Because design documentation cannot anticipate every contingency that might arise during construction of the project, the design firm’s services should include involvement during the construction phase. If the client does not retain the design firm to provide interpretation and clarification of the plans and specifications, there is increased risk because someone else’s decision may lead to problems at the project site. Such problems are likely to lead to disputes that cost both the client and design firm time and money. The party performing the observation or inspection services, or otherwise administering the construction contract, should assume responsibility for its own actions in interpreting the documents and making decisions at the site.
If a client precludes a design firm from providing construction phase services, the design documentation may have to be more extensive and costly. The client should understand the need for a larger fee and increased time for design services and should acknowledge the responsibility that accompanies making changes at the site and interpreting the design documentation. The client can express such acknowledgment through both a waiver of claims and an indemnity provision to pay for any cost to the design firm caused by the design firm’s lack of authority to perform full services on the project.
The design firm and client should be concerned if the design firm’s services are terminated. The design firm might rightfully anticipate that it would have the opportunity to provide design clarifications and interpretations. Not allowing the design firm to perform construction phase services denies it the opportunity to protect the design’s integrity, the firm’s practice, and the client’s interests. A contractual termination agreement should release the design firm from any claims made by the client and protect the design firm from any contractor or other third-party claims for property damage, economic loss, or personal injury.
During any project, all parties to the process share significant risks. A viable risk management technique is to give authority to the party best able to manage a specific risk. If the client does not permit the design firm to perform construction phase services, the design firm still has the risk of liability associated with being the design professional-of-record, but it has no ability to mitigate that risk. In fact, design firms that are capable of, and compensated for, providing more extensive site services (such as through a resident project representative) can better protect client interests by reducing the prospect of a design modification turning into a significant dispute or claim.
If the original agreement does not envision or severs construction phase services from the contract, the contract should protect the design firm against all claims except to the extent that the cost of those claims is the direct result of the design firm’s negligence. It is reasonable that if the client is assuming the responsibility for decisions made during the construction phase, the client should also assume the risk. Similarly, the substitution of another design firm or other entity to administer the construction contract should relieve the design firm from the risk associated with those services. Perhaps most effective in managing the risk is both a release from any claims and indemnity for any costs should changes be made at the site.