Claims – Contr Prof Liability

November 28, 2018

Second lawsuit filed over Charleston airport expansion work

Source: https://www.postandcourier.com, November 20, 2018
By: Warren L. Wise

Two years after Charleston International celebrated completion of its terminal expansion and overhaul, another legal tussle has cropped up.

The airport’s oversight agency is now suing the architect and a subcontractor in state court for at least $1.5 million over the installation of a cable system that controls airport operations.

The Charleston County Aviation Authority alleges Fentress Architects of Colorado and Burns Engineering of Pennsylvania modified drawings to eliminate four telecommunication cable rooms from the second-floor level and relocate them to the ground-floor apron level.

That, according to the lawsuit, required the low-voltage lines to exceed the maximum 295 feet to meet performance requirements. The airport said it identified seven areas where the cables were too long.

The Aviation Authority has already paid for the work, but it says it filed the lawsuit to recoup the cost to redesign the cable installation and construction expenses along with any business interruption expenses.…

November 28, 2018

The cost of allocating design risk to contractors

Source: https://www.constructiondive.com, October 30, 2018
By: Doug Tabeling, Smith, Currie & Hancock LLP on behalf of ConsensusDocs

Design flaws are a constant risk in construction, but the contractual allocation of that risk can sway considerably from project to project. Contract terms can vary from fully expressing an owner’s warranty of the sufficiency of plans and specifications to transferring significant design risk to the contractor. On a traditional design-bid-build project, the default allocation of the risk of design errors is governed by the Spearin doctrine. That principle is derived from a Supreme Court decision holding that the owner bears the risk associated with inadequacies in the design it provides and on which the construction contract is based. But it is only a default principle. The Spearin doctrine is a gap filler, an implied term in a construction contract that can be undermined and limited by express terms to which the owner and contractor agree.

There are several reasons why construction contracts vary in their allocation of the risk of design failures. Some owners prefer to achieve the cost savings associated with limiting the contractor’s risk concerning the design and curtailing the amount of contingency in the contractor’s price. Other owners, however, prefer not to assume the residual risk that is not assumed by the designer under its standard of care.

November 28, 2018

Design-build risk abounds, but can be mitigated

Source: https://www.constructiondive.com, November 26, 2018
By: Joe Beeton

“There is no such thing as risk.” That was the bold message delivered by Grant Holland of Mott MacDonald at last month’s annual Design-Build Institute of America conference in New Orleans. “You cannot quantify, in definitive terms, a particular risk on a project. Every stakeholder has a different view of that risk, they value it differently and they price it differently.”

Instead, the vice president of the United Kingdom-based consultancy’s advisory practice told attendees, “a risk profile is in the eye of the beholder.” In his 25 years of working on U.S. state department of transportation design-build projects, Holland said he’s seen models change from being focused on “risk transfer” to “risk mitigation.”

Common risks embedded in massive design-build and public-private partnerships, for example, tend to be pretty uniform across all projects. “Whether it’s environmental risks, utilities risks, design risks, resources and labor risks — they tend to be constant throughout projects.” At this point in the delivery method’s evolution, he said, it’s less about identifying risks and more about coming up with ways to mitigate them.

One of the more recent methods for doing so, Holland continued, is through allowances. The public sector stakeholder might throw out a number in the early stages of a project that serves as wiggle room. “Whether it’s $2 million or $5 million or whatever number the owner thinks is right” to serve as a ballpark estimation of possible risks, the owner tells the builder to “put it in your bid.” Then it’s on the contractor to spend that amount on risks.…

November 16, 2018

Builder sues over $2 billion San Francisco transit center

Source: https://www.chieftain.com, October 17, 2018

The general contractor that managed San Francisco’s troubled $2 billion transit terminal is suing the agency in charge of the project alleging faulty design and mismanagement.

The joint venture of Webcor Builders and Obayashi Corp. filed the lawsuit Tuesday in San Francisco. It alleges design and planning mistakes sent construction soaring and led to overruns that cost the company $150 million.

