Throwing the Surveyor under the bus 5

[RocketRed]

A bit of background about me (somehow this got really long):

Through some weird happenings and opportunities I find myself majority owner of a small land surveying company. I am partners in a small Civil/Structural firm which is my day job. Great work, great staff and no problems there. During the early mornings and evenings I am in the background of this survey company. My role there is basically General Manager, I have no technical duties, except I write the proposals which have technical aspects. It has been working great - the Surveyor and party chief are the other owners, and my presence allows them to focus solely on technical issues and get their work done. Our project turn around has decreased by 10 days compared to the prior owner where the surveyor/owner was also in charge of all things business. I have a new admin in place that runs the day to day, I stay big picture, do the marketing stuff, and step in if we get an unruly client, someone won't pay their bill, or is angry about a project. Since I have been there (1.3 years) we have done about 190 projects, and I would say we have had 5-6 mad clients. In every case it has been they were just bad clients, but I had to deal with them.

We of course do a lot of pre-design survey for engineering. I have used this survey firm for my engineering stuff for years and never had a problem with the work. I contacted a lot of the survey firm clients when we took over, and let them know that I was a part owner and that my other company was their competition. I have never stole a single client, or even told an engineer's client that I was an engineer. For one my engineering business has too much work, and for the other it is more important to me that the survey business is successful.

That's not the story but shows a little about where I am at.

In my engineering history, I have had geotechs make mistakes, surveyors miss an invert (etc), testing agencies give bad pachometer readings (etc), and lots of other minor technical errors. I have made my share as well. In all of these cases, my response has always been: 1) contact the offending party to verify the mistake, 2) honestly report to the owner regarding the blow), 3) allow the offending party the chance to repair the blow, and work out with the owner how the mistake gets fixed. I try to stay positive, be honest, and work as fast as humanly possible to fix the mistake. Most times, there is no charge and I have never really lost a client over a minor error. We have never called our E and O Insurance company in 15 years.

Last summer my survey crew did a pre-design survey on an 9 acre brushy parcel. This is for a client we have always gotten along great with, and love working for. We were not hired by the engineer but for the owner direct. Part of the project connected two existing manholes, and the field crew somehow did not get an invert right on the downstream manhole (we haven't gone on site to verify the blow yet). They also picked up a locate for a force main and it was apparently 7' off. This is not really their fault if the locator had made an error they just pick up the paint lines, obviously all utility surveys have the note that says "pothole to verify all utility information". These guys have done 50 topo/utility surveys for me and we never have had any issues.

This is where it gets weird:

Our last contact with the project was in September, the client came in and told us we are going to start construction staking next week so get a hold of the engineer. A week later I saw another surveyor out staking the project.

Then in December we got a letter from the client's lawyer stating that we had gotten the inverts wrong and the force main was 7' off, and pay us $30k for the error. No other technical data. We got no notice regarding the errors after they were discovered so that we could double check our notes, or even help out with any changes.

The upshot is that the sewer inverts still allowed gravity flow, just flatter, but not below the code minimums. Not even flat enough to change pipe size. I'm sure that the laterals were affected as well, and what I am hearing through the grapevine is that the engineer didn't make the changes very quickly (they were probably busy) and of course blamed the surveyor (who was at fault - I'm not denying the error) for the long timeline. In the process of the changes (which I have seen, any competent engineer could have made them in a day, any other in a week), which took too long - the owner lost a major lease for the property. The contractor filed a claim or change order as well, because the flatter pipe required more care in installation. Again I don't really have a problem with that as I could see a contractor bidding higher costs for a flatter pipe. They were sole sourced on this project, so bid items were not really used.

Anyway, I find the reaction of the project to be really weird. The engineer responded slowly but was able to keep the client while we are getting asked for $30k with absolutely no contact with anyone about the issues. I am in the position of responding to the lawyer letter and I really want to work this out with the owner in a direct manner. I hate that we are having to go back and forth through a lawyer. I have the revised design drawings in hand. Here is my current COA, let me know what you think about it:

- Get permission to enter site and have crew verify notes/data that we actually made the mistake
- Write letter admitting error (assuming that we did)
- Letter asking the following:

Why weren't we notified immediately?​

What is the timeline for the error findings, change order, and engineering revisions?​

What is the justification of the $30k, the inverts were fixed points?​

Was potholing performed per our plan notes?​

- Contact my E and O company to let them know something may be afoot.

