Engineering Archives - Page 6 of 10

The Construction Contract: 3 Essential Rules

By Lynda

For design professionals, it’s good business to have a solid, fair contract in place before you begin work on a project. So, what are the three essential rules of putting together a construction contract? Our January 2013 ProNetwork News newsletter has the answer:

In the construction world, the contract rules the parties. It is the blueprint (pun intended) that says what you can be sued for, when you can sue the other party, and what your damages will be. If you do not have any written contract, the law presumes certain things that you may not want it to presume. Therefore, you must treat the contract seriously, and consider these three essential rules.

Put all agreements in writing
Negotiate or strike through unfair or one-sided terms
Deal with discrepancies between the Proposal for Services and the Contract

(1) Put all agreements in writing

Design professionals who rely on “handshake” or “gentlemen’s agreements” are playing a game of Russian roulette. One bad project, and you’ll wish that you had a well-written, reviewed and negotiated contract.

Written contracts are crucial to enforcing binding agreements once the dirt begins to turn. Memories fade, records are lost, and key employees leave. Having all the crucial terms in writing eliminates the need to argue over how changes are handled, how compensation issues are dealt with, and how disputes are decided.

(2) Negotiate or strike through unfair or one-sided terms

While a written contract is important, it is almost better to have no written contract than to have a poorly negotiated, unfair, or unclear written contract. Continue reading “The Construction Contract: 3 Essential Rules”

2012 Professional Liability Insurance Survey of Carriers

By Lynda

Design firms go through their Professional Liability insurance renewals annually. Did you know the insurance companies actually get reviewed annually, too?

Check out the 2012 Professional Liability Insurance Survey in the Jan/Feb 2013 issue of Engineering Inc. Magazine.

Then-President of a/e ProNet, Leslie Pancoast of IOA Insurance Services, offered the following insights:

One incentive to switch carriers is better risk management services. Her firm might recommend a switch, for instance, if a designer moves into a specialized industry sector, such as condominium design, or if an opportunity exists to lock in a fixed premium for multiple years.
But be careful. Pancoast says that firms that switch PLI carriers too frequently can sometimes find it difficult to find a willing insurer, particularly if a firm begins to experience claims or is driven back to the market by higher billings.
Residential work continues to generate a lot of claims, and schools and other public projects are beginning to experience claims increases.
Best practices for PLI coverage continue to include good communication and proper documentation.

Read the rest of the article to learn the status of the insurance industry.

Shootout At The Copyright Corral

By Lynda

It is no secret that in the current economic environment, it can be difficult to find projects, and the problem may not end there. It can be even more difficult to secure prompt payment from your client. Sometimes, it is difficult to secure payment at all.

There are certain statutory protections for architects in many states: design professionals’ liens for certain projects and mechanics’ liens for others. But like other legal remedies, statutory protections require timely legal action, and the legal fight can be both financially and personally arduous.

Most of the time, architects and other design professionals have one potential weapon in their arsenals that no one else on the project can bring to the unpaid fees fight: the ability to control the use of their work product through copyright protection. As long as the work product meets certain statutory requirements and their rights are not otherwise waived, design professionals own a copyright by authorship alone. Additionally, registering the copyright with the U.S. Copyright Office entitles the copyright owner to additional statutory damages and attorneys’ fees in any ensuing infringement action.

Copyright is an underutilized tactic in the fee collection “gun fight.” On a project where construction had been in full progress but is stalled because no one – design professionals, project manager, general, and subcontractors – has been paid by the owner, the standard litigation tactic is to sue for breach of contract and file an action for foreclosure on any lien rights. But what if the owner is also in default on its construction loan? Continue reading “Shootout At The Copyright Corral”

When Green is Risky and LEED is Embarrassing…

By Lynda

Remember when Architects and Engineers were still pondering the sustainability of the sustainability fad? In 2009, posts like LEED Accreditation – Fad or Necessity? from the Civil Engineering Central Blog and Is LEED a Load? from the Archinect Discussion Forum were popping up all over the place. Four years later, the industry may have a better grasp on what green means, but some of those original fears and worries may also have a right to remain. This week’s installment of Friday Finds by a/e ProNet includes a pair of articles commenting on the current status of LEED and Green Design.

