Where there's construction,
there's litigation - how to survive the battle
This may not be true with every project, but the construction
industry is -- and always has been -- a hotbed of litigation.
This is an unfortunate aspect of construction in America.
Once a construction dispute starts to snowball downhill,
it tends to take with it any and all persons that touched
the project, even the engineers and architects. Heading
towards litigation is almost a guarantee that the road will
be rough and loaded with traps for the unwary.
Three-way tie Regardless
of the type of project -- a custom home, commercial building,
wastewater treatment plant, power distribution system, or
a highway system-- there are three common levels of participation:
owners, design professionals, and builders/contractors.
What ties them all together are the contractual relationships
and legal obligations between the parties. From an overall
project standpoint, each player's input has a direct affect
on the other two. An owner provides funding. A design professional
creates detailed and buildable plans. A contractor turns
the vision into reality. If any of the three participants
do not perform, they can doom a project. It is truly a symbiotic
Red flag warnings The first
clue that something may be going wrong is that one of the
parties starts documenting everything. Red flags should
go up when notices start appearing frequently. Don't ignore
them. It may just be a sudden surge in project management
discipline, but be skeptical and expect the worst, here's
why: He (or she) with the best documentation wins.
With the ease of email, there is no excuse as to why you
can't shoot off a quick email to confirm an oral decision
that is made at a meeting or during a teleconference. Don't
rely on other people or requests-for-information to document
the story. There are too many decisions that are made on
the fly, at job site meetings, and in teleconferences that
are not tied to any specific RFI. These meeting notes and
e-mails may end up being critical pieces of evidence if
something is delayed, built wrong, or costs more.
Just the facts It is extremely
important to remember when sending emails to avoid making
personal opinions, such as the state of the project or frustrations
with workmates, contractors, etc. Your personal opinions
often become your professional opinions by opposing parties.
Don't expect privacy, and write as if your emails will be
reviewed by a judge -- no sarcasm, no derogatory remarks,
no slamming the owner, engineer or contractors, and -- above
all -- no admissions that you, or anyone who works with
you or for you, have done anything wrong!
These rules should apply even with your own internal emails.
We have heard how internal emails can provide the "smoking
gun" that wins or loses a case. This goes beyond e-mails
and other written communications, so think before you speak
as well. The rules for emails should also apply to any oral
communications or conversations you have with anyone throughout
the project. Remember, your litigation opponent-to-be may
be documenting these impromptu meetings as well. The best
defense is a good offense The bottom line is that a good
defense begins with a good offense. And, you may find yourself
taking the stand and answering questions about a project
2 or 3 years after the project's completion.
Knowing this now may make your life easier when you are
testifying. So, as a minimum, you should adopt the following
as standard procedures for doing business:
1. Document all meetings and then forward to all attendees
for review. If you are an attendee and you receive meeting
minutes that you believe to be incorrect, make your changes
known in writing and forward to all attendees.
2. Document all informal meetings, such as jobsite walks
or impromptu discussions. All you may need is something
as simple as an email summary of what was discussed.
3. Keep a paper copy of all electronic correspondence. Don't
let emails get deleted before printing out copies.
4. Take plenty of photos when you walk the site. Note the
dates when taken. Copy them to CD's for archiving.
5. Handle RFI's promptly. Keep an accurate and updated RFI
6. Handle submittals promptly. Keep an accurate and updated
7. Date-stamp all correspondence you receive, from any source.
8. Document communications with engineers, utility personnel,
suppliers, consultants, construction managers and project
9. Document all attempts at communications; use phone logs
for conversations, sent and received, and voice messages.
Set your fax machine to print out confirmations and keep
failed fax transmissions. Keep a copy of returned email
10. Document the dates that plan revisions are issued and
request a delivery receipt from all recipients if you are
the issuer. Require that all revisions on plans be noted
and clouded in.
11. If appropriate, keep a daily jobsite journal with as
much detail as possible even if not required.
12. Document and retain all calculations used for the project,
such as engineering, labor, material, or down-time estimates.
This will help support any claims. Better safe than sorry
Some of you may think that all this is overkill for smaller
projects, but you're going to wish you had done this if
you're ever caught in the middle of a construction lawsuit
-- regardless of the value of the project. Plus, the better
documentation you have, the easier it is for your attorney
to represent you. Making your attorney's job easier will
reduce your legal bills in the long run.
And, most people find that litigation creates quite a
bit of unwanted personal stress. So, the better your defense,
the less stress you will suffer as you wind your way through
the long processof litigation. Nothing you do will make
litigation enjoyable, but at least you will know you are
in the best possible position to defend yourself when needed.
Scholefield, Esq., holds an active PE license in Colorado,
an undergraduate engineering degree from the University
of Florida, and received her JD from the University of San
Call us now to discuss how you can benefit
by using a different approach to managing to your legal
501 W. Broadway, #1770
San Diego, CA 92101