In the US, putting a capital asset into place has traditionally been a disjointed and inefficient activity. Pressure from clients has forced both design firms and construction contractors to recognize that the process has to work more efficiently. Project teams shifting focus to project success rather than project disputes has resulted in a blurring of the line between design and construction that was established over 150 years ago and that has been reinforced by statutes, regulatory procedures, and case law. One attempt at merging the expertise of those in design and those constructing the design is through expanded design collaboration, often in the form of informal or contractual design assist efforts. Design and construction firms should be aware of two significant developments:
New resource defines design collaboration techniques
Over the past few years, the American Institute of Architects (AIA) and the American Institute of Steel Construction (AISC) have worked together to study design collaboration techniques commonly used in the construction industry. The effort has led to a publication, “Delegated Design, Design Assist, and Informal Involvement – what does it all mean?,” which describes the roles and responsibilities of project participants in these design collaboration scenarios and offers definitions and guidelines that design and construction professionals can adopt for their use. As insurance advisor to the AIA Contract Documents committee, Victor participated in editing the drafts from the perspective of the professional liability exposures of all parties involved in the design collaboration techniques.
The goal of the AIA/AISC joint effort is to create two publications to benefit the design and construction professions:
- Part 1: a publication that was recently released focuses generally on three collaborative techniques, available at the link above. It shows the value of shared expertise in creating clear and consistent expectations.
- Part 2: currently under development, will address design assist as it relates to fabricated structural steel.
ConsensusDocs issues contractual design assist document
The ConsensusDocs coalition that represents many trade associations for contractors, specialty contractors, and subcontractors has released CD 541, Addendum to Agreements Between Owner and Construction Manager and Between Owner and Design Professional for Design-Assist Services. The document defines the roles of the various project participants involved, and includes considerations for design-assist participants to keep in mind when entering into agreements that focus on delivering projects faster, more efficiently, and at less cost. Design-assist brings together project participants, including the contractor, major trade subcontractors, design professionals, and the project owner, during the design phase to address concerns like constructability, scheduling, and cost to build the design.
While CD 541 is meant to aid collaboration, the design-assist process it sets out is not like integrated project delivery or design-build when it comes to allocations of risk. It is a supplemental document to the separate owner-contractor and owner-design professional agreements so risk is allocated through those various separate documents. Further, CD 541 clearly establishes that liability for construction defects remains with the contractor and liability for design errors remains with the design firm, even though the contractor and subcontractor(s) will be involved in the design process. Other important responsibilities for the contractor under CD 541 include:
- The contractor is required to perform near-constant design review to identify constructability issues and provide suggestions to the design firm before they become problems later in the field with delays, conflicts, and changes. This review benefits all parties in the long run so that errors and disputes don’t end up costing more time and money, which design-assist is meant to avoid.
- The contractor is required to perform cost estimating at the typical preliminary design, schematic design, and design development stages. If at any point the cost estimate exceeds a prior estimate given by the contractor, the contractor has to work with the design professional to recommend design changes to reduce costs. Throughout this process, the owner is kept aware of how much it will cost to build the design so the parties can control design creep and avoid surprises at bid time.
- The contractor has to prepare schedules during the design process to gauge whether the design fits within the project owner’s time constraints. Any time an updated schedule shows an adverse change compared to the previous one, the contractor and design firm work together to recommend changes to bring the design back within the project owner’s time constraints.
In addition, the document offers optional services that the parties can elect, including life-cycle cost analysis, sustainable design recommendations, and risk analysis. This risk analysis option requires the parties to collaborate on a list of potential risks to the project, particularly ones that may impact the project’s schedule and cost. The risks are then assigned to the appropriate participant for monitoring and a risk management plan is developed to determine how to respond to a risk should it arise.
Although design responsibility stays with the design firm, there is no requirement that the contractor maintain design liability coverage. Despite the contractual limitation on the contractor’s role, since the contractor will be involved in design preparation, the owner and contractor should consider obligating the contractor to maintain professional liability coverage.
More information on CD 541 is available through ConsensusDocs, including a sample of the contract form and the publication, ConsensusDocs Guidebook and Sample Responsibility Matrix.