricated for inclusion in the works
whether stored on or off the site or in transit
NOTICE: A written communication, excluding social media, issued by either party, the principal agent and/or
agents to the other party, the principal agent and/or agents to, inter alia, record an event, request outstanding
construction information, or where suspension or resumption of the works and/or termination of this
agreement is contemplated

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N/S SUBCONTRACT AGREEMENT: The completed JBCC® Nominated/Selected Subcontract Agreement

(NSSA) and JBCC® NSSA contract data, the subcontract drawings, the subcontact priced document and
any other documents reduced to writing and signed by the authorised representatives of the contractor and
of the subcontractor
PARTY: The employer or the contractor and ‘parties’ shall refer to both of them
PAYMENT CERTIFICATE: A certificate issued at regular agreed intervals [CD] by the principal agent to the
parties certifying the amount due and payable in terms of the JBCC® Payment Certificate format
PENALTY: The stipulated amount per calendar day [CD] payable by the contractor to the employer where
the date or the revised date for practical completion, whichever is the later, has not been met
PRACTICAL COMPLETION: The stage of completion as certified by the principal agent where the works,
or a section thereof, has been completed and is free of patent defects other than minor defects identified in
the list for completion and can be used for the intended purpose [CD]
PRELIMINARIES: The JBCC® General Preliminaries and/or the items listed in the preliminaries section of
the priced document
PRICED DOCUMENT: The document incorporating quantities and/or rates used in the compilation of the
contract sum such as bills of quantities, preliminaries and schedules of rates
PRIME COST AMOUNT: An amount included in the contract sum for the delivered cost of materials and
goods obtained from a supplier as instructed by the principal agent
PRINCIPAL AGENT: The entity [CD] appointed by the employer with full authority and obligation to act in
terms of this agreement
PROGRAMME: A diagrammatic representation of the planned execution of units of work or activities by the
contractor and subcontractors indicating the dates for commencement and completion prepared and
maintained by the contractor
PROVISIONAL SUM: An amount included in the contract sum for the supply and installation of work by a
subcontractor
RECOVERY STATEMENT: The statement prepared and issued in conjunction with each payment certificate
by the principal agent in terms of the JBCC® Recovery Statement format
SECTION: An identified portion of the works for which practical completion is required by a date earlier than
that required for the works as a whole [CD]
SECURITY: A monetary guarantee [CD] provided by the employer to the contractor, or vice versa, in terms
of this agreement from which either party may recover expense and loss in the event of default
SITE: The land or place where the works is to be executed [CD]
STATUS REPORT: A report compiled by the principal agent and/or agents in the event of termination of the
agreement, or where the works has been suspended due to a force majeure event, or in the event of
termination of a n/s subcontract agreement by the contractor, to record the state of completion or otherwise
of the works or the n/s subcontract works. Such status report may include marked up drawings and
photographs
SUBCONTRACTOR: A nominated or a selected subcontractor appointed in terms of the n/s subcontract
agreement by the contractor in accordance with a contract instruction for the supply and installation of
work for which a provisional sum has been included in the contract sum
SUSPENSION: The temporary cessation of the works by the contractor
TAX: Value-added tax, general sales tax or similar consumption tax applicable by law
WORKING DAYS: Calendar days which exclude Saturdays, Sundays, proclaimed public holidays and
recorded contractor’s annual holiday periods [CD]
WORKS: The extent of work to be executed by the contractor described in the agreement and contract
instructions, which includes free issue and materials and goods. Work or installations to be executed by
direct contractors and others responsible to the employer are excluded [CD]

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1.2 Interpretation

1.2.1 In this document, unless inconsistent with the context, the words “accept, allow, appoint, approve, authorise,
certify, decide, demand, designate, grant, inform, instruct, issue, list, notice, notify, object, record,
reduce, refuse, request, state” and their derivatives require such acts to be in writing

1.2.2 The masculine gender includes the feminine and neuter genders and vice versa, the singular includes the
plural and vice versa and a person includes juristic or artificial persons

1.2.3 The headings of clauses are for information only and shall not be used in interpretation

1.2.4 Reference to a clause number written as clause [54.3.2] means that specific clause; or clause [54.3.2-4] means
sub-clauses 2 to 4 inclusively; or clause [54.3.2 & 4] means sub-clauses 2 and 4 only

1.2.5 The word “deemed” shall be conclusive that something is fact, regardless of the objective truth

2.0 LAW, REGULATIONS AND NOTICES

2.1 The contractor shall comply with the law [CD], obtain permits, licences and approvals required and pay
related charges for the execution of the works [17.1.4]. The employer shall comply with the law [CD], obtain
permits, planning, building or similar permissions and pay charges for the works other than those which are
the responsibility of the contractor [26.4.1]

2.2 All communication or notices between the parties shall be in the language of this agreement and in a format
that can be read, copied and recorded

2.3 Legal processes arising out of or concerning this agreement may validly be delivered to and served on the
parties at the physical address of the parties recorded in this agreement. Either party may, at any time, by
notice to the other, change his physical address provided it is in the same country as the original address

2.4 Notices given in terms of this agreement shall be deemed to have been received where:

2.4.1 Delivered by hand - on the day of delivery

2.4.2 Sent by electronic mail, excluding social media - within one (1) working day

2.4.3 Sent by registered post - within seven (7) calendar days after posting

3.0 OFFER AND ACCEPTANCE

3.1 The objective of this principal building agreement is the execution of and payment for the contractors
works for which there has been an offer by one party and acceptance by the other party

3.2 The currency applicable to this agreement is as recorded [CD]

3.3 This principal building agreement shall come into force on the date of acceptance of the offer [3.1] and
continue to be of force and effect until the end of the latent defects liability period [22.0] or the certification of
final completion [21.0] and final payment [25.0]

3.4 Should any provision of this agreement be unenforceable the parties shall act in good faith to agree alternative
provisions in terms of this agreement

3.5 Failure or omission by a party to enforce any provision of this agreement shall not constitute a waiver of such
provision or affect such party’s rights to require the performance of such provision in the future

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4.0 CESSION AND ASSIGNMENT

4.1 Neither party shall cede rights or assign rights and obligations under this agreement without the prior written
consent of the other party, which consent shall not be unreasonably withheld

4.2 The contractor shall not consent to a nominated subcontractor ceding rights or assigning rights and
obligations under this agreement without obtaining the prior written consent of the principal agent
4.3 Notwithstanding the above, where a party cedes any right to any monies due or to become due under this
agreement as security in favour of a financial institution, consent shall not be required provided notice of such
cession is timeously given to the other party

5.0 DOCUMENTS

5.1 Documents referred to in this agreement shall mean the current edition thereof with all amendments thereto
as at the date of submission of the contractor’s tender

5.2 The parties shall sign the original agreement and shall each be issued with a copy thereof by the principal
agent. The original signed agreement shall be held by the principal agent [CD]

5.3 Persons authorised to act on behalf of the parties and/or agents appointed by the employer shall be identified
in the construction information. Such authorised persons may be changed by notice to the other party

5.4 The priced document shall not be used as a specification of materials and goods or methods

5.5 The content of this agreement shall not be published or disclosed or used for any purpose other than that
specified in this agreement by one party without the prior written consent of the other party

5.6 The principal agent and/or agents shall timeously provide the number of copies [CD] of drawings, un-priced
bills of quantities and other construction information at no cost to the contractor

6.0 EMPLOYER’S AGENTS

6.1 The employer warrants that the principal agent has full authority and obligation to act on behalf of and bind
the employer in terms of this agreement. The principal agent has no authority to amend this agreement

6.2 The employer may appoint agents to deal with specific aspects of the works in terms of this agreement [CD].
The principal agent shall give notice to the contractor where such authority is delegated to agents to issue
contract instructions and perform duties for specific aspects of the works. An agent appointed in terms of
this clause shall not be entitled to subdelegate his authority without the prior written consent of the employer
and notice to the contractor

6.3 The principal agent and/or agents shall declare any interest or involvement in the works other than a
professional interest, where applicable [CD]

6.4 Where the principal agent fails to act in terms of this agreement and/or an agent fails to act in terms of
delegated authority, the contractor shall give notice to the principal agent, with a copy to the employer, to
rectify such default within five (5) working days. Where such default has not been rectified, the contractor
may give notice to suspend the works [28.0]

6.5 Where the principal agent and/or an agent fails to act or is unable to act or ceases to be the principal agent
or an agent in terms of this agreement, the employer shall appoint another principal agent and/or an agent
within ten (10) working days of the date of such notice from the contractor. The employer shall not appoint
a principal agent and/or an agent against whom the contractor makes reasonable objection within five (5)
working days of receipt of notice of intention to make such an appointment

6.6 The employer shall not interfere with or prevent the principal agent and/or agents from exercising fair and
reasonable judgement when performing their obligations in terms of this agreement

