PE & EIT Professional Liability. 5

[a3a]

To start, I'm and EIT with years to go until my PE.

I understand that when a PE seals construction documents that he/she has just assumed a certian amount of liability. My question is how far does this liability extend. I have heard that, even after the PE is dead, their family and children have a liability risk directly from problems that could occur on the project that the PE signed off on. This sounds horrible to me. Especially, if the PE isn't around to defend himself. Is it really that bad?

Another Question:

In a previous post in this forum, an EIT expressed his discomfort in signing his name that he reviewed some structural calculations, as he was requested to do by his superior (a PE). Off the top, it would seem that the PE would be responsible for everything that occured in the event of a problem, as I and others believed. However, there were other comments that made me think I am slightly ignorant to liability that I may have as an EIT.

The above worries me a little. In the event that my supervisor (PE or not) instructs me to do something that brings liability onto myself, I would certianly like to know about it. I could see a few different cases:

1. Supervisor is not aware what he asked you to do is not appropriate. Maybe he thought you had the knowlege to do it when you really didn't. In that case you could talk through it.

2. Supervisor is fully aware that he asked something inappropriate, but was sure you could do it and had no evil intentions. You thought you did it correctly. The type of person that would step in and say, "I told him to do it, I was watching him though he didn't know it, and I'll take responsibiliy."

3. Supervior purposely gives inappropriate instructions so that he (and the company) can put everything on to the shoulders of the EIT in the event of a problem. In this case the EIT likely didn't know that he should have questioned the situation. I believe the home health care industry (and I'm sure our industry too) has had cases such as this.

So, after all of that I guess what I'm getting at is: at what point do you become personally liable for instructions by your company, or do you?

I am not seeking professional legal advice here. However, it would shed some light on the subject to let me know how much more I need to learn, how much I should worry, and where I could go to better understand. I hate back-stabbers, and even worse I hate being nieve.

Thanks for the discussion.

 

[redtrumpet]

When a PE affixes his stamp to his document, he is accepting professional responsibility for it.

There are two liabilities for the engineer. The first is a contract liability. This liability can be limited in several ways, first through statute of limitations, secondly through limitation of liability in contract language, and thirdly through errors and omissions insurance.

The second concern is a tort liability. There is no precise definition of tort, but it generally refers to a private or civil wrong or injury, one that involves negligence and that may arise independently of contract. Tort liability cannot be limited, although insurance coverage will take care of that portion up to the limit of the coverage.

Without getting into the specifics of contract and tort law, I recommend the following:
1. Make every effort as an EIT to have your work supervised by a PE, even if the PE does not seal the drawings. It is probably a requirement of your EIT registration that you work under the supervision of a PE. Even if the PE doesn't explicitly stamp your work, he/she is liable. Be wary of requests from non-engineers who want you to bypass the PE supervision process.

2. Are you working for a consulting firm? If the works you design are for the use of your employer, then you generally don't need to worry about contract liability. The company won't sue itself if the structure falls down or the process doesn't work. If the works you design are for other than your employer, then you need to know what the coverages and limitations of your firm's errors and omissions policy is. You also need to see a copy of the service contract with the client. This should have a clause limiting liability to the amount of the E & O insurance coverage, and excluding individual employees from being named in any action. Note that in most cases the firm assumes the contract risk and you won't be sued individually. Still, recent court cases in Canada have held the individual can be sued as well. That is why you should get the individual employee exclusion written in the contract. If your employer refuses to show you the E & O coverage or the services contract with the client, I would look for another job. Those firms that do business on a handshake or verbal contract are disasters waiting to happen. You have a right to know what liability you may be accepting.

3. Work diligently to known standards and codes. The engineer owes a standard of care to the public and the client. The "reasonable care" is measured by applicable professional standards of the engineering profession at the time the services are performed. Those who follow known standards, codes, and practises have a better chance of defending themselves than "cowboys" who rely on seat-of-the-pants practises.

Since tort liability is without limitation, this is the reason individual practitioners keep insurance coverage long after they are retired, and after their death to protect their estate.

 

[JAE]

a3a - you didn't mention in what jurisdiction you reside. redtrumpet's comments are very good and I agree with them. A couple of other slants:

1. The PE has the full responsibility for all designs, not the EIT (unless the EIT did something intentional).

2. The PE, even when signing the plans, is still usually covered by the corporation's insurance. Thus, a lawsuit would generally have to be directed at the company and not the individual although individual PE's are sometimes sued.

3. There are statutes of limitation that apply to projects. In the US, I believe they are set at 7 years (although I am definitely not a lawyer).

A few years ago, we did a design for a long term client where our corporate name was not placed on the plans (there was an issue with our firm working in another jurisdiction. I asked our corporate attorney to verify that given my seal was placed on a "naked" set of plans, would the firm still cover me insurance/legal wise? They concurred that even without the corporate name on the plans we were still covered.

Lastly, I have never heard of any case where a family was liable for an engineer's malpractice after he was dead. The only case I can think of where that would even be possible is if he practiced as an individual (not a corporation or limited liability corp) and his family received his estate. The whole concept of corporation is a means to protect your personal estate and keep it separate from the business.

If you want to really sleep at night - I would suggest simply hiring an attorney to review your specific situation. Or, you could speak with local organizations such as ASCE, your local engineering board, etc. to get feedback there.

 

[RDK]

I’m not a lawyer but my understanding is as follows:

If you are an employee then the concept of agency would apply. You cannot be sued for your actions. Agency holds that the servant (the employee) is not liable for the actions of the master (the employer) Here in Canada this concept is being somewhat limited by the courts. You can be sued if you are grossly negligent You can also be sued if you are a director.

You can limit liability by contract language. See

http://www.encon.ca/english/lcb/

for some articles on this issue.

You cannot limit liability in tort since by definition there is no contract to limit the liability.

In Canada the statute of limitations on being sued is 7 years after the problem is discovered. The problem can be discovered any time without limitation. A recent Supreme Court of Canada decision has made this clear. The building was built in 1972 and the damages apparent in 1989. (

http://www.lexum.umontreal.ca/csc-s...=&corpus=pub_en&language=en&range=1&numdoc=2)

An individual’s estate could be sued if the estate had not been probated. The suit would be limited to the amount of the estate. Once the will bad passed probate and dispersed to the heirs no action could be taken. The estate could only be sued if the individual could be sued.

Professional liability is another matter. If you seal the work or if its done under your supervision then your professional association could take action. This action would be limited to revoking registration or in some cases a fine. Being held professionally incompetent by your piers would also make winning at trail more difficult.

Bottom line is as Red Trumpet has suggested, read your insurance policy and limit liability under your contracts with your employer and your clients,
Rick Kitson MBA P.Eng

Construction Project Management
From conception to completion

http://www.kitsonengineering.com