American Bar Association Forum on the Construction Industry

Transcription

1 American Bar Association Forum on the Construction Industry I Don t See It That Way! Common Mistakes Lawyers Make In Reading and Interpreting Design Documents Bill Quatman, FAIA, Esq. Burns & McDonnell Engineering Co. Kansas City, MO Sue Yoakum, AIA, Esq. Donovan Hatem LLP Boston, MA Presented at the 2010 Fall Meeting We Won t Get Fooled Again: Lessons Learned From the Economic Downturn September 2-3, 2010 Loews Miami Beach Hotel, Miami Beach, Florida 2010 American Bar Association 1

2 A great matter is architecture, nor can everyone undertake it. He must be of the greatest ability, the keenest enthusiasm, the highest learning, the widest experience, and, above all, serious, of sound judgment and counsel, who would presume to call himself an architect. - Leon Basttista Alberti On the Art of Building in Ten Books (1450 A.D.) I. The Evolution of Building Design. A. From Caveman to CAD. From the first Stone Age caveman who drew a line in the dirt, humans have been designing the built environment. And sometimes those designs have contained errors or omissions that have resulted in leaks, cracks, settling and structural collapses of Biblical proportions. Architectural design reached its artistic peak, some believe, during the Italian Renaissance period ( ) when architects and artists were one and the same, such as Florence s pair of contemporaries Filippo Brunelleschi and Leon Battista Alberti, the latter known as the father of modern architecture; to the artist/architects Leonardo Da Vinci and Michelangelo. Then, as the New World and the Colonies began to develop, the art of architecture was separated from the craft of the technical drawing and we had carpenter-architects who drew standard details in the 1700 s. This period was followed by the post-civil War era s first formal schools of architecture (MIT, founded in 1865, and University of Illinois, founded in 1867), and people found themselves in careers as draftsmen. In the early 1980 s computer technology gave us the Computer Assisted Design (or CAD ), which expedited the drafting process, but even further removed the artist s sketchpad and replaced it with a keyboard and mouse. The design process has advanced rapidly -- taking a cue from aerospace engineering -- to today s Building Information 2

3 Modeling (or BIM ), where buildings are shaped in a 3-D virtual world before the first nail is driven. While technology has advanced the speed at which we can design buildings and other structures, the human element is still present in the CAD operator, the BIM model host, and the detail designer. Despite advances in technology and over a thousand years of experience, errors and omissions can still occur in the modern era due to oversight or neglect of the individual architect or engineer who is responsible to draw, click, drag or paste information into whatever media is being used to communicate design intent to a contractor. B. No Perfect Set of Plans. Every set of plans has errors and omissions. This is nothing new. Design errors and omissions are as old as the pyramids. Hammurabi s code, written in ancient Babylon about 1790 B.C., addressed the penalty for a builder whose structure failed. It was strict liability, and death to the builder and his son, depending on the fatalities from the collapse. 1 The Old Testament is likewise full of references to the collapse of ancient walls and houses. 2 Even Christ used a poorly designed building as an analogy for a faith based on an inadequate foundation, which would collapse and be destroyed when tested by a storm. 3 In more modern times, we have the example of the Leaning Tower in Pisa, Italy, built in the 12 th Century. The wonderfully detailed campanile, or bell tower, behind the cathedral Pisa is not famous for its classical Corinthian capitals or its articulate bell-chamber -- it is known for its structural design defect. Craftsmen and masons worked for over 170 years to build the tower, spanning generations. However, foundation 3

4 design and improper soils investigation resulted in settlement that tilted the 183-foot tower by almost 4 degrees. Any modern building would have been torn down due to such deficiency; but the tower in Pisa stands as a reminder that design errors have always been with us. Plans, specifications and shop drawings play a key role in the construction process. Contractors and subcontractors who bid on construction projects rely on the architect/engineer s plans and specifications as being sufficiently detailed and complete so that accurate bids, shop drawings, material submittals, and project schedules can be prepared. The public and owners rely on the integrity of the design of buildings and other structures for shelter and safety. Nonetheless, in absence of some express guaranty, the law does not hold architects and engineers to a standard of perfection. As was held in Klein v. Catalano, a Supreme Court of Massachusetts case from 1982: As a general rule, an architect's efficiency in preparing plans and specifications is tested by the rule of ordinary and reasonable skill usually exercised by one of that profession... In the absence of a special agreement he does not imply or guarantee a perfect plan or satisfactory result. 4 The Massachusetts Supreme Court explained that, just like doctors and attorneys, design professionals are continually called upon to exercise their skilled judgment in order to anticipate and provide for random factors which are incapable of precise measurement. The court continued that, [b]ecause of the inescapable possibility of error which inheres in these services, the law has traditionally required, not perfect results... [U]nlike a manufacturer, an architect does not impliedly guarantee that his work is fit for its intended purpose. 5 4