The Transbay Joint Powers Authority, which operates the Salesforce Transit Center, denied the allegations in a statement Wednesday and said it would hold the contractor responsible for its commitment to deliver the project.

The contractor said it submitted 12,000 requests for information and 1,603 change order requests to officials during construction of the terminal in downtown San Francisco.

The contractor also alleged that tardy responses added to the rising costs.

The project has been mired in litigation.

In May, the engineering firm Skanska USA sued Webcor, saying the contractor’s alleged shoddy instructions led to cost overruns. In addition, the owners of a nearby high-rise apartment building that is sinking and tilting sued the agency. The owners of the Millennium Tower blame the transit center construction project for the building’s tilt.

The terminal opened in Aug. 12 after ten years of planning and construction. It closed a month later after cracks were found in two steel support beams. Agency officials said they don’t when the new terminal will be re-opened.

November 16, 2018

Columbia Gas engineer’s failures at root of gas explosions, NTSB says

“Source: https://www.bostonglobe.com, November 15, 2018
By: Milton J. Valencia

Federal investigators Thursday singled out a Columbia Gas engineer with “limited knowledge” for errors in drafting work plans for a Lawrence construction site, setting in motion a chain of events that led to the Sept. 13 natural gas explosions that killed one man and left thousands without heat and hot water.

In the most detailed accounting to date of the catastrophe, the National Transportation Safety Board identified a series of missteps by the utility at the planning stages for a gas main replacement project in South Lawrence. The agency recommended “urgent” steps to increase oversight within the company and at the state level.

The NTSB investigators have focused on the replacement project and the failure of the engineer planning that job to account for a critical sensor in a line that was being replaced. Once the line was disconnected, the sensor detected a loss in gas pressure that caused the system to pump a huge amount of gas into live lines, leading to more than 120 fires and explosions across Lawrence, North Andover, and Andover, the report found.

“The Columbia Gas field engineer who developed the engineering plans told NTSB investigators that he developed them without reviewing engineering drawings that documented the regulator-sensing lines,” the NTSB said in its report.…

November 16, 2018

Design errors revealed in Miami bridge that collapsed

Source: http://www.globalconstructionreview.com, November 16, 2018

A federal US body investigating the fatal collapse of a bridge in Miami has concluded that there were design errors which could have caused concrete cracking observed before the bridge fell.

Engineers overestimated the load capacity of a critical section, its interim report said.

The report released yesterday by the National Transportation Safety Board (NTSB) avoided saying these errors caused the collapse.

Six people in cars died when the brand new pedestrian bridge over a busy road at Florida International University fell on 15 March.

In response to the update, bridge engineers FIGG issued a statement to The Miami Herald saying “the investigative update is just that, an update,” adding that the report “underscores that no probable cause conclusion should be drawn from the update.”

For the NTSB investigation, experts from the Federal Highway Administration evaluated the available design calculations and construction plans for the bridge, and found design errors.…

November 9, 2018

Transbay Terminal: Cause of cracked steel beams could take weeks longer to determine

Source: https://www.eastbaytimes.com, November 9, 2018
By: Erin Baldassari

Testing of two cracked beams at the Salesforce Transit Center will extend into next week and the results could prompt further testing, officials said Thursday, pushing the estimated date for determining a cause of the failures to the end of the month or later.

Once a cause is determined, the Transbay Joint Powers Authority, the public agency in charge of construction and maintenance of the facility, along with a peer review panel, will determine a permanent fix to shore the cracked beams and reopen the center, said Dennis Turchon, the authority’s senior construction manager.

The $2.2 billion transit center opened on Aug. 12, only to abruptly close six weeks later after workers discovered large cracks in two steel beams that straddle Fremont Street. The beams, which are on the center’s third floor, support the rooftop garden and bus deck.

Officials also closed the section of Fremont Street below the building until crews constructed a temporary fix that allowed the street to reopen last month. Bus riders are using the temporary terminal that had been in place during the center’s construction.

There’s still no estimate on when the center will reopen, a date that will be determined after officials determine a plan for repairs.

Turchon said crews completed a series of onsite tests of the beams before removing samples for testing in a laboratory to determine the steel’s strength and hardness.