As Important As It Is, LEED Can Be So Embarrassing — via TheAtlanticCities.com

TrentBell_LEEDphoto — The New American Home 2013 by Trent Bell via The Atlantic Cities

“But, man, there are a lot of warts in this system.”

LEED has been criticized for:

Being insufficiently demanding of its applicants. Shoot high enough to seem relevant, but low enough that designers will see the standards as achievable and worth trying for.

USGBC, although a non-profit, needs revenues to keep the system going. “If difficulties in the standards or the process of application are too demanding, fewer potential applicants will be willing to pay the costs of documentation and formal review.”

Has “become pro forma, more about earning points than achieving actual environmental performance.”

“I recount this long-winded intro because my friend Lloyd Alter of the environmental website Treehugger has just written a terrific story about a new, supposedly super-green house being touted as “the new face of efficiency” even though it’s really a gigantic luxury house placed in a location where residents have no choice but to drive long distances to do anything. This is ultra-green? Sadly, LEED seems to think so.”

Designers’ Risk: The Dark Side of Going Green — via The Illinois Construction Law Blog

“The language and presumptions of sustainable “green” design are changing a significant portion of the landscape for all stakeholders in the construction and building-related industries. “Green” building impacts everything from the selection of carpeting and window treatments to how far the materials have to be shipped to the project before installation. And with ever evolving sustainable design standards and building codes (e.g. the International Green Construction Code), it is important that designers understand how “green” projects affect their risk. “

Here’s hoping the continued dialogue on these issues will lead to a better understanding and implementation of LEED.

Architects Step Into Contractors Liability, Size XXL

By Lynda

If you have ever gone car or shoe shopping with and for someone else (teenagers and significant others, in particular), you know the difficulty and frustration that usually follows efforts to fit and style those with strong opinions and feelings on the subject. Such shopping is more an effort in very personal comfort, feel and perception than utility. The same can be true for design professionals’ scope of services. The most recent economy has left design professionals to suffer earliest, longest and hardest, particularly those that rely on residential development. To keep busy, some A/Es are marketing a broader scope of services, including services historically reserved for construction contractors. The comfort, feel and perception of such expanded scopes of services are highly personal but come with distinct and practical liabilities and risks. Like finding the right shoe size or vehicle type, A/Es can manage expanded risks with properly fitting contracts, insurance and professional structure.

SUV v. Sedan and Dress Shoe v. Cleats

In annual magazine reviews, sedans are compared to sedans and SUVs are compared to SUVs. The same is true of legal standards by which different roles are judged. A/Es provide a professional service and are compared to other A/Es by a standard of care – what others in the same profession are doing or would have done for a similar project. A/E contracts typically take care to adhere to recitations of the baseline standard of care and avoid or disclaim responsibility for means and methods, safety, warranties and the contractor’s timely or proper performance.

Contractors provide a finished product which is judged by a good and workmanlike standard: a warranty of quality, timeliness and, usually, safe performance of the work. Contractor agreements therefore give the contractor control over and responsibility for means and methods, safety, warranties, schedule and performance.

Crossovers and Hybrids

There is a line between trucks and cars, but there are luxury SUVs and crossovers to blur the line and offer compromises of varying degree. The line between A/E services and contractor services has become equally fuzzy. Try to explain in words the difference between the scope of services of a Construction Manager/Advisor, a Program Manager and an Owner’s Representative. For example: The label is less important than the intended division of responsibility, control and money, and how that is expressed in a contract. Continue reading “Architects Step Into Contractors Liability, Size XXL”

Chinese Architecture Today: The Instant Skyscraper & Copyright Infringement

By Lynda

[youtube http://www.youtube.com/watch?v=Hdpf-MQM9vY&w=560&h=315]

In this video, you can watch the construction of a 30-story apartment building in less than 3 minutes. That’s the beauty of time-lapse technology. But the reality is also super fast. The apartment building, comprised of 30 floors built in sections, “each measuring 15.6 by 3.9 meters, with a depth of 45 centimeters,” was built from the ground up in just 15 days.

