BIM is becoming increasingly used in the industry as a common knowledge platform, whereby design can be shared between consultants and contractors, as they work together on a project. The first judicial decision on BIM highlights how important it is to get the legal documentation right when using BIM.
- Trant Engineering Limited (TEL) was appointed by the MOD to construct a £55m power station at Mount Pleasant Complex in the Falkland Islands.
- TEL employed Mott MacDonald Limited (MML) to provide design consultancy services in relation to the project. MML implemented the use of BIM software to enable other design consultants to manage and share design data on a central platform.
- A contract between TEL and MML was never entered into and both parties sought to rely upon their standard terms and conditions.
- TEL failed to pay a number of disputed invoices issued by MML. In response, MML announced it was suspending all work with immediate effect and revoked its intellectual property licence to TEL in respect of the design data provided up to that point. In doing so, MML relied upon a clause in their (disputed) terms which stated that “Upon full payment of the fees due under the consultancy agreement the consultant shall grant to the client an irrevocable royalty free and non-exclusive licence” to use its design (emphasis added).
- As a result, TEL had no access to the design materials provided by MML and other consultants, which were stored by MML on the BIM software. TEL sought from the Court an injunction upon MML to provide access to the design data.
Conclusion of the Court
Mrs Justice O’Farrell DBE granted an interim injunction in favour of TEL to the design data that had already been carried out by MML and the design that had been provided by others within the BIM platform. This was decided on the basis that, regardless of the contractual position, MML had already accepted payment on account of the work that had been carried out.
What does this mean for BIM projects going forward?
Although these aspects were not commented on within the judgment, the case gives rise to a number of concerns when using BIM:
Who holds the Data?
A considerable amount of reliance is placed upon the party hosting the data, the BIM Operator. The BIM Operator should have a continuing obligation to ensure that the data is available to others, to allow them to progress the project. This obligation should survive suspension and termination of their employment.
It is important for all designers to keep back-up records and the Employer may require the ability to extract data from the software.
Rights of Suspension
The type of clause that MML sought to rely upon in their contract should be avoided in a BIM project. The licence to use design must be passed to the Employer during the provision of the Services. The licence should not be granted upon full payment of fees (which suggests that the licence is not passed until the end of a project) because this would make BIM platform inoperable. The Employer needs the licence to grant a sub-licence to other consultants to commonly use the data.
The right to suspend “any or all obligations” for non-payment is enshrined within the Housing Grants, Construction and Regeneration Act 1996. What happens however if there is an obligation on a BIM Operator to provide ongoing support for others to use the BIM model? Do they have a statutory right to suspend? It is best to ensure that the BIM Operator is appointed under a separate contract that is unrelated to design, so that it is not classed as a construction contract and therefore outside of the ambit of the Act.
The most popularly used BIM Protocol, from the CIC, states that the licence to use design may be suspended or revoked by a Project Member in the event of non-payment (para 6.4). The parties within this the case did not use such a Protocol, but this case puts into focus the ability of such a provision to disrupt the entire project. It is often recommended to delete this paragraph. This case supports the notion that the Employer and other Project Members should be allowed to continue to use design that has already been provided, even in the event of future non-payment, and this distinction should be made clear with the contractual documentation.
This judgement is an interim decision, with the matter to be more fully determined in future by the Court. As BIM becomes more popular in the industry, it is likely that we will see more cases concerning BIM and further legal developments in this area.
This blog post was written by Gemma Irving.
Case reference: Trant Engineering Limited v Mott MacDonald Ltd  EWHC 2061 (TCC)