“Brochurebiage”

brochurebiage

Yes, “brochurebiage” is a word we made up. It refers to that optimistic and puffed‐up verbiage that can creep into a professional’s brochures or other promotional materials. Many people are rightfully proud of their past work and skill and need to sell that experience and ability to prospective clients. However, use such language with caution.

Licensed professionals promoting themselves as the best around can be an effective way to attract clients. The risk comes when they enter into a contract that refers to or incorporates language in promotional material because it could needlessly raise the standard of care. In California, while licensed professionals may hold themselves to a high personal standard, the default legal standard by which professional negligence or malpractice is evaluated is the standard of care of an average professional in the same field and community. This default standard of care is favorable for licensed professionals because it means to avoid liability, they do not need to be perfect. After all, who is?

This average standard of care can be modified however through contract. Professionals sometimes inadvertently do this when a contract refers to or incorporates a proposal or other promotional item that promises superlative services or the “highest standard of care.” Including a standard of care that goes beyond what is required by law unnecessarily raises the bar for performance and exposes the professional to a greater risk of liability if there are allegations that the work was anything less than perfect. Additional problems may arise because professional liability insurance typically covers the average standard of care, so a contract promising a higher standard might not be covered, which could leave the professional on the hook alone.

To minimize this risk, avoid exaggerated language that over‐promises in contracts. Rather than say a professional will provide the absolute best services, say they work hard to provide professional services that lead to successful projects. Show clients examples of superlative work. Finally, avoid contracts that refer to or incorporate promotional materials because that could unnecessarily raise the standard of care, or limit such incorporation only to the scope or fee portion of the proposal. Highlighting past success and emphasizing skill is necessary to generate business, but exercise caution and balance when using or referring to brochurebiage in contracts.

This article has been reprinted with permission from its authors, David E. Barker and Erin Dunkerly of Collins Collins Muir + Stewart LLP in California. 

Nothing contained in this article should be considered legal advice. Anyone who reads this article should consult with an attorney before acting on anything contained in this or any other article on legal matters, as facts and circumstances will vary from case to case.

PNN_1409The closely watched California Supreme Court case of Beacon Residential Community Association v. Skidmore Owings and Merrill et. al. has been decided, and the opinion is bad news for California Architects.  The Court held that architects owe a duty of care to future homeowners in the design of residential buildings where the architect is a principal architect on the project, meaning that the architect is not a subordinate to other design professionals.

Case background and procedural history

As a refresher, this case involved the design and construction of residential units in the Bay Area of California. Originally held as apartments, the units were converted by one of the developers into condominium units. After completion, the condominium association filed a lawsuit against the original developers, contractors, and designers alleging a long list of construction and design defects. Among the issues was a complaint that the individual units did not include air conditioning and that the quality of the windows used was so deficient that the individual units experienced excessive heat gain, making them unlivable.

Skidmore Owings and Merrill (“SOM”) and HKS, Inc. (“HKS”) were the architects for the project. In reliance on past case law in California, SOM and HKS filed a motion in the trial court arguing that they did not owe any duty of care to the condominium association because neither SOM nor HKS had contracted with that entity. The trial court granted that motion. The intermediate appellate court reversed that ruling, holding that under other California law, SOM  and HKS  in fact did owe a duty to subsequent owners who were foreseeable even though SOM or HKS did not contract with them. This created an arguable conflict between cases, and thus the California Supreme Court accepted the case for resolution.

Our firm was privileged to file an amicus brief on behalf of the American Institute of Architects and the American Institute of Architects, California Council, arguing that architects should not be held to owe a duty to downstream owners with whom the architect did not contract. Continue reading “California Supreme Court Rules Against California’s Architects in the Beacon v. Skidmore Owings Case”

PNN_1407The construction phase is a dynamic time of a project and a design professional’s involvement is significant from a risk management perspective since it allows the design professional the opportunity to provide input during the construction of the project.  Since no designs are perfect (and, moreover, are not expected to be perfect to still meet the standard of professional skill and care), all designs require some level of interpretation that is best done by the design professional who created them.  During construction, the design professional can visit the jobsite to determine if construction is proceeding in general accordance with the plans and specifications and clarify the design intent when necessary.  This article addresses issues design professionals should consider if they provide services during this phase.

