October 01, 2017

Quarrelling Collaborators: The Flip Side of BIM’s Interoperability

Kyle Smith

Introduction

At the turn of the twenty-first century, the future of the construction industry looked bleak. The technological movement that had revolutionized the rest of the United States economy left the construction industry largely untouched.[1] The construction industry failed to capitalize on an abundant potential for advancement. Exponential growth in computer, network, and wireless capabilities, made it possible for information technologies to be applied to all phases of the building life cycle.[2] If implemented in the construction industry, this technology could have streamlined historically fragmented operations.[3] The construction industry, however, was trapped in a vicious cycle; a failure to innovate sapped the industry of prosperity, which in turn stifled investment and exacerbated stagnation.[4] Although difficult to quantify precisely, annual estimates of productivity in the construction industry reflected this stagnation.[5]

As the decade wore on, this stagnation continued. Technological innovation continued to permeate other industries, but the construction industry experienced advancement only incidentally. Even when these technological innovations spilled over into the construction industry, the incremental improvement was mainly confined to discrete tasks, such as the use of GPS in surveying and excavation.[6] While this technological spillover undoubtedly made the construction industry more efficient, failure to innovate the underlying construction process stifled the construction industry’s growth. Even as computer, automobile, and aircraft manufacturers used automation and electronic standards to integrate design and manufacturing in their respective industries,[7] the construction industry continued to use paper documents to facilitate data transfer among project participants.[8] This antiquated construction methodology is representative of the industry’s overarching inability to implement technological advancement.

With industry professionals looking for answers, a new design concept emerged with the potential to transform construction design into a virtual and uniquely collaborative process. Building Information Modeling (BIM), as it has come to be known, is “an intelligent model-based process that helps make design, engineering, project and operational information accessible and actionable for buildings and infrastructure.”[9] Although utilized to produce a comprehensive model of the building or structure, BIM is more than just the next iteration of computer-aided design (CAD);[10] it is more accurate to think of BIM as a single, consistent project database into which construction and design professionals place building design information (i.e., create several of their own models).[11] In addition to providing the dimensions included in traditional hard copy specifications, the project database in BIM imbues every modeled element with all of the information needed to design, build, maintain, and operate the envisioned work.[12] Thus, the 3-D model itself is just the tip of the iceberg.[13] As the underlying technology continues to improve, the vision is for added dimensions to place scheduling information (i.e., when the component was fabricated, its erection sequence, or when it is scheduled to be delivered) and cost information (i.e., cost to purchase, fabricate, or erect each component of the design) at the fingertips of the user.[14]

The benefits of BIM and the interoperability it promises are readily apparent. In utilizing a process of managing and collecting comprehensive building data, BIM provides a complete flow of information among dispersed project teams for greater accuracy across the entire supply chain.[15] BIM thereby enables all parties to virtually model all material aspects of a structure before commencing construction, both making the construction industry abundantly more efficient and facilitating immense cost savings.[16] Ultimately, BIM represents a realization of interoperability that has long been a pipe dream in the Architecture, Engineering, and Construction industry,[17] holding the promise of generating real and lasting productivity gains through the collective effort of all parties to the construction process.[18] Implementing BIM in the industry could make discrete construction design a thing of the past; cooperation would no longer be limited to transferring hard copies of two-dimensional design plans and specifications. Thus, after decades of limping behind its more innovative counterparts, the construction industry looked poised to break out of its technological rut.

Introducing BIM in the construction industry, however, has not been without significant complications. As is often the case in the industry, the technology underlying BIM has raced far ahead of the legal framework necessary to facilitate the enhanced interoperability that BIM promises.[19] In breaking down the barriers that currently divide construction projects into a series of discrete tasks and responsibilities, BIM complicates the task of risk management. With multiple project participants contributing to the same model, the risks associated with those contributions cannot be divided into discrete classes of liability. Similarly complicated by this collaboration is the intellectual property protection afforded to the owners of the overall model and even the contributions themselves. With the extensive benefits that BIM promises, however, it has been impossible to keep the BIM genie in the bottle long enough for the legal framework catch up to the technology. Therefore, as BIM continues to permeate in the industry,[20] it becomes critically important to amend existing legal framework to address significant legal concerns.

Part I of the article maps out the legal issues presented by the interoperability that BIM presents, as identified by the International Alliance for Interopabilities. Part II discusses the current legal framework for the creation and protection of intellectual property rights in construction projects under BIM, analyzing the merits of proposals for reform. Part III provides a similar analysis for risk allocation and management in construction projects under BIM.

I       Identifying the Legal Issues

Implementing revolutionary technology often implicates a host of legal problems, especially when the implementation is accompanied by a conceptual shift in the industry. Shifting from discrete design to an era of interoperability changes the fundamental nature of the relationships among construction project participants. While the work performed by designers, engineers, contractors, and sub-contractors has historically been segmented, BIM promises to break down this barrier to more efficient collaboration. In a BIM construction project, the construction professionals contribute to a unified information model or several ‘federated’ models (various models linked together and drawing knowledge from each other).[21] As this conceptual shift in the design process occurs, there is global concern that the industry has not addressed a host of legal issues, risks, and barriers associated with the introduction of BIM.[22] To that end, the International Alliance for Interoperabilities (IAI) has identified eight key issues that practitioners must address in order to adopt true interoperability in the construction industry.[23] While some of these issues pertain to administrative and technological adjustments inherent in the incorporation of new technology, such as the availability of quality software packages and the development of skills necessary to operate the software,[24] the remainder of the list identifies several legal issues arising out of the uniquely collaborative environment provided by BIM.[25] These issues primarily concern the difficulty in establishing the ownership of each contribution to the model and implicate both risk management and intellectual property. There are certainly novel issues that may arise as a result of the introduction of BIM, but addressing these particular legal issues will establish the framework for a successful takeoff of a BIM project.

