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Law Times • JuLy 12, 2010 P3s, power projects keeping construction lawyers busy BY ROBERT TODD Law Times W hile economic doom and gloom continues to creep into the business pages, construction law practitioners are optimistically reporting a steady stream of quality work with no end in sight. Osler Hoskin & Harcourt LLP construction law partner Bob Beaumont says a flurry of significant new developments came to- gether about two years ago and are now finished or near comple- tion. For example, he has been retained to work on projects such as Toronto's new Bay-Adelaide office tower, completed last year, and the Ritz-Carlton Hotel that's expected to wrap up soon. Beaumont notes construction lawyers remain busy throughout the economic cycle. As projects reach completion, legal expertise is often necessary to manage disputes that arise. "It sort of rides through all of the ebbs and flows of the econo- my," he says. Construction law practitioners have benefited in particular from increased activity in Ontario's power and energy sector. Such projects have come about largely through procurements from the Ontario Power Authority, especially from the new feed-in tariff program. Nearly 200 developments have been approved under that program, which targets renewable energy projects from sources such as wind farms, biomass, and solar power. Public-private partnerships also account for a significant amount of the work that has recently tied up construction law practitioners, says Beaumont. Infrastructure Ontario is leading the way on many of these P3 projects. About nine health-care-related infrastructure developments across the province have recently been completed, ac- cording to the Crown corporation. Justice-related projects, such as those at the Roy McMurtry Youth Centre in Brampton, Ont., and the Durham consolidated courthouse, have recently wrapped up. Dozens of other projects are in various stages of completion, from pre-tender to construction. "We see a lot of opportunities," says Beaumont. "We've been very busy for a number of years now and we see that continuing certainly in the near future as a lot of these power projects and P3 projects continue to move through the development stages." But that's not to say there is a dearth of challenges for counsel spe- cializing in the construction sector. The law continues to evolve when it comes to the procurement and request-for-proposal stages of projects, Beaumont notes. "Keeping up with the changes and anticipating where they may go might be one of the greater challenges that we'll face." For example, it remains unclear — depending on the terms and conditions of tender documents — just what rights entities calling for tenders have to negotiate with parties or consider irregularities in bids received. Courts are scrutinizing privilege clauses typically included in tender documents more carefully and pondering the breadth of those conditions, Beaumont says. "The privilege clauses have been getting more and more extensive over time. One of the questions that we're facing now is, have they gone too far? Are the courts going to start pulling back and imposing stricter require- ments on the parties involved?" Greg Hersen, a partner in Torkin Manes LLP's construction law group, says lawyers in this area now face increased scrutiny before be- ing retained on a file by large institutional clients. Many now force law firms to participate in a request-for-proposals process or, as he calls them, "beauty contests," if they wish to be awarded a mandate. But lawyers must be judicious when it comes to deciding which requests to respond to, says Hersen, as doing so can become extremely time-consuming. At the same time, he says it remains unclear whether the trend has pushed construction law practitioners to drop their fees. "It depends on lots of things," says Hersen. "It depends on if there's some guarantee of work down the road, who it is, if there's some guar- antee of the volume of work, if there's some consideration as to how long the process is good for." Meanwhile, Hersen finds construction law continues to be "an odd area to practise in." He says few lawyers practise solely in that sector, possibly due to the sophistication of the work from a legislative stand- point that requires them to become intimately familiar with every detail of the law if they hope to succeed. Construction law is also unique in terms of client management, Hersen adds. That's because practitioners deal with a wide range of or- ganizations and individuals from very sophisticated contractor clients that have lots of experience to those that may be quite new to construc- tion contracting. "You may have a really big, successful company that decides once that they're going to build their own building," he says. "So it's a com- pletely new thing for them to talk about what kind of clauses they're going to need in their contract and things to watch out for." Based on that, Hersen cautions lawyers against "dabbling in the area" of construction law. LT Untitled-3 1www.lawtimesnews.com 4/14/09 9:00:22 AM FOCUS Let us open right door for you the We specialize in Employment and Labour Law in Canada Kuretzky Vassos Henderson is a leading employment and labour law fi rm situated in the heart of Toronto. We are comprised of nine lawyers, all of whom specialize in the area of employment and labour law. We act for many prominent public and private sector employers as well as for individuals. 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