Managing risk on mass timber projects can be more complex than on conventional construction jobs, particularly because a significant portion of the work takes place away from the building site. According to construction law specialists, that reality makes early coordination, detailed planning and clearly defined responsibilities essential for every party involved.
Catherine DiMarco, a partner and certified construction law specialist at Blaney McMurtry, said potential risks need to be identified at the outset and assigned to the appropriate parties, with “no risk gaps” left between responsibilities.
Just as importantly, every participant needs to understand exactly what risks they are taking on.
“Not having that is going to certainly result in disputes and maybe litigation or arbitration,” DiMarco told a Sustainable Buildings Canada (SBC) webinar focused on mass timber risks.
Planning for the realities of mass timber
The timing of onsite construction can be a major consideration when planning a mass timber project.
Protecting timber products from water, ensuring they comply with fire-code requirements and meeting acoustical standards are all critical. At the same time, the foundation and slab-on-grade must be designed and executed accurately so anchors and fasteners can be positioned correctly.
“With the relative newness of mass timber there is a higher risk of gaps in responsibilities and/or a party assuming risk that it doesn’t realize it is assuming,” DiMarco said.
A commonly used contract model in Ontario is CCDC 2, a stipulated-price agreement between an owner and a general contractor. Under that arrangement, the general contractor contracts with subcontractors, who may then engage sub-subcontractors or suppliers.
The CCDC 2 structure can also include a separate professional services agreement between the owner and a consultant, typically an architect or engineer.
Another traditional model is CCDC 5B, under which a construction manager operates at risk. The construction manager may provide pre-construction services such as costing, scheduling and constructability before taking on the general contractor role during construction.
The challenge for mass timber is that these conventional contract structures were developed around traditional construction, where the work is largely performed onsite.
With mass timber, a substantial part of the process happens off site.
Who carries responsibility for stored timber?
That shift can create difficult questions about responsibility after the manufacturer completes the mass timber components and they are stored in a warehouse before being delivered to the project.
DiMarco said determining who is responsible for the storage and proper care of the timber can become complicated.
Questions can include who pays for the warehouse, who monitors moisture content and who is responsible for just-in-time deliveries of materials.
Those risks need to be “baked into the contract” through supplementary conditions, she said. Looking ahead, a future CCDC contract could potentially be “uniquely tailored” to the specific requirements of mass timber construction.
IPD offers a different approach
Integrated project delivery contracts, including CCDC 30, take a different approach. They are structured as multi-party agreements built around collaboration and a no-fault model among the participants.
Under this arrangement, remedies for mistakes made by one party are generally covered collectively by the parties, explained Amelia Phillips Robbins, a senior associate in Blaney McMurtry’s construction law group.
Phillips Robbins, who also presented during the SBC webinar on mass timber risks, said integrated teams will often use BIM while working toward a common set of objectives.
Because manufacturers and suppliers can be members of the IPD team, they can become involved much earlier in the planning process. CCDC 30 also permits additional parties to be added later in the project through a Schedule C.
IPD contracts also include a validation stage. This involves preparing a comprehensive report that the owner and project team can use to determine whether the project should proceed or the contract should be terminated.
For mass timber projects, Phillips Robbins stressed that “pre-planning the project to an extraordinary degree” is critical to maintaining both schedule and budget.
Preparing the validation report requires early site assessments and government approvals, along with the development of a realistic budget based on the project’s design.
Traditional consultant duties may not fit
For consultants, conventional CCDC contracts can present another difficulty on mass timber projects.
DiMarco described the arrangements as “a bit of a square peg, round hole” for consultants because the traditional contract framework does not always account for manufacturing taking place away from the construction site.
Consultants are generally responsible for making regular visits to the jobsite rather than the manufacturing facility. Their duties also include assessing construction progress and receiving and reviewing applications for payment submitted by the contractor and subcontractors.
Those responsibilities can involve verifying the prices of services and materials supplied to the place of work.
Mass timber raises an obvious question: who bills for what, when does that billing take place, and what exactly is the consultant expected to do while the components are being manufactured off site?
Simply changing the definition of the “place of work” so that it includes both the construction site and a manufacturing facility could itself create “unintended consequences.”
One potential solution, DiMarco said, is to introduce supplementary conditions that modify the place-of-work language. This could allow consultants to certify the value of manufactured components and review applications for payment associated with off-site manufacturing.