5 The normal errors or ambiguities in project plans or specifications, as well as in shop drawings and submittals, can give rise to unanticipated construction costs and project delays for which owners and/or contractors seek to be reimbursed. Likewise, delays in the shop drawing preparation and review process can result in claims for time extensions and for additional money. Claims are not at all uncommon since the perfect set of plans and specifications has probably never been created, nor has the perfect project been built. While outside forces, such as differing site conditions, contractor error, market instabilities, force majeure, or owner naiveté of the design and construction process, can contribute to problems with buildings, it is sometimes just a flat design error. As Alberti said in 1450: Of the faults in both public and private buildings, some are integral and inherent, as it were, and the responsibility of the architect, while others result from some outside influence... But not all faults produced by outside influence are irremediable; nor does every mistake made by the architect allow some remedy... If a building cannot be improved without changing every line, the best remedy is demolition, to make way for something new. 6 Change orders are a normal part of the construction process and owners routinely include contingency funds in the project budget to handle design changes and unanticipated conditions encountered during construction. Architecture and engineering are recognized by the courts as inexact sciences 7 and, therefore, errors and omissions are to be expected to some extent. Architects and engineers are not required to be perfect, nor are their documents required to be flawless. Instead, they are required to exercise reasonable care and skill in the preparation of plans and specifications. 8 In a 1991 survey conducted by Engineering News Record magazine, over 84% of contractors said that project specifications often or generally have major omissions. 9 5

6 That survey showed that contractors ranked the most frequent reasons for modifications as: 1) ambiguity; 2) design consultant error; 3) conflict between specs and other contract documents; and, 4) owner changes. The results of the survey are confirmation that there is no perfect set of plans. II. Overview of How to Read a Set of Plans (Architecture 101) A. Guides on Document Organization. Two books that continue as great resources for reading and understanding architectural plans are the Architectural Graphic Standards and The Architect s Handbook of Professional Practice. The Architectural Graphics Standards is published by John Wiley & Sons, Inc. and the AIA. 10 This book, now in its eleventh edition, has been published since Architectural Graphic Standards, considered to be the Architect s Bible, contains over 8,500 architectural illustrations and is considered the industry s leading graphic reference. The AIA Handbook of Professional Practice is published by John Wiley & Sons, Inc. and the AIA. 11 The AIA Handbook, now in its fourteenth edition, has been published since 1920 and is widely recognized as the leading resource on architectural practice. The AIA Handbook has been admitted into evidence by courts and arbitrators as evidence of the standard of care. 12 The AIA Handbook refers to a system of organization for drawings called ConDoc. which was developed in the late 1980 s by two architects to standardize a uniform arrangement of drawings. 13 This led to an even more detailed system called the 6

7 Uniform Drawing System (UDS) developed by the Construction Specification Institute and published in The AIA itself published CAD Layer Guidelines in 1990, updated and revised in 2001 as the U.S. National CAD Standard, Version There are also two more standards for organization of architectural drawings published by The National Institute of Building Sciences (NIBS), one for CAD and another for BIM. 15 For organization of specifications, the two leading standards are the AIA s MASTERSPEC, and CSI s MasterFormat Where in the past, there were only sixteen divisions of specifications, the new AIA guide has fifty divisions and while CSI still has sixteen divisions, it uses multiple subparts. Suffice it to say that an explanation of these guidelines are beyond the scope of this paper. B. Typical Sheet Organization. Plans are organized starting with sheets containing information relating to: 1) building site, civil engineer and landscape architect s documents; 2) the building, architectural documents; 3) structural systems, structural engineer s documents; 4) mechanical, plumbing, and electrical engineer s documents; and for some projects; 5) specialty consultant s documents. Most design teams consist of multiple design consultants who each prepare their own documents and specifications and stamp and seal their documents. The architect, in its contract with the owner, typically agrees to deliver a design that includes the usual and customary structural, mechanical, and electrical engineering services. AIA B101 Par. 3.1 (2007 edition). The first sheet in any set of plans is the Title Sheet which contains information relating the project, the owner and the design team. The first series of plans in the set are civil or landscape sheets typically designated with the letter C or L and numbered 7