II     Intellectual Property

Determining the ownership of both the overall BIM model and the various contributions to the model raises questions as to the parties’ intellectual property rights and protection. While it may be tempting to overlook the impact that intellectual property laws have on the construction industry, BIM cannot properly be implemented without an understanding of the role that copyright protection plays in the construction industry. Under the authority conferred by Article I Section 8 of the Constitution,[26] Congress promulgated copyright legislation to provide an exclusive set of rights[27] to the owner of an original work of authorship fixed in any tangible medium of expression.[28] Unlike patent law, these works are protected as soon as the work is memorialized in tangible form, rather than the moment the work is registered with the appropriate government agency.[29] As a trade-off, however, copyright protection is a narrow form of protection, protecting only the expression of ideas and not the ideas themselves.[30] Moreover, copyright protection is subject to several significant exceptions, most notably the ability of other authors to independently create and copyright an identical work.[31]

Although most closely associated with the entertainment industry, copyright protection occupies an important place in the construction industry. In fact, starting in 1976, copyright protection included architectural design plans under the statutory definition of copyrightable subject matter.[32] This protection, however, did not extend to the three dimensional structures derived from technical drawings and thus, did not prohibit deriving the technical drawings by taking measurements of the building itself.[33] This loophole was closed in 1990 by the Architectural Works Copyright Protection Act (“AWCPA”), which conferred protection to architectural designs embodied in three-dimensional building structures.[34]  This supplemental protection was perfectly timed, as it curbed the copying of buildings using the technological advancements in the digital media context.[35] Now that both drawings and buildings are protectable under copyright law, copyrighted material will inevitably be implicated and change hands at every stage of a construction project.[36] Given the exclusive rights afforded to the copyright owner, construction contracts necessarily contain copyright provisions granting a license to each party so as to avoid multiple counts of copyright infringement.[37]

A     Legal Issues Implicated

Even when the design process was a discrete task, almost entirely detached from the rest of construction, there were conflicting understandings of who deserved the intellectual property rights to the design plans and the resulting building. Under existing copyright protection, the “author” of the work is presumed to own the copyright of the plans. While the architects are thus the default copyright owners, clients nonetheless feel entitled to use and reproduce the work after having paid for the design services.[38] In the absence of a “work for hire” contractual agreement, however, the architect, as the author of the work, has the right to preclude the owner’s future use of the design documents.[39] While customarily addressed with licensing agreements,[40] this potential holdout problem will become even more complicated as greater parties begin to access and contribute to the overall model.

When a project employs BIM and utilizes the interoperability it facilitates, the ultimate design model will comprise contributions from a myriad of members of the project team. Existing licensing agreements may allocate to each member of the project team a right to use the copyrighted material, but these agreements may prove to be insufficient when the ownership of these documents is uncertain.[41] Boilerplate documents, standardized design elements and functional specifications may not be eligible for copyright protection standing alone, but the combination of these standard and individualized features may permit a party to make a claim for copyright protection.[42] Thus, even standard and discrete contributions from project team members may implicate copyright ownership to the extent that they are contributing to a unique expression of design elements. The evolution and maturation of BIM systems will only exacerbate the ownership concerns. In implementing interoperability to streamline a construction project, BIM projects will frequently contain joint contributions to individual components of a model. Thus, issues of joint authorship will necessarily arise when it is unclear where one contribution ends and another begins.[43]

Moreover, the technology utilized in BIM projects necessarily changes the fundamental ownership inquiry. Advanced versions of BIM technology promise to allow the specifications in one component to automatically update, and make necessary changes to, other components of the model.[44] A project participant’s individual contribution will therefore not only contribute to the overall expression of the design, it may also change the expression of other components that may otherwise be considered to be “authored” by other project participants. While these modifications may originate in a project participant’s change to a single input, the ultimate change to the expression of the design model may best be attributed to the BIM software program. Thus, the inquiry may not be who, but rather what, is the author of the overall model.[45] As technology continues to play a greater role in BIM projects, and construction design is shifted from architects and other traditional design professionals to software professionals, the ownership of the building and the underlying design model may be subject to greater dispute.[46]

Parties to the construction project may not be the only parties interested in access to the BIM design model; future occupants and lessees may want access to the model to understand the impact that future changes may have on the integrity or efficiency of the building.[47] The age of digitization has enabled easy transfer of design models to these interested parties.[48] Similarly, once in the hands of these parties, the copyrighted material can be easily manipulated and used.[49] Thus, the technology that has enabled the implementation of BIM has similarly complicated the ownership disputes as they relate to intellectual property rights.[50] Ultimately, as Bruner and O’Connor recognize in their leading treatise on Construction Law, “intellectual property issues and ‘who is responsible for what’ are not well thought out and agreed.”[51] 

B     Proposed Solutions

The simplest and most disconcerting solution is to ignore these intellectual property implications altogether. There is some suggestion that amendments to the current intellectual property framework in construction contract are not worth the trouble.[52] These commentators focus on the narrow scope of copyright protection, arguing that the intensive and unique nature of the design process will almost never result in the creation of identical products.[53] In that vein, protecting against an almost non-existent threat leads to rigid guarding of intellectual property rights that are contrary to the open and collaborative environment BIM seeks to foster.[54] On the contrary, a failure to account for the intellectual property rights of the BIM designs only encourages parties to act opportunistically and serve their own interests. This is best illustrated by solutions proposed by various commentators.

1      Academic Proposals

At the end of an article intended to highlight the importance of intellectual property in the construction industry, practitioners from the United Kingdom suggest that the solution to ownership disputes implicated by BIM may be to have the sub-contractors develop and maintain separate sets of documents.[55] One set of documents will be disclosed to the other project participants and will contain just enough information for the other project participants to satisfy their design and construction responsibilities.[56] The other set of documents will remain confidential and will consist of proprietary design documents, including detailed workshop drawings.[57] The problem with this proposal stems from its inconsistency with the spirit of interoperability. By facilitating interoperability, BIM is intended to capitalize on the expertise of the various project participants. Encouraging sub-contractors to maintain a separate set of documents may preclude the use of their insights to yield a more efficient project outcome, thereby undermining the goals of BIM. Moreover, maintaining separate sets of documents requires a determination of whether the material is either critical to the project or proprietary in nature. Sub-contractors may naturally err on the side of confidentiality and thus, engage in self-serving behavior of the sort BIM was supposed to remedy.