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7.0 DESIGN RESPONSIBILITY

7.1 The contractor shall not be responsible for the design of the works other than the contractor’s and
subcontractors’ temporary works. The contractor shall not be responsible for the coordination of design
elements

7.2 Any design responsibility undertaken by a subcontractor shall not devolve on the contractor. All contractual
or other rights the contractor has against such subcontractor arising from any design responsibility undertaken
shall be ceded to the employer on the date of final completion or the date of termination of this agreement
[9.2.3]

7.3 The contractor shall be responsible for the timeous submission of design documentation by a selected
subcontractor for acceptance and coordination by the principal agent and/or agents [23.2.8]

INSURANCES AND SECURITIES

8.0 WORKS RISK

8 .1 The contractor shall take full responsibility for the works from the date on which possession of the site is
given to the contractor and up to the date of issue of the certificate of practical completion or deemed
achievement of practical completion for the works as a whole, or a section thereof. Thereafter responsibility
for the works as a whole, or a section thereof, shall pass to the employer

8.2 The contractor shall make good physical loss and repair damage to the works caused by or arising from:

8.2.1 Any cause before the date of practical completion [19.0]

8.2.2 Any act or omission of the contractor in the course of any work carried out in pursuance of the
contractor’s obligations after the date of practical completion

8.3 The liability of the contractor in respect of any loss or damage shall include, but not be limited to:

8.3.1 The cost of making good such physical loss and repairing damage to the works including clearing away
and removing all debris and any other costs to reinstate the works

8.3.2 The new replacement value of free issue [12.1.10]

8.3.3 The cost of additional professional services

8.4 Notwithstanding subclause 8.3, the limit of the contractor’s liability shall not exceed the amount of the contract
works insurance [10.1.1] [CD]

8.5 The contractor shall not be liable for the cost of making good physical loss and repairing damage to the works
caused by or arising from:
8.5.1 The use or occupation of any part of the works by the employer, the employer's employees and/or
agents and those for whose actions they are responsible

8.5.2 An act or omission of the employer, the employer's employees and/or an agent and those for whose
actions they are responsible

8.5.3 An act or omission by a direct contractor

8.5.4 The use or occupation of any part of the works by a direct contractor

8.5.5 The design of the works for which the contractor is not responsible [7.1]

8.5.6 A defect in free issue or materials and goods specified by trade name where the contractor has
no right of substitution. The contractor hereby cedes any right of action to the employer that may
exist against the supplier and/or manufacturer of such free issue and/or materials and goods

8.5.7 Force majeure

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8.6 Where the contractor is not liable for the cost of making good physical loss or repairing damage [8.5] such
making good and/or expense and/or loss shall be measured and valued and included in the contract value
by the principal agent [17.1.10]

8.7 The contractor shall immediately give notice to the principal agent on becoming aware of physical loss or
damage to the works

9.0 INDEMNITIES
9.1 The contractor indemnifies and holds harmless the employer, the employer's employees and/or agents
from all claims or proceedings for damages, expense and/or loss including legal fees and expenses in respect
of or arising from:

9.1.1 Death or bodily injury or illness of any person or physical loss or damage to any property other than
the works arising out of or due to the execution of the works or presence on and/or occupation of the
site by the contractor. Should such an event occur, the contractor shall forthwith give notice to the
principal agent

9.1.2 Non-compliance by the contractor with the law, regulation or bylaw of any local or other authority and
the failure by the contractor to obtain any permit, licence or approval that the contractor is required to
obtain in terms of this agreement [2.1]

9.1.3 Physical loss or damage to construction equipment or other property belonging to the contractor or
the contractor’s subcontractors but excluding direct contractors’ equipment or property

9.2 The employer indemnifies and holds the contractor harmless from all claims or proceedings for damages,
expense and/or loss, including legal fees and expenses, in respect of or arising from:

9.2.1 An act or omission of the employer, the employer's employees and/or agents and those for whose
actions they are responsible

9.2.2 An act or omission of a direct contractor [16.0]

9.2.3 Design of the works [7.2] where the contractor is not responsible for such design

9.2.4 The use or occupation of any part of the works by the employer, tenants, direct contractors or others
authorised by the employer

9.2.5 Proceeding with the works on instruction from the employer without the employer obtaining the
required permission under the law in terms of this agreement [2.1]

9.2.6 Interference with any servitude or other right not recorded in construction information issued to the
contractor that is the unavoidable result of the execution of the works including the removal of or
weakening of or interference with the support of land and property adjacent to or within the site unless
resulting from any negligent act or omission by the contractor or his subcontractors. Should such an
event occur, the contractor shall forthwith give notice to the principal agent

9.2.7 Physical loss or damage to an existing structure and the contents thereof where this agreement is for
alterations or additions to an existing structure. Should such an event occur, the contractor shall
forthwith give notice to the principal agent

9.2.8 A defect in free issue

9.2.9 Physical loss or damage to the works where a certificate of practical completion has been issued
[19.0] or practical completion has been deemed to have been achieved

9.2.10 Advance payments certified by the principal agent and paid by the contractor to subcontractors
[27.1.8; 27.2.4]

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10.0 INSURANCES
10.1 The party responsible shall effect and keep the respective insurances [CD] in force in the joint names of the
parties from the date of possession of the site until the issue of the certificate of practical completion with
an extension to cover the contractor’s obligations after the date of practical completion [8.2.2]:

10.1.1 Contract works insurance [CD] for the works that shall make provision for direct contractors [CD], free
free issue [CD], materials and goods, professional fees, temporary works, clearing away and removing
of all debris and any other costs to reinstate the works and where required, damage to employer owned
surrounding property [CD] where not covered under the removal of lateral support insurance

10.1.2 Supplementary insurance [CD] for the works against loss or damage caused by civil commotion, riot,
strike, labour disturbance and lockout to the extent not insured under the contract works insurance

10.1.3 Public liability insurance [CD] providing indemnity in respect of accidental death or injury to any person
and accidental loss of or physical damage to tangible property, to remain in force until the date of final
completion

10.1.4 Removal of lateral support insurance [CD] where the employer considers that the execution of the works
could cause the removal of or weakening of or interference with the support of land or property adjacent
to or within the site (also including employer owned surrounding property) and the consequences thereof.
The employer shall appoint an agent to design and monitor appropriate support structures for use in
excavations and/or in existing property that form part of the works and/or the site

10.1.5 Other insurances [CD]

10.2 Where practical completion in sections is required [20.0], or where the works is for alterations and additions,
the employer shall effect and keep in force contract works insurance [10.1.1], supplementary insurance
[10.1.2], public liability insurance [10.1.3] and where applicable, removal of lateral support insurance [10.1.4]
and other insurances [10.1.5] in the joint names of the parties until the date of final completion

10.3 The party responsible for effecting insurances [10.1.1-5; 10.2] shall provide proof of the insurances effected
to the other party before the commencement of the construction period and, where required, provide proof
of extension or renewal of such insurances before their expiry. Upon request the party responsible for effecting
insurances shall provide the other party with the entire policy wording of such insurances

10.4 The contractor shall be responsible for the deductible amounts [CD] other than where a claim against an
insurance cover is due to default of the employer, the employer’s employees and/or agents and those for
whose actions they are responsible

10.5 The employer may, at his expense, require the cover of the contract works insurance [10.1.1] to be increased.
The party responsible for effecting insurances shall provide written proof of such adjustment

10.6 Where the employer fails to effect the required insurances within ten (10) working days after notice to do so
the contractor may, on expiry of the notice period, suspend the works until such insurances have been
effected [28.1.4]

10.7 Where this agreement is terminated [29.0] and the contractor is not required to make good the physical loss
or repair damage to the works, the right to the proceeds of an insurance claim shall vest solely in the employer.
The party responsible for the insurances shall give notice to the insurer to clarify the status of the insurance
cover and/or further insurance obligations applicable to the works, public liability insurance, supplementary
insurance and removal of lateral support insurance

10.8 Any amounts not recovered from insurers shall be borne by the employer or contractor in accordance with
their respective obligations under this agreement
10.9 The party responsible for effecting the insurances shall keep insurers informed of any relevant changes in
respect of this agreement

10.10 The parties shall at their discretion effect insurances for aspects not insured such as construction equipment
and work by direct contractors after practical completion

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11.0 SECURITIES

11.1 The contractor shall provide to the employer a guarantee for construction within fifteen (15) working days
of acceptance of the contractor’s tender and choose:

11.1.1 A guarantee for construction – (variable) initially equal to ten per cent (10%) of the contract sum
and keep such security valid and enforceable until the final payment certificate has been issued to
the contractor [25.15]

or …

11.1.2 A guarantee for construction - (fixed) equal to five per cent (5%) of the contract sum and a payment
reduction of five per cent (5%) of the value of each payment certificate up to a maximum of five per
cent (5%) of the contract sum [25.3.3; 25.12]. The contractor shall keep such security valid and
enforceable until the only or last certificate of practical completion has been issued