Do you have the resources?

The firm must have sufficient staff to devote to this important phase of the project.  The services during this phase require experienced professionals who know how to handle themselves on the jobsite and how to successfully complete tasks in the office.  If junior professionals perform construction phase services, the firm must ensure senior professionals are available to (and actually do) mentor the junior staff.  A successful mentoring program requires regular and meaningful communication between junior and senior staff who need to be proactive to nurture the mentoring relationship.  Mentoring is a two-way street:  it will not be effective if busy senior professionals do not devote time to advance junior professionals’ development and junior staff must take the initiative to seek out senior staff for guidance.

What does your contract say?

Industry standard documents have relatively balanced language regarding the construction phase.  However, design professionals are often faced with a client-

proposed document that may not include appropriate language for the design professional’s involvement in the construction phase. Continue reading “Construction Phase Services: Considerations for a Successful Outcome”

PNN_1405Seen any changes the past thirty years in the delivery of professional design services?  Sure, you have—particularly in the area of construction documents. Raised stools and drafting tables, pounce, and lead-darkened calluses on the middle finger of the draftsmen have, for the most part, yielded to CAD. Although CAD’s promise of error-free drawing may have proven elusive, many of its other promises have been fulfilled. Some even appear understated in hindsight—in part because CAD and the Internet seem to have been made for each other. Their combined effect reduces trying to list all the ways CAD has changed project delivery to a futile exercise.

Like CAD in the ‘80’s, BIM seems to hold similar promise today—a fact not lost on contractors, A/E’s, and project owners alike. Digital models are more-and-more often offered or requested as “deliverables.”  And multiple models for the same project are not uncommon—as building team participants explore their usefulness at various stages of design and construction. Some models are used much like enhanced CAD construction documents, provided and controlled largely by the A/E. But many incorporate data contributed by sources other than licensed design professionals, including suppliers, fabricators, contractors, and subs. Not surprisingly, many contractors and construction managers view BIM as a means for carving out an increased share of the project delivery pie—and are taking full advantage of it as both a marketing and performance tool. Some of them have even become the primary creators and custodians of digital models. Of course, that is not altogether unnatural. After all, it’s hard to ignore a tool that can show what will be built—and also to be useful in actually building it. Continue reading “The Design Professional in the Age of BIM: Things that change; things that don’t.”

Sometimes it’s difficult to sort through all the resources available to design professionals on the internet. We recommend you check out this series of eleven free videos from aecKnowledge, each one an interview with a respected architect in California’s Bay Area.

aecKnowledge Insights video series

Jack McAllister, FAIA

Throughout his long career, Jack McAllister has placed value on understanding how materials were fabricated and buildings constructed, and the importance of working directly with clients, allied design professionals, and the craftspeople building his creations. Above all, Jack learned the value of mentorship, as he describes so poignantly in this in-depth interview curated by Tim Culvahouse, FAIA.

Chuck Davis, FAIA

At age 78, Chuck remains a partner in EHDD, a fabled Bay Area architecture firm with a distinguished international reputation. In this candid interview, Chuck shares his insights about his early years with pioneer Joe Esherick, working with David Packard on the design of the Monterey Aquarium, his post-partum blues, collaborating with clients, the “search and discovery” that makes great architecture, and passing the torch to a new generation of leaders.

Peter Dodge, FAIA

Peter is a founding member of EHDD–one of America’s most distinguished architectural practices. A Fellow of the American Institute of Architects, Peter is the 2008 AIA California Council’s Lifetime Achievement Award. In this interview, he describes his circuitous path to architecture and talked about his contributions to the profession.