Other proposals call for a return to the segregation of design tasks and construction tasks which once characterized the construction industry. One such proposal suggests that the parties specify by contract that designers maintain the ultimate responsibility for design tasks while the ultimate responsibility for the means-and-methods of construction rests with the contractors and suppliers. [58] This allocation of responsibility would only be the default arrangement, as exceptions would exist for clearly defined design roles for contractors and suppliers.[59] While this approach aims to capture the benefit of discrete classes of liability without stunting interoperability, it fails to achieve accomplish this goal. One of the benefits of BIM lies in the ability of contractors and sub-contractors to improve the efficiency of a construction project by modifying components of the design to more accurately reflect the build environment. Thus, these design roles may not be clear at the outset of the project. Any attempt to delineate these roles ex ante runs the risk of either defining them too narrowly, disincentivizing contractors and sub-contractors from contributing to a more efficient design, or too broadly, swallowing the default rule.

There is also a proposal that only parties who created the model on their own information technology systems may modify it, with narrowly defined exceptions if necessary.[60] This proposal suffers from the same infirmities as the other proposals. By allowing the original creator to capture the ownership and corresponding benefits of subsequent improvements, this proposal reduces the incentives for contractors and subcontractors to modify the designs.[61] To unlock the full benefits of interoperability, the project participants must be able to modify the design as necessary.  Moreover, this proposal may alienate traditional construction project participants by shifting the ownership away from the actual creators to the software engineers. Designers and contractors may therefore be less likely to engage in a BIM project. While these academics are more theoretical in nature, a more practical starting point may be the amended ConsensusDocs and AIA form documents.

2      AIA

The American Institute of Architects (AIA) first responded to the changing culture of the construction industry in 1997.[62] The 1997 AIA form documents included only limited coverage of digital CAD documents, providing that the exchange of these digital files should be accounted for by a separate agreement between the owner and the architect.[63] The AIA issued a new set of form documents in 2007 that broadly addressed digital data transfer through two short documents: the Digital Data Licensing Agreement[64] and the Digital Data Protocol Exhibit.[65]  The copyright complications presented by BIM were not explicitly addressed by these documents; in fact, the 2007 AIA documents made no mention of the issue of copyright. Instead, defining digital data as “information, communications, drawings, or designs created or stored for the Project in digital form,” the Digital Data forms only roughly extended coverage to information that would be contained in a BIM project database.[66] In the intellectual property context specifically, both documents suggest only that the transmission of digital data constitutes a “warranty by the transmitting party” that it is the owner of the digital data or that it has permission from the copyright owner to transmit the digital data.[67]

As BIM matured and the understanding of its potential uses expanded, the AIA recognized an increasing need for improved documentation and contractual relationships.[68] Thus, just one year later, the AIA issued a new form document, the Building Information Modeling Protocol Exhibit,[69] specifically geared toward the issues that BIM presents.[70] The 2008 AIA form defines various elements of the BIM digital model, but it is primarily focused on granting rights of access.[71] While the 2008 AIA BIM Protocol does address the ownership of model elements when they are implemented into the overall model,[72] it fails to account for issues of joint ownership of the model elements.[73] Thus, the early iterations of the form documents inadequately address the unique intellectual property issues presented by BIM.[74]

The AIA again updated its form documents in 2013 to include a Building Information Modeling Protocol Exhibit,[75] Project Digital Data Protocol Form[76] and Project Building Information Modeling Protocol Form.[77] These documents reflect the important conceptual shift in the construction industry, as they operate between parties that do not have contractual relationships.[78] They also aid in better documentation of BIM execution by acknowledging BIM’s migration away from traditional CAD design, identifying the authorized uses of model elements, and expanding description of the protocols needed for electronic exchange of model data.[79] Given the source of these documents, however, the coverage of intellectual property rights is mostly limited to establishing that the architect will be the lead designer and developer of BIM protocol and end uses for a project. The documents thus frame much of their discussion of intellectual property right documents in terms of the “designer’s” intellectual property rights.[80] Greater emphasis is given to the control the designer is to have over the modification of these design elements. These, however, are more focused on liability concerns than on issues of ownership with regard to future use of the model and model elements.

3      ConsensusDocs

ConsensusDocs has similarly issued several editions of BIM form documents, but only the most recent set of ConsensusDocs forms provide significant coverage to the copyright concerns expressed above. In 2008, ConsensusDocs issued a BIM Addendum[81] to address the issues that BIM presents. The addendum recognized that copyright issues may be arise in the newly collaborative BIM design environment, but it suggests that that this is primarily a matter to be determined by contract between the owner and architect/engineer.[82] Importantly, the 2008 ConsensusDocs BIM Addendum did not provide for the ownership interest that contractors and sub-contractors might possess. When the ConsensusDocs forms were updated in 2011, the treatment of BIM was mainly limited to including BIM and other electronic documents as a basic service requirement included in the owner’s program.[83] Thus, many of the copyright issues mentioned above went unaddressed in the ConsensusDocs forms prior to the 2015 amendments.

The sixth and final article of the 2015 BIM Addendum specifically addresses intellectual property rights in the BIM model and model components. Most of the article addresses the IP licenses that are involved in a BIM project. As a threshold matter, Article 6 requires that each contributor possess a legal right to grant a licenses to the other contracting parties, allowing each of them to use their contribution.[84] Theses licenses, when granted, are project specific and grant project participants the right to reproduce, distribute, display and develop derivative work.[85] While these licenses are limited to the duration of the project, a subsequent license is granted at the completion of the project to preserve each contributor’s right to the future use of their contributions. [86] Thus, the 2015 BIM Addendum largely addresses the licensing and ownership concerns that individual contributors may have, both during and after a construction project. Like the AIA documents, however, the ConsensusDocs forms fail to address issues of joint authorship. While there are certainly issues to be ironed out, the ConsensusDocs forms represent a great starting point to be supplemented by best practices developed by industry professionals as BIM achieves more prevalent use in the industry. [87]