11.2 The contractor shall:

11.2.1 Maintain and/or replace a guarantee for construction - (variable or fixed) [11.1.1-2] at least twenty
(20) working days before such security is due to expire

11.2.2 Provide a guarantee for advance payment where an advance payment is required. The contractor
shall keep such security valid and enforceable until the advance payment is repaid [11.3]

11.3 The amount of the guarantee for advance payment shall be reduced by the amount repaid by the contractor
as certified by the principal agent in payment certificates. If the advance payment is not repaid by the date
a certificate of practical completion is issued or deemed achievement of practical completion or by the
date of termination by the employer due to contractor default [29.9.3], the entire outstanding amount shall
immediately become due and payable

11.4 Where the contractor fails to provide the specified guarantee for construction the employer may:

11.4.1 Hand over the site to the contractor and withhold an amount in interim payment certificates to the
contractor until the total amount withheld is equal to ten per cent (10%) of the contract sum. The
amount withheld shall be reduced at practical completion [19.0] to two and one half per cent (2.5%)
of the contract sum and to zero per cent (0%) in the final payment certificate [25.9; 25.15]

or …

11.4.2 Terminate this agreement [29.1.1; 29.2]

11.5 The employer shall:

11.5.1 Provide to the contractor a guarantee for payment where required in the accepted tender [CD] within
fifteen (15) working days of acceptance of the contractor’s tender

11.5.2 Keep such guarantee for payment valid and enforceable in terms of the security form and/or provide
a replacement guarantee for payment at least twenty (20) working days before such security is due
to expire

11.6 Where the employer fails to provide the guarantee for payment [CD], or such security has expired, the
contractor may, after giving ten (10) working days notice, where such default has not been remedied,
forthwith suspend the works until such security has been provided [12.1.1; 28.1.1] or by further notice
terminate this agreement [29.14.2; 29.15]

11.7 Where the contract value exceeds the contract sum by more than ten per cent (10%) the guarantee for
payment shall be adjusted at the employer’s expense. The employer shall provide written proof of such
adjustment

11.8 The original or the replacement security form(s) shall be returned to the other party within ten (10) working
days after the expiry date

11.9 Where a party makes an unjustified call on a security, the amount paid and default interest shall be paid to
the other party [27.1.2; 27.1.5]

11.10 The contractor shall waive his lien or right of continuing possession of the works on receipt of a guarantee
for payment from the employer

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EXECUTION
12.0 OBLIGATIONS OF THE PARTIES
12.1 The employer shall:

12.1.1 Provide a guarantee for payment [11.5], where applicable [CD]

12.1.2 Record specific requirements [CD] where the existing premises will be in use and occupied during the
execution of the works including restriction of working hours [CD]

12.1.3 Record and describe relevant natural features and known services [CD] where the contractor shall be
responsible for their preservation

12.1.4 Define any restrictions to the site or areas that the contractor may not occupy [CD]

12.1.5 Give possession of the site to the contractor on the agreed date [CD]

12.1.6 Effect and keep in force insurances in the joint names of the parties, where the employer is responsible
for providing insurances [CD]

12.1.7 Make payments by the due date [25.10] [CD]

12.1.8 Make advance payments, where required [CD]

12.1.9 Permit reasonable access to the works by the contractor and/or subcontractors subsequent to
practical completion to fulfil outstanding obligations [17.1.17; 19.7]

12.1.10 Supply free issue [CD] to suit the programme

12.1.11 Define the extent of work to be carried out by direct contractors [CD]

12.1.12 Ensure that the principal agent and/or agents provide adequate construction information timeously
to the contractor

12.1.13 At the employer’s discretion make direct payment where the contractor has failed to honour a n/s
subcontract payment advice after notice of default by a subcontractor to the principal agent, the
employer and the contractor [14.5 and/or 15.5]

12.2 The contractor shall:

12.2.1 Have inspected the site and any existing structures and be thoroughly acquainted with the conditions
under which the works is to be executed including means of access and any matters which may
influence the execution and/or the pricing of the works

12.2.2 Within fifteen (15) working days of acceptance of the contractor’s tender submit to the principal
agent the priced document with items priced to include all costs, overheads and profit, extended and
cast. Where the priced document contains errors or discrepancies and/or prices considered by the
principal agent to be imbalanced or unreasonable the principal agent and the contractor shall adjust
such prices without any change to the contract sum

12.2.3 Provide a guarantee for construction [11.1; 11.2.1]

12.2.4 Provide a guarantee for advance payment [11.2.2], where applicable [CD]

12.2.5 Effect and keep in force insurances in the joint names of the parties where the contractor is
responsible for providing insurances [10.0] [CD]

12.2.6 Prepare and submit to the principal agent within fifteen (15) working days of receipt of construction
information a programme for the works in sufficient detail to enable the principal agent to monitor
the progress of the works

12.2.7 On being given possession of the site commence the works and proceed with due diligence, regularity,
expedition, skill and appropriate resources to bring the works to practical completion and to final
completion [21.12]

12.2.8 Provide everything necessary for the proper execution of the works in compliance with the agreement

12.2.9 Coordinate the programme with subcontractors’ and direct contractors’ programmes

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12.2.10 Regularly update the programme to illustrate progress of the works and revise the programme where
the principal agent has revised the date for practical completion

12.2.11 Regularly submit to the principal agent a progress report and a schedule of outstanding construction
information to avoid delays to the works

12.2.12 Cooperate with the principal agent in the preparation of cash flow projections and the compilation of
payment certificates [25.1]

12.2.13 Designate a competent person to continuously administer and control the works and to receive and
implement notices and contract instructions on behalf of the contractor

12.2.14 Maintain daily records of categories of persons and construction equipment employed on the works
and regularly provide copies to the principal agent

12.2.15 Keep on site a copy of all construction information required for execution of the works to which the
employer and principal agent and/or agents shall have reasonable access

12.2.16 Allow the employer and principal agent and/or agents reasonable access to the works, workshops
and other places where work is being prepared, executed and/or stored

12.2.17 Give notice forthwith to the principal agent and/or the employer where items of free issue have been
received damaged prior to storage or, where on unpacking, are found not to be in good order before
installing such items

12.2.18 Provide, maintain and remove on practical completion all temporary structures, construction
equipment and notice boards

12.2.19 On achievement of practical completion hand over to the principal agent all information for the
preparation of ‘as built’ documentation and applicable statutory and/or regulatory approval certificates
as well as all operating and instruction manuals and the like

12.2.20 Cede to the employer on the date of issue of the certificate of final completion any guarantees,
product warranties or indemnities pertaining to the works. This cession shall not prejudice any other
rights that the employer may have [21.11]

12.2.21 Forthwith notify all subcontractors where a certificate of practical completion and/or a certificate
of final completion has been issued by the principal agent for the works, or a section thereof

12.3 The principal agent and the contractor shall hold regular meetings to monitor progress of the works and to
deal with technical and coordination matters. The principal agent shall record and timeously distribute the
minutes of such meetings

13.0 SETTING OUT

13.1 The principal agent and/or an agent with delegated authority shall:

13.1.1 Point out boundary pegs or beacons identifying the site and the datum level

13.1.2 Define the setting out points and levels required for the execution of the works

13.2 The contractor shall:

13.2.1 Be responsible for accurate setting out of the works notwithstanding checking by others

13.2.2 Be responsible for the preservation and the reinstatement of boundary pegs, beacons and other survey
information and, where disturbed or destroyed, replace such items at his expense

13.2.3 Not be responsible for incorrect setting out if incorrect information was issued to the contractor. In
such event the contractor may be entitled to a revision of the date for practical completion [23.2.5]
and/or an adjustment of the contract value [26.0]

13.2.4 Immediately suspend affected work to an appropriate extent where encroachments of adjoining
structures occur and where undocumented services, natural features, articles of value or relics are
uncovered on site and forthwith give notice to the principal agent who shall issue a contract
instruction on how to proceed with the works. Any relics or other articles of value found on the site
shall remain the property of the employer

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14.0 NOMINATED SUBCONTRACTORS

14.1 The principal agent and/or agents shall:

14.1.1 Prepare tender documents in conformity with the n/s subcontract agreement and this agreement for
work intended to be executed by a nominated subcontractor

14.1.2 Call for tenders

14.1.3 Scrutinise the received tenders for compliance with the tender documents in consultation with the
contractor, where appointed

14.1.4 Nominate a subcontractor and instruct the contractor [17.1.14] to appoint such subcontractor as a
nominated subcontractor in terms of the n/s subcontract agreement and other tender requirements

14.1.5 Inform the contractor where an advance payment is to be made to the subcontractor for an amount
included in the accepted tender and that a guarantee for advance payment shall be provided by the
subcontractor for the amount stated [NSSA-CD]

