Is there a preferred standard form of contract that can be used with #BIM? One option explored.

Introduction

The blog asks whether there is a preferred standard form of contract that can be used in accordance with Building Information Modelling (BIM) and whether any existing contract type can be used.  The context of contracts and options will be reviewed briefly before proposing that the recent issue of the Chartered Institute of Builders (CIOB) Complex Project Contract 2013 (CPC 2013) that potentially aligns with the collaborative ethos of BIM in a modern construction industry.  Benefits and challenges of this contract will be investigated to examine the possible future success of this for BIM.

 

Contract

Circo (2012) identifies that relational contract theory asserts that “we can properly understand and analyse contracts, contract law and contractual disputes only when we look beyond discrete transactions and express terms of agreements to examine the relationships involved” (Circo, 2012, p. 16).  This reflects the issue that disputes illustrate relational problems within a project team and that greater collaboration and integrated project delivery is required more than ever to overcome these issues (Circo, 2012).  Circo argues that relational contracts are designed to “strengthen and manage relationships involved for greater efficiency, problem-solving, and collaboration” (Circo, 2012, p. 18).  Therefore prior to commencing a project the decision on what type of overall structure of relationships between project participants should be confirmed and aligned with the aims of the project client (Circo, 2012).  Furthermore, Circo (2012) concludes that written agreements can be effective to “establish, define and manage” relationships (Circo, 2012, p. 24).  Current contracts such as the Joint Contracts Tribunal (JCT) are adversarial contracts that do not support this collaborative way of working in a modern construction industry, therefore alternatives are required.

 

Emmitt, Gibbs, Lord and Rucker (2015) develop the context of a construction industry in need of a contract that can mitigate the average construction dispute of US$31.7m value and a 12.8 month average duration to determine (Emmitt et al., 2015).  They propose that new contractual frameworks, as well as cultural change, training and growth, are required to support this new 21st century construction industry (Emmitt et al., 2015).  In addition to this, Emmitt et al. (2015) argue that BIM changes the relationships within a project team and requires new legal and contractual information to confirm, for example; who owns a federated model, who is responsible for creating, analysis and updating information, when information will be delivered and what priority of the documents will be (Emmitt et al., 2015).  Emmitt et al. (2015) argue that a new collaborative environment (i.e. not just a contract) is required to ensure an approach that fosters cooperation.  This altered ethos or way of working could be more important than the contract itself, as without a team basis that supports cooperation, a contract will only serve to provide a recourse to dispute resolution.  Therefore, it is argued here that the spirit of collaboration and culture within a team is fundamental, prior to deciding a contract type.  Further to this, the type of project, whether a building, infrastructure or utilities project, and the scale will impact on the contract type required.

 

Contract options

Bond (2013) identified alternative contracts, as identified by the Lean Client Group (Mosey, 2012) that may be suitable for adoption of the BIM Protocol or may have one already integrated:

 

  • Joint Contracts Tribunal (JCT) Contracts – e.g. Traditional, Design and Build, Constructing Excellence, adoption of the Public Sector Supplement plus some minor amendments to main contract proposed.
  • New Engineering Contract (NEC3) Option C – a non-adversarial, partnering contract with minor amendments proposed to provide an adequate contract for BIM Level 2 requirements.
  • PPC 2000 – an explicitly multiparty contract with client, contractor and consultants forming a Partnering Team. Whole team is appointed by a single multiparty contract, which allows the Protocol to apply to all involved (as suggested by the Protocol).
  • CIOB Complex Projects Contract 2013 (CPC 2013) – argued as the only BIM contract currently available, with no amendments required and no Protocol to be bolted-on. Embraces Level 2 procedures and reduces risk of contradiction in terms and risks by amending standard contracts.

 

Emmitt et al. (2015) confirm that the Government Level 2 pathfinder trial project utilised PPC2000 without amendments (Cookham Wood Trail Project, 2013) or a BIM Protocol (Emmitt et al., p. 287).  However, the use of collaborative work practices and an approach of mutual collaboration appear to have had successful results, over and above the contract type used in itself.