III   Risk Management

The Construction Industry Institute has stated that “the ideal [construction] contract—the one that will be most cost-effective—is one that assigns each risk to the party that is best equipped to manage and minimize that risk, recognizing the unique circumstances of the project.”[88] This efficient risk allocation is intuitive in theory, but it is almost impossible to achieve in practice. Before risks can be efficiently allocated according to the Construction Industry Institute, the array of risks to be allocated must first be identified. Construction projects are replete with risk, ranging from differing site and weather conditions to surges in the price of labor and materials.[89] Thus, merely identifying and categorizing all of the risks proves to be a daunting task. The process of identifying any number of the panoply of risks confronting a construction project cannot be reduced to a distinct formula, and thus is often identified based on past experience.[90] This anecdotal identification varies project to project, as it is inherently tied to the expertise of those tasked with identifying the risk.[91] Further complicating matters is the overlap that often exists among risks. These risks are interdependent but must be identified separately since each is conceptually distinct from the other risks. [92] While the task is not easy, the stakes are incredibly high. Identified and unidentified risks alike threaten to add expense and delay to each stage of the construction process. As the threat of delays and expenses mount, it becomes important to analyze all risks from the perspective of the services to be provided, the persons who present risk, and the potential damages.[93]

Given that BIM introduces additional parties into the design phase of a construction project, the most important risks to contemplate are the risks of inaccurate design plans. Currently, project designers—the architects and engineers—have managed the risks of reliance by disallowing reliance by parties other than their direct client and creating caveats supported by the law, limiting their liability to the application of the relevant standard of professional care and due diligence.[94] At common law, parties responsible for the design of a project element would be liable for any errors or defects in the design. [95] In modern practice, however, designers and consultants alike are only held to be liable for errors and defects in portions of the design for which they failed to exercise reasonable skill and care.[96] The brunt of the risk in erroneous design is shifted to the owner under the Spearin doctrine. A 1918 Supreme Court decision, Spearin establishes that the owner impliedly warrants the information, plans and specifications provided to the general contractor.[97] Whether this overarching liability will change as the contractors themselves begin to contribute to the design documents is just one of several questions that arise in a BIM world.

A     Legal Issues Implicated

The information that is often contained within the BIM model is inseparable from what is often made available to all project participants. Thus, a question that emerges at the forefront of BIM implementation is who is going to be the owner of the model. There is a belief in the industry that ownership of the model is tantamount to control of the market.[98] Thus, despite the assumption of liability that may accompany ownership of the ultimate BIM model, construction parties may pursue ownership of the model to secure their role in the market. While establishing the owner of the overall model may be a threshold dispute, it is just the tip of the iceberg.

Vast resources are currently expended in the legal system to determine the party “responsible” for problems at the construction site or in the design files. Even when construction design was segmented into discrete tasks with little overlap, risk identification and allocation were not easy tasks. Perhaps the most significant change that BIM entails is the conceptual shift with respect to the risk management in construction projects.[99] The BIM process provides direct model access to a variety of parties, who make decisions and allocate resources based on the information contained therein. It is therefore critical to the functionality of BIM for the parties to be able to rely on the data encompassed by the model. This potentially creates a new class of liability, as each party with access to the model must agree on the proper allocation of the risk that the various contributions contain errors. While such errors will hopefully be the exception rather than the norm, it is important that the BIM protocol provides for such eventualities. 

As contributions from other project participants increase, design professionals, as the party ultimately responsible for the project design, are opened up to a significant amount of uncertainty as it relates to their designs.[100] The most significant of these risks is the risk that they will be vicariously liable for errors, mistakes, and omissions present in the other parties’ contributions.[101] In early stages of BIM implementation, this may not be a significant problem as it will be easy to determine which parties contributed to designs and thus, identify the party responsible for bearing the risk of defect. Risks can therefore be allocated in a manner closely tracking traditional allocation.[102]  As BIM matures, however, and contractors begin to play a greater role in the construction design, lines between party contributions become blurred, making it difficult to establish the responsible party.[103] Involving the construction participants in the design process may enable early detection of errors in design plans, but it does not eliminate them entirely.[104] Thus, design professionals must be cognizant of the liability that may arise out of a failure to verify the accuracy of each contribution and the updates they may produce.[105] These risks may very well alter the fundamental application of the Spearin doctrine, as contractors may make changes that violate code or structural requirements when contributing their trade expertise suggestions during the revamped BIM design process.[106]

One final issue is going to be the role that insurance will play in the BIM environment. There is currently disagreement among commentators even as to the character of the impact that BIM will have on insurance claims. There is some suggestion that the uncertainty in the consultants’ and contractors’ risk profiles will cause insurers to deny claims made on a BIM project.[107] In stark contrast, one international insurer suggested that BIM will actually decrease risk of claims.[108] This disagreement is illustrative of the widespread legal uncertainty inherent in the adoption of BIM. As in other contexts, it seems that the only source of agreement is that the current insurance framework fails to accommodate the interoperability BIM promises to facilitate.[109] Ultimately, there is tension between BIM’s focus on collective effort and responsibility and the industry’s practice of tightly defining responsibilities and limiting reliance on the contributions of other construction parties.[110] Efforts to alleviate this tension are reflected primarily in the form documents issued by the AIA and ConsensusDocs.

B     Proposed Solutions

Unlike in the intellectual property context, a relatively small number of commentators have proposed risk management solutions outside of those contained in the form documents proffered by the AIA and ConsensusDocs. In fact, in a proposal for BIM adoption internationally, one commentator points to published form documents as the key to successful implementation of BIM.[111] There are, however, a few academic proposals that provide greater context for the provisions implemented into the form documents.

1      Academic Solution

Ultimately, for the construction process to function efficiently and equitably, these risk allocation concerns must be addressed by limiting each professional’s responsibilities to risks that are within their control. In order to do so, there is some suggestion that contracts among construction project participants should specify that the BIM model is not a contract document.[112] This proposal suggests that the contract will also limit the use of the model to use for “coordination purpose” and would expressly disclaim any warranty of accuracy by the owner of the model.[113] This proposal may only represent a slight departure from current practice, since contractors usually recognize that digital models are not accompanied by a warranty of accuracy,[114] but this may precisely be the problem. The above section recognizes that the existing framework is insufficient to address the nuance of risk management in the BIM environment. Ultimately, true interoperability requires that the parties be able to use the collaborative model freely. Without some warranty of the accuracy of the model and model elements, parties may be hesitant to rely on the accuracy of the model and thus, may revert to using the two-dimensional design plans and specifications governed by the Spearin doctrine.  