8 sequentially starting with C-1 and L-1. The second series of plans are the architectural drawings typically designated with the letter A and numbered sequentially starting with A-1. The third series of plans are the structural drawings typically designated with the letter S and numbered sequentially starting with S-1. The fourth series of plans are the mechanical drawings typically designated with the letter M and numbered sequentially starting with M-1. The fifth series of plans are the plumbing drawings typically designated with the letter P and numbered sequentially starting with P-1. The sixth series of plans are the electrical drawings typically designated with the letter E and numbered sequentially starting with E-1. The next series of plans can include specialty design consultants such as food service, fire protection and telecommunication. Of course, this organization of a set of plans may vary from project to project depending on the architectural and engineering teams working on the project. Within any given set of plans for each design discipline, the drawings are organized from general plan information to elevations, sections, enlarged plans, enlarged sections and finally details. Plans are prepared from the bird s eye view cutting the building at approximately five to six feet above each floor. Overall building plans are typically drawn with north at the top of the sheet. These sheets will contain a north arrow symbol for orientation. Reflected ceiling plans are drawn from the viewpoint of laying on the floor and looking at the ceiling. Exterior elevations are drawn from the viewpoint of looking directly at each exterior side of the building and drawing the building as a flat drawing. Interior elevations are drawn from the viewpoint of looking directly at each interior wall and drawing interior walls that illustrate design features or typically demonstrating 8

9 interior information. Building sections and wall sections are drawn by cutting the building along a line and the line is selected to relay important design information. Enlarged plans and elevations are selected to give additional critical design information and drawn at large scale in order to illustrate this additional information. Details are also selected to relay information on a typical and unique level and again drawn at a large scale in order to illustrate this additional information and referenced back to the larger plans and elevation. Symbols are used to understand where plans, elevations, sections and details are cut and how they reference back to the larger plans and elevations drawings. Symbols are used to illustrate various pieces and parts of the building and to relay information about the design. There are a large variety of symbols used in any set of plans from north arrows, to section cuts, to detail references. Each design firm may have unique symbols they prefer to use in the preparation of their documents, however, symbols are trending towards becoming more standardized. Each sheet will contain a title block listing the design professionals involved on the project, the date of the document release, an area for the various design professionals to stamp and seal their respective documents, and sheet numbers. The title blocks are typically created by the architect and/or prime design professional and distributed to the design team to use on their sheets. Within each sheet and various drawings there are symbols that assist the reader in understanding how this enlarged plan, section or elevation relates to the project. Some contract documents will have legend or general note sheets that can be used to understand typical design information. Other contract documents may include this 9

10 information on each sheet as needed. There is really no set approach and each design team can agree how they will include this information. The purpose of the contract documents is to include enough information relating to the design to enable the contractor to prepare costs, schedules, and shop drawings, and to build the project. Conflicts, errors and omissions in the contract documents confuse the contractor and do not provide clear understanding of the design direction. The two dimensional ( 2D ), world of plans, elevations, sections and details has limitations on the ability to relay the design intent. Some project participants, most often the owner, cannot read and understand 2D drawings. A three dimensional ( 3D ) drawing or model can better relay design intent because it is much easier to orient and understand a 3D versus a 2D drawing. With the advent of computers, 3D drawings are the preferred drawing type to easily communicate design intent. Recently, the design and build industry began embracing Building Information Modeling as the preferred 3D modeling tool. III. Building Information Modeling (BIM) The BIM revolution allows the designer the ability to draw their design as a 3D model that is intelligent and includes design information beyond that contained in the lines that make up a drawing. In a BIM model, attributes are typically attached to the drawing objects to assist in explaining the design. These attributes contain specific design criteria, including cut sheets containing design criteria and specification sections. This type of at your finger tips information has never been as readily accessible as it is with BIM. 10

11 A. What is BIM? BIM is a tool used by architects, engineers, contractors and subcontractors to prepare plans and shop drawings. The National Institute of Building Sciences describes BIM this way: A Building Information Model, or BIM, utilizes cutting edge digital technology to establish a computable representation of all the physical and functional characteristics of a facility and its related project/life-cycle information, and is intended to be a repository of information for the facility owner/operator to use and maintain throughout the life-cycle of a facility. 16 B. How is BIM Used? BIM is not new. It is only a new tool in the design and build industry. Other industries, such as the aerospace and automotive industries, have used BIM for decades. BIM modeling allows the project participants to better understand the design and to make informed decisions relating to the design, cost and scheduling. Contractors and subcontractors can use the 4-D (scheduling) and 5-D (cost estimating) aspects of the BIM software to produce movie type critical path models and accurate costs estimates. There were many early BIM articles that anticipated and envisioned one model that all project participants would collaborate on together to develop a central model. In discussions with many design and construction professionals, the idea of one central model is false. The design model is typically utilized by the contractors and subcontractors only as a reference, with the contractors and subcontractors creating their own models that input and extract information from the construction viewpoint. In addition, software and hardware restrictions limit working efficiently in one model. The models simply contain too much information, and therefore, for most projects the idea of one model cannot be realized with today s technology. 11

