By Ronald R. Leaders, Esq.

Increasing numbers of public and private owners are considering use of design/build procurement to secure the benefits associated with design/build. Design professionals on design/build projects often have different roles and responsibilities as compared to the traditional design-bid-build procurement processes used on most public and private projects. Design/build projects often require design professionals to work outside their traditional boundaries of services and practices developed on design-bid-build projects.

This article will discuss submittals and site safety -- two areas where the design/build procurement process may create increased performance problems and liability exposure. Tools and techniques available to design professionals to avoid and manage client misunderstandings, project performance problems and liability exposures will also be described for design/build projects.

Roles Of Professional Responsibilities

Design/build projects have at least two roles for design professionals. An owner’s design professional assists in the development of design and performance criteria, preparation of specifications and request for proposal documents, review of submittals and monitoring performance of the design/build team. A separate design professional on the design/build team completes the final design of the project and provides construction-phase engineering support to the constructor. Some large power and infrastructure projects may also have a third design professional in the role of lender’s engineer. Confusion and potential misunderstandings about professional responsibilities can be minimized by developing a greater understanding and educating the owner and other parties on the varying responsibilities.

The roles and responsibilities to be performed by the design professionals will generally be described within the contract documents. Prudent design professionals use their contract scope of services to describe the specific tasks being performed, applicable levels of effort, and assumptions and limitations on pricing and scope. Scopes can also be used to describe activities that are not being provided within the agreed scope and pricing. Failure to define services not provided is a common root cause to many client cost overrun disputes.

Standard industry contract forms and owner construction contracts often include responsibilities for design professionals within the commercial terms and conditions. If not carefully coordinated, construction contract provisions dealing with construction phase services such as site safety and submittal review may differ from the scope of services of either design professional. The use of contract forms not intended for design/build procurement can also cloud the allocation of responsibility on the design/build project. These construction provisions need to be reviewed for consistency with the design professional’s intended scope of services. Standard design/build contract forms are offered by the Engineer’s Joint Contract Documents Committee, American Institute of Architects, Associated General Contractors and Design-Build Institute of America and can provide examples on describing the review services and responsibilities pertaining to the design/build team submittals. The DBIA also provides a Manual of Practice for additional guidance.

Finally, design professionals have ethical and professional responsibilities with respect to public welfare and safety issues that may arise outside any specific contractual obligations. These non-contractual professional obligations are common areas for ambiguity and potential misunderstandings when design professionals work on a design/build project. Because many owners have insufficient experience with design/build, the owner’s consulting design professional can perform a critical role of establishing owner expectations and educating and developing appropriate guidance for proper implementation of the design/build concept. Clear communication of responsibilities to project team members, clients and project owners through the use of good project communication tools and well-defined scopes of services is an important risk mitigation technique for all design professionals on all design/build projects.

Effective Teamwork On Design/Build Projects

Design professionals have always considered establishing and maintaining good relationships with clients critical to predictable project success and overall firm successful performance. Research by the Construction Industry Institute, based on large infrastructure and industrial projects, demonstrates that non-technical features of project performance are the most critical success factors in predicting whether the parties will consider a project a success. Non-technical features include effective communication, teamwork, trust among the project members and an overall positive relationship among the parties. A current or prospective project can be evaluated for probable successful outcomes through the use of a Disputes Potential Index tool from the Construction Industry Institute.

Anecdotal project evidence indicates that these same "non-technical" project features are also very important in achieving a successful design/build project. A fast-moving design/build project requires even more attention to the "non-technical" project management activities in order to achieve successful results. Submittal reviews and site safety are two areas where effective communications can minimize many of the potential misunderstandings and liability exposures of a design professional on a design/build project.

Site Safety Considerations

Design professionals on traditional design-bid-build projects have well-established practices for allocating exclusive responsibility for construction site safety to the construction contractor. Design professionals on a design/build team need to formally address these same issues (of specifications establishing exclusive contractor responsibility, disclaimers of design professional responsibility for construction site safety issues, indemnity and additional insured provisions in construction contracts, and avoidance of detailed review or approval of contractor safety procedures) with the constructor, in spite of the close working relationship required for successful design/build project performance.

