Residential job never took off due to contract language 5

[TehMightyEngineer]

I work mainly doing precast structural design work these days with very little consulting work. However, someone found my name and asked me to take on an interesting side job doing the structural design for a high-end residential home. My boss gave me permission to do it on my own time but under the umbrella of the company so as to use the professional liability insurance (and as long as I kicked back a percentage of the fee for their risk). Seemed reasonable and given that I wouldn't have the usual overhead of a normal consulting office I offered what I felt was a fair price (not too low and not too high).

Unfortunately, the home owner is also a lawyer or someone with a legal background and he balked at my contract language. We negotiated back and forth but, in the end, he did not want to agree to a few of my clauses claiming they created a moral hazard for him. Namely the clauses regarding indemnification; such as the Good Samaritan clause where he would indemnify me for any Good Samaritan acts, or the limitation on my liability where he would indemnify me for all claims above the limits of what my professional liability would cover (which this already was a concession as the original wording was much more favorable to me).

In the end we could not agree to modify the contract sufficient for the client and so they passed on accepting my offer. As this is entirely a side job I have no real loss missing out on this job but given that this is the first time I've ever seriously had to debate contract language I'm left wondering if I was unreasonable or if he was? Reading through much of the information I could find online regarding professional contracts I seriously don't believe it would have been a wise move to accept the clients proposed modifications to the contract language. Doubly so as this was a side job that could potentially put my day-job company at serious risk on top of risk to my own assets.

If I had more need to get this job I probably would have brought in a lawyer to sort it out. But, without getting a lawyer involved, what do you guys think of this situation?

Professional and Structural Engineer (ME, NH)
American Concrete Industries

http://www.americanconcrete.com

 

[hokie66]

Consider yourself lucky, and move on. Designing a house for a lawyer would be one I would shy away from, especially if residential structural consulting is not your core business.

 

[thaidavid40]

I agree with hokie66. Most homeowners don't have a clue as to the real cost of engineering design, or construction. They will string you along endlessly with changes and requests, working by fits and starts. Your only hope is to be able to lay off the job for extended periods while everything percolates down. Being negotiated out of reasonably-protective clauses by a lawyer would only add insult to your injuries. I'm glad you have a day job, since you are probably better off without this job. Lots of luck to the lawyer in finding a schmuck who will work on his terms alone.
Dave

Thaidavid

 

[Triangled]

you did good

 

[TehMightyEngineer]

Oh, this isn't my first rodeo as far as residential design, I've been down that road before and refuse to bend over backwards for residential scope creep. I only agreed to it from the start because the client was exceptionally detailed and had clearly done a lot of homework prior to contacting me. It also was a fascinating idea for a home that would have been a lot of fun to design. I explicitly stated what the scope of work was, how much time I required to complete it, and that the scope of work did not include major revisions which would require a cost increase. The client went over the contract with a fine tooth comb so I'm quite sure he understood that part.

I mildly cautioned the client about how I felt these were common contract clauses in the hope of convincing him that he's going to have trouble finding an engineer of quality and who will agree to his terms. Oh well, I parted with some structural advice on ponding, snow drift loads, and floor vibration so hopefully he'll know the right questions to ask to find out if the structural engineer he chooses is on the level.

Professional and Structural Engineer (ME, NH)
American Concrete Industries

http://www.americanconcrete.com

 

[oldestguy]

There should be a standard fact taught in civil engineering classes. The worst clients and least likely to pay are attorneys on their own jobs. However, it is great fun to take them to court in the process.

 

[Ron]

OG...I teach it in all of my Construction classes! I agree it is important.

TME....attached is a little booklet I wrote quite some time ago for contract review....incidentally....you were correct to do what you did. Even no contract is better than a bad contract! Agree with hokie66.

 

[Ron]

TME...also....he'll find an engineer who will agree with his terms. Poor naive soul!

 

[TehMightyEngineer]

Ahahahah, Ron, that was one of the sources I used when I was puzzling through the clients proposed contract. What a fantastic document and I found it incredibly useful, every engineer should read it.

Professional and Structural Engineer (ME, NH)
American Concrete Industries

http://www.americanconcrete.com

 

[Ron]

Thanks, TME...I appreciate that.

 

[Ingenuity]

Ron, a star for you. Great document. Thanks for posting.

 

[spciesla]

I laughed out loud,

Lawyer: " ...created a moral hazard for him."

That's awesome.

 

[TehMightyEngineer]

It was even his wording.

Professional and Structural Engineer (ME, NH)
American Concrete Industries

http://www.americanconcrete.com

 

[msquared48]

Oxymoron, huh?

Mike McCann, PE, SE (WA)

 

[Ron]

Ingenuity...thanks. Very kind of you.

 

[Triangled]

had an architect friend years ago doing a job on the side ask me to provide engineering for a vintage Pasadena CA area moderate-sloped hillside house his potential client, a lawyer, was buying..... extend deck, add room, reinforce this, level that. My proposal excluded stuff like floor squeaks and doors and windows sticking etc and limited my liability etc. architect told me client turned it down and architect used that 'turn-down' to extricate himself too... and he thanked me in wonderfully colorful language. I never looked back.

then again I sometimes think of the poor guy trying to sell a mattress to a young engineer... about 30-40 mattresses were laid out in order of stiffness in the warehouse.... and that engineer had to try out a number of them in the stiffer end of the spectrum, again, and again, questioning stiffnesses, wondering if they were in the correct order. sometimes I wonder if that guy runs the other direction when an engineer comes into his store.

Ron, excellent document. I'm gonna improve mine after reading that.

 

[hokie66]

Yes, it works both ways, Triangled. I contracted with a builder friend of mine to build a house for us a few years ago. John, the builder, cajoled his father Jack, a retired builder, into supervising the construction of my house. Making a long story short, Jack did a good job, but vowed never again to build a house for an engineer.

 

[BUGGAR]

I see no mention of Termination Clauses.

 

[TehMightyEngineer]

In what regard BUGGAR? I had one in my contract.

Professional and Structural Engineer (ME, NH)
American Concrete Industries

http://www.americanconcrete.com

 

[tstructural]

@Triangled -

I had 3 contractors out to my place to bid on an addition and upgrades throughout. I explained that I was a structural engineer and would most likely be there on a regular basis checking out their work. All 3 contractors found a reason to NOT bid on the project. Oh well - I thought it was only fair for me to warn them in advance. I never did get that additional built .