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Task force will explore standard contracts for IPD

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by Patricia Williams

A task force of the Canadian Construction Documents Committee (CCDC) is drafting a standard contract for projects undertaken using the Integrated Project Delivery (IPD) model. The task force began work on the groundbreaking initiative about two years ago. A consultation draft is expected to be complete by early to mid-2016.
Task force will explore standard contracts for IPD

The document will then be circulated to the CCDC's constituent associations as well as some owners for review prior to being finalized, said task force member Serge Massicotte.

"We will take their comments under advisement and revise accordingly," said Massicotte, president of Massicotte Construction and a former chair of the Canadian Construction Association (CCA).

A final draft will then be produced prior to publication of the new document by early 2018. Relatively new in Canada, IPD is a highly collaborative process intended to fully engage owners, designers and construction teams early in the project, thus reducing waste and delivering value. A single multi-party contract, often including multiple trades in addition to the contractor and consultant group, outlines the parties' duties to the project and to each other. Profits and risks are shared. Measurable objectives are set for improvement over traditional projects. In Canada, IPD was first used on the $102-million Moose Jaw Hospital in Saskatchewan. The project was delivered under budget and a year ahead of schedule by a team that included Graham Construction.

"Because this approach is so different from other contract models that are in existence in Canada, the CCDC felt that a specifically designed standard contract was required," said task force member Art Winslow, Graham's Lean IPD director. Winslow, who led Graham's foray into IPD at the Moose Jaw project, said the CCDC task force is referencing the contract that was "developed from scratch" on that project, as well as some U.S. documents.

"Really, what we are doing is creating a hybrid that is parallel to how other CCDC documents are written," he said. "But, the content is drawn from these three sources."

Winslow said the U.S. contracts that are being referenced are written in a universal lean/IPD language that crosses borders. Lean construction principles are "sprinkled" throughout.

"IPD is a delivery model that is based on lean principles," Winslow said. "This delivery model has more value if you add lean, as was done in Moose Jaw." Items that will be addressed in the new CCDC standard contract include formulas for sharing of risks and rewards, limitations of liability and incentives to team members.

"The idea is to have a fair and balanced approach so that the contract is not biased in any one particular direction," Winslow said, noting the contract is relationship-based. Currently, there are believed to be five projects underway in Canada that incorporate IPD. "There certainly is a lot of interest in this," Massicotte said.

"I think you will see a big increase in the requirements for IPD once owners gain a better understanding of its benefits."

Winslow, who gave a presentation on IPD at the Canadian Design-Build Institute's 2015 annual design-build conference, said the CCDC wants to stay ahead of the curve "that we see coming."

The CCDC is a national joint committee responsible for the development, production and review of standard Canadian construction contracts, forms and guides. Its constituent organizations are the Association of Consulting Engineering Companies-Canada, Construction Specifications Canada and the Royal Architectural Institute of Canada as well as  the CCA.

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