Tag Archives: risk avoidance

Adding an “Additional Insured” in the Professional Services Agreement: an exercise in futility! (law note)

Posted on by

As an architect or engineer,  you may be asked to sign a contract that has a requirement of adding the Owner (or Contractor, in a design-build project) to your own insurance as an “additional insured”.  This is usually a fall out of the fact that the Owner is treating you like a contractor and using “stock” contract language.  It is not appropriate, nor sometimes even possible, to add the Owner to your professional liability policy.

This is beacuse professional liability insurance only provides coverage for “professional services”.  That is, if it is even possible to buy such coverage, it won’t work to avoid any risks the Owner is seeking to avoid, because the Owner is not providing licensed architectural or engineering services on the Project.

In fact, because of the way professional liability policies are generally written, naming the project Owner as an additional insured essentially voids any coverage for the owner for your Firm’s design errors & omissions.

What should you do with a stubborn Owner who insists he wants to be an additional insured under your E&O policy?  Explain the facts to him, and point out he is risking voiding coverage all together.  Tell him to call me, or point out this post to him.  Also, several insurance brokers, agents, and companies have simple one or two page information sheets that you can provide to the Owner to help with his education.

Remember, having an “Additional Insured” in an Errors & Omissions policy is a true exercise in futility.  It may not be what the Owner wants to hear, but such is life!not want to hear

 

Question time:  have you ever been asked to add an Owner to your E&O insurance?  How did you handle it?  Share in the comments section, below. 

And if you haven’t already, be sure to download your free white paper on the 7 Critical Mistakes that Architects & Engineers make– it’s in the box on the top right hand side of the blog.

 

Photo credit.

Architects & Engineers – Liaising With Contractors (guest post)

Posted on by

Today’s guest post is by David Morrison.  David has worked on both sides of the construction site during his time in renovation.  Having stepped from the gravel pit into the office a few years ago, David currently now works with UK Tool Centre, liaising with the industry on their behalf.

Working as a site engineer or lead architect has many challenges and is undoubtedly one of the toughest roles, interwoven around effective communication skills with the clients as well as the site contractors, subcontractors and suppliers.

Since maintaining discipline and accountability is at the core of any successful venture, the same is true for a construction site also. The site engineer plays the “unwanted” role of implementing carrot and stick policy, awarding the effective contractor and dealing with the laggard.

carrot with club

 

For those beginning their engineering and architectural careers, or for those who still struggle to maintain a tight ship when dealing with contractors, there are a number of things to keep in mind.

a.)    Organizing Self – The way a site engineer organizes his work plays a very important role in meeting the final objective and let the workplace run as a team. The first and most important thing is to set an example by doing things in the same manner as you are requiring and expecting from the contractors.

b.)    Be Clear – A site engineer must ensure that the contractors have clear instructions, drawings and specifications related to their work. Otherwise the “garbage in; garbage out” rule shall be applicable to the final outcome.

c.)     Work Milestones – A site engineer should coordinate with the general contractor, who in turn should use professional project management tools, define work milestones and interact with the subcontractors to keep an eye on their timely completion. If any issues arise, they must be addressed quickly, so that the contractor or subcontractor’s work is not delayed.

d.)    Performance Appraisal – Informing  a contractor of his performance quality is only half the job; informing him in a timely manner is the remaining half. The site engineer should develop methods of regular assessment of work of each prime contractor, and should include this information in regular project meetings. This allows the site contractor to timely identify the gaps (both related to man and machine) in his work and to take action to complete the work successfully.

e.)    Teamwork, Motivation and Inspiration – To foster teamwork among various site contractors, a site engineer should know how to dig into his own experience of similar works. He should always work to motivate them by giving good and bad examples out of his experience. A well experienced site engineer always have lots of good advice from his earlier encounters to inspire the contractors and give them potential solutions to difficult tasks and situations.

f.)     Prompt Payments – A site engineer must always ensure that as per contractual terms with contractors the payment for the various milestones must be promptly processed and done without any delay. This is of utmost importance in getting the work done from contractors on a construction site.

g.)    Safety – A site engineer must always ensure that contractors shall never compromise on safety and security rules to expedite the work. A bad accident can be devastating, to the individuals involved and also to the project schedule.

h.)    Friendship, Philosophy and Guidance – A site engineer should know how to work as a friend-philosopher and guide to the contractors and must not always act as bully. After all, the contractor may have some genuine issues with the design team’s performance as well.

Advice for construction is ten to the dozen and there are a lot of potential misguiding mantras out there.  One of the most useful to take into account has always been: “It may take a lifetime to learn the ways to deal with contractors on-site, and still a lot will be left to learn.”

 Thanks David.  Now it’s your turn.  Thoughts, comments, questions?  Share in the comment section below.

Photo courtesy Teaching Underground.

 

Infrastructure Defects: ASCE’s Report Card (Spoiler: America gets a D+) (news note)

Posted on by

How many bridges do you drive over on your way to work each day?  Probably a bunch, if you have the typical commute of 32 round trip miles per day.  Now, how many of them are *not* structurally sound?  Probably more than you realize.