12 C. Some BIM Project Examples. Several stadium projects have been successfully delivered with BIM. Specific projects include two new professional baseball stadiums: the Washington Nationals ballpark, which opened in March, 2008, and the $1.3 billion Yankee Stadium, which opened in April, 2009, as well as the dual-team $998 million Meadowlands Stadium in New Jersey, which will host the New York Jets and Giants beginning with the 2010 football season. 17 These projects teams utilized BIM for visualizing design and fabrication, detecting clashes, ordering steel, creating bills of materials, and expediting schedule. The project participants stated that sharing a building information model has been a win-win for the whole project team. 18 D. BIM Benefits. BIM allows design professionals to create a library of objects that are created as 3D objects with technical information attached and ready to insert in the model, thereby allowing the information to show up automatically in plan, elevation and section views. For example, a typical loading dock can be drawn in the library and ready to insert in various drawings on various projects. The loading dock object contains generic information relating to typical loading docks, including attributes that contain information concerning specific loading dock criteria and specification sections. These BIM libraries can assist in quickly understanding all the elements of a particular design feature such as loading docks. Shop drawing BIM models, created by the contractor and its subcontractors, contain specific information relating to the products selected to be installed in the project. For example, with the loading dock example above, the shop drawing will include the 12

13 specific loading dock to be installed at the project. This loading dock may or may not be dimensionally the same as shown on the design documents, but more then likely, will vary from the loading dock illustrated on the contract documents. The design professionals review these BIM shop models for design intent, as well as for relationship to and coordination with other shop models. The real benefit of BIM is when all participants use the BIM tool to draw their respective drawings. This allows a review of the project in the BIM shop model review, but only if all shop drawings are prepared in BIM. E. Use of the BIM Model to Create 2D Contract Documents. The 2D drawings are extracted from the BIM models and arranged on drawing sheets. Typically, wall sections and details can be extracted from the BIM model, but require additional hand-drawn information to enable a complete understanding of the design intent. F. BIM is Here to Stay. BIM is a powerful drawing tool and is here to stay. Many design and construction firms that use BIM to create their documents and drawings on a project cannot imagine participating on a project without the benefit of BIM. BIM allows all participants a better understanding of the design. As a result, cost estimates and construction schedules can be prepared more efficiently. BIM will not create a perfect model. There will be errors and omissions in BIM models; therefore, coordination of the contract documents and shop drawings is still a concern. It is, however, much easier to understand 3D models and to identify clashes within the contract documents and shop drawings when BIM is used to prepare the 13

14 drawings. It is much harder to read and identify potential "clashes" on two dimensional plans, elevations and sections. The "clashes", or errors and omissions, in the contract documents occur where two or more objects occupy the same space and a decision must be made regarding which objects trump the others and get to occupy the space. Typically "clashes", whether on BIM projects or projects not using BIM, are not identified during the design phase, but instead are identified through Requests For Information ( RFIs ) and,change orders which can impact costs and schedule and are often the center of attention in claims and/or lawsuits. The BIM tool allows for the reduction of errors and omissions in the contract documents and shop drawings and allows the project participants to see the project in the same way. IV. Shop Drawings. Shop drawings are a controversial area for design professionals. Federal contract provisions define shop drawings in FAR (d) as drawings, submitted to the Government by the Contractor, subcontractor, or any lower tier subcontractor pursuant to a construction contract, showing in detail, (1) the proposed fabrication and assembly of structural elements, and, (2) the installation (i.e., fit, and attachment details) of materials or equipment. 19 These documents are the fabricator s set of documents and the documents that are used in the construction of the project. Shop drawings are prepared by others, not under the architect s supervision, but are, by custom and by contract, reviewed by the architect and approved for fabrication and for construction. The level of review varies depending on the complexity of the submittal and the practice of the reviewing professional. Some engineers do a complete check of each weld symbol, 14

15 measurement and calculation, while other professionals only do a cursory review. Several courts have found design professionals liable for negligent shop drawing review. 20 Shop drawing review and approval has been debated around the country, especially since the collapse of the Hyatt skywalks in Kansas City in 1981 and the resultant litigation. A review of this issue starts with understanding the purpose of shop drawings. A. Purpose of Shop Drawings. Contrary to some beliefs, architects and engineers do not design each and every component of the project. Some items are manufactured products, such as elevators, cooling towers, toilet partitions, light fixtures, windows, etc., and some items are specified as design-build by the contractor, such as fire sprinkler systems, curtain walls, wood trusses, and precast panels. With manufactured products, the design professional selects and specifies a particular model, make, color, and size appropriate for the project. The contractor is then required to submit information verifying that a specific product will be supplied that meets the design criteria. Still other building components are custom fabricated for the project, such as millwork, fritted glass, and structural steel. Rather than design each aspect of these components, the detailing is left up to others -- typically the fabricator itself --, who are more familiar with the dimensions and assembly processes of thr components. The fabricator s drawings are then given to the fabrication shop for use in making each component, thus the name shop drawing. Under AIA form documents, the submittal process requires that the fabricator s drawings are first submitted to the contractor, who is to review "and approve the shop 15

