You Asked; We Answer

You Asked; We Answer

Source: Beazley, A&E Reporter, Volume 7, Issue 1 – January 2012

In this edition of “You Asked, We Answer!” we address the question of whether a design professional should admit liability to its client if it’s obvious the design professional made a mistake on a project. From a risk management and professional liability perspective, there are risks associated with admitting liability since “mistakes” do not necessarily equate to legal liability.

Standard of care

Design professionals must remember the importance of including appropriate standard of care language in their professional services agreements since standard of care provisions are critical in managing the client’s expectations regarding the design professional’s services. While a contractor may provide a warrantee for its workmanship, in most jurisdictions, absent a contractual obligation design professionals are required only to perform in a manner consistent with the degree of skill and care ordinarily exercised by similarly situated design professionals. Since the design professional is not required to perform perfectly, the existence of an error or omission in the design professional’s drawings and specifications does not necessarily mean that the design professional breached the standard of care.

Communication is key

Beazley has long emphasized the importance of timely and effective communication between design professionals and their clients to maintain project clarity and address issues as soon as they arise. However, design professionals are forewarned that if they admit liability, these types of admissions, especially if they are in writing, will surely resurface as evidence during litigation.

Action Plan

Regardless of the amount of pressure you receive from the client to concede liability or the client’s apparently friendly demeanor (which should not be misinterpreted as an indication that the client will not file a claim against you), we recommend you advise the client that you will investigate the issue, report the matter up the chain-of-command, and contact your professional liability insurance representatives to develop a plan of action.

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