Here's a question which doesn't come up to often, but any input would be appreciated. I'm working a large residential project. It involves 3,000 SF cottage, and 14,000 SF main dwelling.
The owner recently decided to step away from using a qualified GC based purely on the fees associated with the work. (In our area, it's a minimum of 10% for profit and overhead.) ...So the owner hires a "project manager" with limited understanding of house construction, who is taking the construction docs, and sending them out to bid with the various trades and local vendors. The part where it gets scary is that the owner and his PM intend to hire their own "site supervisor" who will supposedly manage the project from a job site trailer.
Would you run for the hills before this train wreck leaves the station, or get some kind of bullet proof limit of liability letter from your attorney? It's a really nice project, but the circumstances seem awfully sketchy.
Do get the limitation of liability, (you should try get those on EVERY project) and wait and see.
The owner may realize the error of their ways at some point and bring in a GC.
On the other hand, it's not uncommon in my town for high-end homeowners to take on the GC role. They are usually retired or housewives and thus have the time to spend on assuming the GC role. Some of them are good at it, some are not.
It could go either way. If this person has been a good client so far it's possible s/he will continue to heed your advice and that of the PM throughout the process. Definitely get the super duper liability. It sounds worth a chance if you like the project. Plenty of experienced but shitty contractors out there, who's to say how this person will act once things get rolling.
To answer a few questions - I have worked for this client before. He's a nice guy but can be cheap as hell. The typical NYC multi-millionaire. Fighting people over ten dollars is literally sport for them ...So he decides to hire a friend's PM which might better be described as an "owner's rep". This guy has experience in very high end New York City town houses, but knows only enough to be dangerous when it comes to house construction.
The idea of trolling the local lumber yard to hire some flunky - to sit in a trailer and drink coffee all day - whose job is to report back on whether or not the trades have shown up. This has to be the stupidest thing ever.
Granted the GC fee would have been in the range of 1.5M (for a 14 million dollar project), but this still sounds scary. Without the presence of a GC,when shit goes wrong as it always does, all fingers will point to who knew best, and I've worked on well over 200 houses in my 30 year career.
Thank you all.
...I do like the suggestion of RTF Away.. lol. That was my first instinct.
...or without jumping ship, there must be a way to draft bullet proof limited liability clause. Between the questionable site manager, and God knows who shows up with a 7-11 coffee cup, this whole thing is a bit unsettling to say the least.
...this whole thing is like going to the walk-in-medical clinic and asking if they can do a little brain surgery, because the Mayo Clinic is too pricey.
Dec 18, 17 1:48 pm ·
·
Non Sequitur
Instead of pure white, can we substitute it with beige?
Document the shit out if everything. Every phone call, email, text, site visit. Not that it will protect you but it will help when you have to defend yourself.
A$$holes with money think they know everything, and basically there is no way to convince them otherwise. Because they have money. When shit happens it is always somebody else's fault. You're in line whether you know it or not.
Placing non-professionals in positions of power on a complex, expensive project is a guarantee of disaster. Kickbacks, buck-passing, blame games, blatant self-interest, etc. are the norm. In the end it will be a crap project that cost more and took longer than if the best builder used the most expensive subs. 10% is a very reasonable construction fee for this kind of work.
If you have to take it on plan on writing a book about it afterwards. Take copious personal notes for reference. The experience will likely be the basis for a screenplay that blows Mr. Blandings Builds His Dream House right out of the water.
...Thanks Miles. Lol Those are some priceless words of advise. ...How very true that the richer they are, the dumber everyone else is. Money sure has a way of clouding one's judgement. It's like putting Miracle Growth on someone's ability to go from minor asshat, to the greatest one of all times.
Aside from all the potential building flaws (w/o a GC), architects should also be concerned about the third party lawsuits. Our regional work force is primarily comprised of most immigrant workers.
There are horror stories where these sneaky bastards drive their injured friends and relatives to the site with a broken limb, and then say that they had a "work related" accident. Everyone gets a love note from a lawyer a few days later. You can't make this stuff up!
Dec 18, 17 2:35 pm ·
·
shellarchitect
"the richer they are, the dumber everyone else is."
awesome
Others have touched on some of this...I went through a similar situation, but w/ about 1/10th the budget.
I would:
Write a letter/e-mail laying out the possible pitfalls of this approach.
Require the owner to write me a letter saying that they're solely responsible for any cost increases, schedule delays, etc. that may result from not having a qualified GC.
Require that any work needed of your office due to poor project management, problems with subs, etc. are additional services, to be paid at $X an hour.
If I didn't get items 2 and 3, I'd likely walk. And when everything goes to s**t, I'd pull out that letter and say "I told you so," you should have listened to me.
One of my biggest worries would be that an experienced GC is going to have an ongoing relationship with their subs. And fabricators etc. in the area who they might not have worked with will likely be motivated to do a good job because they want to be the GC's stair fabricator for their next 20 projects. With the owner on their own, subs/fabricators have no incentive to keep to schedule/price, as the project's a one off. So when they have to be in 3 places at once, they'll go to the 2 projects with GC's who can bring them more work in the future, and leave your guys project unmanned.
For CA services, I recommend setting out how many hours are included as part of your basic services. If you exceed that number of hours, it's add'l services. Otherwise you'll get into arguments with your client over whether particular CA hours were needed to to poor management of the job, or something else.
For my project, it was tough - lots of arguments between construction manager, owner, and us - but we stuck it out. Construction took a year instead of 6 months, and we billed almost as much in add'l services as our whole base fee because we had to be on site all the time to prevent/fix problems.