16 drawing. The contractor s approval represents that the materials have been verified, field measurements taken, and field criteria checked and coordinated with the requirements of the Contract Documents. AIA A201 Par (2007 edition). The approved shop drawing is then submitted to the architect, or its consulting engineers, for review. The architect s review and approval is to check conformance with information given and the design concept expressed in the Contract Documents. AIA A201 Par (2007 edition). When the shop drawing is returned approved by the architect, the contractor can begin fabrication. Since delayed reviews can hold up fabrication, design professionals need to act promptly on submittals, keeping a log of the date received, the action taken, and the date returned to the contractor. The AIA publishes a form, AIA Doc. No. G712 (1972 edition), to use in logging in shop drawings and other submittals. B. Liability for Negligent Review and Approval of Submittals. One court has stated that, shop drawings are the final word as to how the work should proceed on the job, and supersede the architectural plans. 21 Given the importance of shop drawings, negligent review and approval by the design professional may result in liability, depending on the facts and the contractual duties of the reviewing professional. The meaning of architect approval was discussed in a 1977 Nebraska case where the specifications called for solid wood doors, but the contractor supplied particle board doors. The court held that the architect s approval of the shop drawing did not sanction the use of nonconforming doors. The contract language defining the architect s approval was a key factor in the court holding that the contractor was not entitled to additional compensation for replacing the doors. 22 Under the AIA form documents, the 16

17 contractor is not relieved of responsibility for deviations from the contract requirements by virtue of the architect s approval of shop drawings and submittals, unless the contractor has: 1) specifically informed the architect in writing of the deviation; 2) the architect has given written approval of the specific deviation; and, if a cost change is involved, 3) a change order has been issued. AIA A201, par (2007 edition). The same clause also states that the contractor is liable for errors and omissions in shop drawings despite approval by the architect. In the absence of such a contract clause, a design professional may be held liable for negligent review and approval of a shop drawing. In Jaeger v. Henningson, Durham & Richardson, 714 F.2d 773 (8th Cir. 1983), the specifications called for use of 10 gauge steel on a stair landing. Shop drawings were submitted which called for thinner 14 gauge steel and were approved by the architect. The landing pan was fabricated of 14 gauge steel and collapsed when two workers stepped onto it to perform welding. The architect was found negligent and held liable for injuries to the workers. In a follow up case, the architect then sued the contractor for indemnity for submitting the defective shop drawing. The court denied the indemnity claim, however, based on a South Dakota antiindemnity statute. 23 By contrast, in Lutz Engineering Co. v. Industrial Louvers, Inc., 585 A.2d 631 (R.I. 1991), the court found that the project architect/engineer owed no duty to a subcontractor based on the contract shop drawing language. The architect s duty was owed only to the general contractor, not to the subcontractor. Where the submittal contains information relating to the means and methods of construction, AIA-type contract language may shield the design professional from 17

18 liability. For example, in a 1982 Oklahoma case, an architect was found not liable for the deaths of two workers and the injury of another allegedly caused by negligent approval of shop drawings for steel erection. 24 The court held that under the AIA General Conditions the contractor, not the architect, was responsible for temporary field connections and for the means and methods of construction. C. No Action Taken. A design professional s failure to take action on a submittal does not necessarily mean approval. That very issue came up in a 1946 Missouri case. 25 In that case, the specifications provided that the contractor should furnish shop drawings when required by the specifications, but that no shop drawings should be submitted except as required. It was further stated that shop drawings submitted without being required would be returned without action. The tile section of the specifications made no provision for shop drawings. Nonetheless, the tile supplier sent shop drawings to the subcontractor who made corrections and forwarded the drawings to the general contractor. The contractor then submitted the shop drawings to the owner (the government). The owner returned the shop drawings with the notation, Shop drawings are not required for this work; however, contract requirements should be followed in all cases. When the subcontractor started to install the tile presuming approval of the submittal, the owner s engineer stopped the work and directed that different bull nose tile be used as required by the specifications. As a result, the subcontractor sued the general contractor for additional compensation. In denying recovery, the court pointed out that silence doesn t necessarily mean acceptance. The court stated that, The fallacy of [the subcontractor s] contention regarding shop drawings lies in their assumption that the damages they sustained resulted from 18