“A very important element that we’ll find out very soon is those core samples,” Turchon said. “That is a very important element to weigh into the matrix of solutions.”

But, the authority’s board of directors on Thursday also called for a more thorough review of the entire facility, also by a peer review panel.

“Given that we found (these cracks) just by chance, it begs the question of what other things are in the building that we should be looking at,” said Ed Reiskin, the San Francisco Municipal Transportation Agency’s director of transportation and a member of the authority’s board. “The emergence of the issue puts at stake the credibility of the entire project.”

The beams used American-made steel and were fabricated by a highly-regarded Stockton-based company, Herrick Corporation, which worked on the Transamerica Pyramid, 181 Fremont Street and the Salesforce Tower in San Francisco.

Skanska USA, a subcontractor of Webcor-Obayashi that was responsible for overseeing the procurement of steel at the transit center, filed a lawsuit in May against the authority, alleging the authority mismanaged the project and provided documents that were flawed or incomplete, causing delays and resulting in extra work for which Skanksa was not reimbursed.

The center’s general contractor, Webcor-Obayashi, also filed a lawsuit in October seeking $150 million in damages, alleging similar complaints. A spokesperson for the contractor said they anticipate the two suits are just the first of “an avalanche of lawsuits” to come due to the early mismanagement of the center.

The authority’s board of directors fired its former executive director, Maria Ayerdi-Kaplan, in 2016 over concerns about major cost overruns and repeated delays. San Francisco’s Department of Public Works then took over the project.…

November 7, 2018

Contractors face tough time covering construction delays

Source: https://www.businessinsurance.com, November 6, 2018
By: Gaven Souter

Delays in construction projects can cause huge increases in costs, but identifying insurance policies to cover the costs is complex and varies significantly depending on policy wordings, construction insurance experts say.

While traditional construction insurance coverages may apply or specific delay in startup insurance may be triggered, there’s rarely a straightforward solution to covering the construction delays, they say.

Most construction projects run late, and a significant proportion of projects run over budget, said Tony Rastall, divisional director, energy, at Ed Broking Group Ltd. in London.…

November 6, 2018

Johnson Street Bridge builder sues City of Victoria over design, costs

Source: https://www.timescolonist.com, November 3, 2018
By: Bill Cleverly

The new Johnson Street Bridge is built and in use, but legal wrangling over its design and costs continue.

In a lawsuit filed in B.C. Supreme Court, PCL Constructors Westcoast Ltd., the company that built the bridge, maintains design information for the bridge “was not accurate and complete” and “contained errors, omissions and misrepresentations.”

The suit seeking unspecified damages names the city, bridge design consultant WSP Canada Group Ltd. (formerly known as MMM Group), and Hardesty & Hanover, a sub-consultant, as defendants. The statement of claim, filed in Supreme Court in Chilliwack, says the city failed to provide design information in a timely manner, unreasonably changed the design (including specifications), and failed to pay PCL’s costs arising from changes.…

October 31, 2018

The cost of allocating design risk to contractors

Source: https://www.constructiondive.com, October 30, 2018
By: Doug Tabeling of Smith, Currie & Hancock LLP on behalf of Consesus Docs

Design flaws are a constant risk in construction, but the contractual allocation of that risk can sway considerably from project to project. Contract terms can vary from fully expressing an owner’s warranty of the sufficiency of plans and specifications to transferring significant design risk to the contractor. On a traditional design-bid-build project, the default allocation of the risk of design errors is governed by the Spearin doctrine. That principle is derived from a Supreme Court decision holding that the owner bears the risk associated with inadequacies in the design it provides and on which the construction contract is based. But it is only a default principle. The Spearin doctrine is a gap filler, an implied term in a construction contract that can be undermined and limited by express terms to which the owner and contractor agree.

There are several reasons why construction contracts vary in their allocation of the risk of design failures. Some owners prefer to achieve the cost savings associated with limiting the contractor’s risk concerning the design and curtailing the amount of contingency in the contractor’s price. Other owners, however, prefer not to assume the residual risk that is not assumed by the designer under its standard of care.…