Visit the aecKnowledge website to watch these interviews. The following is a list of the rest of the interviewees:

  • George Homsey, FAIA
  • Odile Decq
  • Thom Mayne, FAIA
  • Gwynne Pugh, FAIA, ASCE
  • Steven Ehrlich, FAIA

chicagobean

Dozens of a/e ProNet members from across the country are gathering in Chicago this week for the annual fall meeting. They will be joined by representatives from several top tier professional liability insurance companies and a few major design industry organizations, including the AIA, NSPE, and ACEC.

Over the course of three days, members will receive presentations from the following insurance carriers: Beazley, Ironshore, HCC, Victor O. Schinnerer, Axis, Catlin, Hanover, RLI, All Risks, Liberty, Travelers, Navigators and Arch. These presentations will help inform the specialist brokers of a/e ProNet about industry trends, policy language changes, new coverage opportunities, and the like. It will also give our members a chance to ask questions and make suggestions pertinent to their own clients.

Along with insurer presentations, there will also be ample opportunity for the brokers to network with one another, alerting the group to trends around the country and problem solving in the collective.

To open the week, the Board of Directors will meet, and to close, Kent Holland of Construction Risk will present to the membership on the second edition of a/e ProNet’s Risk Management and Contract Guide for Design Professionals.

constrobservationConstruction observation is a powerful weapon for architects and engineers (A/E) in their risk management arsenal. Certain clients understand the benefits when A/E firms offer construction phase services. However, driven by slow economic conditions, many clients are asking firms to do more, with less, including reducing or eliminating construction phase services. Other clients decide they will administer the construction contract themselves or decide to use a third party instead of the A/E firm. Clients have also held the A/E to a higher standard of care when providing construction observation services. How do these actions affect A/E firms?… It significantly increases the A/E’s risk and liability exposures.

Construction Phase Risks

Details in design documents cannot anticipate every contingency that may occur during the construction phase. If the A/E firm of record is not retained to provide clarification of the plans and specifications the risk of misinterpretation of the contract documents increases. Bad decisions can lead to project confusion, delays, increased costs, disputes and claims between the owner and the A/E.

The exposure of the A/E is increased due to certain owners and contractors asserting that the designer has a similar responsibility of the contractor for discovering all defects on the project. Based on this distortion and unrealistic expectation of construction observation services, owners and contractors have stated the A/E should be a guarantor of the contractor’s work. These expectations dramatically increase the A/E’s standard of care and risks associated with construction phase services. Court decisions have ruled in Owners’ favor holding that the A/E has a duty to guard the owner against all non-conforming work on the project, although much of that work was completed when the firm was not present on-site. Members of the plaintiff’s bar continue efforts to hold the A/E accountable for this higher standard of care for construction phase services. Continue reading “Construction Observation: Important Risk Management Service”

Graduation2

We’re proud to announce that the American Institute of Architects (AIA) panel–which includes a/e ProNet member Tom Coghlan of Design Insurance Agency, Inc.–has selected Kevin Fletcher and Nathan Blair to receive the 2014 a/e ProNet AIA David W. Lakamp Scholarship.

The scholarship program was initiated by a/e ProNet in 1990, and includes an annual award of $5,000 to two architecture students who demonstrate a particular interest in the principles of management in architecture practice.

You can read more about our scholarship and how to apply next year at our website. But here, let’s learn a little more about the next generation of leaders in the architecture community.

Kevin Fletcher

Kevin Fletcher grew up in Miami, FL and will be completing his Bachelors of Science in Architecture at Wentworth Institute of Technology in 2015 with plans of attending graduate school in the fall of 2015. During his time as an undergraduate student, Fletcher, a Dean’s List Scholar, has remained an active member of the American Institute of Architecture Students (AIAS).