Recognizing the above-mentioned complications of joint authorship, another problematic proposal suggests relying on the common law doctrine of joint and several liability.[115] This proposal would make every contributor to the model jointly and severally liable for any defect that may arise.[116] While this may be appealing from the perspective of the end-user, it hardly alleviates the problems of risk management among the project participants.[117] Design contributors would inevitably seek to contractually indemnify themselves from defects outside of their contributions. Thus, this proposal does not address the quarreling that may still occur among project contributors to allocate risk appropriately.

The issue of insurance is largely unaddressed by academic proposals. One solution suggests the use of latent defects insurance. [118] The problem of this approach lies in the fact that the defect must be latent, inevitably postponing any coverage until the completion of the construction project. Similarly, given the breadth of this coverage,[119] there are very few underwriters, which would make the insurance extremely expensive. An alternative solution would be to move toward integrated project insurance (IPI). Under this system, project participants would each contribute to the premium payments.[120] Like the solution relying on joint and several liability, however, each party would seek to make contributions proportional to the increased risk generated by their contributions. Again, fighting among project participants would likely ensure. Ultimately, commentators recognize that the proper solutions may not emerge until BIM assumes a more prominent role in construction projects. In the meantime, project participants may turn to the AIA and ConsensusDocs form documents to best facilitate BIM implementation. 

2      AIA

As discussed previously, the AIA form documents have been substantially revised to account for the unique issues presented by BIM. The 2008 AIA BIM Protocol was certainly a step in the right direction with respect to addressing risk management concerns, but the ultimate problem with the document is its focus on two-party contracts. As such, the 2008 form documents do not adequately address the vision of BIM as a collaborate process in which members of both the construction and design teams are contributing jointly to the design model.[121] BIM protocol document therefore adopts traditional risk allocation and thus, fails to address the risk allocation issues associated with the implementation of BIM, leaving them to be addressed in other contractual documents.[122]

The updated AIA documents released in 2013 facially provide greater coverage for the risks associated with BIM usage, but their practical limitations may still undermine the goals of BIM. After reinforcing that the architect is the lead designer of the BIM model, the 2013 forms limit the modifications that can be made to each design elements. Similarly, the documents suggest that the warranty of accuracy for each model element will be limited to a “level of detail” specified in the contract document.[123] This level of detail will be a minimum detail necessary for functional implementation into the overall BIM model. Any reliance on the model beyond the level of detail specified, even if more detail is provided, comes at the sole risk of the relying party. Thus, the risk allocation provisions in the form documents are drafted to be designer friendly and reflect the overarching desire of architects to assume control of the BIM model without accepting the liability that accompanies such control. By minimizing the warranty of accuracy for each design component and limiting any subsequent modification of the components, the AIA form documents insulate the original designer and discourage valuable contributions from other project participants.[124] 

3      ConsensusDocs

Most of the provisions made in the first ConsensusDocs BIM Addendum in 2008 only facially address the risk allocation concerns that BIM presents. Even though the Addendum identifies the new position of information manager and suggests the significant responsibilities that may be attached to this position,[125] the appointment of this position is left to the parties.[126] Similarly, later sections suggest that each party will be responsible for the contribution that it makes to a model,[127] but commentators suggest that these provisions do not alter the traditional risk allocation.[128] In fact, the ConsensusDocs forms provided that “nothing in the addendum shall relieve the Architect/Engineer from its obligation, nor diminish the role of the Architect/Engineer, as the person responsible for and in charge of the design of the Project.”[129]

Thus, the risk management provisions of the BIM addendum are merely a work in progress, leaving much of the actual task of risk allocation to the parties themselves. Without polished documents, parties were left to quarrel over onerous indemnity provisions, thereby inhibiting collaboration and undermining the full benefits of BIM.[130]

An important amendment in the 2015 Addendum, therefore, is that the BIM Addendum takes precedence over governing contracts.[131] The 2015 Addendum therefore endeavors to assist contracting parties more thoroughly develop their “BIM Execution Plan.” An initial plan will be developed, but as new parties join the construction project, they can revise the plan with the approval of the other parties.[132] As part of this “Execution Plan,” the ConsensusDocs forms establish that each party is responsible for the information they provide and the model elements they contribute.[133] Given this responsibility, the form documents take care in defining what constitutes a contribution. For instance, participation in class resolution or other modeling activities “shall not constitute performance of design services.”[134] Further, design professional cannot be compelled to permit modifications to their designs inconsistent with their responsibility to “comply with applicable codes, regulations or laws.”[135] 

These amendments reflect a significant step toward establishing the legal framework necessary to implement BIM. The 2015 ConsensusDocs Addendum equitably allocates risks to the parties responsible for the development of that design. The shortcomings of these provisions may rest in their insufficient contemplation of joint contributions. While the forms provide contributors with the right to refuse amendment, they do not fully address the point at which modification to a design contribution represents an independent contribution. Similarly, the forms do not provide for risk allocation in the event that interoperability yields joint contributions of model elements that are incapable of division. Perhaps this would be to the responsibility of the BIM Manager as the party generally responsible for interoperability.[136] Perhaps most importantly, BIM Managers, and the ConsensusDocs forms they utilize, must address the current difficulty parties have in sharing the model components due to incompatible software programs.[137]

Conclusion

Building Information Modeling, and the interoperability it promises, holds the potential for exponential technological advancement that has long been absent in the construction industry. In order to unlock this potential, however, the construction industry must overcome its characteristic inability to incorporate new technologies into the construction process.[138] BIM therefore represents both a tremendous opportunity and a significant challenge. With the increasing use of BIM, comes an increasing need for better documentation of the contributions and contractual relationships associated with BIM collaboration.[139] Collaboration has not been an industry hallmark; instead, participants have assumed definite and distinct roles and liabilities.[140] Thus, it is widely recognized that existing legal framework fails to properly address the unique legal concerns that BIM presents, especially in the contexts of intellectual property and risk management.[141] 

While the legal framework for BIM needs to be further developed, this development may be accomplished using existing form documents.[142] BIM may change the nature of collaboration, but it does not entirely alter the risk to, or ownership rights of, project participants.[143] Thus, the legal framework can be developed through the existing framework of the ConsensusDocs and AIA form documents.  These documents significantly address the legal complications that BIM presents, but it is widely acknowledged that work needs to be done before BIM can be implemented to capitalize on the huge productivity gains it promises. It is only a matter of time before BIM becomes the primary construction design vehicle, thereby increasing the urgency in addressing shortcomings in these form documents. If these issues are not properly fleshed out ex-ante, they are going to be addressed in courts and arbitration hearings.[144]

Endnotes

[1] 2 Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O'Connor Construction Law § 7.10 (December 2016).

