The second edition of the General Conditions of Contract for Construction Works, which is commonly referred to as GCC 2015, is a South African construction contract predominantly used for government projects.
The new edition contains amendments that are still often misunderstood or not enforced correctly, says Alusani® Course Leader - Steve du Toit.
“With government infrastructure projects ranging from R1-million to multiple billions of Rands, everyone knows they need to use a construction agreement. Problems continue to arise when they don’t follow the terms that are stipulated in the agreement,” says du Toit.
Built environment professionals have a range of construction contracts at their disposal, including FIDIC, the NEC and the JBCC Suite of Contracts. The GCC, however, appears to be the go-to agreement for large infrastructure projects where the Employer is a state-owned entity.
The GCC contains a number of clauses that establish the general risks, liabilities and obligations of the contracting parties and the administrative procedures for the administration of the contract. There are many variations between the GCC 2015 and its predecessor, the GCC 2010, with the biggest variation relating to how a Contractor controls his time.
When a construction agreement has been established for a project, the project will have a start date and a completion date. Part of the contract value will be based on how long the Contractor needs to be on site for. If a Contractor experiences delays, he is entitled to claim an extension.
“Upon approval of the extension, additional time will be allocated to the Contractor and this results in additional time-related costs. To prove that the Contractor is entitled to additional time, he will need to show the effect of the delays on his programme schedule. The updates to the new GCC contract now stipulate that any additional time that the Contractor saves has to be added to his float. If a Contractor is ahead of schedule, they must use the additional days that have been awarded to them. This update means that Contractors need to be more transparent in the administration of their time,” says du Toit.
Another change is that Contractors are entitled to suspend work if their Employer doesn’t pay them, bringing the GCC in line with other construction agreements.
du Toit, who has spent over two decades as a practising attorney in the Construction sector, says these agreements tend to be very lengthy and complex.
“During my time as a practising attorney, I saw many lengthy and complex agreements, but few things require such careful understanding and fine-combing than construction agreements. It is for this reason that built environment professionals are encouraged to attend CPD-accredited training courses on the agreements that are at their disposal,” says du Toit.
Steve will be presenting an essential guide to how the GCC 2015 works in practice on 15 & 16 November 2018 at Melrose Place Guest Lodge in Johannesburg. This course is multi-CPD-accredited with ECSA and the SACPCMP.
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