“Zhang Yue, founder and chairman of Broad Sustainable Building, is not a particularly humble man,” writes Lauren Hilgers in her recent piece for Wired magazine. “A humble man would not have erected, on his firm’s corporate campus in the Chinese province of Hunan, a classical palace and a 130-foot replica of an Egyptian pyramid. A humble man, for that matter, would not have redirected Broad from its core business—manufacturing industrial air-conditioning units—to invent a new method of building skyscrapers. And a humble man certainly wouldn’t be putting up those skyscrapers at a pace never achieved in history.”

The efficiency made possible by this copy-paste style of construction could change the way whole cities are designed in China, the country with the highest population in the world. But what impact will it have elsewhere? And what are the risks of such speedy construction?

In October 2012, Evan Osnos wrote Boss Rail, an article for the New Yorker magazine which revealed the flaws in China’s recent high-speed rail boom.

“In 2003, China’s Minister of Railways, Liu Zhijun, took charge of plans to build seventy-five hundred miles of high-speed railway—more than could be found in the rest of the world combined… With a total investment of more than two hundred and fifty billion dollars, the undertaking was to be the world’s most expensive public-works project since President Eisenhower’s Interstate Highway System, in the nineteen-fifties. To complete the first route by 2008, Minister Liu, whose ambition and flamboyance earned him the nickname Great Leap Liu, drove his crews and engineers to work in shifts around the clock, laying track, revising blueprints, and boring tunnels… When the first high-speed line débuted with a test run in June, 2008, it was seventy-five per cent over budget and relied heavily on German designs.”

On July 23, 2011, lightning struck a signal box outside the city of Wenzhou, and gave one of the high-speed trains a green light rather than a red on. The resulting crash killed 40 people and injured 192. It was this tragedy that forced China to take a closer look at what turned out to be a highly pressurized process, hobbled by the corruption of government officials, as well as the illegal practices of wealthy citizens.

Sacrificing oversight and transparency for speed is a concern, especially since China is already in the architecture world’s line of fire these days due to frequent accusations of copyright infringement (Creative China, Cutting and Pasting?). In a recent example, the New York Daily News wrote, “Already famed for fake designer bags and pirated DVDs, imitation in China may have reached new heights with a set of towers that strongly resemble ones designed by renowned architect Zaha Hadid.”

But Hadid might be the first to remind her counterparts that the existence of China’s specific market, even taking into account the political structure and shaded history, is beneficial. She has worked extensively in China, crediting the country as a major influence on her evolution and success as an artist. In a November 2012 piece published by Newsweek, author Melinda Liu quotes Hadid as saying, “Every country has its local requirements. In China, the requirement is to be big. Where else can you get this scale? That’s its Chineseness.”

Whether this latest exercise in speed and efficiency will be primarily positive for the world of architects, engineers, and builders remains to be seen.

Veni, Vidi, Vici, Lis Pendens: I came, I saw, I got sued – Part 2 of 2

By Lynda

The following is an excerpt of Part 2 in this two-part series. In Part 1, author Eric Singer covered Veni (I went to the site) and Vidi (I observed for general conformance with design intent).

Lis Pendens – I got sued anyway

Sometimes observable deficiencies get missed, or the timing, relative solvency or insured status of the parties and plain old bad luck conspire to force you to defend your compliance with the standard of care. In tort claims (injuries, property damage or other calamities), most states have procedural mechanisms to apportion fault among the parties or to add parties potentially at fault. Contract lawsuits are different and an owner could choose to pursue the A/E and leave the contractor alone or to settle and join forces with the contractor. In contract cases, many jurisdictions make it difficult for an architect to pursue claims against a contractor without a direct contract. You can defend by blaming the contractor’s “empty chair” or try a more aggressive approach. The general conditions may provide you with some ammunition.