19 failure of the [owner] or [the contractor] to approve or disapprove the shop drawings submitted. When the drawings were returned, [the subcontractors] were warned that the contract requirements should be followed.... In view of the above facts and the further fact that the shop drawings originally submitted to [subcontractor], and before they were corrected by them, provided for general use of [the proper tile type], we cannot say that failure to approve or disapprove the shop drawings misled [subcontractor]. Furthermore, the specifications did not require shop drawings, and when the [owner] returned those submitted with the notation attached, it was not for [the general contractor] to assume to approve them. 26 Under the AIA A201 General Conditions (2007 edition), architects are given the right to request certain informational submittals without the need to approve those documents. Paragraph states that, Informational submittals upon which the Architect is not expected to take responsive action may be so identified in the Contract Documents. Contractors should not assume that the absence of action on such submittals means approval. Design professionals who use such clauses should add a no action taken box to the shop drawing review stamp, noting that the contractor should follow the contract requirements. D. The Hyatt Skywalk Case. No single case has had the dramatic effect on the construction industry as that involving the collapse of the Hyatt skywalks in 1981 during which 114 people were killed and over 180 more were injured. In the wake of this disaster, the industry engaged in a decade of review of the entire process of shop drawings and design delegation. The personal injury and wrongful death cases were mostly settled out of court. The Missouri licensing board held months of hearings and ultimately, disciplinary action was taken against the structural engineers who designed the skywalks. The administrative law 19

20 judge who conducted the hearings issued a lengthy 442-page opinion in which he found violations of the state licensing laws sufficient to permanently revoke the licenses of two engineers, as well as the Certificate of Authority of the engineering firm. The engineers appealed the Board s action. 27 In affirming, the Court of Appeals held that although, by custom, the structural engineer elected to have the steel fabricator design the steel connections, this did not relieve the engineer of responsibility for the design of those connections. The Court stated that under the Missouri licensing statute, once an engineer seals the design for a project, he becomes responsible for the whole engineering project unless he disclaims liability as permitted by statute. 28 Absent such a disclaimer, the engineer is not relieved of responsibility for engineering decisions made by fabricators. The Court found that the reviewing engineer was aware of a design change made by the steel fabricator (switching a single rod suspension system to a double rod design for ease of fabrication); however, the engineer did not review the hanger connection proposed for the double rod design despite representing to the architects that a review had been done. The Court found that such conduct was a willful act with wrongful intention, constituting gross negligence by a professional. The Court stated that, [s]hop drawing review by the engineer is contractually required, universally accepted and always done as part of the design engineer s responsibility. E. The AIA Shop Drawing Clauses. As a result of the post-hyatt litigation and industry awareness of risks associated with the shop drawing review process, the 1987 edition of the AIA General Conditions greatly expanded the coverage of this topic. The 1997 and 2007 editions carry forward 20

21 the expanded language, but add a potentially dangerous twist. Paragraph 3.12 and its ten subsections detail the shop drawing process. Paragraph states that the contractor is not to perform work which requires a shop drawing until the respective submittal has been approved by the Architect. Since the contractor must wait on architect approval, there is a potential for project delay caused by inaction in the approval process. The architect has a duty to take action on shop drawings with such reasonable promptness as to cause no delay in the Work... while allowing sufficient time in the Architect s professional judgment to permit adequate review. AIA A201 par (2007 edition). The time for review of shop drawings should be established in the contractor s schedule of submittals, which is coordinated with the Contractor s construction schedule and allows the Architect reasonable time to review submittals. AIA A201 par (2007 edition). Any submittals not approved in a timely manner should be brought to the architect/engineer s attention, especially those relating to long lead-time components of the Project. The expanded language of A201 s shop drawing review clause, paragraph 4.2.7, includes at least four disclaimers of what the architect s approval is not. The new twist relates to design-build components of the project, such as items required by a performance specification, or sprinkler systems, curtain walls, precast or other building components to be designed by the contractor. Paragraph of the 2007 A201 General Conditions requires the contractor to submit shop drawings signed and sealed by a licensed design professional for such work. The clause goes on to state that, [t]he Owner and Architect shall be entitled to rely upon the adequacy, accuracy and completeness of the services... by such design professionals. Time will tell whether 21

22 delegation of design to the contractor is a cost effective procedure or an invitation for disaster. Maybe we haven t learned much from the Hyatt collapse after all. F. Shop Drawing Stamps. There is a wide variety of wording used on shop drawing stamps. During the mid-1980 s, there was a push to avoid using the word approved on shop drawing stamps. Design professionals thought, or were advised, that if they avoided using the A word during their review, they might not have liability for action taken by them on submittals. Phrases such as reviewed, no exceptions noted, authorized to proceed, and the like became common. In fact, one of the major professional liability insurers required their insureds to use reviewed on their stamps. Despite this, time has shown that the courts still equate the review and passage of judgment by the design professional with approval, regardless of the wording used on the stamp. Interestingly, the AIA s Handbook of Professional Practice contained a recommended stamp until the 2008 edition which recommended that the word approved be used by both the contractor and architect. The AIA s "recommended" stamp as published in 1994 had these four boxes as choices 29 : APPROVED APPROVED AS CORRECTED Fabrication/installation may be undertaken. Approval does not authorize changes in the Contract Sum or Contract Time. REVISE AND RESUBMIT Fabrication/installation MAY NOT be undertaken. In resubmitting, limit corrections to the items marked. 22

