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How are variations valued under a JCT subcontract?

By agreement, by an accepted quotation, or under the Valuation Rules, which start from your subcontract rates and move to fair rates or daywork.

Updated: . By Jack Butler-Kettle, Construction Claims Consultant.

For section 5 clause by clause, see how JCT section 5 works.

The answer

Section 5 of a JCT subcontract sets the rules, much as section 5 of the main contract does. First, you and your main contractor can simply agree a price, before or after the work. Second, where the direction asked you to quote, your accepted quotation sets the price. Otherwise the work is valued under the Valuation Rules, which run in a fixed order. Work like the work you priced, done in similar conditions and quantities, is valued at your rates. Where the conditions or the quantity have changed significantly, your rates are the basis, with a fair allowance for the difference. Work unlike anything you priced is valued at fair rates and prices. Omitted work comes off at your rates. Daywork is used only where the work cannot properly be valued by measurement. The rules also let other work be revalued if a variation substantially changes the conditions it is done in. Loss and expense, the cost of disruption or a longer job, stays out of the valuation. It has its own clause and its own notices. Check your amendments too, because they can change any of these rules. Then price each variation on the rule that fits it, and say which rule you used. When a valuation comes back on the wrong rule, answer it on the rule, not on the total. Our Variation Claim service values each variation under the rules your subcontract sets and presses it to agreement.

Example

Illustrative example. The scenario and figures are invented.

The facts

A drylining subcontractor on a JCT subcontract has three variations to value. The main contractor has valued all 460 square metres at the £32 partition rate, £14,720.

What happens

  1. The subcontractor sorts the three items by the rule each one falls under.
  2. The 300 square metres of added partitions match the priced work, conditions and quantity, so they go in at £32: £9,600.
  3. The 120 square metres moved to night working are the same work in different conditions. So £32 is the basis, with a fair allowance of £6 a square metre: £4,560.
  4. The 40 square metre curved wall is unlike anything priced, so it is valued at a fair rate built up from labour and materials: £2,850.

The three variations

ItemRuleAmount
Added partitions, 300 square metresYour rate of £32£9,600
Partitions moved to night working, 120 square metres£32 plus a fair allowance of £6£4,560
Curved wall, 40 square metresFair rate from labour and materials£2,850
TotalEach item on its own rule£17,010

The outcome

The account goes in at £17,010, £2,290 more than the flat-rate figure, with each line tied to the rule that sets it.

To have each variation valued under the rule your JCT subcontract sets and pressed to agreement, see our Variation Claim service.