[2] Id.

[3] Id.

[4] Partick J. O’Connor, Jr., Productivity and Innovation in the Construction Industry: The Case for Building Information Modeling, 1 Journal of the American College of Construction Lawyers 5 (2007) (noting the significant labor shortage and the image problem that was plaguing the construction industry).

[5] Id.

[6] Perhaps the most broad-based example of incidental improvement in the construction industry is the development of the cell-phone. While the construction industry is by no means utilizing the cell phone in an innovative way, cell phones nonetheless provide more efficient communication among participants in construction projects. Id.

[7] Id.

[8] 2 Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O'Connor Construction Law § 7.10 (December 2016).

[9] Erin Green, BIM 101: What is Building Information Modeling?, ENGINEERING.COM, http://www.engineering.com/BIM/ArticleID/11436/BIM-101-What-is-Building-Information-Modeling.aspx (February 3, 2016).

[10] CAD is extremely limited in the information that it provides and in many ways perpetuates the same errors that the industry encountered with hand drafting. For a comparative analysis highlighting the advantages of BIM, Lachmi Khemlani, Why Building Owners Should Care About Interoperability, 29 Building Sciences at 4 (2005).

[11] 2 Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O'Connor Construction Law § 7.17  (December 2016)

[12] Partick J. O’Connor, Jr., supra note 4.

[13] Carl J. Circo, A Case Study in Collaborative Technology and the Intentionally Relational Contract: Building Information Modeling and Construction Industry Contracts, 67 Ark. L. Rev. 873, 882 (2014) (“BIM components, however, are virtually intelligent—packed with information beyond the graphic display”).

[14] Partick J. O’Connor, Jr., supra note 4.

[15] Green, supra note 9.

[16] Patrick J. O’Connor, Jr., supra note 4.

[17] BIM was foreshadowed as early as 1962 when Douglas Engelbart described an architect entering specifications and data into a building design and watching the structure take shape, a concept very similar to current parametric modeling. Douglas Engelbart, Augmenting Human Intellect: A Conceptual Framework (May 1962). The term BIM was first introduced in the 1990s but recession placed a halt on the early stages of investment and technological development. Green, supra note 9.

[18] Sheet Metal and Air Conditioning Contractors National Association, Inc., Legal Implications of Building Information Modeling, White Paper (June 2014) [hereinafter SMACNA White Paper], available at https://www.smacna.org/docs/default-source/building-information-modeling/smacna-white-paper-legal-implications-of-building-information-modeling-pdf.pdf?sfvrsn=2.

[19] See Howard Ashcraft, Building Information Modeling: A Framework for Collaboration, 28 Construction Law. 5 (Summer 2008).

[20] BIM has been described as one of the key strategies to improve the construction industry’s productivity around the world, being mandated by many countries for certain public biddings. A. Ryan, G. Miller & S. Wilkinson, Successfully Implementing Information Modelling in New Zealand: Maintaining the Relevance of Contract Forms and Procurement Models, presented at the 38th Australasian Universities building Education Conference (2013).

[21] Koko Udom, BIM: Mapping Out The Legal Issues, NBS (February 2012), https://www.thenbs.com/knowledge/bim-mapping-out-the-legal-issues.

[22] Su-Ling Fa, Intellectual Property Rights in Building Information Modeling Application in Taiwan, ASCE Journal of Construction Engineering and Management, Volume 1140, Issue 3 (March 2014), available at http://ascelibrary.org/doi/abs/10.1061/(ASCE)CO.1943-7862.0000808.

[23] The technological issues identified include: skills of virtual prototyping; availability of quality industry software packages; availability of XML/IFC XML standards. Where the IAI, IFC, and IFC XML Should be in Two, Five and Ten Years: An Action Plan of the IAI-AC for the Next Ten Years, International Alliance for Interoperability, available at http://www.interoperability.org.au/17188.html.

[24] Id.

[25] These issues include the formal risk management and contractual relationships of virtual prototyping as well as the corresponding shift in culture and standards of practice. Id.

[26] The Copyright and Patent Clause provides that “Congress shall have Power…[t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive right to their respective Writings and Discoveries.” U.S. Const. art. I., § 8, cl. 8.

[27] The owner of a copyright has the exclusive rights in a copyrighted work to, inter alia, reproduce the work, prepare derivative works, and display the work to the public. See 17 U.S.C. § 106.

[28] Architectural design plans were classified as pictorial and graphic works. See 17 U.S.C. § 102(a)(5).

[29] Id. at § 201(a).

[30] Id. at §102.

[31] S. J. Liebowitz. Research in Law and Economics: The Economics of Patents and Copyrights (John Palmer & Richard O. Zerbe, Jr. eds., 1986)

[32] See 17 U.S.C. § 101.

[33] Rashida MacMurray, Trademarks or Copyrights: What Intellectual Property Right Affords Its Owner The Greatest Protection of Architectural Ingenuity?, 3 Nw. J. Tech. & Intell. Prop. 111, 113 (2005).

[34] The Architectural Works Copyright Protection Act of 1990, 104 Stat. 5133 (1990) (codified at scattered sections of 17 U.S.C.); 17. U.S.C. § 102(a)(8).

[35] Rashida MacMurray, supra note 33 (noting that the AWCPA provided a remedy for drawings derived from digital images of the copyrighted building).

[36] Marcus Harling, William Gard & Steven James, Intellectual Property in Construction Projects: Why is Important?, Lexology, http://www.lexology.com/library/detail.aspx?g=8cbb5dd6-e104-438f-b467-9cddb864c5b8 (January 28, 2014).

[37] Id.

[38] Rashida MacMurray, supra note 33, at 115.

