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Three "mega trends" impacting construction range from payment to project delivery, says legal expert

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by Daily Commercial News

There are three “mega trends” currently in the construction industry pointed out construction lawyer Geza Banfai during a recent presentation.

TORONTO

There are three “mega trends” currently in the construction industry pointed out construction lawyer Geza Banfai during a recent presentation.

Banfai highlighted the movement to prompt payment legislation, the abandonment of the court system and the movement to integrated project delivery, as those trend areas, during a presentation to the Ontario Construction Users Council, reported the Council of Ontario Construction Associations’ (COCA) recent newsletter.

Prompt payment legislation is prevalent throughout the world, though not in Canada, he said, because there is a lot of anger stemming from slow payment.

He added that there is a movement in Ontario pushing for prompt payment legislation.

According to Banfai, under such legislation contractors who are not paid in accordance with the terms of a contract may suspend work or terminate the contract.

COCA believes this is the first discussion of prompt payment legislations with buyers of construction.

Businesses are abandoning the court system Banfai stated. The march to alternate dispute resolution is accelerating and to prove his point he noted that his last trial was eight years ago and that the vast majority of disputes are mediated to resolution.

Factors include an “outrageously” expensive court system; that court decisions can be unpredictable; judges admittedly are amateurs when it comes to construction law; and arbitrators and mediators in construction disputes are selected for their experience in construction.

The rules that govern commercial behaviour come from legislation and precedent court decisions, and there are fewer precedents because of this movement away from courts, said Banfai.

In the current Canadian construction landscape, there is a movement to integrated project delivery, he said to the users council.

Banfai observed that the existing construction delivery model keeps people in silos. They are linked in the delivery of construction projects by contracts that try to make the silos clearly defined and delineated.

Building Information Modeling and Integrated Project delivery are slowly changing the current model in Canada. In this emerging model, multiple parties agree to work together on a team to build and are bound by a multi-party contract, noted Banfai.

DCN NEWS SERVICES

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