by Lawrence A Borda, Esq.
Partner
Powell, Trachtman, Logan, Carrle, Bowman & Lombardo

As an environmental consultant, your control over potential liability is never greater than during the contract negotiation process. That’s why it makes good business sense to spend time to understand your contract and in negotiating with clients.

Think of your contract as a shield. Protect yourself by staying within it. The contract may limit liability, allow for recoupment of some of your legal costs and require alternate dispute resolution. It’s important for the contract to be "in writing" because memories and motivations change. Remember that the contract is not only important to you now, but downstream as well -- you may have to deal with subsequent owners, insurance companies and subrogation.

The Ten Commandments Of Contract Drafting

The following "commandments" can serve as a quick reference guide and will help you to take a proactive approach to your contracts and negotiations.

1. Never begin services until you have a complete and executed agreement. You’ll minimize the potential for misunderstandings, even if it’s a short, simple assignment, by putting in writing what you’re doing and, perhaps more importantly, what you’re not doing.
2. Define your scope of services. The majority of claims are brought by clients, not third parties, due to their shattered expectations. Be simple and thorough by clearly allocating duties and responsibilities. Clearly define the responsibility of the owner. What role will he have in permitting and bonding? What are the owner’s insurance obligations?
3. Do not become the insurer or guarantor of the success of the project. Avoid language such as "guarantee" and "warranty." As a provider of technical services, you want to avoid offering warranties similar to those used for products.
4. Foresee the foreseeable. Identify those areas of the contract that traditionally have been a source of liability for design professionals and address them in the contract.
5. Make certain that your subconsultants have the same duties and responsibilities as you and that they have adequate insurance in place.
6. Don’t give away the protection of your professional liability insurance. Be careful of warranties and certification. Keep in mind that you’re acting as a professional, not as a guarantor of your services. Your work should be judged by the reasonable standard of practice that exists at the time the services are offered. Be wary of superlatives; phrases such as "highest standard of practice" can increase your exposure.
7. Make certain that you can recover for additional services. Define with specificity what it is that constitutes additional services.
8. Allocate and control liability. Limitation of liability clauses are becoming more common and are enforceable in many states. They are an effective tool in attempting to limit exposure to your client.
9. Don’t give away the little bit that the law has given you. If you have certain rights under the law, don’t give them away.
10. Don’t lose during performance what you gained during negotiation -- it’s easier to avoid a lawsuit than it is to win one. Act consistently within the confines of your duties and obligations of the contract. Don’t assume or do more work than set forth in your contract.

Finally, always act in a professional manner.

Prior to becoming an attorney, Lawrence Borda worked for a mechanical construction firm for more than a decade, during which he served as project manager on numerous construction projects, including hospitals, hotels and other buildings. As a partner with Powell, Trachtman, Logan, Carrle, Bowman & Lombardo, his practice focuses on the representation of architects, engineers, contractors and subcontractors involved in the design and construction of commercial and industrial projects. He holds a Juris Doctorate from Temple University School of Law.