Clarkslegal LLP - Solicitors in Reading and London

Legal Updates

Building BIM into the contract

05 April 2018 #Construction


We are seeing an increased adoption of BIM (Building Information Modelling) in the projects we are advising on across the private sector. Of course, BIM Level 2 became mandatory for use on all centrally procured UK public sector works in April 2016. The implementation of BIM means that the contract documents for the contractor and through the supply chain and professional consultants will need to consider the specific implications of BIM.

The legal, contractual and insurance matters that arise when dealing with the requirements of BIM are wide-ranging. The extent of changes will depend on the extent to which BIM will be used and the parties’ preferences. In this article, the focus will be on four key areas, including: 

  1. BIM requirements and documentation;
  2. Risk allocation;
  3. Insurance; and
  4. Intellectual property and ownership.

What is BIM?

BIM is essentially a collaborative approach to the design and build process which uses information modelling and information management to create a virtual model of the entire project. In the BIM Overlay to the RIBA Outline Plan of Work, the Construction Project Information Committee describes BIM as a “digital representation of the physical and functional characteristics of an asset to support reliable decision-making and management of information during its life cycle, from earliest conception to demolition”.

1. BIM requirements and documentation

There is no standard market position, but BIM contractual documentation will usually include the following:

  • An execution plan,
  • A BIM protocol such as the CIC BIM Protocol,
  • An Information model,
  • (Employers) information requirements.

However, the documentation often differs from contract to contract. This can be seen in the industry standard forms. In the new NEC4 Option Clause X10 it requires an Information Execution Plan and Information Model. In contrast, the JCT 2016 BIM provision refers to a protocol but gives flexibility as to its form.

Underlying all this, the various project participants should all know what is expected of them at the outset via a BIM Implementation Plan. Such a plan should address matters such as:

  • What the intended outputs of the BIM models are? (I.e. what models are to be created and by whom and for what purpose);
  • A definition of the content of each model and level of detail required from each participant at specified milestones;
  • How to resolve any conflict between model contents;
  • Ownership of model(s) and data inputs;
  • Management of the modelling process;
  • What levels of reliance that can be placed upon the data content of models and at what stage in their development; and
  • The software platforms intended to be used, processes for transferring and accessing model files and file storage location.

2. Risk allocation

With multiple contributors to the BIM model, there is the clear question of how the risks will be allocated. An error in the information provided to the BIM model or detection of a clash requiring a change can cause serious delay and costs consequences. Who will carry this risk?

The NEC4 approach is that the client is liable for faults in information provided by information providers other than the contractor (such as subcontractors and subconsultants). However, this presents a problem if the contractor is meant to be responsible for managing the model and for some or all of the information providers.

In addition, the BIM Protocol may regulate matters relating to the submission of design information and this may take precedence over any conflicting terms in the contract. 

3. Insurance

The requirements of BIM may require changes to any existing insurance arrangements and parties with design responsibilities should maintain professional indemnity insurance to cover failures due to design. A number of options are available, one area which has been discussed at length is the use of Integrated Project Insurance. Whatever approach is adopted, care should be taken to ensure the correct level of cover is arranged.

4. Intellectual property and ownership

One of the most discussed aspects of BIM is the complicated intellectual property rights and ownership issues. BIM can potentially create rights in software code, databases and the models themselves. Intellectual property provisions will need to be drafted widely enough and include transmission of electronic information.  When numerous contributors are involved in a project, the contracts should deal with the rights of each contributor. 

The industry standard forms, including JCT, NEC4, CIC Protocol, do not deal with these rights fully, in the sense that: 

  • JCT only addresses it by way of stating that the design documents or information to be provided under the BIM Protocol are Contractor Design Documents;
  • NEC4 goes further, saying that the client owns the information model and the contractor’s rights over information provided by the contractor which is used to create or change the information model; and
  • CIC Protocol does not deal with ownership of and rights to use the models and the copyright licence is recoverable on non-payment of fees.

A contract should also consider which licensing arrangements are the most suitable when applying BIM. This should include access to the BIM model to track progress or to extract project data.

The licensing hurdle arose recently in the case of Trant Engineering Limited v Mott MacDonald Ltd [2017] EWHC 2061 (TCC). The BIM coordinator had revoked the contractor’s access codes to the common data environment in light of a payment dispute. However, the Court granted an interim mandatory injunction against a BIM coordinator, requiring them to provide access. In such circumstances, the BIM coordinator of the common data environment is a gatekeeper of the whole project. Therefore, if a BIM coordinator revokes access to the common data environment, it not only does so in respect of its own designs, but, potentially to all other designs, schedules, contracts, reports and other data and information about the project within that common data environment.

Conclusion

Whilst the adoption of BIM may be on the rise, in the current absence of a standard market position on BIM, contractual arrangements must be considered on a project-by-project basis and reflect the extent to which BIM will be used.

Clarkslegal, specialist Construction lawyers in London, Reading and throughout the Thames Valley.
For further information about this or any other Construction matter please contact Clarkslegal's construction team by email at constructionsector@clarkslegal.com by telephone 020 7539 8000 (London office), 0118 958 5321 (Reading office) or by completing the form on this page.

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David Rintoul

David Rintoul
Partner

E: drintoul@clarkslegal.com
T: 0118 960 4675
M: 07880 741 514

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Construction team
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