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15/04/2020 – Risk management: business as usual

How can we provide risk management services in the current climate? As it turns out, almost exactly the same as we always have! It’s very much business as usual for our risk management team. From our perspective, looking at the construction industry through contracts and education, this is what we’re seeing of the pandemic.

Contract Reviews

The last two weeks of March were intensely challenging for the construction industry, as senior managers found their time urgently diverted to the logistical task of getting entire teams set up to work from home. Our team certainly faced a few days of connecting uncooperative equipment on dining tables and searching out free powerpoints in houses full of people working or studying from home. But, as with many consultants, having had some remote working arrangements and technology in place already made the transition smoother.

Our Risk Managers and support staff are now comfortably working from home. And the work is most definitely still there.

Apparently it takes more than a pandemic crisis to stop clients and builders from sending out one-sided consultancy agreements. In March 2020, we reviewed the same number of consultancy agreements as March 2019, perhaps tilted slightly more towards the public sector than usual. Contracts ranged across hospitals and aged care, universities, infrastructure, commercial developers, Commonwealth, State and local government, and sub-consulting to builders.

The content of our insurance reviews of consultancy agreements is unchanged by any of the developments around COVID-19. Professional indemnity insurance (“PI”) does not generally contain any exclusions relating to pandemic or government shut-down. Most of the immediate losses resulting from the pandemic (such as lost fees, or costs relating to staff) are unlikely to be within PI cover in the first place. But any claims against consultants for defective professional services arising out of COVID-19 ought generally to be covered by PI – for instance, claims by the principal/owner for delays in providing professional services due to staff unavailability, or negligent contract administration when assessing the builder’s COVID-related extension of time claims.

Looking at contracts from a legal, rather than insurance, perspective, there are some clauses that require special consideration in the current climate, such as “force majeure” and time provisions. Our new related business, informed Lawyers Pty Ltd, covered some of these in a recent article for Planned Cover. These issues are outside the scope of the insurance-based contract review service delivered by our risk managers at informed by Planned Cover, however.

The biggest challenge for our team has been letting go of paper print-outs, which are handy when you need to flip between terms, definitions and annexures without losing your place in a 200-page contract, or vent your frustration at that one-sided clause with creative comments scrawled in the margin!

The highlighting and comment functions in Adobe Reader have served us well, for our own purposes of flagging the insurance issues in contracts:

And the reviews we send out at the end of this process are the same consistent product as always.

In-house Seminars

For many Planned Cover clients with large or medium teams, our risk managers provide in-house seminars covering key risk topics like document management, managing sub-consultants and construction phase services. Over March/April, we started providing these remotely, to teams based in the office, or at home, or a combination of both. Comprising the same content as the in-house seminar series we usually deliver in person, they can count towards CPD points and come with assessment questions for architects who need “formal” points. Many of our clients have found these a good way to keep connectivity and engagement with their remote-working staff.

informed CPD

Naturally, we have cancelled our in-person informed events until it is safe to meet face-to-face again. We are looking to reschedule our 2 April Sydney event on the Design and Building Practitioners Bill 2019 (NSW) as on online event, once the Bill’s fate is clearer (and refunds have been issued to all ticketholders in the meantime).

The majority of our CPD is online, and will continue as planned.

Our online CPD library (included online courses and recordings of past webinars) is always available to help you and your staff meet regulatory requirements for education.

Our next webinar on 30 April, Contracts In-Depth, draws on the new areas of expertise that our related business informed Lawyers Pty Ltd is able to provide. We will cover topics like delays and extensions of time, set-off clauses, variations, termination rights, indemnity clauses and performance standards, demonstrating how clauses that look similar at first glance can in fact impose very different obligations, and provide examples of both protective and problematic phrasing to look out for.

Bookings for the webinar are now open:

Discount codes have been sent to Planned Cover clients and our mailing list – but please get in touch if you can’t locate yours.

Wendy Poulton
Risk Manager
informed by Planned Cover

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