General Conditions frequently contain a warranty in favor of both the owner and the architect. The AIA A201 (2007), for example, provides “The Contractor warrants to the Owner and Architect that materials and equipment furnished under the Contract will be of good quality and new unless the Contract Documents require or permit otherwise. The Contractor further warrants that the Work will conform to the requirements of the Contract Documents and will be free from defects, except for those inherent in the quality of the Work the Contract Documents require or permit.” (A201 – 2007, §3.5). Interpretation of this provision and rights of the architect in these circumstances varies greatly state to state. If viable in your state, a warranty claim against the contractor may prevent the owner and contractor from settling cheap or joining forces against the design team.

To read about Vici, I conquered, visit our website where you may download the full PDF version of this October 2012 issue (and all previous issues) of our ProNetwork Newsletters.

About the Author: Eric Singer is a partner at Ice Miller, LLP. He concentrates his practice in construction law, with emphasis on the representation of architects, engineers, contractors, owners, and lenders as well as other professionals, in litigation and alternative dispute resolution of design and construction issues. Mr. Singer, who was awarded his J.D by the University of Chicago Law School, is a former Professional Affiliate Director of the American Institute of Architects of Chicago and is a member of multiple bar associations and design professional groups. Recently ranked as AV Preeminent by Martindale-Hubbell and listed in The Best Lawyers of America, Construction Law, by those peer-review organizations, Eric is an active speaker and prolific author on the subject of construction litigation and the liability of the design professional. Contact Eric Singer at: eric.singer@icemiller.com

Don’t forget to contact your local a/e ProNet broker if you have any questions!

An Anniversary Post: Burj Khalifa in the (Smelly & Spectacular) News

By Lynda

As the world rings in 2013, The ProNet Blog is celebrating its one year anniversary. We had high hopes for the blog at the start of 2012, but those expectations have been exceeded in every way. In the last 12 months, we’ve posted 68 articles on architecture and architects, engineering and engineers, and the insurance industry that backs them up. This has allowed several thousand visitors to find the information they wanted and needed.

Burj Khalifa 2012 Fireworks. Photo via arabianbusiness.com.

In the spirit of hopefulness that should belie the eve of any new year, we turn now to what got us off to such a great start last year, Burj Khalifa, the tallest building in the world, and one which is dominating headlines this New Year’s Eve.

For starters, tonight’s fireworks display is highly anticipated. One Lebanese businessman is reported to have shelled out almost $20,000 to spend New Year’s Eve in a 7,000 sq-ft penthouse apartment in downtown Dubai with an excellent view of Burj Khalifa. He’s just one of the more than one million people expected to party-in the new year Dubai-style. Good news! For those of us who can’t quite make it downtown by midnight, we can watch the Burj Khalifa fireworks live on YouTube!

Besides, squeezing in close to the overwhelming structure might be better in theory than in fact, especially given Kate Ascher’s recent interview with NPR’s Terry Gross. The author of The Heights: Anatomy of a Skyscraper revealed that, as Gather.com put it, “Yes, the tallest structure built by man could also be considered to be the smelliest.”

GROSS: Well, it really illustrates one of the paradoxes of modern life, that we have these just incredible structures that reach, you know, that seem to reach to the sky and then in a place like Dubai you have a 24 hour long line of trucks waiting to dispose of the waste from those buildings.

ASCHER: Right. Well, you know, you have to remember that a place like Dubai really emerged in the last 50 years. It was a sleepy, you know, Bedouin town half a century ago. And what you do is when you bring in the world’s, you know, most sophisticated architects and engineers, you can literally build anything, including a building of 140 or 150 stories. But designing a municipal network of sewage treatment is in some ways more complex.