[39] Id.

[40]  Marcus Harling, supra note 36.

[41] Lesley Currie, Building Information Modelling: Its Impact on Insurance, Intellectual Property Rights and Design Liability, Society of Construction Law at 9 (2014), available at https://www.apm.org.uk/sites/default/files/scl%20paper%20-%20published.pdf.

[42] See CSM Investors, Inc. v. Everest Development Ltd., 840 F.Supp. 1304, 1310 (D.Minn, 1994); Richmond Homes Mgmt, Inc., v. Raintree Inc., 862 F.Supp. 1517, 1524 (W.D.Va. 1994).

[43] Koko Udom, supra note 21.

[44]  2 Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O'Connor Construction Law § 7:107.17 (December 2016)

[45] Id. (“If the program is changing to accommodate changes to the input, is there an engineering logic components to the program itself? Is the model designing itself?”).

[46] Id.

[47] Lesley Currie, supra note 41 (citing Brodie McAdam, (2010) "Building information Modelling: the UK Legal Context", International Journal of Law in the Built Environment, Vol. 2 Issue: 3, 246-259 (2010)).

[48] Lesley Currie, supra note 41.

[49] Id.

[50] While copyright rights are still the primary category of intellectual property rights that are implicated, the quantity and arrangement of information provided by the BIM also implicate database rights and potential patent rights. See Id.

[51] The development of the law, especially with respect to the protection of intellectual property rights, has lagged behind the development of the technology. 2 Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O'Connor Construction Law § 7:107.10 (December 2016).

[52] SMACNA White Paper, supra note 18 (citing D. Larson & K. Golden, Entering the Brave, New World: An introduction to contracting for Building Information Modeling, 34 Wm. Mitchell L. Rev. 75, 89-91 (2007)).

[53] SMACNA White Paper, supra note 18.

[54] Id.

[55] Marcus Harling, supra note 36.

[56] Id.

[57] Id.

[58] SMACNA White Paper, supra note 18 (citing D. Larson & K. Golden, Entering the Brave, New World: An introduction to contracting for Building Information Modeling, 34 Wm. Mitchell L. Rev. 75, 89-91 (2007)).

[59] Id.

[60] Id.

[61] The extent to which improvers deserve copyright protection is a common topic in copyright scholarship. While patent law affords protection to the through the concept of blocking patents and the reverse doctrine of equivalents. Mark A. Lemley, The Economics of Improvement in Intellectual Property Law, 75 Tex. L. Rev. 989 (1997).

[62] Up until the 1997 versions of the AIA form documents, paper documents were considered to be the normal “Instruments of Service.” It was not until PCs began to achieve widespread use that AIA form documents started to account for the three-dimensional models of construction designs. Christopher L. Noble & Bennet Heart, The AIA’s New Digital Data Documents, 28 Construction Law. 12, 12 (Spring 2008).

[63] AIA Document B141-1997 § 1.3.2.4. Similar language appears in AIA Document B151-1997 § 6.4.

[64] The Digital Data Licensing Agreement provides for the exchange of electronic files among parties that are not in privity with one another. AIA Document C106-2007.

[65] Similarly, the Digital Data Protocol Exhibit provides a form document to be appended to the owner-architect contract designed to set forth the conditions governing the format of electronic data. AIA Document E201-2007.

[66] E201-2007 § 1.1.1; C106-2007 § 1.3.

[67] E201-2007 § 2.1; C106-2007 § 2.2.

[68] Kimberly A. Hurtado, BIM Comes of Age: The New ConsensusDOCS BIM Addendum (2015) for Life-Cycle Building Information Modeling, 36 Construction Law. 37 (Fall 2015).

[69] The Building Information Modeling Protocol Exhibit establishes the overall protocol for BIM use, outlining the stages of development and identifying the rights of access and specific design responsibilities at each of these stages. AIA Document E202-2008 § 1.1.

[70] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac. Construction Law § 17:26. (December 2014).

[71] AIA Document E202-2008 § 2.2.

[72] The document provides that the ownership of a model element is not affected by its implementation. Id.

[73] AIA Document E202-2008 § 2.2.

[74]  Christopher L. Noble & Bennet Heart, supra note 62, at 16.

[75] AIA Document E203-2013.

[76] AIA Document G201-2013.

[77] AIA Document G202-2013.

[78] AIA Document G202-2013 § 7.05

[79] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac. Construction Law § 17:26. (December 2014).

[80] The AIA documents have been criticized for failing to promote collaboration. By emphasizing the intellectual property rights for the architect, the AIA documents disincentivize contractor contributions to construction design efforts. BIM: mapping out the legal issues. Koko Udom, supra note 21.

[81] ConsensusDocs 301 BIM Addendum.

[82] Id. § 6.4.

[83] Brian Perlberg, Donald W. Gregory, Melissa A. Orien, available at https://www.consensusdocs.org/News/Download/6ca68e33-87a2-428e-acf1-9fb300b783ad?name=The%202011%20Comprehensive%20Update%20to%20ConsensusDOCS.pdf

[84] Kimberly A. Hurtado, BIM Comes of Age: The New ConsensusDOCS BIM Addendum (2015) for Life-Cycle Building Information Modeling, 36 Construction Law. 37 (Fall 2015).

[85] ConsensusDocs 2015 BIM Addendum § 6.4

[86] The parties make archival copies of their contributions and the license grants them the right to use these contributions in future projects. ConsensusDocs 2015 BIM Addendum § 6.6.1.2.

[87] Kimberly A. Hurtado, supra note 68.

[88] Impact of Various Construction Types and Clauses on Project Performance, Construction Industry Institute Rep. 10 (1986).

[89] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac. Construction Law § 7.1 (December 2014).

[90] 2 Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O'Connor Construction Law § 7.2 (December 2016).

[91] Id.

[92] 2 Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O'Connor Construction Law § 7.23 (December 2016).

[93] Gerald I. Katz, Risk Analysis: Identifying and Controlling the Causes of Costs of Construction Litigation, Construction Accounting and Taxation, 2001 WL 36648125(2001)

[94] Koko Udom, supra note 21.