23 REJECTED Review/approval neither extends nor alters any contractual obligations of the Architect or Contractor. FIRM NAME By Date For those wanting more comfort, and a really big stamp, the AIA also had a longer version with a 142 word disclaimer at the bottom. The AIA contracts state that the architect is to review and approve, or take other appropriate action (i.e. reject, require revision, etc.). As a result, the courts find that "review" equals "approval". In the opinion of the Administrative Law Judge issued in the Hyatt case, he observed that, Although the contract documents require that shop and erection drawings be submitted to the engineer of record for review and approval, testimony at trial indicates that engineers never use the term approved when indicating review and approval of these drawings. This custom apparently rests upon the dubious basis that most engineers insurance carriers have directed that the word approve not be used. 30 The judge went on to note that although the steel shop drawings did not indicate approval, based upon all the evidence, the Commission finds that the 'review stamp' of the structural engineer of record on the Hyatt project, placed on shop and erection drawings, functionally indicates both review and approval of such drawings. Specific definitions within the contracts may, however, deflect liability from the design professional. For example, in a 1995 Virginia case, the court held that the engineer s stamp which stated that review does not relieve the contractor from complying with all requirements of the contract documents meant that the contractor was liable for the failure of certain post-tensioning components and that the engineer s 23

24 approval did not waive the original contract requirements. 31 As a result, the contractor,, not the owner, was liable for the error. G. Industry Changes. The post-hyatt fallout continues to affect the industry today. 32 In October 1985,, the American Society of Civil Engineers (ASCE) published its Final Report and Recommendations on Assignment of Authority & Responsibility for Design of Steel Structures. Many state licensing boards have since restricted the practice of design delegation, while others have authorized it. New York has been a particular hot-bed of activity surrounding the delegation of design responsibility to contractors. In late 1996, building contractors and steel fabricators filed suit in New York to challenge a state agency rule that allowed the principal designer to delegate design responsibility through unlicensed contractors to secondary licensed designers. 33 As mentioned above, the 1997 and 2007 AIA documents allow the architect to delegate design responsibility to the contractor. AIA A201 par (2007 edition). The key concern, regardless of who performs the design, is to make sure that the client gets a quality building and that the public is safe. Shop drawing review cannot be based upon disclaimers and avoidance. Since these are the drawings actually used to build from, careful review is required by a licensed professional familiar with the project. VI. Legal Issues in Interpreting Design Documents. A. Contract Documents. The phrase contract documents is widely used in the construction industry to include not only the signed contract between the parties, but a host of other documents, drawings, specifications, reports, surveys, exhibits, and conditions. All of these pieces of 24

25 information make up the construction contract. Most are not attached to the contract, but are merely mentioned and incorporated by reference. What may escape immediate attention is that the drawings and specifications are as much a part of the contract as the payment or dispute clauses. 1. Not Just the Agreements and General Conditions. As one New York court stated, [i]n the context of the performance of a construction contract, the term contract documents generally refers to architectural plans, drawings, surveys, specifications, engineering reports, change orders, and the like... applicable to the work to be performed. 34 Standard AIA General Conditions define the contract documents as: the Agreement, Conditions of the Contract (General, Supplementary and other Conditions), Drawings, Specifications, Addenda issued prior to execution of the Contract, other documents listed in the Agreement and Modifications issued after execution of the Contract. AIA A201, Par (2007 edition). The AIA contracts then go on to explain that, [t]he Contract Documents form the Contract for Construction and that the Work means the construction and services required by the Contract Documents. AIA A201, Par and (2007 edition). Therefore, the contract documents are the essence of the agreement, forming the contract and describing all work to be performed. 2. Specs Equal to Drawings. Under the AIA forms, there is no priority given as between the terms of the written agreement, the drawings, or the specifications. AIA s A201 General Conditions states only that, [t]he Contract Documents are complementary, and what is required by one shall be as binding as if required by all, which from a legal perspective puts the drawings and specifications on equal footing. AIA A201 Par (2007 edition). 25

