NPPE engineering law: what the exam expects you to know

Contracts are the backbone of the law section, because almost every engagement, construction project and job is one. Expect to decide whether a valid contract exists. The elements the exam expects you to know are an offer, an unqualified acceptance of that offer, consideration (something of value exchanged by each side), an intention to create legal relations, parties with the capacity to contract, and a lawful purpose.

Expect questions on what can undo a contract and what happens when one is broken. Misrepresentation, some mistakes, duress and unconscionability can make a contract void or voidable, and frustration can end it when an unforeseen event makes performance impossible. When a party breaches, damages are the usual remedy and the injured party is expected to take reasonable steps to limit its loss. Courts can also order specific performance or an injunction where money is not enough.

Questions also test how contracts are read and how they share risk. An ambiguous term is generally read against the party that drafted it, and clauses such as limitation of liability, indemnity, force majeure and change orders decide who bears a loss before anything goes wrong. Because standard-form construction and consulting agreements are common in practice, many of these questions are framed around a project.

A tort is a civil wrong that causes harm, independent of any contract. For the NPPE, the tort that matters most is negligence. A claimant must show four things: the defendant owed them a duty of care, the defendant breached the standard of care, the breach caused the harm, and real damage resulted. For a licence holder, the standard is that of a reasonably competent professional in the same field, not perfection.

A professional can be liable to a client in contract and in tort at the same time, and to third parties who reasonably relied on their work, which is why negligent misrepresentation comes up in questions about reports and opinions. Employers are generally vicariously liable for their employees' negligence in the course of employment, and where a claimant's own carelessness contributed, damages can be reduced in proportion to fault.

Liability is managed with contract terms and insurance. Limitation of liability and indemnity clauses cap or shift risk between the parties. Professional liability insurance, often called errors and omissions insurance, responds to claims arising from professional services, while commercial general liability insurance covers bodily injury and property damage. Limitation periods, the time allowed to start a lawsuit, are set by provincial law and vary, and the clock generally starts when the problem was discovered or reasonably could have been.

Intellectual property gets its own questions because licence holders create it every day: drawings, reports, specifications, software, inventions and processes. The questions that matter most are about ownership and use rather than filing procedure: who owns the copyright in a set of drawings, whether an employer owns an employee's work, whether a client may reuse a design on another project, and what happens when an invention is disclosed before a patent application.

As general principles, copyright in work an employee creates in the course of employment usually belongs to the employer unless an agreement says otherwise. A consultant usually keeps the copyright in drawings and reports prepared for a client, and the client receives the right to use them for the project they were made for. In every case the contract can change the default, so the first question in a scenario is often what the agreement says.

Confidentiality ties intellectual property to ethics. A licence holder must not use a former employer's or client's confidential information for a new one, and non-disclosure agreements are how most technical know-how is protected. That overlap is why some intellectual property questions read like ethics questions.