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Friday, September 16, 2005 | Construction defects are not always the fault of the contractor.

There are many steps in the development of a project, the contractor being responsible for just one of them. Contractors do not have a magic wand to overcome bad decisions and inadequate design provided by others in the system.

To fully understand this issue, one must have a basic understanding of the “building scenario” and the role of the various participants in the construction process.

The way it works, or at least should work, is as follows:

In the first stage, the developer will obtain a parcel of land he wishes to develop. The developer then hires an architect to perform the design of the building. It is the architect’s responsibility to produce a comprehensive set of plans and specifications, conforming to all building codes, regulations, ordinances and depicting every element of the project that is to be built.

The architect will hire structural engineers, electrical engineers, mechanical engineers and other licensed professionals to aid in the design of the building.

The end product of the planning stage is a set of plans and specifications that become the instrument of communication to the construction team as to what to do, where to do it and what to do it with.

These plans and specifications are submitted to the city’s Building Department for review and a building permit.

The developer then hires a general contractor to perform the actual construction work. The physical construction activities are generally performed by “specialty contractors,” who have expertise in various aspects of the industry, i.e. electrical, mechanical, plumbing, etc. and perform the work under subcontract agreements with the general contractor, who coordinates and supervises the work. The general contractor is also responsible for quality control, project security and myriad other project management responsibilities.

In every contract between the general contractor and the developer and the subcontract agreements between the general contractor and the subcontractors, there is always a certain clause: “Perform all work per plans and specifications.” This clause presumes that all the information needed to properly execute the work will be found in those plans and specifications and, if followed, will lead to a successful project.

This description is an oversimplification of the building scenario, but it describes how the system is basically supposed to function.

In reality, things rarely work out that way.

Building and marketing condominiums is a highly competitive industry. This means developers desire to produce their product for the least cost possible. From the perspective of the construction team, this works against the issue of quality construction.

In the beginning of the process, architects compete for a chance to design the project for the developer by submitting a cost for the design. The cheapest cost, of course, gets the work.

Most developers want only enough design performed to obtain a building permit, which is seldom enough design to build from, let alone ensure quality construction.

These plans are referred to as a “merchant set of drawings.” The city requires only enough information to compare the design to the building code, seismic requirements, life safety requirements and basic building elements. The city does not have a responsibility to, and so does not, evaluate the quality of products incorporated into the project.

It is, therefore, a common misconception that the city performs comprehensive quality control inspections and overview of projects.

The city’s basic responsibility merely involves safety and conformance to building codes. For example, the city checks whether an entry door and frame to a unit meets the fire code. City inspectors do not review if the door is a decent quality door and frame or a cheap door and frame.

The result is that the construction team is handed a set of plans and specifications that have been permitted but that are not comprehensive. These plans often lack many intricate details, are not coordinated and are not adequate for their intended purpose – that of guiding construction.

Another factor complicating the building scenario is a largely unskilled workforce.

There is a huge lack of trained and skilled craftsman in the construction industry today. The industry’s workforce these days is largely made up of “day workers.” These folks have replaced highly trained craftsman of yesteryear and are, for the most part, untrained and unskilled. Many of them are unable to communicate in English.

While there are still union-trained workmen and trained workmen from several quality training programs within industry associations, those programs are barely able to keep up with the training of enough people to supervise crews of untrained workers.

Today’s building products are often very technical, require careful handling, mixing and applications and will not perform if even one element of installation is not exactly right. Unskilled workmen using highly technical building products can have disastrous results.

Often, the developer has a preconceived cost in mind for the project and if the overall anticipated cost exceeds that theoretical cost, changes begin to occur that more often than not degrade the quality of some or many parts of the project. This is obviously counterproductive to the overall end quality of the project.

In contract negotiations between the developer and the general contractor, it is almost always the quality control function that is cut out of the project to save money. This often leaves the general contractor with the responsibility and risk but without any money in the job for quality control people. It is false economy on the grandest scale.

When viewed in total, it is an overwhelming concept for a general contractor.

For many years, regulations have piled up, one on top of another, often redundant in nature and many unnecessary. This all adds to the ultimate cost of the product being produced.

This ultimately leads to projects that have inherent deficiencies, that do not meet the buyer’s expectations or published quality. The result of that is often litigation.

Most people do not understand the nature of construction defect litigation. There are almost always some legitimate issues involved and many that are frivolous. More often than not, if one were to read an actual complaint filed against a builder, one would think the building is totally unsafe to live in and is about to collapse. They would also probably think it was a willful act on the part of the builder to make it that way.

The manner in which much of the litigation is conducted amounts to legal extortion in many cases, and has served to drive many of the nation’s building insurance companies out of California.

Most builders are unable to obtain insurance these days if their work includes residential work of any type, particularly if it includes a homeowners’ association. However, I will defer comment on the complexities of the insurance industry to those more informed on the subject.

The industry needs to pay much more attention to quality control to overcome these deficiencies. The city, or county, or whomever the permit agency is, simply does not provide intimate inspection services.

Developers should insist on quality design documents. Most architects are capable and willing to provide these, if their client is willing to pay for the services.

Developers should evaluate the services they are purchasing from a general contractor.

The lowest price may not include valuable services required to produce the project he has in mind, and he should assure himself that all necessary components and competence are included in the contractor’s cost.

Third party inspections and peer reviews of various aspects of the project should also be performed. These services are available from several sources and, again, should be made part of the overall project scenario.

Pre-qualification of specialty contractors should be incorporated into the building process. Only those subcontractors with proven track records and known competence should be permitted to become involved in the process.

Above all, quality should be the word of the day.

It is one thing to showcase a product in a shiny brochure, touting its quality and elegance, but the final product should include everything required to meet the buyer’s expectations.

Until this becomes standard practice, construction defect litigation will thrive, insurance companies will be further alienated and there will be fewer players in residential construction.

Until the system changes, therefore, litigation will continue and there will be continuing problems with less than quality construction on some projects.

John Elliott is executive vice president of Roel Construction Co. Inc. He has worked in the construction industry for 43 years. He can be contacted at

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