This close working relationship with the constructor on design/build projects may create potential liability exposure for constructor site safety problems if not handled carefully by well-defined contract provisions and project performance guidelines regarding site safety responsibilities. The site safety risk allocation provisions used in traditional design-bid-build projects, giving the constructor exclusive responsibility for compliance with construction site safety requirements, are also applicable to design/build projects, including contracts between the designer and the constructor on the design/build team.

My experiences in training and counseling design professionals on risk and liability issues indicate a widespread need for specific guidance on handling varying degrees of observed safety concerns. This training and guidance can be provided at little or no cost from insurers, insurance advisors and legal advisors and can provide a solid foundation for consistent treatment of observed safety concerns. Inappropriate personnel actions at the site can jeopardize the effectiveness of contractual safety risk allocation provisions.

Submittal Reviews

The difficulty in managing the scope of the submittal review process is a significant risk area for all parties on a design/build project. Owners often select Design/build contracts because the design/build team has exclusive single-source responsibility for the adequacy of the final design and construction to meet the performance and other requirements of the design/build contract. Power plants and other industrial or infrastructure projects financed with special project non-recourse financing often require use of design/build contracts, to minimize the technical non-performance risk to the owner and lenders. However, managing the level and scope of submittal review by the owner and owner’s design professional is critical to maintaining the single point design and performance responsibility of a design/build project.

Owners and their consulting design professionals need to appreciate that their submittal review activities on design/build projects must differ from traditional design-bid-build projects. In many cases, the persons actually performing submittal reviews have not been instructed or trained regarding the differences in the submittal review purpose and process. Designs and other construction details for design/build projects typically do not contain the same level of detail as traditional design-bid-build projects because the design/build team has discretion over the extent and timing of the design detail to be provided in support of the construction. On the other hand, reviewers for owners or other design professionals who do not understand the differing roles of the two design/build design professionals can seriously disrupt the design and construction schedule and alter responsibility for the design if they insist on design detail comparable to the traditional design-bid-build procurement process. An owner selecting a design/build process needs to implement appropriate controls on the type, level of effort and purpose of submittal reviews in order to avoid undermining the overall benefits of design/build.

The design/build team is responsible for completion of the final design. Although, as with traditional design-bid-build, submittals prepared by material and equipment suppliers will be reviewed by the design professional on the design/build team for consistency with its design documents, submittal reviews by the owner and the owner’s design professional can be problem areas if the limited scope of review is not understood. The design/build team is required to produce a completed project that meets the overall design/build contract requirements. Submittal reviews by the owner or its design professional are generally limited to compliance with the contract requirements. Because a design/build contract typically provides for limited design criteria and performance objectives, a submittal review should be restricted to compliance with these contractual requirements. However, design professional submittal reviews often are not limited to this scope, and disputes often arise over level of detail or changes in design approach requested by the owner during submittal reviews.

Contract scopes should address the purpose and extent of submittal review during scope or pricing definition. Most importantly, owners and design professionals need to be educated on the different focus of the design/build submittal review process.

Summary

Design Professionals must adjust their traditional services to fit the differing roles and responsibilities of a design/build procurement process. The differing roles and responsibilities are not always understood by owners and design professionals performing the work, which can lead to project performance problems and potential liability exposure. A number of contract forms are available as references in describing these differing roles. Educating owners to unique aspects of design/build projects remains a very important element in establishing a foundation for successful design/build project performance.

Ronald R. Leaders’ law practice emphasizes construction, design and environmental law issues. He represents construction contractors, design professionals, material suppliers and public owners.

Prior to founding the law firm of Buckley & Leaders, Mr. Leaders was a former Managing Director, General Counsel and Partner in R. W. Beck, an international engineering and construction management firm; Associate General counsel with Morrison-Knudsen Company, an international construction and environmental services company, and contract manager in the petrochemical industry with Bechtel Corporation and Chevron Corporation. He is a founding member and past chairman of the General Counsel Forum of the American Consulting Engineers Counsel. Mr. Leaders is also a former member of the Engineers Joint Contract Documents Committee and was involved in the development of the EJCDC Design/Build set of documents.

Mr. Leaders received a Bachelor in Chemical Engineering and M.S. in Metallurgy from Georgia Tech and a J.D. from the University of San Francisco.