ConsensusDocs Newsletter Article Addresses New Legal Issues for Drones Used in Construction

NASBP is pleased to provide the NASBP membership the following article, “Use of Drones in Construction:  New Rules and Legal Issues,” by Warren E. Friedman, Senior Counsel at Peckar & Abramson P.C. which ConsensusDocs published in its ConsensusDocs Newsletter.

Advances in technology have made drones a sought after and cost efficient tool to monitor work on construction sites. Drones provide real-time data on job progress, can help identify quality issues, and acquire other useful information in an expeditious and cost-effective manner. Rather than flying planes or helicopters over a construction site for aerial photographs or video or otherwise have employees walk a site to document conditions, a drone equipped with a camera makes the process easier and significantly less expensive. Advents in technology allow today’s drones to be controlled via mobile devices connected to the internet, and positioned using autopilot navigation. Drones can also be used by the construction industry for, among other things, quality inspections, ensuring that contractors and laborers are performing and meeting milestones, documenting deliveries and timing of deliveries, and tracking construction progress and scheduling.

Until recently, there was a lack of clarity regarding the permissibility and appropriateness of drone usage in the United States. Individual states and local governments have implemented laws governing drones, but there was only limited guidance provided by the federal government.

FAA’s New Drone Operational Rules

Earlier this summer, on June 21, 2016, the Department of Transportation’s Federal Aviation Administration (FAA) finalized the first operational rules for routine commercial use of small unmanned aircraft systems (the FAA’s terminology for drones). These rules are contained within Title 14 of the Code of Federal Regulations (14 CFR) part 107 and are scheduled to become effective on August 29, 2016.

The new rules implemented by the FAA apply to all drones weighing less than 55 pounds that are being used for non-hobbyist or commercial purposes, but there are separate requirements for hobbyist or recreational use of drones. Under the new rules, the FAA has developed a variety of operational limitations that drone users must follow. By way of example:

Drone users may not act as a remote pilot for more than one drone at one time, cannot operate from a moving aircraft, cannot operate from a moving vehicle (unless the operation is in a sparsely populated area), and cannot operate a drone if the user knows or has reason to know of any physical or mental condition that would interfere with the safe operation of the drone. Remote pilots for drones are required to conduct a preflight visual and operational inspection in order to ensure that the drone’s systems are functioning properly, including checking the control links between the controls and the drone. Drones are permitted to carry objects and transport property, subject to certain weight restrictions, provided that the object being carried can be securely attached will not adversely affect the flight characteristics or controllability of the drone. There is, however, a prohibition against drones carrying any hazardous materials. Drone flights are limited to daytime use only, except for “civil twilight,” which is considered 30 minutes before official sunrise or 30 minutes after official sunset during local time. However, in order to operate a drone during civil twilight, the drone must possess the appropriate anti-collision lighting. Drones may not operate over any persons not directly participating in the drone operation, may not operate under a covered structure, and may not operate inside a covered stationary vehicle. The drone must remain in the visual line of sight of the drone pilot in command and the person manipulating the flight controls.  Alternatively, a visual observer can be designated to assist the drone operator in maintaining a visual line of sight. However, it is important to note that the rules require that either the drone operator or the visual observer must maintain a close enough visual line of sight unaided by devices such as first-person view cameras or other equipment. During operation, the drones maximum ground speed cannot exceed 100 mph (87 knots) and its maximum altitude cannot exceed 400 feet above ground level. Other operational rules included minimum weather visibility requirements, permissible use in certain classes of airspace, encounters with other aircrafts, restrictions on careless/reckless conduct, and the use of foreign drones. Although the above provides a general synopsis of the FAA’s new operational rules, there is also a process by which the FAA will waive certain of these requirements if the drone operator can demonstrate to the FAA that the appropriate safety measures will be utilized pursuant to a certificate of waiver.

Licensure/Certification for Drone Pilots

Additionally, included within the new rules is a certification requirement for drone operators. The drone operator must be at least 16 years old and possess a remote pilot certificate or be directly supervised by someone with such a certificate. In order to qualify for a remote pilot certificate, an individual must either (1) pass an initial aeronautical knowledge test at an FAA-approved knowledge testing center or (2) possess an existing non-student Part 61 pilot certificate (as provided for in 14 CFR, part 61), complete a flight review within the previous 24 months, and take a drone online training course provided by the FAA. The Transportation Security Administration will also conduct a security background check of all remote pilot applications prior to issuance of a certificate.

Since the FAA will expectedly continue to update these rules as commercial drone operations expand, it is critical that businesses remain informed and up-to-date on new regulations, requirements, and standards. Additionally, drone operators will need to be cognizant of the new regulations to avoid potential civil and criminal penalties.

Insurance, Risk and Litigation Concerns

Since insurance considerations are important for every construction project, construction companies should ensure they have appropriate insurance coverage for drone operation in order to avoid gaps in coverage. Most, if not all, commercial general liability policies contain language which excludes an insurer’s liability for “‘bodily injury’ or ‘property damage’ arising out of the ownership, maintenance, use or entrustment to others of any aircraft . . . owned or operated by or rented or loaned to any insured.” Since a drone would seemingly qualify as an aircraft, or at a minimum, sophisticated insurers or coverage counsel could make such an argument to avoid coverage, construction companies that utilize drones should consider purchasing unmanned aircraft insurance or adding an unmanned aircraft liability endorsement to an existing commercial general liability policy.

Likewise, in light of the FAA’s new rules, appropriate language should be included in agreements and subcontracts to address limits of drone operations, minimum insurance requirements, and ensuring compliance with drone pilot certification.

Privacy concerns is another issue that is typically front and center in the media when it comes to drone related issues, and is one which companies should consider addressing on the front end of construction projects to avoid potential claims from adjacent or nearby property owners.

Aside from pre-project planning, construction companies should also consider the impact drone usage may have on litigation. As a project tool, information obtained from drones is likely to result in requests for discovery should litigation arise and litigants may be expected to preserve any evidence obtained through the use of drones. Consequently, preservation of data obtained from drones or otherwise maintained on drones becomes a significant concern because the failure to preserve evidence may lead to assertions of spoliation of evidence, especially if parties are involved in a dispute at the time and are aware that litigation is likely or if litigation has already commenced. Separately, video and photographic documentation obtained from drones documenting project progress may assist litigants in proving their claims, assist experts in understanding claims, and assist judges, juries, and other fact-finders in evaluating claims and defenses. Like many other technological advances, there are benefits and drawbacks to the use of drones on construction projects from a litigation perspective.

Long known for leadership and innovation in construction law, Peckar & Abramson’s Results FirstSM approach extends to a broad array of legal services—all delivered with a commitment to efficiency, value and client service since 1978. Now, with more than 100 attorneys in eleven U.S. offices and affiliations around the globe, our capabilities extend farther and deeper than ever. Find Peckar & Abramson’s newsletter here.

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