14 May Legal services worth the investment
Legal services are often regarded as a grudge purchase; however, it ensures that consulting engineers and mining houses save money in the long term.
“When consulting engineers are preparing bids for projects on behalf of mining companies, it becomes difficult to justify the cost of legal services,” says specialised law firm LNP Attorneys CE and director Nikita Lalla.
She notes that attorneys need to build a trust relationship with their clients, whereas consulting engineers often have longstanding relationships with mining houses, which take precedence.
An additional challenge is helping potential clients see the benefit of the services legal experts provide. Legal experts can play an essential role as part of a multidisciplinary team in ensuring the success of the projects they work on.
“The need for a multidisciplinary approach needs to be advocated. It’s difficult to say to a client that R100 000 and more should be spent on a multidisciplinary team when the client’s imperative is to get the contract off the ground,” says Lalla.
She notes that not enough time is spent on the first phase of the procurement, which includes choosing the best procurement methodology, preparing the scope of work, and ensuring that the contract is the appropriate scope of work when preparing a request for quote (RFQ).
“The contract, particularly if the language used is not clear or stringent enough in terms of protecting the client’s rights, can result in a cession of various rights and an increase in the types of claims that could be made against the client,” says Lalla.
She cites previous cases that she has worked on where the consequences of attorneys not being consulted from the outset were the cession of intellectual property rights or claims for delays.
Lalla explains that contracts need to have a legal and a technical spot check, to ensure that both the contract and the client’s requirements are “cohesively melded”.
“Sometimes contractors request the insertion of their own documents and clauses, while the employer is unaware of the consequential implications thereof,” says Lalla.
However, these problems can be mitigated if the consulting engineer and/or mining company ensures that specialist legal advice is part of the process from the start of the procurement process.
The attorney can then evaluate the risk factors, possible mitigation factors and regulatory issues, especially in cross-border transactions. LNP Attorneys can provide assistance with such aspects – from the issuing of an RFQ to the project close.