Construction Today - July 2016 - 13

2. Ineffective-project management
An owner may make poor decisions when it
does not have the experience or resources to
closely manage a project and does not enlist
outside experts to help. Common project
management issues include insufficient
contingencies in budgets to account for
complex design and constructability issues,
late owner decision-making on design
elements or major equipment, and a lack of
active management of the interface between
contractors and designers. These problems
are often characterized as arising from
deficient or late design work and blamed on
the A/E, but the owner could have avoided
these issues - and the resulting delays and
increased costs - with better project management. Owners having little construction
experience or pursuing unique, complex or
fast track projects should consider hiring an
experienced advisor (A/E or construction
manager) or personnel to manage the project
on the owner's behalf.

3. Failure to coordinate design from multiple sources
Even in a traditional design-bid-build project, it is a mistake to
believe that the A/E holds all design responsibility and will be able
to provide a 100 percent complete design prior to construction.
Interface between design and construction is always critical, with
the contractor preparing shop drawings and as-built drawings. Also,
as site conditions, equipment selection and installation, constructability issues, budget concerns and other factors impact construction,
revisions to the design may be necessary.
If design is incomplete prior to the beginning of construction, is
unexpectedly difficult and costly to construct or is incompatible with
selected equipment, there can be disputes about whether budget and
schedule problems that arise are the fault of the A/E, contractor or
owner. Design and construction contracts should be clear about which
party is responsible for which design activities and provide time in the
schedule for review and interface of designers and contractors.

Joanna
Horsnail is
a partner
and Sara
Hess is an
associate in
the Chicago
office of
Mayer Brown LLP, where
they both specialize
in construction and
infrastructure transactions.  They represent
owners, contractors, designers, consultants and
lenders in a broad variety
of complex construction

projects.
4. Choosing the wrong project delivery method
If a project is complex, needs to be fast-tracked or its scope is likely to
evolve over time, a design-bid-build approach may lead to increased
claims and disputes. Uncertainty as to project scope and ongoing
design (and re-design) may lead to schedule and cost overruns, with
contractors making claims against the owner, and the owner in turn
faulting the A/E. Consider using a design-build or IPD approach if
it will be important for the parties to collaborate closely over the
course of design and construction of the project. These delivery
methods may provide better clarity as to the responsibilities of the
parties and the mechanisms for their collaborative interaction, and
may better help the owner achieve its project goals.

5. Letting claims accumulate
Parties often choose to ignore claims until the end of a project in
order to keep the project moving. At the end of a project, contractors
often settle their claims with the owner first, and then the owner
pursues the A/E (and its insurance) for recovery of these costs.
The A/E may not even be aware of the contractor's claims if the
A/E is not closely monitoring the construction phase. The parties
will be more likely to manage claims efficiently and minimize cost
and schedule impact if they have clear and open communication
and agree to resolve claims as they arise. Consider contracting for
expedited dispute resolution during the project in order to resolve
disputes early and efficiently.
In general, the risk of claims between an owner and A/E on a
project can be reduced if the parties communicate well - including by preparing thoughtful, clear contracts that contain explicit
agreements regarding standards of care, responsibilities for design,
expectations for interaction during design and construction, and
schedule commitments.

13

JULY 2016 CONSTRUCTION-TODAY.COM

BEST PRACTICES

the owner and contractor over the course
of the project. Under any of these delivery
methods, an owner may choose to engage a
separate consultant to serve as the owner's
advisor, with duties of professional responsibility and loyalty to the owner, but with no
design responsibility for the project.
Liability can arise when an A/E is playing
multiple roles on the project, suffering from
divided responsibilities and potentially misleading the owner as to the A/E's obligation to
act in the owner's interest. This is particularly
problematic when the A/E is serving - or if
the owner believes the A/E is serving - as
both an advisor to the owner and as the
designer of the project. Recent case law has
demonstrated that A/Es can be held liable for
large damages in these circumstances. Avoid
these issues by carefully defining the A/E's
professional standard of care, clearly assigning
design responsibility and plainly outlining
any duty to act as the owner's advisor and advocate. Most importantly, avoid having an A/E
serve as both owner-advisor and designer.


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Table of Contents for the Digital Edition of Construction Today - July 2016

Contents
Construction Today - July 2016 - Cover1
Construction Today - July 2016 - Cover2
Construction Today - July 2016 - 1
Construction Today - July 2016 - Contents
Construction Today - July 2016 - 3
Construction Today - July 2016 - 4
Construction Today - July 2016 - 5
Construction Today - July 2016 - 6
Construction Today - July 2016 - 7
Construction Today - July 2016 - 8
Construction Today - July 2016 - 9
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Construction Today - July 2016 - 15
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Construction Today - July 2016 - 55
Construction Today - July 2016 - 56
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Construction Today - July 2016 - 58
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Construction Today - July 2016 - 60
Construction Today - July 2016 - 61
Construction Today - July 2016 - 62
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Construction Today - July 2016 - 65
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Construction Today - July 2016 - 125
Construction Today - July 2016 - 126
Construction Today - July 2016 - 127
Construction Today - July 2016 - 128
Construction Today - July 2016 - 129
Construction Today - July 2016 - 130
Construction Today - July 2016 - 131
Construction Today - July 2016 - 132
Construction Today - July 2016 - 133
Construction Today - July 2016 - 134
Construction Today - July 2016 - 135
Construction Today - July 2016 - 136
Construction Today - July 2016 - 137
Construction Today - July 2016 - 138
Construction Today - July 2016 - 139
Construction Today - July 2016 - 140
Construction Today - July 2016 - 141
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Construction Today - July 2016 - 147
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Construction Today - July 2016 - 149
Construction Today - July 2016 - 150
Construction Today - July 2016 - 151
Construction Today - July 2016 - 152
Construction Today - July 2016 - 153
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Construction Today - July 2016 - 155
Construction Today - July 2016 - 156
Construction Today - July 2016 - 157
Construction Today - July 2016 - 158
Construction Today - July 2016 - 159
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Construction Today - July 2016 - 161
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Construction Today - July 2016 - Cover3
Construction Today - July 2016 - Cover4
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