The JCT Prime Cost Building Contract is designed for projects that
require an early start on site, often for alterations or urgent repair
work (such as fire damage). The exact nature and extent of the work is
not known until the project is underway, so full design documents are
not completed until work has commenced.
The JCT Prime Cost Contract (PPC) is sometimes also called a cost plus contract, or cost reimbursable contract.
The prime cost contract is a specialised, cost-reimbursable contract which is generally for use when an early start is required, but where it is not possible to define the exact nature and extent of the work required sufficiently accurately enough to obtain a firm lump sum price for it.
The prime cost contract was originally intended for use in cases of repair and reinstatement works after a fire, or other damage to existing structures. It is also useful for alterations and repairs to old buildings where there are similar uncertainties as to the precise requirements and nature of the works that will eventually be needed.
The PPC contract does require the appointment of an Architect/Contract Administrator and Quantity Surveyor to administer the contract, and contains provisions for the strict control of work and expenditure.