In the summers throughout his college education, Fletcher has gained experience working as an Intern at BC Architects AIA, Inc. Prior to graduation, he has applied his talents in areas of marketing presentations, conceptual design, design development, and construction documents. All of which have contributed to his understanding of building systems, codes, and construction methods. Following graduate school, Fletcher plans on pursuing his NCARB registration along with his LEED accreditation.

Apart from his academic and professional involvement within the field of architecture, Fletcher has spent time developing skills in other areas of graphic design, photography, and videography. All the while, maintaining an active lifestyle along with a passion for travel.

Nathan Blair

Mr. Blair graduated with a Bachelor of Science in Architecture from the University of Utah in 2014. He will be returning to the U of U in the fall to complete work on a Masters of Architecture with an expected graduation in 2016. Mr. Blair is currently employed with Epic Engineering located in Heber City, UT. He has immensely enjoyed his time there helping to grow a newly established architecture department. Upon completion of the Master’s degree program, it is Mr. Blair’s intention to seek fulfillment of IDP credit hours with Epic Engineering.

Mr. Blair’s design interests center around identifying and isolating the spirit of our time with an affinity for communicating these visions through contemporary materials and methods. Mr. Blair was recently able to implement these ideologies by competing in the CTBUH Student Tall Building Design Competition, receiving positive remarks. He is also looking forward to participating in the University of Utah’s DesignBuildBLUFF program.

During his free time, Mr. Blair will most likely be found fly fishing. He also enjoys playing tennis, golf, billiards, and getting sushi on the weekends. Mr. Blair is constantly striving to improve himself personally and professionally, and concludes in his own words, “My name is Nathan Blair. I’m a lifelong student, an aspiring architect, and I’m a Mormon.”

Congratulations, Kevin & Nathan! We wish you both the best of luck in your academic and professional careers.

travelerslogoWhen it comes to insuring architects, engineers, and design consultants, one thing the top-tier Professional Liability insurance providers have in common is a wealth of risk management resources for their clients. Some of these resources are even made available to the public. For example, in the past, we’ve blogged War Stories: Real-life Claims Scenarios from Victor O. Schinnerer and Beazley Pro, a new publication from Beazley.

But if, in the course of the day, you come up against an insurance term you wish you understood better, the Travelers Contract Solutions Matrix is a good place to look for your answer

Organized glossary style, this index begins with A Well-Written Contract and ends with Waiver of Subrogation. It’s a place to find definitions, explanations, examples, and answers to frequently asked questions, each presented in the form of a concise two-page document. Other relevant topics included are Additional Insureds, Duty to Defend, Requests for Information, and Unauthorized Changes.

The following is an excerpt from the Travelers Contract Solutions Matrix document on Insurance Requirements:

III. Negotiating points

Policy Limits. You may be asked to provide higher limits than you maintain under your current professional liability or other insurance policy. You may be able to recoup that additional cost of higher limits from the other party to the contract through higher fees. In some cases, specific job excess or specific client excess coverage is available to increase limits on a single project or for a single client.

Length of Obligation. Since professional liability coverage is written on a claims-made basis, you may be asked to maintain the coverage for years following completion of the project. You should negotiate a reasonable period of time in light of the economics of the project and the applicable statute of limitations/statute of repose.

Insurability. Typically, professional liability policies do not cover express warranties and guarantees or liability assumed by contract (liability beyond what a design professional would normally have under the law). Therefore, it is important to evaluate each provision in a proposed contract to verify that you are not guaranteeing your work or being held to a standard of care that is greater than what is imposed by law. In particular, any indemnity clause should be carefully reviewed for this issue.

Download the full PDF version of this resource to find information on Professional Liability, Commercial General Liability (CGL), Workers’ Compensation and Employers’ Liability, and Commercial Auto Liability.

We hope this perk from Travelers is helpful to you. Of course, if you have insurance questions, you can always contact your local a/e ProNet broker and get a quick, straight, specialized answer.