14.2 The contractor may refuse to appoint such subcontractor:

14.2.1 Against whom the contractor makes a reasonable objection

14.2.2 Who refuses or fails to enter into a n/s subcontract agreement and/or to comply with other tender
requirements

14.2.3 Who has failed to provide a required security [NSSA-CD]

14.3 Where such subcontractor is not appointed by the contractor for the reasons stated [14.2], or where the
appointment of a subcontractor has been terminated, another subcontractor shall be nominated and
appointed in accordance with a contract instruction issued by the principal agent

14.4 Where the subcontractor has complied with the tender requirements, in accordance with a contract
instruction issued by the principal agent [17.1.14], the contractor shall:

14.4.1 Appoint the subcontractor as a nominated subcontractor and forward a copy of the signed n/s
subcontract agreement to the principal agent

14.4.2 Provide a guarantee for payment in the amount stated within fifteen (15) working days of such
appointment, where required in the n/s subcontract agreement [CD]

14.4.3 Forward the subcontractor’s regular payment claims to the principal agent and/or agents by the date
stated [NSSA-CD]

14.4.4 Issue to each subcontractor (with a copy to the principal agent) a JBCC® n/s subcontract payment
advice and a JBCC® n/s subcontract recovery statement to reconcile the amount due for payment with
the amount stated in the JBCC® n/s subcontract payment notification issued by the principal agent

14.4.5 Pay the subcontractor the amount certified by the date stated in the JBCC® NSSA contract data
[25.13]

14.5 Where the contractor fails to provide proof of payment to the subcontractor within five (5) working days of
a notice by the principal agent, the employer may instruct the principal agent to certify direct payment to
the subcontractor and recover such amount from the contractor [27.2.7]

14.6 Where a nominated subcontractor has been declared insolvent, or where, after notification by the contractor,
the principal agent agrees that a nominated subcontractor is in default of a material term of the n/s
subcontract agreement, the principal agent shall instruct the contractor to give notice to the subcontractor
to rectify such default. The principal agent shall instruct the contractor to terminate the n/s subcontract
agreement should such default continue for five (5) working days after such notice [17.1.15]

14.7 Where a n/s subcontract agreement with a nominated subcontractor is terminated:

14.7.1 Due to default or insolvency of the subcontractor [23.2.10], or default of the employer, the principal
agent and/or agents [23.2.11] any variation in the cost of completing such subcontract works shall be
for the account of the employer

14.7.2 Due to default or insolvency of the contractor any variation in the cost of completing such subcontract
works shall be for the account of the contractor. The employer may recover expense and/or loss
[27.2.8]

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14.7.3 The principal agent shall instruct the contractor to appoint another nominated subcontractor [14.1.4]
to complete the subcontract works

14.8 There shall be no privity of contract between the employer and a subcontractor appointed by the contractor

15.0 SELECTED SUBCONTRACTORS

15.1 The principal agent and/or agents shall:

15.1.1 Prepare tender documents in conformity with the n/s subcontract agreement and this agreement for
work intended to be executed by a selected subcontractor in consultation with and to the reasonable
approval of the contractor

15.1.2 Call for tenders from a list of tenderers agreed between the contractor and the principal agent

15.1.3 Scrutinise the received tenders for compliance with the tender documents in consultation with the
contractor

15.1.4 In consultation with the contractor, choose the compliant tenderer to be appointed as a selected
subcontractor in terms of the n/s subcontract agreement

15.1.5 Inform the contractor where an advance payment is to be made to the subcontractor for an amount
included in the accepted tender and that a guarantee for advance payment shall be provided by the
subcontractor for the amount stated [NSSA-CD]
15.2 The contractor may refuse to appoint such subcontractor:

15.2.1 Who refuses or fails to enter into a n/s subcontract agreement and/or to comply with other tender
requirements

15.2.2 Who has failed to provide a required security [NSSA-CD]

15.2.3 Against whom the contractor makes a reasonable objection where circumstances have changed

15.3 Where such subcontractor is not appointed by the contractor for the reasons stated [15.2], or where the
appointment of a subcontractor has been terminated, another subcontractor shall be chosen in consultation
with the contractor and appointed in accordance with a contract instruction issued by the principal agent

15.4 Where the subcontractor has complied with the tender requirements, in accordance with a contract
instruction issued by the principal agent [17.1.14], the contractor shall:

15.4.1 Appoint the subcontractor as a selected subcontractor and forward a copy of the signed n/s
subcontract agreement to the principal agent

15.4.2 Provide a guarantee for payment in the amount stated within fifteen (15) working days of such
appointment, where required in the n/s subcontract agreement [CD]

15.4.3 Forward the subcontractor’s regular payment claims to the principal agent and/or agents by the date
stated [NSSA-CD]

15.4.4 Issue to each subcontractor (with a copy to the principal agent) a JBCC® n/s subcontract payment
advice and a JBCC® n/s subcontract recovery statement to reconcile the amount due for payment with
the amount stated in the JBCC® n/s subcontract payment notification issued by the principal agent

15.4.5 Pay the subcontractor the amount certified by the date stated in the JBCC® NSSA contract data
[25.13]

15.5 Where the contractor fails to provide proof of payment to a subcontractor within five (5) working days of a
notice by the principal agent, the employer may instruct the principal agent to certify direct payment to the
subcontractor and recover such amount from the contractor [27.2.7]

15.6 Where the selected subcontractor is in default of a material term of the n/s subcontract agreement, the
decision of whether or not to terminate the n/s subcontract agreement is that of the contractor

15.7 Where a n/s subcontract agreement with a selected subcontractor is terminated:

15.7.1 Due to default of the employer, the principal agent and/or agents any variation in the cost of
completing such subcontract works shall be for the account of the employer [25.3.7]

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15.7.2 Other than due to the default by the employer, the principal agent and/or agents any variation in the
cost of completing the subcontract works shall be for the account of the contractor [25.3.7]

15.7.3 The principal agent shall instruct the contractor to appoint another selected subcontractor [15.1.4]
to complete the subcontract works

15.8 There shall be no privity of contract between the employer and a subcontractor appointed by the contractor

16.0 DIRECT CONTRACTORS

16.1 The contractor shall:

16.1.1 In accordance with a contract instruction [17.1.16] permit direct contractors [CD] to execute and/or
install work as part of the works. Such access to the works shall not constitute deemed achievement
of practical completion or occupation by the employer [19.6]

16.1.2 Make reasonable allowance in the programme for such work or installation

16.1.3 Be entitled to claim expense and/or loss caused by direct contractors [23.2.9; 27.1.7]

16.2 Payment of direct contractors shall be the responsibility of the employer outside this agreement

16.3 There shall be no privity of contract between the contractor and a direct contractor appointed by the employer

17.0 CONTRACT INSTRUCTIONS

17.1 The principal agent may issue contract instructions to the contractor regarding:

17.1.1 Rectification of discrepancies, errors in description or quantity or omission of items in the agreement
other than in the JBCC® Principal Building Agreement

17.1.2 Alteration to design, standards or quantity of the works provided that such contract instructions shall
not substantially change the scope of the works

17.1.3 The site [13.0]

17.1.4 Compliance with the law, regulations and bylaws [2.1]

17.1.5 Provision and testing of samples of materials and goods and/or of finishes and assemblies of elements
of the works

17.1.6 Opening up of work for inspection, removal or re-execution [23.2.4; 26.4.2]

17.1.7 Removal or re-execution of work

17.1.8 Removal or substitution of any materials and goods

17.1.9 Protection of the works

17.1.10 Making good physical loss and repairing damage to the works [23.2.2]

17.1.11 Rectification of defects [21.2]

17.1.12 A list for practical completion specifying outstanding or defective work to be rectified to achieve
practical completion, a list for completion and a list for final completion specifying outstanding or
defective work to be rectified to achieve final completion

17.1.13 Expenditure of budgetary allowances, prime cost amounts and provisional sums

17.1.14 Appointment of a subcontractor [14.0; 15.0]

17.1.15 Termination of a nominated n/s subcontract agreement [14.6]

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17.1.16 Work by direct contractors [16.0]

17.1.17 Access by others or previous contractors to remedy defective work

17.1.18 Removal from the site of any person employed on the works

17.1.19 Removal from the site of any person not engaged on or connected with the works

17.1.20 On suspension or termination, protection of the works, removal of construction equipment and
surplus materials and goods [29.0]
17.2 The contractor shall comply with and duly execute all contract instructions

17.3 Should the contractor fail to proceed with a contract instruction with due diligence, the principal agent may
give notice to the contractor to proceed within five (5) working days of receipt of such notice. Where the
contractor remains in default, the employer may engage others to carry out such contract instruction and
recover expense and/or loss incurred [27.2.3]

17.4 The contractor shall not be obliged to execute contract instructions for additional work issued after the
certified or deemed date of practical completion

17.5 Oral instructions shall be of no force or effect

COMPLETION
18.0 INTERIM COMPLETION

18.1 This clause applies only to the n/s subcontract agreement and is included to retain the same clause numbers
between the two agreements