Of course I can go back into the contract and pull out the weasel words and show the Lawyer, but I would really prefer to get this over with face to face and show the owner that we are not the kind of company who would hide behind an contract for a problem we made, but it may be too far down the path now to go back.

Thanks for reading!

Any thoughts or ideas about what I should do?

How do you folks handle it if a subconsultant makes an error? Especially if the Owner requires that you use a particular subconsultant?

 

[oldestguy]

This the first thing that should have been done immediately.

"- Contact my E and O company to let them know something may be afoot."

I'd run all this past them before doing anything.

 

[Ron]

OG is exactly on point...don't do anything until you talk to your E&O carrier. Also, why would you admit anything in writing? That makes no sense.
If you screwed up, own up to it; however, don't offer that in writing on the front end.

 

[MacGyverS2000]

Also, why would you admit anything in writing? That makes no sense.

If you screwed up, own up to it; however, don't offer that in writing on the front end.

I don't get this attitude. A mistake was made, and he is wiling to own up to it. Putting it in writing does not change the fact that the mistake was made, nor does it make him more liable than he already is. Not putting it in writing means one thing only to me... you're leaving yourself room to weasel out if things don't go as you had planned.

That said, any response in writing that admits a (potential) mistake should also include a request for verification of said mistake, as well as potential resolutions based upon currently known data (to be updated as more data flows in).

Dan - Owner

http://www.Hi-TecDesigns.com

 

[cvg]

Even if a survey error was made does not mean that the surveyor was negligent - if due care was exercise during the survey. it could be argured that the owner was negligent in not reporting the error to the surveyor

 

[1gibson]

Certainly the client breached the contract by cutting off communication with you and having someone else do the work, right?

 

[oldestguy]

MACGYVERS: Once one knows the experience that Ron has on all this, he would not question his opinion. In my case I only had one claim, a mere 8 million, so even though engineers are good at evaluating and solving things, we had better leave these things to our attorneys. What do they say about a person representing himself???

 

[nonplussed]

This is the most important thing you want to consider in this situation:
"One thing you don’t want to do if a claim is made against you—do not admit that you made a mistake. Admitting liability can seriously jeopardize your E&O coverage."

You must ask permission (and have it documented) from your insurer as to whether you admit fault. If you admit fault without their permission they may have reason to reject your claim.

The insurer may decide to fight in court or the insurer may decide to pay without going to court based purely on financial interests. But admitting fault might be considered reason to drop your case.

 

[RocketRed]

All great advice coming through. Thank you.

We haven't officially admitted anything yet, we haven't gone out to check on the actual blows in the survey. We can't tell from the field notes what went wrong. There could be a number transposed in the engineering or any number of things. Like I said, from the engineering it appears we made a mistake. The field guys are both 10 year vets of the biz and are extremely conscientious about utility work and so I am really shocked that this happened.

COA - verify blow in the field, call E and O company, then letter regarding our position.

There is a 3rd piece to this that I didn't mention. The work was for the old company, we switched to the new one on Jan 1, 2016. The old owner has filed bankruptcy, and for all intents and purposes, that company is gone. However, even if we could sneak out of the deal due to that, I would only think of that as my very last option. I would much rather just do business straight up and find solutions to problems, not hide out. I have a feeling that the E and O guy is going to say "we don't insure that company anymore and the sole member is banko". I know we paid for the tail insurance for him, but I'm not sure what happens to that after a bankruptcy. I guess I will find out soon enough.

Immediate notification would have changed everything I am sure of it. There was probably $30k in construction staking on this project, if we had been involved we could have reduced the price of that and kept the project moving. Like I said, there was something really weird about the owner/project reaction.

 

[msquared48]

Deep pocket theory here rules...

Mike McCann, PE, SE (WA)

 

[MacGyverS2000]

I understand the legal ramifications of putting it in writing... but if this were in the ethics forum, I have to wonder if the answer would be closer to mine. On top of that, why should the answers differ at all if we're supposed to be ethical (rhetorical question, of course).

Dan - Owner

http://www.Hi-TecDesigns.com

 

[TheTick]

Once lawyers involved, it's time to shut up. Let your insurance company handle. It's not their first rodeo.

 

[Ron]

MacGyverS2000.....my point is that you don't offer up such on the front end. Lawyers are wordsmiths. A well-intended admission of a single issue can easily be twisted by a lawyer to mean an admission of everything; past, present and future. We, as engineers, do not want to expose ourselves to more liability than we have to. As simple as an issue might appear, it can get convoluted very quickly in the litigation world.