 

When considering the preferred contract that can be used in accordance with BIM, NEC3 and PPC2000 have been argued as one possible appropriate contract to use (Mosey, 2013).  However, it is proposed that the recent CIOB Complex Projects Contract 2013 is the first contract available that manages time in complex construction and engineering projects and also the first standard contract form that caters for BIM explicitly within the contract terminology (designingbuildings.co.uk, 2016).  What constitutes a complex project is open for debate, however the contract proposes that this is where a project cannot be developed on ‘intuition’ itself.  The contract also provides for contractors who will prepare a BIM for the whole of the works or where a design contribution is needed, which is unique to contracts currently.

 

General provisions of the contract include that “parties shall work together in the manner set out in the Contract and shall co-operate in a spirit of mutual trust and fairness” which is a clear statement in contrast to how the JCT Standard Building Contract has worked to date (Glover and Elliott, 2013, p.3).  The contract focusses on time management with a Project Time Manager (PTM) appointed, who advises the Contract Administrator (CA) on time related issues, and an Auditor who acts as a Time Management Expert who assess the contractors Planning Method Statement, Work Schedule and Progress Records (Glover and Elliott, 2013).  Glover and Elliott (2013) argue that although there is an additional administrative burden, the plain language of the contract and structure aims to reduce disputes, although this remains to be tested thoroughly.  The United Nations building has confirmed that this is what it will be doing to try and receive the benefits of this new contract, the results of this will be investigated heavily once completed (United Nations to test drive new CIOB Complex Projects Contract, 2015).

 

Emmitt et al. (2015) investigate the aims, benefits and challenges of CPC 2013 and illustrate that the aim of the contract is a “proactive, open, scientific approach … to reduce the likelihood and severity of disputes” (Emmitt et al., 2015, p. 287).  This is firmly positioned as a 21st century contract that does not rely on paper for communication and focuses on “collaboration and transparency” to manage the risk, time, cost and quality areas (Emmitt et al., 2015, p. 288).  The contract specifically mentions BIM, the only contract currently available to do so, and confirms copyright and ownership as well as Levels of Detail required throughout six design stages (Emmitt et al., 2015, p. 288).   A BIM Protocol is still required for “maintenance of the model” and therefore the clauses included will need amendment to ensure that the Construction Industry Council (CIC) BIM Protocol cl. 2.11, that it will not prevail in overriding the main contract (CIC, 2013, p. iv).   This appears to partly resolve the concern that the BIM Protocol, unless altered, may have unintended consequences for the main contract.  Uniquely the CPC 2013 also references the requirement for a Common Data Environment (CDE), a requirement of BIM Level 2 and therefore is most aligned with this particular aspect of the UK Government’s BIM Level 2 strategy.

 

Emmitt et al. (2015) argue the CPC 2013 links to BIM aims as they engender;

 

  • Transparent, reliable, electronic information exchange.
  • Aim to produce high value project information which can be used to make informed decisions and increase certainty for t project team members.
  • Require front end investment in an attempt to reduce the likelihood and severity of future problems.
  • Require a collaborative approach.

Emmitt et al. (2015, p. 289)

 

There is some criticism from Emmitt et al. (2015, p. 290) that the CPC 2013 has limitations regarding software exchanges in native format, the use of a CDE as not being compulsory and whether the contract trusts individuals to perform their roles.  This illustrates that for all the alignment with BIM there are still challenges and specific organisational planning is required amongst the team to establish ways of working and collaborative behaviour towards a shared goal.  Additionally, Emmitt et al. (2015, p. 291) confirm that the contract appears to focus on the construction stage and not on the whole life cycle of a project, a key aspect of BIM.  This may limit the effectiveness of BIM as a process to assist with the long term strategic planning and use of the model and information through as asset lifespan.