The American Society of Civil Engineers (ASCE) has just released its American Infrastructure Report Card.  Overall, the nation scored a miserable overall D+. Here’s the breakdown for the Transportation categories:

        Aviation        D
        Bridges        C+
        Inland Waterways        D-
        Ports        C
        Rail        C+
        Roads        D
        Transit        D

    In the breakout for North Carolina,

  • 2,192 of the 18,165 (12.1%) bridges in North Carolina are considered structurally deficient.
  • 3,296 of the 18,165 (18.1%) bridges in North Carolina are considered functionally obsolete.

The report has a ton of interactive information, including a nation-wide county by county deficient bridges look up, identifying infrastructure defects in detail.  Currently, much of the planned infrastructure improvements is in limbo while the sequester is in effect.  However, our nation’s system of deficient bridges must be a priority.  Will it take another event similar to Minnesota’s I-35 bridge collapse before we fix our nation’s infrastructure?  Let’s hope not.

Your turn.  What are your thoughts about the current infrastructure of America’s roads and bridges?

When Running a Project, Don’t Think Like an Architect! (guest post)(Tue Tip)

Posted on by

Today, we welcome back Christopher G. Hill as guest author.  Chris is a LEED AP, Virginia Supreme Court certified mediator, lawyer and owner of the Richmond, VA firm, The Law Office of Christopher G. Hill, PC. Chris has been nominated and elected by his peers to Virginia’s Legal Elite in the Construction Law category on multiple occasions and is a member of the Virginia Super Lawyers “Rising Stars” for 2011 and 2012. He concentrates his practice on mechanic’s liens, contract review and consulting, occupational safety issues (VOSH and OSHA), and risk management for construction professionals.  

Chris authors the Construction Law Musings blog where he discusses legal and policy issues relevant to construction professionals. Additionally, Chris is active in the Associated General Contractors of Virginia and the Board of Governors of Construction Law and Public Contracts Section of the Virginia State Bar.  Most importantly, Chris’ blog was a personal inspiration to me as I set about my own blog back in 2009.  Welcome Chris!

Chris Hill
First and foremost, thanks to my pal Melissa for the opportunity to post here at her great blog.

Now that the formalities are out of the way, I will explain the title of this guest offering.  When Melissa first contacted me for my thoughts on poor project management from the contractor’s perspective, my first thought on how to avoid causing friction was “Don’t think like an architect.”

Before you flip the switch and head off for another post, possibly even another blog, hear me out.  Yes, I know that much of the audience for this piece is likely to be architects and other design professionals.  Yes, I know that all of you try hard.  But no, not all of you can run a job smoothly when acting as an Owner’s representative on a project (as opposed to designing a great building).  I’m here to help with my “musings” (see how I did that?) gained from years of representing the folks that you all seem to think are trying to ruin a project:  contractors and subcontractors.

The main thing that both “sides” of this equation need to remember is that you are all in this together.  Without your approval, the GC (and by extension the subcontractors and suppliers) on the project won’t get paid.  Without the GC and its cohorts, you, the architect, will have to listen to an Owner complain about the pace of the project and the fact that you aren’t running the project how that Owner wants it run.  See? All of us are in the same boat.

Failing to row in the same direction (to continue to beat this metaphor over the head) as the GC and seeing the GC as one that seeks to undermine your beautiful and artistic design sensibilities can only undermine those sensibilities.  GC’s and subcontractors, if asked nicely early on, can give you great insights into the scheduling, proper materials, and even the best and most efficient building design.

For example, an HVAC subcontractor can help you with the ductwork design in the beginning so that later on you aren’t barking at the GC because the subcontractor requested a change order (now waiting on your desk for approval) due to the fact that a load bearing wall would have to be moved in order for the ducts to go where you wanted them.  This minor bit of early discussion avoids the issue and keeps the GC and its subs happy, keeps the project on track and avoids messy things like liens and bond claims.

Failure to consult early and often, in a cooperative manner, leads to grumpy GC’s, ticked off subs, and a project that slows to a glacial pace.  This keeps everyone, including you, from being paid.

I could continue to rant, but you are smart folks.  You can do all of that engineering type math and all of that geometry and work with CAD that I decided was too hard so I went to law school.  You get the point: you and those that perform the construction at your project are not adversaries.  Yes, you represent the owner and want to make sure that the building is built right.  However, the best way to do this is to consult early and often.  Free information flow is the best way to keep everyone happy and everyone paid.

Thanks again to Melissa for letting me rant.

Thanks, Chris.  Ranting with a purpose is always welcome on my blog!  Readers, it is your turn.  Questions, comments, or rants for Chris or me?  Comment below.

How is the Carnival Cruise Ship Disaster Like Some Construction Projects?

Posted on by

cruise shipNow that I have your attention:  Have you followed the “cruise from hell” story, in which Carnival Cruise passengers were forced to make do on a ship with no working power or lavatory facilities for the better part of a week?

Think this has nothing to do with construction projects?

On the contrary, this story serves as a reminder that if something can go wrong, eventually, it WILL go wrong.

No where is this more true than on a construction project.

Read my guest post on today’s Construction Law Musings to find out how you can prepare for the unexpected on your construction projects.  While you are there, browse around and check out the wealth of information on Chris Hill’s Virginia-based construction law blog.

~ Melissa

PS:  New to this blog?  Please sign up for email delivery and your free white paper on 7 Critical Mistakes made by architects & engineers.

Photo:  (c) Roger Wollstadt