Education, tech adoption critical for construction lawyers

Education, tech adoption critical for construction lawyers

19 October 2020 By Jerome Doraisamy
Ben Bury

Practitioners in the construction space were already having to get up to date on new design, planning and production processes before the pandemic, and the learning is set to continue in the “new normal”, says one partner.

Prior to the age of coronavirus, HFW partner Ben Bury said that construction lawyers were having to get better acquainted with fundamental processes pertaining to design, panning and production so as to better support their clients.

In the looming new normal, he told Lawyers Weekly, ongoing learning will be key to success, as such processes will continue to evolve and, alongside it, the risk profile.

“Lawyers advise their clients on risk, and it is very difficult to make an accurate assessment of risk without fully understanding the processes by which the client intends to execute their legal obligations,” he noted.

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“New technologies have had a considerable impact in changing the design, planning and production processes on a construction site. Examples of technology contributing to these processes include the digitisation of project management tools and the integration of building information modelling (BIM) into the project lifecycle.

“The construction industry is traditionally heavily fragmented, involving numerous levels of sub-contracting in an already complex network of contractual relationships. In the past decade, we have seen some employers and contractors moving away from a culture of pushing risk down the line to a culture of collaboration and risk-sharing. Tools such as BIM enable large amounts of reliable real-time data to become available to the entire supply chain.”

The role of construction lawyers

Aside from immediate assistance in things like drafting contracts with technology companies, construction lawyers can support their contractor and employer clients, Mr Bury said, by educating themselves about the new technology in which their clients will be investing.

“In legal circles, we often hear the term ‘factual matrix’ to describe the circumstances in which the law is applied. In the construction world, the factual matrix includes the technology the client will be using on the building site and in the office to execute his or her obligations,” he outlined.

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“When analysing risk, clients expect their lawyers to assist them in analysing the risk known now, but also analysing future risk that the client might face around the corner. If a lawyer does not understand the process by which the client will be executing his or her obligations, including the technology involved, he or she may find it difficult to see where future risk might lie.”

Emerging opportunities

The construction market is “far from recession proof”, Mr Bury mused, and COVID-19 will “inevitably” have a deep impact on every aspect of the construction sector.

“This is sadly likely to include debt defaults and insolvencies. It will also be necessary for governments and sponsors to rethink their investments in certain infrastructure and energy projects. However, there is no particular reason for pessimism amongst construction lawyers in the post-pandemic world,” he said.

“There are a great many construction projects ongoing around the world which cannot simply be put ‘on hold’ and there is always a need for investment in new infrastructure regardless of the economic climate. In addition, lawyers can play a positive role in assisting their clients to amicably resolve the disputes which invariably arise on all major construction projects.”

Lessons for other lawyers

In the post-pandemic world, Mr Bury continued, safety and efficiency are “likely to remain the key priorities” for any construction company, and this is likely to be true for companies in many other sectors.

“Clients will be looking for benefits including better design coordination, less variation, reduced wastage, and the use of technology will inevitably increase in line with this,” he hypothesised.

“Lawyers will need to monitor this trend. Whilst efficiency does not only mean cost savings, it is nonetheless likely that lawyers will need to maximise the value they add to their clients’ businesses if they want their clients to keep coming back to them for advice.”

Reflections

Looking ahead, Mr Bury said that the pandemic has created a “new working environment”, both in the office and at the building site.

“The use of digital communication and the initiative to minimise physical attendance at the building site has created both challenges and opportunities for the construction industry. However, many of these technologies are not new. The pandemic merely accelerated interest and investment in them,” he concluded.

“Take, for example, the trend towards off-site prefabrication and modular construction. This had been developing rapidly before COVID-19 as project managers adopted various ways to ensure timely delivery of their projects. The pandemic has increased interest exponentially.

“According to a study conducted by the Commercial Construction Index, 67 per cent of the contractors in the US that currently use prefabrication and modular construction expect demand to increase. This is consistent with a recent report published by EY, which estimated that the prefabrication and modular construction market will expand at 5.96 per cent and 6.9 per cent compound annual growth rate respectively from 2020 to 2025.”

Education, tech adoption critical for construction lawyers
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