Originally posted Monday, 10 October 2011

Written by Andrew Ness

Building Information Modeling (BIM) reduces in a very tangible and visible way some of the perennial risks of construction that have historically plagued many an Owner— most obviously the problem of uncoordinated drawings that contain conflicts and clashes between different building systems. Beyond doubt, BIM is a notable advance in building technology, and the more complex the structure, the more noticeable the effect.

But while BIM accomplishes a real reduction in tangible risks like the risk of clashes in the field, at the same time it creates new and intangible risks of friction or disputes among the parties to the construction process. This stems from the fact that BIM is a new and transformative technology that does not fit well within our existing framework of legal rules and principles. Most significantly, the benefits of BIM are best realized when the models created for the project are openly and easily shared among all those involved, and each party, whether lead designer, design consultant, contractor, or subcontractor can make appropriate contributions or corrections to the models, for the information and benefit of all. But this concept of an open and collaborative working relationship is pretty much foreign to our legal system. The existing legal system frankly is poorly equipped when it comes to appropriate legal rules for regulating such a multi-party, collaborative kind of relationship. Instead, our contract and tort law systems are very heavily biased in favor of legal rules that are designed to identify a single party who is legally responsible for the problem when things go wrong.

The unfortunate result of this is considerable legal uncertainty for those who get access to and the ability to modify the project model, and a reluctance to allow such access to all of the participants who ideally should have it if the full promise of BIM is to be realized. The resultant risks are the perceived risk of being held financially responsible if an undetected error creeps into the model and this leads to an expensive error in the field, as well as the more hidden risk that the investment of money and time in BIM does not yield as much benefit to the Owner as it should.

The standard construction industry form agreements and contract provisions do not even begin to address these BIM-created risks. So how can they be mitigated or addressed? Someday the legislatures or the courts may create or evolve default legal rules that apply in the absence of a specific agreement, and provide the basic assurances needed to mitigate these risks. But don’t hold your breath—this will likely require many years, given the very limited rate of change that is built into our legal system. So what is needed instead is self-help, in the form of getting all those involved in the project models to agree on a common set of rules and standards of responsibility. In concept, such a multi-party agreement could fashion a collaborative environment in which the benefits of BIM can flourish to their fullest. This is a lot easier said than done, however. Agreements in the construction industry are traditionally two-party contracts—Owner-contractor, Owner-designer, contractor-subcontractor, and so forth. Just getting everyone involved to sign onto one agreement, even one that only deals with BIM-related issues, is a significant departure from normal practice and a major challenge in itself. Moreover, in this still relatively early stage of BIM’s development, a clear concept of just what those collaborative rules should be is far from obvious.

To date, two industry groups that issue form agreements for use by the construction industry have made an initial attempt to address the special risks of BIM via an addenda to their standard contract forms. The American Institute of Architects (AIA) has done so mainly via two recommended exhibits (documents E201 and E202), but to date the most comprehensive effort to address the specific collaboration issues raised by BIM is the BIM Addendum issued as its document 301 by ConsensusDOCS.

The BIM Addendum works within the two-party nature of construction industry contract arrangements, rather than trying to get all parties to sign a single new agreement. The addendum is designed to be appended to every two-party agreement where both parties will have model access. Assuming, as is the intent, that each copy of the Addendum is identical, the overall effect is much the same as if all parties had signed a single agreement to govern their overall relationship respecting the project models. The Owner’s major responsibility, besides requiring all project participants to use the BIM Addendum, is to appoint a designated “Information Manager”—a party that has agreed to take on the responsibility to control access to the models, maintain security for the models, and keep track of who else is entering data into the models and where it is being added. The Information Manager is most likely to be the lead designer, but this can be varied if desired. While the commercial terms are not specified, the Owner should expect to pay a separate fee for these not insignificant responsibilities being taken on by the Information Manager.

The core provisions of the BIM Addendum, however, are the responsibilities assumed by each participant (called a “Contributor” in the Addendum) who has access to a model. Each Contributor agrees that it will responsible for its own contributions, and for those made by its subcontractors or consultants. All Contributors agree to report any errors, omissions, or inconsistencies in the model that they may identify, which helps reduce errors for the benefit of all. Each promises that they possess the legal right to the intellectual property that they contribute to the model, and each agrees that the other Contributors all similarly retain their respective rights. All Contributors have the right to use all the contributions that comprise the model, but only for purposes of the specific project, and not for any purpose beyond that. Finally, there are limits placed on claims against those others that the Contributor has a contract with regarding access to and use of the model.

At this stage of BIM’s evolution, the ConsensusDOCS BIM Addendum is probably best viewed as a “first pass” attempt at addressing the risks of BIM. Doubtless, the concepts it includes will evolve with real-world experience, and many other industry participants will likely have bright ideas for improvements and additions that will in time become widely adopted. But certainly the BIM Addendum is a fair and reasonable first effort, and well worth the effort to adapt and utilize on projects today in order to mitigate and reduce the risks of BIM.

A partner in the Washington, D.C., office of Jones Day, Andrew Ness assists Owners and others with troubled projects, solving complex construction and design related problems without need for formal dispute resolution whenever practicable. He has also served as lead counsel on a wide variety of large construction disputes that were resolved in federal and state courts and via domestic and international arbitrations. Andy also has extensive experience in resolving disputes through the use of mediation and other alternative dispute resolution techniques, and he has drafted and negotiated design, EPC, and construction contracts for a wide range of major projects around the world. adness@jonesday.com