19.0 PRACTICAL COMPLETION

19.1 The principal agent shall:

19.1.1 Inspect the works at appropriate intervals to give the contractor interpretations and direction on the
standard of work and the state of completion of the works required of the contractor to achieve
practical completion [CD]

19.1.2 Issue a contract instruction [17.1] consequent on each such inspection, where necessary

19.2 The contractor shall:

19.2.1 Inspect the works in advance of the anticipated date for practical completion to confirm that the
standard of work required and the state of completion of the works for practical completion has been
achieved

19.2.2 Give at least five (5) working days notice to the principal agent of the anticipated date for the
inspection for practical completion of the works to meet the anticipated date for practical completion

19.3 The principal agent shall inspect the works, or a section thereof, within the period stated [CD] and forthwith
issue to the contractor:

19.3.1 A comprehensive and conclusive list for practical completion [17.1.12] where the works has not
reached practical completion specifying the defects to be rectified and work to be completed to
achieve practical completion

19.3.2 An updated list for practical completion limited to items on the list for practical completion that
have not been attended to satisfactorily. The contractor shall repeat the procedure until all items on
the list for practical completion have been attended to satisfactorily before the certificate of
practical completion is issued by the principal agent

or …

19.3.3 A certificate of practical completion with a copy to the employer stating the date on which practical
completion of the works, or a section thereof, was achieved

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19.3.4 A list for completion with a copy to the employer

19.4 Should the principal agent not issue a list for practical completion or the updated list within five (5) working
days after the inspection period, or the certificate of practical completion [19.3], the contractor shall give
notice to the employer and the principal agent. Should the principal agent not issue such list within a further
five (5) working days of receipt of such notice, practical completion shall be deemed to have been achieved
on the date of such notice and the principal agent shall issue the certificate of practical completion
forthwith

19.5 On issue of the only or last certificate of practical completion the employer shall be entitled to possession
of the works and the site subject to the contractor’s lien or right of continuing possession of the works where
this has not been waived. On issue of the certificate of practical completion for a section, the employer
shall be entitled to possession of such section

19.6 Where the employer takes possession of the whole or a portion of the works by agreement with the contractor,
practical completion shall be deemed to have occurred. The principal agent shall after inspection of the works
[19.3] issue a certificate of practical completion to the contractor with a copy to the employer within five (5)
working days of the date of possession of the whole or a portion of the works by the employer and the list for
completion of items to be rectified and work to be completed within a period agreed between the parties

19.7 On issue of the certificate of practical completion of the works, or a section thereof, where the principal
agent instructs that installation work is to be executed by others, the employer and/or contractor shall allow
access for such installations

20.0 COMPLETION IN SECTIONS

20.1 Where completion in sections is required [CD] the terms and conditions applicable to the works as a whole
shall apply to each section

20.2 The principal agent shall for each section issue:

20.2.1 A certificate of practical completion [19.3]

20.2.2 A certificate of final completion indicating where applicable, if it is for the last section to reach final
completion [21.6.2]

21.0 DEFECTS LIABILITY PERIOD AND FINAL COMPLETION

21.1 The defects liability period for the works shall commence on the calendar day following the date of practical
completion and end at midnight (00:00) ninety (90) calendar days from the date of practical completion
[CD] or when work on the list for completion has been satisfactorily attended to [21.6], whichever is the later

21.2 Where defects become apparent during the defects liability period the principal agent may instruct the
contractor [17.1.11] to progressively attend to such items, whilst at all times minimising inconvenience to the
occupants

21.3 The contractor shall:

21.3.1 Inspect and forthwith rectify all items on the list for completion no later than ten (10) working days
before the expiry of the defects liability period [19.3.4]

21.3.2 Give notice to the principal agent to inspect the works within five (5) working days of receipt of such
notice

21.4 Where items on the list for completion have not been attended to the principal agent shall give notice to
the contractor of such outstanding items. The process [21.3] shall be repeated until all items on the list for
completion have been attended to

21.5 The contractor shall give notice to the principal agent when the outstanding items on the list for completion
have been attended to. The principal agent shall inspect the works within five (5) working days of receipt
of such notice

21.6 On the expiry of the ninety (90) calendar days defects liability period [21.1] or when all items on the list for
completion have been attended to and on receipt of the contractor’s notice to the principal agent,
whichever is the later, the principal agent shall inspect the works and within ten (10) working days either:

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21.6.1 Issue a list for final completion detailing all outstanding work or defects that must be attended to, or
rectified to achieve final completion

or …

21.6.2 Issue the certificate of final completion to the contractor with a copy to the employer

21.7 Where the principal agent issues a list for final completion:

21.7.1 The contractor shall forthwith complete all outstanding work and rectify all the defects

21.7.2 The contractor shall give notice to the principal agent when all outstanding work has been completed
and all the defects have been rectified

21.7.3 The principal agent shall, within five (5) working days of receipt of the contractor’s notice(s) [21.7.2]
give notice to the contractor either that the items on the list for final completion have been
completed, or issue an updated list for final completion of the items not completed and of any further
defects that have become evident since the last inspection

21.8 Where the principal agent gives notice to the contractor of items on the list for final completion or an
updated list for final completion specifying all outstanding work to be completed and/or defects to be
rectified to achieve final completion the process [21.7.2-3] shall be repeated until all items on the (updated)
list for final completion have been completed. On completion of all items on the (updated) list for final
completion the principal agent shall forthwith issue the certificate of final completion to the contractor
with a copy to the employer

21.9 Where the principal agent has not issued the list for final completion or the updated list within five (5)
working days after the inspection period [21.6], the contractor shall forthwith give notice to the employer
and the principal agent. Should the principal agent not issue such list within a further five (5) working days
of receipt of such notice, final completion shall be deemed to have been achieved on expiry of such notice
period and the principal agent shall forthwith issue the certificate of final completion

21.10 Where a subcontractor’s defects liability period extends beyond the contractor’s defects liability period:

21.10.1 The contractor’s obligations and liability concerning the subcontractor’s defects shall end on the
date of issue of the certificate of final completion

21.10.2 The remaining portion of the subcontractor’s defects liability period shall be ceded to the employer
on the date of issue of the certificate of final completion

21.11 Where the contractor, a subcontractor or a supplier is required to give a guarantee, warranty or indemnity,
other than a security to the contractor, the rights and obligations under such guarantee, warranty or indemnity
shall be ceded to the employer on the date of issue of the certificate of final completion. This cession shall
not prejudice any other rights the employer may have [12.2.20]
21.12 A certificate of final completion shall be conclusive as to the sufficiency of the works and that the
contractor’s obligations [12.2.7] have been fulfilled other than for latent defects

22.0 LATENT DEFECTS LIABILITY PERIOD

22.1 The latent defects liability period for the works shall commence at the start of the construction period and
end five (5) years from the certified date of final completion

22.2 The contractor shall make good all latent defects that appear up to the date of expiry of the latent defects
liability period [3.3]

22.3 Where termination of this agreement occurs before the date of final completion, the latent defects liability
period shall end:

22.3.1 Five (5) years from the date of termination [29.10] for the completed portion of the works only

or …

22.3.2 On the date of termination where execution of the works has become impossible due to circumstances
beyond the control of either party [29.20], or on the date of termination by the contractor due to default
by the employer, the principal agent and/or agents [29.17.3; 29.23]

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23.0 REVISION OF THE DATE FOR PRACTICAL COMPLETION

23.1 The contractor is entitled to a revision of the date for practical completion by the principal agent without
an adjustment of the contract value for a delay to practical completion caused by one or more of the
following events:

23.1.1 Adverse weather conditions

23.1.2 Inability to obtain materials and goods where the contractor has taken reasonable steps to avoid or
reduce such a delay

23.1.3 Making good physical loss and repairing damage to the works [8.2] where such risk is beyond the
reasonable control of the parties

23.1.4 Late supply of a prime cost amount item where the contractor has taken reasonable steps to avoid
or reduce such delay

23.1.5 Exercise of statutory power by a body of state or public or local authority that directly affects the
execution of the works

23.1.6 Force majeure

23.2 The contractor is entitled to a revision of the date for practical completion by the principal agent with an
adjustment of the contract value [26.7] for a delay to practical completion caused by one or more of the
following events:

23.2.1 Delayed possession of the site [12.1.5]

23.2.2 Making good physical loss and repairing damage to the works [8.5] where the contractor is not at risk

23.2.3 Contract instructions [17.1-2] not occasioned by the contractor’s default

23.2.4 Opening up and testing of work and materials and goods where such work is in accordance with the
agreement [17.1.6]

23.2.5 Late or incorrect issue of construction information [12.1.12; 13.2.3]

23.2.6 Late supply of free issue, materials and goods for which the employer is responsible [12.1.10]

23.2.7 Late appointment of a subcontractor in terms of the agreed programme where the contractor has
taken reasonable steps to avoid or reduce such delay [14.4.1; 15.4.1]