Supermodel & Superskyscraper. Photo via Emirates 24/7.

Maybe the smell explains why, earlier this month, supermodel Heidi Klum tweeted a picture of herself with the superskyscraper far, far, far off in the distance. “If you can see past my loud outfit….that is the worlds tallest building!”

Some people remain undeterred, however. An Emirati mountaineer, Saeed Al Memari, has been given the green light to climb the side of Burj Khalifa and perform a base jump from the top on January 1. Al Memari had originally wanted to make the jump on New Year’s Eve, but the fireworks spectacular would, apparently, have made the stunt “too dangerous.” Once the fireworks are done, it should be no problem. Call me crazy, but this sounds… crazy.

Meanwhile, last week, a 32-year-old Commando in the Royal Navy, fueled more by charity than by adrenaline, climbed more than 3,000 feet of rope to raise money for the Children’s Happy Hospital Fund. Sergeant Rob Garthland began the Burj Khalifa Rope Climb Challenge at 7:00 a.m. and “completed 110 climbs of a 30 foot rope in HMS Raleigh’s gymnasium” by 4:00 p.m. He hopes to raise about 1,000 GBP for the charity. Help him reach his goal by donating today!

We wish all of our readers a safe, celebratory New Year! And we hope you’ll visit us for more design industry resources, updates, and information in 2013.

4 Risk Management Webinars for Design Professionals in 2013

By Lynda

In 2013, Professional Liability insurance provider Victor O. Schinnerer will host independent subject-matter experts for four webinars, all geared toward Architects, Engineers, and other Design Professionals:

Employment Liability Issues in a Recovering Economy

February 13, 2013, 1:00 – 2:00 pm eastern

Thomas L. McCally, Esq., Carr Maloney, P.C., Washington, DC

Design firms face various types of employment liability issues during the normal course of business. However, the downturn and subsequent recovery of the economy have brought these issues to the forefront of concerns for design firms. An attorney expert in litigating design firm employment practices claims will discuss the issues firms need to recognize as the economy improves and firms prepare to staff-up for the recovery.

Business Models and Financial Opportunities in a Recovering Economy

April 10, 2013, 1:00 – 2:00 pm eastern

Michael O’Brien, ASA, Rusk, O’Brien, Gido + Partners, Washington, DC

From funding sources to procurement procedures, the financial environment for professional services has significantly changed since the pre-recession economy. Both in the public and private sectors, the rules, risks, and routes to financial success are different. Professional services firms need to adjust their business plans to remain viable and to benefit from the opportunities in a recovering economy. Specializing in solving the business management and ownership challenges of consulting firms, our expert will share thoughts on the needs and responses of firms in the new service environment.

Technology Risks for Design Professionals

September 11, 2013, 1:00 – 2:00 pm eastern

David J. Shannon, Esq., Marshall, Dennehey, Warner, Coleman, Goggin, Philadelphia, PA

Technology risks associated with the business operations and professional services of design professionals is not new. However, the increased use of building information technologies and collaborative delivery methods, such as integrated project delivery, may increase the exposure of firms to traditional technology risks, as well as introduce new risks. Join our discussion with an attorney expert in technology risks to learn what exposures design firms need to be aware of and how to manage those exposures.

Insurance and Legal Questions for the Collaborative Design Team

October 9, 2013, 1:00 – 2:00 pm eastern

Rebecca H. Farnum, Esq., Thompson & Bowie, LLP, Portland, ME

Building information modeling and integrated project delivery provide a platform through which all members of the design and construction team collaborate. As with all new technologies and delivery methods, there are important questions the collaborating team should ask to identify and respond to legal and insurance issues in the open transfer of information in a contractual arrangement of shared risk and reward. Our expert will discuss what types of questions the team should ask before formally entering a collaborative agreement.

Visit our website to download the full PDF version of the 2013 Victor O. Schinnerer webinar schedule.