[95] Lesley Currie, Building Information Modelling: Its Impact on Insurance, Intellectual Property Rights and Design Liability, Society of Construction Law at 9 (2014), available at https://www.apm.org.uk/sites/default/files/scl%20paper%20-%20published.pdf.. 

[96] Id.

[97] United States v. Spearin, 248 U.S. 132 (1918).

[98] “The greatest fear on the part of architects is that general contractors will take a ‘huge part’ of the industry by ‘owning the model’ … ‘Our biggest fear right now is that the contractor selling the model to the client and just hiring the architect as a consultant that puts the design down.’” T. O’Brien, Successfully Navigating Your Way Through The Electronically Managed Project, 28 Construction Law. 25, 26 (Summer 2008).

[99] A. Ryan, G. Miller & S. Wilkinson, supra note 20 (stating that the greatest challenge presented by BIM “will encompass the roles, responsibilities, and associated liabilities of a project team).

[100] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac., Construction Law § 17:20. (December 2014) (The perceived risks include: Responsibility for inaccurate design models; Models fail to incorporate relevant data; Design models vary from contract documents; Design models are late; Responsibility for subsequent misuse of the model; Responsibility for errors and omissions of a subsequent user; and Responsibility for the incorporation of improper design data by a subsequent user.

[101] Id.

[102] There is some suggestion, therefore, that early efforts to implement BIM will not change the legal principles governing risk allocation and management. Fenwick Elliot, Legal Issues Surrounding Building Information Modelling, 20 November 2012: www.lexology.com (highlighting that design risk does not sit with the role of information manager, but that of the lead designer).

[103] Most states require the architects to be the “responsible” party for construction design; thus, architects naturally deny any liability for changes to their designs. Howard Ashcraft, supra note 19, at 13.

[104] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac. Construction Law § 17:20. (December 2014).

[105] When multiple parties are contributing and relying to components of a BIM model, several questions arise, including: “who is responsible for errors in joint contributions; to what extent can you rely on others’ designs; what about reliance on the data contained in the models”. Lesley Currie, Building Information Modelling: Its Impact on Insurance, Intellectual Property Rights and Design Liability, Society of Construction Law at 9 (2014), available at https://www.apm.org.uk/sites/default/files/scl%20paper%20-%20published.pdf.

[106] Kimberly A. Hurtado, BIM Comes of Age: The New ConsensusDOCS BIM Addendum (2015) for Life-Cycle Building Information Modeling, 36 Construction Law. 37 (Fall 2015).

[107] Currie, supra note 105.

[108] Id.

[109] Id.

[110] SMACNA White Paper, supra note 18.

[111] “A common proponent amongst the international BIM leaders is their publication of guidelines, standards, and BIM protocols which have provided their construction industries with the necessary tools with which to implement BIM.” SMACNA White Paper, supra note 18.

[112] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac. Construction Law § 17:20. (December 2014).

[113] Id.

[114] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac. Construction Law § 17:21. (December 2014).

[115] Lesley Currie, Building Information Modelling: Its Impact on Insurance, Intellectual Property Rights and Design Liability, Society of Construction Law at 9 (2014), available at https://www.apm.org.uk/sites/default/files/scl%20paper%20-%20published.pdf.

[116] Id.

[117] Id.

[118] Id.

[119] Under this insurance, latent defects will be covered, even if it is the result of poor workmanship and negligence. Id.

[120] Id.

[121] Christopher L. Noble & Bennet Heart, supra note 62, at 15-16.

[122] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac. Construction Law § 17:21. (December 2014).

[123] AIA Document G202-2013.

[124] D. Larson & K. Golden, Entering the Brave New World: Introduction to Contracting for Building Information Modeling, 34 Wm. Mitchell L.Rev. 75, 93 (2007)

[125] AIA Document G202-2013 § 3.2.

[126] Id. at § 3.1

[127] ConsensusDocs 301 BIM Addendum § 5.1 (2008).

[128] See Richard H Lowe & Jason M Muncey, ConsensusDocs 301 BIM Addendum, Construction Law., Volume 29, Number 1 (Winter 2009) (“The addendum does nothing to alter the standard of care applicable to Project Participants under the common law or contract. According to the BIM addendum, the standard of car applicable to the model is determined by that Party’s governing contract, or common law, whichever is applicable.”; Ryan, G. Miller & S. Wilkinson, Successfully Implementing Information Modelling in New Zealand: Maintaining the Relevance of Contract Forms and Procurement Models, … (I don’t think that it is a change in the job that engineers and architects do, it’s (BIM) just helping to do it better.”).

[129] ConsensusDocs 301 BIM Addendum, §1.4.

[130] 2 Philip L. Bruner & Patrick J. O’Connor, Jr., Bruner & O'Connor Construction Law § 7.25 (May 2008 Supplement).

[131] ConsensusDocs 2015 BIM Addendum § 1.7 (modifying former § 1.8 from ConsensusDocs 2008 BIM Addendum)

[132] Kimberly A. Hurtado, BIM Comes of Age: The New ConsensusDOCS BIM Addendum (2015) for Life-Cycle Building Information Modeling, 36 Construction Law. 37 (Fall 2015).

[133] Id.

[134] ConsensusDocs 2015 BIM Addendum § 1.5.

[135] ConsensusDocs 2015 BIM Addendum § 1.3.

[136] Kimberly A. Hurtado, supra note 135.

[137] Id.

[138] SMACNA White Paper, supra note 18.

[139] “BIM Comes of Age: The New ConsensusDOCS BIM Addendum (2015) for Life-Cycle Building Information Modeling,” 36-FALL Construction Lawyer 37 (2016)

[140] Howard Ashcraft, supra note 19 at 5

[141] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac. Construction Law § 17:19. (December 2014).

[142] Joel Lewin & Charles E. Schaub, Jr., 57 Mass. Prac. Construction Law § 17:18. (December 2014). 

[143] Id; See Richard H Lowe and Jason M. Muncey, ConsensusDOCS 301 BIM Addendum, Construction Law., Volume 29, Number 1 (Winter 2009).

[144] SMACNA White Paper, supra note 18.

Entity:
Topic:

Kyle Smith

Latham and Watkins, Washington, D.C., Finalist of the Law Student Writing Competition