One of the OP's protections is his professional liability insurance. He is obligated by his policy to report a POTENTIAL claim, not just a claim. When that is reported, the insurer will likely direct him to have no contact with the other party outside the presence of the insurer's attorney. The OP must further understand that the attorney assigned by the insurer is there to protect the interests of the insurance company first, and secondarily the OP's interests, though they should be and usually are the same.

 

[JedClampett]

Engineers tend to blame everything on themselves. Due to that, we're always confessing our sins openly, which lawyers for the other side love.
You might of made a mistake, but not be liable for any damages. It all has to do with "standard of care" and other legal terms. Let the lawyers handle it.

 

[TLHS]

"There is a 3rd piece to this that I didn't mention. The work was for the old company, we switched to the new one on Jan 1, 2016. The old owner has filed bankruptcy, and for all intents and purposes, that company is gone. However, even if we could sneak out of the deal due to that, I would only think of that as my very last option. I would much rather just do business straight up and find solutions to problems, not hide out. I have a feeling that the E and O guy is going to say "we don't insure that company anymore and the sole member is banko". I know we paid for the tail insurance for him, but I'm not sure what happens to that after a bankruptcy. I guess I will find out soon enough."

Seriously, don't even talk to the other guys until you've talked to your insurer. This is a really complicated situation and it might be solved by a letter from your insurer supplied lawyer. On the other hand, you could make it severely worse on your own.

You aren't going to get more work from these people and they're not going to give you the same courtesy that you're giving them. Don't screw yourself.

 

[Ron]

JC...right on! The proof is negligence, not a mistake. You can make a mistake and still not be negligent in your practice. You are correct....that standard of care will likely control.

 

[oldestguy]

This case has many ramifications that further show his good intentions may well ruin it for the engineer unless he follows the precautions noted. While we may think things are unfair, such as using "deep pockets" for paying the claim, that's the way things are these days and we had better get used to it. Ethics are fine to have as our goals, but attorneys and money sometimes rule.

 

[RocketRed]

Thanks everyone for the insight thus far. It really has been great to have some perfect stranger's perspectives.

Since the OP I have taken a little action:

Got in the field and verified the information - we indeed had a blow on an invert by a foot. I grilled the field crew mercilessly and it was just a garden variety screw up. A mis-read of the rod, and entered into the field notes. I can't even try to be mad at them, they have really been great employees and made me a lot of money. Otherwise the survey on this project was really nicely done.

All other site information was accurate.

I called my insurance co and they told me to just forward a narrative at this time, and keep them up to date. They will have an adjuster call me as needed. You all were right on this, I needed to have this noted by my insurance co. If the potential claim turned into an actual claim after our next renewal they would drop us and not help.

They told me to feel free to work it out with the owner, and if I did the narrative and notice would not affect our insurance costs if nothing is paid out from them.

I wrote back to the Owner asking for a face to face meeting in his office. After reviewing the engineering closely it is apparent that the major cost/schedule item that they are claiming we caused is not the invert issue but location of a force main. We simply followed a locating companies marks for it, and the locates were wrong. Our depiction of all surface items is exactly right.

I will keep you all up to date as the saga unfolds.

Truly I have appreciated everyone's input.

 

[beej67]

I never throw the surveyor under the bus unless he missed some shots under there that I need.

Hydrology, Drainage Analysis, Flood Studies, and Complex Stormwater Litigation for Atlanta and the South East -

http://www.campbellcivil.com

 

[RocketRed]

beej67 it is funny you should say that for a couple reasons 1) my surveyors are out getting topo for a bus barn facility my engineering firm is working on and 2) I also never throw the surveyor under the bus unless the bus is in the way.

I just got a new project in my engineering office for a zero rise analysis. The owner is using their own favorite surveyor, and these guys do shoddy to mediocre work at best. Even worse they are slow, but their prices reflect all of that. Every time we have a project with them we never get enough data, and the extra pick-ups take forever to get. For this project I know they are going to give me an assumed datum and I will have to ask for real datum right off the bat.

But when my client told me it was their favorite guy, I didn't say anything except "Yes, we have worked with them before it has always gone great" which is partly true, it was just slow and a pain in the rear on our end. When this project gets bogged down waiting for the pick ups, I am not going to say anything worse than "We are at a bit of a stand still, while surveyor gets this or that done, but I will gladly check in and let them know we are in a hurry for the data".


The other point in this thread is my asking the crowd. How do you handle it when another professional on the team makes a mistake? What is the correct response for the owner?