23.2.8 Late acceptance by the principal agent and/or agents of a design undertaken by a selected
subcontractor where the contractor’s obligations have been met [7.3]
23.2.9 An act or omission by a nominated subcontractor [14.0] or a direct contractor [16.0]

23.2.10 Insolvency or termination of a nominated subcontractor [14.7.2]

23.2.11 Suspension or termination by a subcontractor due to default of the employer, the principal agent
and/or agents

23.2.12 Execution of additional work for which the quantity in the bills of quantities is not sufficiently accurate

23.2.13 Suspension of the works [28.0]

23.3 Further circumstances for which the contractor may be entitled to a revision of the date for practical
completion and an adjustment of the contract value are delays to practical completion due to any other
cause beyond the contractor’s reasonable control that could not have reasonably been anticipated and
provided for. The principal agent shall adjust the contract value where such delay is due to the employer
and/or agents

23.4 Should a listed circumstance occur [23.1-3] which could cause a delay to the date for practical completion,
the contractor shall:

23.4.1 Take reasonable steps to avoid or reduce such delay

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23.4.2 Within twenty (20) working days of becoming aware, or ought reasonably to have become aware of
such delay, give notice to the principal agent of the intention to submit a claim for a revision to the
date for practical completion, failing which the contractor shall forfeit such claim

23.5 The contractor shall submit a claim for the revision of the date for practical completion to the principal
agent within forty (40) working days, or such extended period as the principal agent may allow, from when
the contractor is able to quantify the delay in terms of the programme
23.6 Where the contractor submits a claim for a revision of the date for practical completion the claim shall in
respect of each circumstance separately state:

23.6.1 The relevant clause [23.1-3] on which the contractor relies

23.6.2 The cause and effect of the delay on the current date for practical completion, where appropriate,
illustrated by a change to the critical path on the current programme

23.6.3 The extension period claimed in working days and the calculation thereof

23.7 The principal agent shall, within twenty (20) working days of receipt of the claim, grant in full, reduce or
refuse the working days claimed, and:

23.7.1 Determine the revised date for practical completion as a result of the working days granted

23.7.2 Identify each event and the reference clause for each revision granted or amended

23.7.3 Give reasons where such claim is refused or reduced

23.8 Where the principal agent fails to act within the period [23.7] such claim shall be deemed to be refused. The
contractor may give notice of a disagreement [30.1] where the principal agent refuses a claim, alternatively
reduces a claim, or fails to act

24.0 PENALTY FOR LATE OR NON-COMPLETION

24.1 Where the contractor fails to bring the works, or a section thereof, to practical completion by the date for
practical completion [CD], or the revised date for practical completion, the contractor shall be liable to the
employer for the penalty [CD]

24.2 Where the employer elects to levy such penalty the employer, or the principal agent on instruction from
the employer, shall give notice thereof to the contractor. The principal agent shall determine the penalty
due from the later of the date for practical completion [CD], or the revised date for practical completion, up
to and including the earlier of:

24.2.1 The actual or deemed date of practical completion of the works, or a section thereof [23.7.1]

24.2.2 The date of termination [29.8]

24.3 The principal agent shall include the penalty in regular interim payment certificates from the date on which
the employer’s entitlement to penalties commences

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PAYMENT
25.0 PAYMENT

25.1 The contractor shall cooperate with and assist the principal agent in the preparation of cash flow statements
and payment valuations by providing all required documents and quantified amounts of work duly executed.
Where the contractor has not provided such information the principal agent shall make a fair estimate of the
work executed

25.2 The principal agent shall regularly by the due date [CD] issue payment certificates to the contractor with a
copy to the employer until and including the issue of the final payment certificate. A payment certificate
may be for a nil or negative amount

25.3 Each payment certificate shall separately include:

25.3.1 A fair estimate of the value of work executed

25.3.2 A fair estimate of the value of materials and goods [25.4; 25.5]

25.3.3 Security adjustment [11.1.2; 11.4.1]

25.3.4 Cost fluctuations, if applicable

25.3.5 The gross amount certified

25.3.6 The amount previously certified

25.3.7 Amounts due to either party in the recovery statement [27.1]

25.3.8 Tax

25.3.9 Interest amounts included in the recovery statement

25.3.10 Other non-taxable amounts

25.3.11 The net amount certified due to the contractor or the employer

25.4 The value of materials and goods [25.3.2] (excluding materials and goods off site or in transit) shall be
included in the amount certified only where:

25.4.1 Not prematurely delivered or offered for delivery in terms of the programme

25.4.2 Stored and suitably protected against loss and damage

25.4.3 Covered by insurances [10.0]

25.5 The value of materials and goods [25.3.2] stored off site and/or in transit shall be included in the amount
certified only where covered by a guarantee for advance payment or such other security acceptable to the
employer

25.6 Materials and goods when certified [25.4] and paid for shall become the property of the employer and shall
not be removed without the written authority of the principal agent

25.7 The principal agent shall concurrently with each payment certificate issue:

25.7.1 To the employer and the contractor a recovery statement showing the amounts due to either party
in the current payment certificate

25.7.2 To the contractor a statement showing the amount certified for each subcontractor

25.7.3 To each subcontractor a n/s subcontract payment notification showing the amount included in the
payment certificate and its date of issue

25.7.4 The determination of default interest

25.7.5 The determination of compensatory interest

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25.8 An interim payment certificate shall not be evidence that the works and materials and goods are in terms
of the agreement

25.9 The principal agent shall certify one hundred per cent (100%) of the amount of the final account including
adjustments [26.0; 27.0] in the final payment certificate

25.10 The employer shall pay the contractor the amount certified in an issued payment certificate within fourteen
(14) calendar days of the date for issue of the payment certificate [CD] including default interest and/or
compensatory interest

25.11 The contractor shall pay the employer the amount certified in an issued payment certificate within twenty-
one (21) calendar days of the date of issue of the payment certificate [CD] including default interest

25.12 Where a guarantee for construction (fixed) and payment reduction [11.1.2] has been chosen the value of
the works [26.0] and materials and goods [25.3.2] that exceeds the contract sum and any contract price
adjustments (cost fluctuations) [25.3.4; 26.9.5] [CD] shall be certified in full. The value certified that does not
exceed the contract sum shall be subject to the following percentage adjustments:

25.12.1 Ninety-five per cent (95%) of such value in interim payment certificates issued up to the date of
practical completion

25.12.2 Ninety-seven and one half per cent (97.5%) of such value in interim payment certificates issued up to
but excluding the final payment certificate

25.12.3 One hundred per cent (100%) of such value in the final payment certificate

25.13 The contractor shall pay all subcontractors within seven (7) calendar days of the due date for payment by
the employer [CD] and on request provide proof thereof to the principal agent within seven (7) calendar
days of a request to do so

25.14 Where the employer has made a partial or no payment of the amount due in an issued payment certificate
by the due date or where the principal agent fails to issue a payment certificate, the contractor may give
ten (10) working days notice to comply, failing which the contractor may:

25.14.1 Suspend the works [28.1.3]

25.14.2 Exercise the lien or right of continuing possession of the works where this has not been waived

25.14.3 Call up the guarantee for payment [11.5]

25.15 The principal agent shall issue the final payment certificate to the contractor with a copy to the employer
within seven (7) calendar days of acceptance of the final account by the contractor, but not before the issue
of the certificate of final completion, other than on termination [26.11; 29.0]

25.16 Where the contractor disputes the correctness of the final account within the period allowed [26.12], the
principal agent shall issue interim payment certificates to the contractor with a copy to the employer by
the due date [CD] for the undisputed amount(s)

25.17 For the purposes of provisional sentence in relation to a payment certificate only, the parties consent to the
jurisdiction of any court of law of the country [CD]

26.0 ADJUSTMENT OF THE CONTRACT VALUE AND FINAL ACCOUNT

26.1 The principal agent shall determine the value of adjustments to the contract value in cooperation with the
contractor in the preparation of the final account. Where such adjustments require measurement on site,
the contractor shall have the right to be present

26.2 Adjustments to the contract value resulting from a contract instruction [17.1] shall be determined as follows:

26.2.1 Work of a similar character executed under similar conditions shall be priced at the rates in the priced
document

26.2.2 Work not of a similar character shall be priced at rates based on those in the priced document and
adjusted to suit the changed circumstances

26.2.3 If the above methods do not apply, work shall be priced at rates based on the necessary use of labour,
construction equipment and/or materials and goods for executing the work plus an allowance of ten
per cent (10%) mark-up

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26.2.4 Work omitted shall be valued at the rates in the priced document, but where the omission of such
work alters the circumstances under which the remaining work is carried out, the value of the remaining
work shall be determined by the above methods

26.3 Where work is identified as provisional in the priced document the principal agent shall omit such value from
the contract value and add the value of work as executed to the contract value

26.4 Where the contractor has made payment for items not included in the priced document in accordance with
a contract instruction with the approval of the principal agent, the actual amounts paid plus a ten per cent
(10%) mark-up shall be added to the contract value limited to:

