Design-Build CMs and Liability
Design-build project delivery is changing the way that responsibility is allocated for assuring that construction complies with plans and specifications, and also for the responsibility for worker safety.
Design-build project delivery is changing the way that responsibility is allocated for assuring that construction complies with plans and specifications, and also for the responsibility for worker safety. Construction managers (CMs) are increasingly filling the void left by design professionals who are no longer directly responsible to owners, but rather to their “employer”-the design-builder-who is often a contractor. As a subcontractor to the design-builder, the architect or engineer is not in a position to relate directly to the owner’s interests. Likewise, the design-build firm cannot be expected to put the owner’s interests ahead of its own.
The CM who serves in an “agency” capacity is retained by the owner and provides advice on matters such as whether work is being completed on schedule or within budget. The CM may recommend corrective actions, but is not responsible for construction means or methods, nor for the safety of the contractor’s crew or the subcontractor’s employees.
“At-risk” construction management differs in that the CM, for all practical purposes, guarantees a fixed price for the project. The CM retains trade contractors and assumes all the usual obligations for project completion and safety of workers.
The difference in the liability implications of these two approaches is illustrated by two recent cases related to worker safety on the job site. In Bokodi v. Foster Wheeler Robbins , a common-law negligence standard was applied. In the case, a CM appointed a site manager who, in turn, designated a field superintendent and a safety manager who conducted weekly safety meetings. A worker injured on the site sued, and the CM argued that it was not required to prevent subcontractors from performing their duties in a routine way. The court disagreed, ruling that the CM had retained control over incidental aspects of the subcontractor work, in part by establishing its own safety program.
By contrast, an earlier unrelated case, Sec. of Labor v. Fleming Construction Inc. , dealt with the duties of a CM to oversee the construction of a bank building by a specified date and to deal with safety and health issues. When a worker fell from the roof during construction, the CM was alleged to be liable under federal safety requirements.
The CM was exonerated, however, by showing that the firm did not control the means and methods of construction or of safety precautions. The contract called for the CM to act only in an advisory capacity to the owner, the bank and the project architect. The CM was not empowered to compel contractor compliance with safety measures; the firm could only inform the owner of safety concerns, leaving it to the client to take corrective action.
The lesson to be drawn from these and similar cases is for CMs serving in an “agency” basis to precisely define the extent and scope of their services in a way that does not imply any degree of control of the actual construction.
By MILTON F. LUNCH
Milton F. Lunch was general counsel of the National Society of Professional Engineers.