26 2. What if in Conflict? If there is a conflict with the numerous contract documents, and there often is, how is this to be resolved? Under the AIA forms, conflicting documents would be submitted to the architect for interpretations, as in a request for information. AIA A201, Par and (2007 edition). The architect will then respond to such written request with a decision that is to be, consistent with the intent of, and reasonably inferable from, the Contract Documents, and will be impartial and issued in good faith. If either party disagrees with the architect s interpretation, the intent appears to be that the matter becomes a dispute which is then submitted back to the architect as the Initial Decision Maker (or IDM) for a second bite at the apple. Failure to resolve the issue at that stage leads to mediation and arbitration. AIA A201, Article 15 (2007 edition). B. Ambiguities in Plans and Specs. A contract is ambiguous if it is susceptible of two different and reasonable interpretations, each of which is found to be consistent with the contract language. 35 Stated otherwise, where, from the four corners of the contract, the terms are susceptible of more than one meaning so that reasonable persons may fairly and honestly differ in their construction of the terms. 36 If the language of the contract is unambiguous, then words are to be given their plain and ordinary meaning. 37 Since plans and specifications are incorporated into the construction contract by reference, they are subject to the same rules of interpretation as the terms of the agreement itself. Courts have held that whether a plan or specification is ambiguous is a question of law for the court to decide. 38 The rules of interpretation can be summarized in the following sections: 26

27 1. Construed Against the Drafter. Once a contract is found to be ambiguous, legal rules of contract construction provide that the ambiguity is to be construed against the drafter. As one state Supreme Court has stated, A basic principle in the construction of contracts is that an ambiguity in the language of the contract will be strictly construed against the party who drafted the provision. 39 The rationale for this rule is that, doubtful and uncertain language in a contract is construed against the party preparing the contract, for he has created the troublesome ambiguity. 40 When that drafter is an architect or engineer who has prepared documents for use by the project owner in obtaining bids, courts generally construe ambiguities against the owner. 2. Application of Rules to Construction Documents. Many courts have applied these rules of contract construction to bid documents, holding that the documents are to be construed in favor of a contractor s reasonable interpretation against the owner. The construction case often cited is Blount Brothers Construction Co. v. United States, 346 F.2d 962 (Ct. Cl. 1965), in which the government s plans and specifications for certain concrete work were in conflict. The court laid out certain rules for dealing with ambiguities created by conflicts between plans and specifications. Those include, a. A contractor s interpretation of the documents will be adopted if within the zone of reasonableness ; b. Contractors have a duty to inquire and to seek a clarification as to a patent ambiguity; c. Contractors are not expected to seek clarification of hidden ( latent ) ambiguities; and, 27

28 d. Ambiguities in contracts drawn by the government are construed against the drafter. 41 The rule of law that any ambiguity is construed most strongly against the party who drafted the specification is known as the rule of contra proferentem. 42 The rationale for the rule is that, it puts the risk of ambiguity, lack of clarity, and the absence of proper warning on the drafting party which could have forestalled the controversy; it pushes the drafters toward improving contractual forms; and it saves contractors from hidden traps not of their own making. 43 Many courts have stated that any ambiguity in a contract must be resolved most strongly against the party who prepared it. 44 The idea is that the drafting party has the responsibility to make the contract terms clear, and if he fails to do so, the other party s reasonable interpretation will control. This rule applies equally to the plans and specifications which become a part of the contract and the contract documents. Since the owner provides and furnishes the plans and specifications to the contractor, the owner is deemed to be the party who drafted the documents. If the plans and specifications are ambiguous, the courts will construe the documents in favor of the contractor s interpretation -- if reasonable -- and against the owner s. The contractor need not show that his interpretation is the best, only that it is within the zone of reasonableness. 45 For example, in Neal & Co., Inc. v. U.S., 945 F.2d 385 (Fed. Cir. 1991) the contractor claimed that government specifications for shipping certain precast concrete elements were ambiguous. The court agreed, holding that, The Government s interpretation is not unreasonable, but neither is the interpretation put upon it by [the contractor] and by the trial judge. If the Government wants a particular interpretation to be made of a contract provision, it can write the provision to make that meaning clear

29 The contractor was awarded the extra costs incurred for shipping. 3. Patent vs. Latent Ambiguities. Court cases hold that a patent ambiguity is one that is recognized as an obvious omission, inconsistency, or discrepancy of significance. 47 A latent ambiguity, by contrast, exists when the ambiguity is neither glaring nor substantial nor patently obvious. 48 When a conflict of interpretation is presented, the meaning of the words included in a contract is determined by a two-step process. The Court must first determine whether an ambiguity exists. If an ambiguity is immediately apparent, it is a patent or obvious ambiguity, and the contractor is under a duty to seek clarification. If a contractor does not inquire about a clearly patent ambiguity, the ambiguity will be construed against the contractor, not the drafter. 4. The Zone of Reasonableness. Far-fetched interpretations of the documents will not be allowed. The contractor s interpretation of an ambiguous provision or detail must be within the zone of reasonableness. 49 The Government, as the author, has to shoulder the major task of seeing that within the zone of reasonableness the words of the agreement communicate the proper notions A party seeking to have its interpretation adopted must demonstrate that it actually and reasonably relied upon that interpretation when it entered into the contract Contract Authority of A/E To Interpret. One way to resolve contract ambiguities is to designate an official interpreter of the documents. Some construction contracts provide that a third party, usually the 29