October 19, 2018

Building on BIM


Use of Building Information Modelling (BIM) in both the public and private sectors is increasing albeit with differing levels of application. One of the perceived benefits is to reduce the risk and cost of projects but this will only be realised if the contractual documentation is adequately set up to allow the process to work as it should and avoid disputes. The March 2011 Working Party Report confirmed that little or no change is required to copyright law, contracts or insurance arrangements to facilitate working at BIM level 2.

In the years since that Report, issues have arisen and lessons have been learned through the use of BIM; and the CIC Protocol 2013, the JCT 2016 suite and NEC4 2017 suite have since been published.

This article looks at whether the approach confirmed in the Report (particularly in light of the more recently published Protocol and contract suites) is still the market standard, and whether the current approaches go far enough.


BIM documentation

Whilst the documentation used to implement BIM is likely to include an execution plan, protocol, information model and information requirements it can differ from contract to contract. NEC4 gives little flexibility as it includes only the Information Execution Plan and Information Model. JCT 2016 only refers to a protocol but gives flexibility as to its form. To ensure alignment with the terms and conditions it is important to look at what the BIM documentation comprises at an early stage to determine if amendments need to be made to the terms and conditions.

Setting out BIM requirements

There seems to be a consensus that requirements associated with BIM should be set out somewhere in the contract documents but there is no standard approach as to the extent of the obligations and liabilities needed or where these should sit. The CIC Protocol is intended to be appended to the building contract, consultant appointments and sub-contracts. It sets out the liabilities, responsibilities and intellectual property rights related to BIM and attempts to integrate BIM Level 2 with standard form contracts with no amendments needed to the standard form. JCT 2016 includes the BIM Protocol as a contract document but as there is flexibility as to the form of the protocol it may or may not include any BIM related obligations.

The risk with an approach such as that adopted by the CIC Protocol is that there could be inconsistencies between the protocol and the terms and conditions, particularly around key areas such as liability and intellectual property. One approach is to rely on a contractual priority clause. This may not, however, always be appropriate given that, for example, the CIC Protocol states that it takes priority in the event of an inconsistency.

A cleaner approach perhaps is to let the BIM documentation (as contract documents) deal with the more technical aspects of the process whilst the relevant terms and conditions are updated to incorporate and weave in the necessary provisions dealing with obligations, liabilities, ownership, intellectual property etc. This may be what is envisaged by NEC4 given that the BIM Documentation (i.e. the Information Execution Plan and Information Model) appear to be technical documents and Secondary Option X10 covers ownership of the model and liability.

Obligations and standard of care

Given the importance to the efficient working of the model of timely information drops in the form required by the BIM documentation by all project team members some simple obligations on the contractor and consultants in their terms and conditions are sensible. Again, however, the standard forms deal with this in different ways.

In JCT 2016 the BIM Protocol is a contract document bringing compliance with that within the contractor’s general obligations. NEC4 places obligations on the contractor to collaborate with others who are contributing to the model and provides a brief process for finalising the Information Execution Plan, but this is as far as it goes. The CIC Protocol includes obligations on project team members to produce and deliver models and comply with the information requirements.

A common approach that does appear to be materialising is that the standard of care to be used when providing information for the model is one of reasonable skill and care. Both the CIC Protocol and NEC4 adopt skill and care obligations either linked to the skill and care normally used by professionals, referring back to the level of skill and care under the relevant agreement or reasonable endeavours. Once again, however, parties will need to make sure the BIM documentation is consistent with the terms and conditions.

Limitations on Liability

Both the BIM documentation and the models should be checked for limitations on the contractor’s liability. Arguably there is no reason why limitations on liability in this context should be treated any differently from general limitations on the contractor’s or consultant’s liability, but this is not the approach taken in all of the current standard forms.

The CIC Protocol states that there is no warranty from the project team members regarding the integrity of the electronic data they provide. This potentially undermines the usefulness of the model and each project team member should be able to take responsibility for the electronic data provided. Whilst the NEC4 does not contain such explicit limitations on liability some of the provisions in the new secondary option need to be approached with care. One example is that the client is liable for faults in information provided by Information Providers other than the contractor – this would be a problem if under your contract the contractor is meant to be responsible for managing the model, and also this muddies the waters on liability where the contractor is responsible for some or all of the information providers (e.g. subcontractors and subconsultants). There may also be other general clauses limiting the contractor’s liability elsewhere in the contract, which you should look out for.

Insurance

NEC4 places an obligation on the contractor to provide insurance for claims made against it arising out of its failure to provide information for the model using the specified duty of care. Neither JCT 2016 or the CIC Protocol cover insurance and although it does not do any harm professional indemnity insurers do not appear to be excluding BIM claims to date so consider whether these obligations are necessary for BIM level 2.

Intellectual property and software licenses

One of the most discussed aspects of BIM is its impact on the usual copyright provisions seen in construction contracts. None of the standard consultant appointments have been updated in this respect and the JCT 2016 only deals with it by virtue of the fact the design documents or information to be provided under the BIM Protocol are Contractor Design Documents. The NEC4 goes a little further by stating 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. The CIC Protocol fails to deal with ownership of and rights to use the models and the copyright licence is revocable on non-payment of fees. None of these approaches seems to fully deal with all of the potential intellectual property issues.

The intellectual property rights created by BIM go beyond copyright by creating rights in software code, databases and the models themselves. The intellectual property provisions will need to be wide enough for this and to include for the transmission of electronic information and allowance for the material to be used in a model connected to the project. Consider also whether it is prudent, particularly on a traditionally procured project, for the intellectual property licence to flow through all of the contract documentation so cross licences are granted to all project team members. As identified in NEC4, provisions should be inserted to deal with ownership of the federated model.

In light of Trant Engineering Limited v Mott MacDonald Ltd [2017] parties should also consider whether a separate software licence is required in addition to the usual intellectual property provisions. One of the fundamental principles of PAS 1192-2:2013 is the provision of a single environment to store shared asset data and information, accessible to all individuals who are required to produce, use and maintain it. Without this BIM cannot work and therefore, if the BIM documentation itself does not deal with this, surely the terms and conditions should.

The overall picture

Currently there is no market standard position on the approach to BIM. As BIM continues to develop it is important to keep an eye on contract amendments and consider on a project by project basis whether amendments are required depending on the level of application, the BIM documentation and how familiar the client, the contractor and the design team are with the process.