What Standard? Under Whose Care?

By Robert C. McCue, PE and E. Mitchell Swann, PE
Consulting Engineers, MDCSystems®

Can a Designer or Owner shift responsibility for design errors and omissions by requiring an enhanced effort for construction coordination drawings by contractors?

To answer this question we will recount an example project that was bid as Design-Bid-Build where the fundamental element of the dispute was design defects with regard to spatial arrangement and sizing of system features. Responsibility for system sizing and coordination and to what standard it is performed are key elements of this example.

In this example, the Owner tried to obtain support for their defense to design errors by making a series of Design Build and performance specification arguments regarding the Contractor’s responsibility to find and correct these errors.

The popularity of the Design Build model and the additional freedom it provides to Owners may be subtly influencing the types of practical project execution Owners are employing regardless of the actual contract mechanism in use.

The project concerned an institutional building located in a foreign state. The contracts were written and let as a Design-Bid-Build and the Owner had separate and independent contracts with the Design Professionals and the General Contractor\Construction Manager. The Designers provided bid and issued for construction documents. The issued for construction documents contained system configurations and equipment that did not comply with the local building codes or standards. Failure to comply with code is typically prima facia evidence of failure to meet the applicable standard of care.  However, in this particular instance, there were some questions as to what extent a “foreign” owner has to comply with local codes. However, that said, it is still incumbent upon a designer to satisfy the code, or advise an owner to obtain a variance¹.

The key issue in the dispute was the fundamental design system coordination, or lack thereof, which does not become evident until the construction period. The design drawings and specifications indicated/required certain equipment, devices, and materials to be installed in interstitial spaces. However, when the contractor attempted to detail his coordination drawings to install the identified scope it was discovered the systems wouldn’t fit within the required spaces. When the contractor asked for clarification on these issues, the design team then issued a series of design revisions (bulletins) during the course of construction – in effect redesigning the mechanical and electrical systems “on the fly.” However, in many instances, the revisions did not fully address the problem which was often only discovered during installation. The result was a significant amount of construction rework and a significant lengthening of the project’s duration.

The owner’s creative arguments, as to responsibility for the errors, attempted to shift liability to the contractor by making “Design-Build” assertions based on boilerplate sections of the projects specifications calling for coordination by the contractor and the preparation of construction coordination drawings for the work. The owner’s designers and experts asserted that the design drawings were “diagrammatic” and the contract was intended to be “performance based”.  Their justification was in part, that since the beginning and end devices for the systems were the same it was “just the routing and sizing that changed”, there was effectively little impact on the construction effort.  They went on to argue that, had the contractor developed more complete construction coordination drawings at an earlier time then there would have been no impact on construction.

MDC was able to show that this argument created what was effectively an impossibility because the specifications and contract terms would have it required detailed coordination drawings to be developed before component shop drawings could be obtained and submitted for approval.  The contractor would need to know the size and installation details of equipment and devices in the building before he knew exactly what those equipment and devices were.  Clairvoyance is not a reasonable expectation.

MDC was able to determine and illustrate how each of the owner’s arguments were false, based not only on the contract, but also on the actions of the parties during the early stages of construction when shop and coordination drawings were developed and approved.

Using a combination of technical design assessments and schedule analysis, MDC analyzed the technical issues and successfully demonstrated the deficiencies in both the design and the “management” of the review and approval process for both shop drawings and coordination drawings by the owner’s design consultants and project team.

Considering the issues illustrated in this example, it may provide some insight into how Design Build concepts are increasingly influencing project execution by owners.

Owners who have been in the Design-Bid-Build world are attracted to the flexibility offered by Design-Build but cannot actually obtain the benefits because of the legacy and rigidity inside their own organizations to the paradigm shift required. These include successive design reviews and successive shop drawing reviews to satisfy the “old guard” inside their organizations.

The increased use of performance specifications in Design-Bid-Build contracts is an attempt to gain some of the advantages of the Design Build approach but it clashes with the review/approval legacy embedded in the organization.

When enhanced construction coordination is required of the contractor where does the responsibility for design coordination end and construction coordination start?  Is this requirement intended to overcome design deficiencies or satisfy owner legacy procedures?  In the above example for discussion, the fundamental responsibility for the adequacy of the design documents prepared by the designer remained with the designer as determined by the fact finder.

Each project dispute is unique however and the fact pattern described above and the outcome may not be applicable when different circumstances are at play. This example does, however, illustrate how the impact of Design Build concepts are being experienced on traditional projects.

As design-build becomes a more common delivery strategy, especially amongst organizations or entities that have traditionally not employed it², it is likely that mis-applications of the Design Build concept will create more – not less – situations similar to that described above.

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¹ If a variance from code must be obtained, it will inherently be the Owner’s variance and thus the Owner’s responsibility to obtain it. However, it would be reasonable for a designer to alert his client that such a variance might be needed.

² Government agencies at all levels, Public entities, Institutional Owners, etc.