26.4.1 Charges by authorities [2.1]

26.4.2 The cost of opening up and testing [17.1.6], where the work is according to this agreement

26.4.3 The cost of insurances [10.0], where applicable [CD]

26.5 The contractor shall give notice to the principal agent within twenty (20) working days of becoming aware,
or ought reasonably to have become aware of expense and/or loss for which provision was not required in the
contract sum failing which such claim shall be forfeited

26.6 Following notice [26.5], the contractor shall submit a detailed and substantiated claim for the adjustment of
the contract value to the principal agent within forty (40) working days, or such additional period as the
principal agent may allow

26.7 The principal agent shall make a fair assessment of the claim [26.6] and adjust the contract value within
twenty (20) working days of receipt of such details

26.8 Where the principal agent fails to act within such period [26.7] the claim shall be deemed to be refused. The
contractor may give notice of a disagreement [30.1] where no assessment is received

26.9 The principal agent shall:

26.9.1 Omit prime cost amounts and budgetary allowances [17.1.13] from the contract sum and determine
the actual value of such work to be added to the contract value

26.9.2 Omit provisional sums [17.1.13] from the contract sum and determine the actual value of such
subcontractors’ work to be added to the contract value

26.9.3 Prorate the contractor’s allowances for profit and attendance on provisional sums and prime cost
amounts excluding any allowance for cost fluctuations

26.9.4 Adjust the preliminaries amounts in accordance with the method selected [CD]

26.9.5 Adjust the contract value to include contract price adjustments (cost fluctuations), if applicable [CD]

26.9.6 Rectify discrepancies, errors in description or quantity or omission of items in this agreement other
than in the JBCC® Principal Building Agreement [17.1.1]

26.10 The principal agent shall prepare and issue the final account to the contractor within sixty (60) working
days of the date of practical completion

26.11 The contractor shall accept the final account within thirty (30) working days of receipt thereof or give notice
of non-acceptance with reasons failing which the final account shall be deemed to be accepted

26.12 Should the reasons for non-acceptance of the final account [26.11] not be resolved within ten (10) working
days of the notice of non-acceptance, or within such extended period as the principal agent may allow on
request from the contractor, the contractor may give notice of a disagreement

26.13 The principal agent shall issue the final payment certificate to the contractor within seven (7) calendar
days of acceptance of the final account

27.0 RECOVERY OF EXPENSE AND/OR LOSS

27.1 The principal agent shall issue a recovery statement with each payment certificate to the parties with
explanatory documentation to support the calculation of amounts due to:

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The employer resulting from:

27.1.1 Penalty [24.3]

27.1.2 Default interest [25.7.4]

27.1.3 Expense and/or loss [27.2]

The contractor resulting from:

27.1.4 Default interest [25.7.4]

27.1.5 Compensatory interest [25.7.5]

27.1.6 Damages

27.1.7 Expense or loss caused by a direct contractor [16.1.3]

27.1.8 Advance payments [9.2.10; 12.1.8]

27.1.9 Termination of a n/s subcontract agreement due to default of the employer, the principal agent
and/or agents [14.7.1; 15.7.1]

27.2 The employer may recover expense and/or loss incurred or to be incurred resulting from:

27.2.1 Paying charges [2.1]

27.2.2 Effecting insurances due to the contractor’s default [10.0]

27.2.3 Work executed by others due to the contractor’s default [17.3]

27.2.4 Recoupment of advance payments [9.2.10; 11.3]

27.2.5 The contractor not paying amounts due to the employer [25.3.7]

27.2.6 Termination of this agreement by the employer [29.1]

27.2.7 Amounts paid directly to subcontractors on default by the contractor [14.5; 15.5]

27.2.8 Termination of a n/s subcontract agreement (14.7.2; 15.7.2]

27.2.9 Default by the contractor where not less than five (5) working days notice detailing such default has
been given before the issue of the next recovery statement to allow the contractor the opportunity to
remedy such default

27.2.10 Adjustment of the n/s subcontract preliminaries due to the subcontractor as a result of a default by
the contractor

27.3 Where an amount is due to either party and has not been paid, the other party may recover the amount from
any of the following:

27.3.1 Subsequent payment certificates [25.0]

27.3.2 A demand in terms of the security [11.0]

27.3.3 The defaulting party as a debt

27.4 Where either party has been liquidated, or this agreement terminated, the other party may exercise rights in
terms of the security [11.0]

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SUSPENSION AND TERMINATION

28.0 SUSPENSION BY THE CONTRACTOR

28.1 The contractor may give ten (10) working days notice to the employer and the principal agent of the
intention to suspend the works where the employer or the principal agent has failed to:

28.1.1 Provide and/or maintain a guarantee for payment, where required [11.5-6]

28.1.2 Issue a payment certificate by the due date [25.2] [CD]

28.1.3 Make payment in full of an amount certified in an interim payment certificate by the due date [25.10]
[CD]

28.1.4 Effect insurances [10.1.1-5; 10.2], where applicable [CD]

28.1.5 Appoint another principal agent and/or another agent, where applicable [6.5] or where an agent has
failed to act in terms of delegated authority [6.4]

28.2 Where the employer has not remedied a default in terms of a notice the contractor may suspend execution
of the works until such default has been remedied without prejudice to any rights the contractor may have

28.3 Where the works is suspended the contractor shall instruct each subcontractor to suspend the n/s
subcontract works forthwith

28.4 Where the works has been suspended by the contractor [23.2.13] the principal agent shall revise the date
for practical completion on resumption of the works with an adjustment of the contract value

29.0 TERMINATION
Termination by the employer

29.1 The employer may give notice of intention to terminate this agreement where the contractor has failed to:

29.1.1 Provide and maintain a guarantee for construction [CD]

29.1.2 Proceed with the works [12.2.7]

29.1.3 Comply timeously with a contract instruction [17.0]

29.2 Where the employer contemplates terminating this agreement the employer or the principal agent on
instruction from the employer shall give notice thereof to the contractor of a specified default [29.1.1-3], to
be remedied within ten (10) working days of the date of receipt of such notice

29.3 Where the contractor has not remedied a specified default within such period [29.2] the employer may
forthwith give notice to the contractor of termination of this agreement

29.4 The employer may employ others to safeguard the works, complete the outstanding work and rectify defects
in that portion of the works executed by the contractor [27.2.3]. The contractor shall be liable to the
employer for such costs that shall be included in the final account [26.10]

29.5 The employer may use materials and goods and temporary structures on the site for which payment shall
be included in the final account

29.6 Should the contractor default on removing temporary structures or construction equipment from the site
the employer, without being responsible for any loss or damage, may have such items belonging to the
contractor removed or sold. Resulting costs and/or income shall be included in the final account

29.7 The employer, on notice to the contractor, may recover damages from the contractor from the date of
termination including, but not limited to, additional costs incurred in the completion of the remaining work
[25.3.7; 27.1.3]

29.8 The employer may apply the penalty [24.0] up to the date of termination where the initial or revised date for
practical completion has passed

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29.9 The employer has the right of recovery against the contractor, where applicable, [CD] from:
The guarantee for construction (variable) until the final payment has been made; or
The guarantee for construction (fixed) until the date of practical completion; or
The payment reduction until the final payment is made; or
The guarantee for advance payment until the outstanding balance has been repaid to the employer

29.10 The latent defects liability period for the completed portion of the works shall end [22.3.1] five (5) years from
the date of termination

29.11 Where this agreement is terminated, the contractor shall forthwith give notice of termination of the n/s
subcontract agreement to each subcontractor

29.12 Termination of the works shall not prejudice any rights the employer may have

29.13 The right to terminate may not be exercised where the employer is in material breach of this agreement

Termination by the contractor

29.14 The contractor may give notice of intention to terminate this agreement where:

29.14.1 The employer has failed to provide and maintain a guarantee for payment, where applicable [CD]

29.14.2 The employer has failed to give possession of the site to the contractor [12.1.5]

29.14.3 The employer has failed to allow the principal agent and/or agents to exercise fair and reasonable
judgement as contemplated by this agreement [6.6]

29.14.4 The employer has failed to effect insurances, where applicable [CD]

29.14.5 The employer has failed to pay the amount certified by the due date [25.10]

29.14.6 The employer has failed to appoint another principal agent and/or agents, where applicable [6.5]

29.14.7 The principal agent has failed to issue a payment certificate to the contractor by the due date [25.2]

29.15 Where the contractor contemplates terminating this agreement, the contractor shall give notice to the
employer and/or the principal agent of a specified default [29.14.1-7], to be remedied within ten (10) working
days of the date of receipt of such notice

29.16 Where a specified default has not been remedied within such period [29.15] the contractor may forthwith
give notice to the employer and the principal agent of the termination of this agreement

