A client procuring a construction project rarely possesses the expertise to develop its plans into a detailed specification that a contractor can carry out. It would appoint a team of consultants, which will typically include an architect, structural engineer, services engineer, cost consultant and a project manager, to provide this.

With the JCT (with its pan-construction industry membership) having recently launched its first standard form of appointment - albeit for public sector clients only - it is perhaps now an opportune time to re-examine the CIC Consultants' Contract which was the first standard form of appointment with the stated intention of achieving a compromise acceptable to all parties.

The CIC contract enables a consultant team to be appointed on the same terms. It is not unique in this respect; the earlier BPF Consultancy Agreement had the same purpose (as did the NEC's Professional Services Contract). Where this contract differs, however, is in its publisher's claim that it strikes a fair balance between the interests of the client and the consultant. The BPF Consultancy Agreement makes no such assertion. It is intended to promote the interests of construction clients.

Controversially, one of the ways in which the CIC Consultants' Contract seeks to achieve fairness and balance is by incorporating a financial limit on the consultant's liability. Recent history suggests that such limitations are increasingly sought by consultants (although the economic downturn may alter this as consultants are less able to "pick and choose" their work and become more willing to accept risk). As far as clients are concerned the circumstances of the project and the consultant's role are the key factors in determining whether a cap is appropriate. By making a cap on liability a standard term, clients may feel their negotiating position on the issue is prejudiced.

It is true that the contract is less consultant-friendly than contracts published by organisations such as the ACA SFA/08 and ACE A(1) 2002 (Revised 2004). There is, for example, no net contribution clause and the standard of skill and care required is raised to that of a competent and experienced consultant of the relevant discipline.

The ACA and ACE forms are rarely acceptable to experienced clients for projects of a high value and were regarded with suspicion by them. This is partly because clients will want certain risks to rest with the consultant and partly because they need to ensure that their construction contracts are "institutionally-acceptable". The "institutions" in this case are funders or forward purchasers who wish to protect their financial investment by seeing that the developer passes certain risks down the procurement chain.

The above-mentioned professional organisations' contracts tilt the balance of risk in favour of the consultant and are consequently generally not regarded as being institutionally-acceptable.

So with its intention to find a middle ground between the longstanding negotiating positions of consultants and clients, what impact has the CIC Consultants' Contract had on the market? Almost a year on from its debut, the answer is "not much". One significant hurdle for the CIC is that, for major projects, clients and design and build contractors are simply not that interested in achieving a fair balance. Funders and clients sit at the top of the contractual chain and with their desire to protect their financial commitments to the project from construction risks, they are invariably predisposed to bespoke consultants' contracts prepared in a pro-client form. Consultants may only be able to alter this where they hold a significant negotiating advantage - and as already noted this may become more difficult for them in a market where there is less work to go around.

It is worth mentioning the detailed Scope of Services which the CIC has issued for use in conjunction with the contract. Unlike the BPF Consultancy Agreement or RIBA's 2007 Plan of Work, the integrated activities contained in the Scope of Services may be allocated to consultants, specialists and contractors as appropriate. It will be interesting to see how consultants, contractors and sub-contractors react to this novel approach.

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq

Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.

The original publication date for this article was 30/12/2008.