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:
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:
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:
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.
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:
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  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.
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.