29.17 Where this agreement is terminated by the contractor:

29.17.1 The contractor shall forthwith give notice of termination of the n/s subcontract agreement to each
subcontractor

29.17.2 The contractor shall remove temporary structures, construction equipment and, on notice, surplus
materials and goods from the site within ten (10) working days, or such period agreed by the
principal agent

29.17.3 The latent defects liability period shall end on the date of termination [22.3.2]

29.17.4 The contractor may be entitled to recover damages [27.1.6]

29.17.5 The guarantee for construction shall expire on the date of termination

29.17.6 The guarantee for advance payment, where applicable [CD], shall expire on repayment of amounts
due to the employer

29.17.7 The guarantee for payment [11.5-6], where applicable [CD], shall expire on payment of the final
payment certificate or on payment in full of the guaranteed sum or on the security expiry date,
whichever is the earlier

29.18 Termination of the works shall not prejudice any rights the contractor may have

29.19 The right to terminate may not be exercised where the contractor is in material breach of this agreement

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Termination by either party

29.20 Either party may give notice of intention to terminate this agreement where:

29.20.1 The works is for alterations and/or additions to (an) existing building(s), or a new building, which has
been substantially destroyed regardless of the cause other than by the party seeking termination

29.20.2 Progress of the works has ceased for a continuous period of ninety (90) calendar days, or an
intermittent period totalling one hundred and twenty (120) calendar days as a result of a force majeure
event or the exercise of statutory power by a body of state or public or local authority that directly affects
the execution of the works

29.21 The party contemplating termination of this agreement shall give ten (10) working days notice to the other
party. Where this agreement is terminated by either party:

29.21.1 The contractor shall forthwith give notice of termination of the n/s subcontract agreement to each
subcontractor

29.21.2 The party responsible for insurance [CD] shall inform the insurer and the other party of the date of
termination of the agreement

29.21.3 The guarantee for payment, where applicable [CD], shall expire on payment of the final payment
certificate or on payment in full of the guaranteed sum or on the security expiry date, whichever is the
earlier

29.21.4 The guarantee for construction shall expire on the date of termination

29.21.5 The guarantee for advance payment [11.2.2; 11.3], where applicable [CD], shall expire on repayment
of amounts due to the employer

29.22 Neither party shall be liable to the other party for expense and/or loss resulting from the termination

29.23 The latent defects liability period for the works shall end on the date of termination [22.3.2]

Termination procedure by the employer, the contractor or by the parties

29.24 On termination of this agreement the contractor shall:

29.24.1 Cease work and ensure that the works is safe in terms of the law

29.24.2 Remain responsible for the works [8.1] until possession is relinquished to the employer

29.24.3 Remove temporary structures, construction equipment and, on notice from the principal agent,
surplus materials and goods from the site within ten (10) working days, or such period agreed by
the principal agent

29.25 On termination of this agreement the principal agent shall:

29.25.1 Prepare and hand over to the employer all compliance certificates, as built drawings and product
warranties in conjunction with agents, the contractor and subcontractors

29.25.2 In consultation with the contractor where possible, compile and issue to the parties a status report
recording completed and incomplete work on the date of termination of the works within twenty (20)
working days of such date

29.25.3 Continue to certify the value of the work executed and materials and goods for payment by the
employer or the contractor until the issue of the final payment certificate [25.15]

29.25.4 Prepare and issue the final account to the contractor within sixty (60) working days of the date of
termination including the cost of materials and goods and those ordered before termination that the
contractor is bound to accept and make payment for

29.26 Termination shall take effect after completion of the procedure [29.24.1]

29.27 The employer shall arrange appropriate insurances to suit the stage of completion of the works

29.28 This clause shall, to the extent necessary to fulfil its purpose, exist independently of this agreement

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DISPUTE RESOLUTION
30.0 DISPUTE RESOLUTION

Settlement by the parties

30.1 Should any disagreement arise between the employer (or the principal agent or an agent) and the contractor
arising out of or concerning the action or inaction of the employer (or the principal agent or an agent) or the
contractor, or any other matter concerning this agreement (including the validity thereof), either party may give
notice of a disagreement to the other. The parties shall attempt to resolve such disagreement between them
and record such resolution in writing signed by them

30.2 Where the disagreement is not resolved within ten (10) working days of receipt of the notice of disagreement,
the disagreement shall be deemed to be a dispute

30.3 The dispute shall be referred to adjudication within ten (10) working days of the expiry of the period [30.2] by
means of a notice of adjudication by the party (the referring party) which gave the notice of disagreement

30.4 The notice of adjudication shall clearly define the scope of the dispute and the relief sought by adjudication

30.5 Failure to comply with the procedure described [30.3-4] shall cause the dispute to be resolved by arbitration and
not by adjudication

Adjudication

30.6 Where a dispute is referred to adjudication:

30.6.1 The adjudicator shall be nominated by the nominating body [CD] and shall be deemed to have been
appointed by the parties

30.6.2 The applicable rules shall be stated [CD] or shall be by agreement between the parties and the
adjudicator, failing which the rules shall be determined by the adjudicator. Neither party shall be entitled
to legal representation, unless otherwise agreed in writing by the parties

30.6.3 A determination given by the adjudicator shall be immediately binding upon and implemented by the
parties notwithstanding that either party may give notice to refer the dispute to arbitration

30.6.4 Where the adjudicator has given a determination, either party may give notice of dissatisfaction to the
other party and to the adjudicator within ten (10) working days of receipt of the determination, or an
extended time period provided in the applicable rules for adjudication whereafter such dispute shall be
referred to arbitration

30.6.5 Where the adjudicator has not given a determination within the time period allowed or extended time
period provided in the applicable rules for adjudication either party may give notice to the other
party and to the adjudicator that if such determination is not received within ten (10) working days of
receipt of this notice his appointment is thereupon automatically terminated and such dispute shall
be referred to further adjudication or arbitration, at the option of the referring party

30.6.6 The adjudicator shall not be eligible for subsequent appointment as the arbitrator

Arbitration

30.7 Where the dispute is referred to arbitration:

30.7.1 Arbitration shall not be construed as a review or appeal of an adjudicator’s determination.

Any determination by the adjudicator shall remain in force and continue to be implemented unless and
until overturned by an arbitration award

30.7.2 The resolution of the dispute shall commence anew

30.7.3 The referring party in the adjudication shall be the claimant in the arbitration

30.7.4 The arbitrator shall be nominated by the nominating body [CD] and shall be deemed to have been
appointed by the parties

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30.7.5 The applicable rules shall be stated [CD] or shall be by agreement between the parties and the
arbitrator, failing which the rules shall be determined by the arbitrator

30.7.6 The arbitrator shall have the authority to finally determine the dispute including the authority to make,
open up and revise any certificates, opinion, decision, determination, requisition or notice relating to
the dispute as if no such certificate, opinion, decision, determination, requisition or notice had been
issued or given

30.7.7 The arbitrator’s award shall be final and binding on the parties

Mediation

30.8 Notwithstanding the provisions relating to adjudication and arbitration the parties may, by agreement and at
any time, refer a dispute to mediation, in which event:

30.8.1 The provisions relating to adjudication and/or arbitration shall be deemed to be suspended from the
time of such agreement until notice by either party that they be resumed

30.8.2 The appointment of a mediator, the procedure, and the status of the outcome shall be agreed between
the parties

30.8.3 Regardless of the outcome of a mediation the parties shall bear their own costs concerning the
mediation and equally share the costs of the mediator and related expenses

General

30.9 The employer consents to the joining of any subcontractor with the contractor as a party to any proceedings

30.10 Where the parties fail to specify a body to nominate the adjudicator [30.6.1] or the arbitrator [30.7.4] the referring
party shall have the right to choose a local recognised body to suggest one or more persons with appropriate
skills to be appointed as an adjudicator or an arbitrator. Such nomination shall be binding on the parties

30.11 The parties shall continue to perform their obligations in terms of this agreement, notwithstanding any
disagreement or dispute that exists between them

30.12 This clause shall, to the extent necessary to fulfil its purpose, exist independently of this agreement

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AGREEMENT

The agreement comprises the entire contract between the parties. No representations, terms, conditions or warranties
not contained in this agreement shall be binding on the parties. No agreement or addendum varying, adding to, deleting
or terminating this agreement including this clause shall be effective unless reduced to writing and signed by the duly
authorised representatives of the parties

The contracting parties

The parties Employer Contractor

Business name

Business type

Business registration

Tax number (VAT/GST)

Contact person

Telephone

Mobile number

E-mail

Address: Building name

Address: Street

Address: Suburb

Address: City

Address: P O Box

Address: Post Office

Address: Province

Address: Country

Project name

Project location

Currency
Accepted contract
sum including tax
Accepted contract
sum including tax
in words
Signed – who by
signature hereto
warrants authority
Name of signatory

Signed: Date

Signed: Location

Signed: Witness

Name of witness

©Copyright reserved: JBCC® Principal Building Agreement, Edition 6.2 – June 2024