Breaking down barriers

In PPC2000, launched recently by John Egan as part of the Rethinking Construction initiative, we have the first standard form project partnering contract. The fact that it has been produced by the Association of Consulting Architects, rather than one of the more recognised contract drafting bodies, is puzzling. The drafting work was done by law firm Trowers & Hamlin, which specialises in acting for local authorities. Is that a clue about what sort of client will be the principal user of this form?

In this and my next column, I shall examine the objectives of PPC2000 and consider the extent to which it is likely to achieve them. In doing so, I am reminded that three years ago (28 November 1997, page 37), I stated: "To think that the attitude of working together positively is going to be encouraged by writing words into contracts is muddled thinking. There is a place for contracts and charters, but to confuse the two is only going to lead to further problems."

From that statement, you might think that I am no fan of partnering. On the contrary, I am one of its greatest supporters. At that time, I kept coming across situations where people seemed to be confusing the roles of partnering and contracts in construction procurement.

I was also becoming increasingly frustrated (and I'm afraid Sir Michael Latham must take some of the rap here) by seeing wishy-washy and legally meaningless language written into contracts, which rambled on about duties of good faith, co-operation and the like. All that is fine in the right place: the partnering charter or whatever the parties use to record their commitment to teamwork. But putting it in the contract simply serves to confuse the parties and – as shown in the only case so far dealing with the effect of partnering arrangements – the courts.

My own views on partnering were shaped by my involvement, albeit peripheral, in the aftermath of the Heathrow tunnel collapse. Remember that? In the early hours of 21 October 1994, newly excavated tunnels collapsed in the central terminal area, leaving an office block submerged in a massive hole. It was a miracle that nobody was killed. Strange as it may sound, this incident led to what must be one of the greatest partnering triumphs of all time.

There were a number of novelties about the Heathrow Express project, both from a procurement and technical point of view. One was the use of the New Engineering Contract (as it was then known) on a major construction project of this scale. How did it bear up in the ensuing crisis? It was totally overwhelmed – despite new features such as early warning notifications and adjudication of disputes.

Out went the contract and in came the "seamless team". In practical terms, this meant key personnel from all the major parties – client, contractor and key consultants – working alongside one another as part of a team, first in damage limitation and then in recovery mode.

What was especially striking was how people embraced the partnering ethos, and how much satisfaction they clearly derived from working together to turn the project around

From a lawyer's point of view, much of this was, of course, extremely disturbing. What about the risks involved in compromising responsibilities and contractual confidences when personnel from different organisations are mixed up? Having personnel seconded to the project might be great but where would it leave things from a contractual point of view?

The sheer scale of the problem was one of the secrets of success; the consequences of failure were so great that it was almost unthinkable. But the reason that the process worked so effectively was that it broke down the divisive barriers of traditional contracting and threw the conventional schedules of responsibility out of the window. What was particularly striking was how people embraced the partnering ethos, and how much satisfaction they derived from the experience of working together to turn the project around.

It is unrealistic to expect that project partnering in normal circumstances, introduced at the outset of a project, will generate the same degree of motivation and energy. But that is no reason for ignoring its real benefits in terms of added motivation, productivity and, ultimately, increased value. Whether parties use charters or team-building workshops is irrelevant. Anything that encourages the parties to make the project "number one" should be promoted.

However, partnering is not suitable for every organisation nor for every project. There are still clients who transparently use the partnering label as a smokescreen for holding contractors to ever-diminishing margins, while expecting them to sacrifice the contractual protection they would usually expect. Partnering in such circumstances is like swimming with sharks rather than dolphins.

I do not see the UK construction industry being ready to abandon contracts as the basic mechanism whereby relationships are regulated. But I do see partnering continuing to play an increasingly important role in steering projects towards "win-win" conclusions.