 

A criticism of the contract has been levelled by Bingham (2012) who argues that the contract is too complex and, with sixty four clauses, questions whether the contract will be read by the project participants.  Bingham (2012) argues for a smaller contract with just the crucial clauses, although he fails to confirm what these may be.  Mendelblat (2013) is more complementary and proposes that the use of progress records compiled by the contractor, a schedule of anticipated out turn time (rather than predictions made at the time of tender), and transparency could lead to a good working environment for participants.  Mendelblat (2013) also anticipates that the CIC BIM Protocol will be used with the contract which will require some amendment to align with the CPC 2013.

 

Conclusion

The field of contract and the construction industry is complex and there are many options.  It has been argued here that prior to any decision on contract the best cooperative and collaborative team structure should be identified for a client to make informed decisions.  The correct contract for use will then need to be chosen from a range of options, however the use of JCT Constructing Excellence, PPC 2000, NEC3 or CIOB CPC 2013 appear to be appropriate options.  These are in contrast to the traditional JCT SBC or Design and Build contracts that have an adversarial approach and appear to be ill suited to the collaborative working environment that the BIM process is proposing.

 

References

Bingham, T. (2012). CIOB complex contract: Unpickupable. [online] Building. Available at: http://www.building.co.uk/ciob-complex-contract-unpickupable/5039856.article  [Accessed 5 Jun. 2016].

CIOB. (2016). Contract for Complex Projects. [online] Available at: http://www.ciob.org/insight/contract-complex-projects  [Accessed 5 Jun. 2016].

Circo, C. (2012). The evolving Role of Relational Contract in Construction Law. The Construction Lawyer, [online] 32, pp.16-24. Available at: http://Heinonline.org  [Accessed 5 Jun. 2016].

Cookham Wood Trial Project. (2016). 1st ed. [ebook] London: Constructing Excellence. Available at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/325950/Cookham_Wood_case_study__CE_format__130614.pdf  [Accessed 5 Jun. 2016].

Designingbuildings.co.uk. (2016). Complex projects contract – Designing Buildings Wiki. [online] Available at: http://www.designingbuildings.co.uk/wiki/Complex_projects_contract  [Accessed 5 Jun. 2016].

Emmitt, S., Gibbs, D., Lord, W. and Ruikar, K. (2015). BIM and construction contracts – CPC 2013’s approach. In: Institute of Civil Engineers. [online] Baath: University of Bath, pp. 285-293. Available at: http://opus.bath.ac.uk/42904/  [Accessed 5 Jun. 2016].

Glover, J. and Elliott, F. (2013). The New CIOB Contract for Use On Complex Projects. 1st ed. [ebook] London: Navigant Consulting, pp.1-4. Available at: http://www.navigant.com/~/media/WWW/Site/Insights/Construction/IFH%20Winter%202013/CON_IH_NewCIOBContractForUseOnComplexProjects_TL_1213%20final.pdf  [Accessed 5 Jun. 2016].

Mendelblat, M. (2013). CIOB’s Contract for use with Complex Projects: take the plunge! | Construction Blog. [online] Constructionblog.practicallaw.com. Available at: http://constructionblog.practicallaw.com/ciobs-contract-for-use-with-complex-projects-take-the-plunge/  [Accessed 5 Jun. 2016].

Mosey, D. (2013). PPC: The natural home for BIM and collaborative working. [online] NBS. Available at: https://www.thenbs.com/knowledge/ppc-the-natural-home-for-bim-and-collaborative-working  [Accessed 5 Jun. 2016].

Pickavance, K. (2014). The CIOB Complex Projects Contract 2013. [online] NBS. Available at: https://www.thenbs.com/knowledge/the-ciob-complex-projects-contract-2013  [Accessed 5 Jun. 2016].

United Nations to test drive new CIOB Complex Projects Contract. (2015). Construction Manager, [online] (February 2015), p.4. Available at: https://issuu.com/constructionmanager6/docs/cm.march2016.combined  [Accessed 5 Jun. 2016].

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