Bye-bye, Bambi

In his article "Be Serious" (12 September, page 51), Tony Bingham considered the Be Collaborative contract and predicted that the client would take the lawyer's advice, and that advice would be not to use a contract that didn't pass the risk onto someone else. Tony is, of course, a lawyer himself, but in day-to-day construction contracting, he perhaps overestimates the influence of our profession.

But is he right about the role of the lawyer, and fate of the Be Collaborative contract?

First, it is worth considering the role of the lawyer. Most construction companies have far more experience of contract negotiation and drafting than construction lawyers. Further, except perhaps on complex, high-value projects (such as big PFI jobs) clients are far more likely to rely on their quantity surveyor or architect to advise on the conditions of contract than their lawyer. And rightly so. There is little magic in a construction contract and it does not require a lawyer to identify risk. Rather, it is for the commercial people to decide what risks are acceptable and to price those risks accordingly. Where lawyers can occasionally add value is in ensuring that the contract properly reflects the risks the client is willing to take.

By and large, commercial people want to do deals and too often lawyers become a barrier, which is not their role. The fact is, most contracts are signed without a lawyer ever casting an eye over them. Further, in considering forms of contract, lawyers and everyone else would do well to remember that most contracts do not end up in disputes.

It is against this backdrop that lawyers will have a view on the Be Collaborative contract – but the relevance of that view should not be overstated. Clients will be able to work out for themselves quite quickly whether or not it is a contract that works for them. For what it's worth, my opinion is that the take-up might be slow.

For a start, it doesn't look like too many other contracts I have seen. Furthermore, it contains vague and subjective notions such as the "overriding principle of collaborative behaviour" and "mutual trust and respect". The parties must also draw up a "project protocol" that has no contractual effect. There is also provision for a "risk allocation schedule". Thus, the parties allocate future risks at the time of contracting. For example, the contractor could agree to take the risk of the first five weeks of any delay caused by unforeseen ground conditions. Thereafter the employer bears the risk. However, the contractor will price for this risk, so the employer pays anyway (even though the probability of such delay occurring might be remote). There is even a provision in the risk register for personality clashes. One wonders how that risk might be allocated and priced.

Of course, clients have asked me about it and therefore it is not in my bottom drawer, unlike Tony's copy. But then again, I was also consulted a lot about the SCL Protocol. My response is the same. Both documents cater for the worst and assume that the project is going to go pear-shaped, when in fact most do not. It assumes and caters for such risks and therefore the inescapable conclusion is that employers will have to pay for them, as contractors will price for such risks.

Egan will no doubt be delighted by the introduction of key performance indicators in the contract, which allow the parties to monitor each other's performance. The trouble is, there is no guide as to what the KPIs should be, and no apparent consequences (other than a lot of arguing, no doubt) if they are not met. This promises to be a rather toothless tiger, and a potentially expensive one at that.

So, rather like the SCL Protocol, (which appears, after much hype, to have died a rapid and rather predictable death) the collaborative contract offers much in the way of novelty value and apparently honourable intentions but little in the way of practical assistance. No doubt contractors will use it if asked and price accordingly.

When disputes arise, goodness knows how the courts will apply the overriding principle of collaboration. For that reason alone, it is just possible that some construction lawyers will recommend its use after all.