Thank you jcarch. Great advise. I really appreciate the detailed reply. You are so right about having a team in place. There's always a really nice synergy and efficient flow to the work, particularly when everyone knows each other.
Quite frankly, if the roof leaks, or the siding starts coming apart, the owner would rectify those issues on his own dime, without question. Foolishness is one thing - being mean spirited is another.
At the end of the day his primary objective is in saving roughly a million dollars in GC fees. Hiring his own motley crew for construction administration could be likened to having a very hefty line item for errors and omissions. ...As arrogant as the type A's can be, they do understand risk to a certain degree - but the majority of them are not so likeable as Miles pointed out.
The biggest concern on any project is the liability factor, and in being protected from the potential of third party lawsuits. We have an excellent structural engineer, so all should go well, assuming that the pilings, steel and framing are executed correctly. But what if someone gets injured? The blame invariably will be passed onto the one with either the deepest pockets, or the folks with the most experience. Spending time in court sounds like a nightmare.
All this to say...you guys have been great. I am a sole practitioner, and my only moral support are my dogs. The Mrs.does not need or want to hear about any of this B/S. as null pointer suggested...Run TF Away has been on my mind for the past week, but I may stick this one out - only if the correct legal duct tape is placed into a revised contract.
David Curtis: "little pink houses for you and me". ...Those were the days. Why doesn't anyone want a farm house anymore?!
We all know the - I'm smarter than everyone else - type.
99% of the time, they're dead wrong, but you'll never get them to admit it. There's danger there because when things go wrong, it couldn't have been them who screwed up, so it must be some else, like their architect.
1% of the time they're actually a Steve Jobs type. I have yet to have that be the case though.
Dec 18, 17 4:35 pm ·
·
shellarchitect
how could they be smarter than everyone else when they are not an architect? seems pretty clear to me
To add to jcarch's excellent advice, do all CA on time + expenses billed bi-weekly at a serious hourly rate. This will keep you out of a deep hole when Mr. Big Wad decides not to pay you. Which he probably will when the project goes south.
As to liability the only escape is not to do the project. Standard language "Architect not responsible for acts of omissions of the contractor ..." is meaningless because in a real lawsuit everyone gets named and you have to sort it out with lawyers. Which pretty much means that even if you win you lose.
If it was me I'd politely decline the work because "it's not in the client's best interest". He's doing you a favor by tripping on his dick at the beginning of the project rather than halfway in.
I've had a few projects in the past where the owner decides this after getting bids. It's been a train wreck every time and a time sink for me. My contact now states that If the owner decides to be his own contractor my services will not continue into construction. Not worth it. Also, when the dummy doesn't know how to do something he will be ringing you non-stop for everything from where do your get this, to how do you do that. FOH
...I was looking for an AIA contract which might limit the services to design only, but they don't seem to have such a thing. The B101-2017 has wording which drags the architect into site visits to periodically review the work - even though they have that very nice follow up provision stating that the architect is not responsible for any errors or omissions by the contractor or his sub-contractors. Any attorney worth their salt would do their best to argue their way around this. That's why an LOL (limit of liability clause) should be placed in every contract, no matter how small the project is.
"If it was me I'd politely decline the work because "it's not in the
client's best interest". He's doing you a favor by tripping on his dick at the beginning of the project rather than halfway in."
Excellent advice Miles. One note on the second comment...This may be a physical impossibility in that most of the 1%-ers have needle dicks, and that's why they can be so incredibly difficult.
Final decision... I am not boarding the crazy train before it leaves the station. Period. As much as this seems like a great opportunity, this thing has all the earmarks of headaches waiting to happen. As of now, I refuse to meet with the owner's rep. order to vet any of the knuckle heads that he's trolling for at the lumber yard. This only creates potential implication (for me) for when the farking house falls down after it gets hammered by its first hurricane.
My father said you have a choice - you can eat or you can sleep. Sometimes it's not an easy choice to make. I walked away from a guy who owned 7 high rises in Manhattan after three rounds of design when he unilaterally decided to "adjust" my fee. I really couldn't afford to lose the job but the alternative was losing my mind. I was having chest pain from the stress. A paycheck can cost far more than it's worth. Since then it's simple, I have a zero tolerance policy for bullshit and assholes.
The fact that the guy is a know it all cheapskate whose hobby is fighting about meaningless sums of money should tell you everything you need to know. He'll make all the decisions and then blame you when they don't turn out well. It's a time sink and you won't get paid, but probably will get sued if anything goes wrong, which it probably will. Too many red flags.
You didn't say what he does for a living. If he's a lawyer, run twice as fast.
You said the PM doesn't have much residential experience - but what is his experience in? And same question for the "site manager".
If the PM has construction experience, even if not residential, and if the site manager is experienced enough to be an effective clerk of the works, then it could work out to be a pretty normal project.
I've worked on Owner-GC projects that went fine, and others that didn't. The common denominator on the ones that went bad wasn't owner's inexperience - it was owner's stinginess and stubborness. Inexperienced owners who are open-minded, willing to bring in experienced help, and willing/able to spend what quality costs can pull this off.
Looking at this from the initial perspective, the bottom line is that the situation certainly has the earmarks of trouble written over it. On the other hand, I have worked with the owner before, and knew what I was getting into - to some degree. The decision to not hire a GC is where the surprise came from. That said, the owner is not malicious, albeit he knows how to split a nickel in two if it came down to it. (He deals with very high end commercial real estate, and being frugal just seems to be the nature of the game).
His last house was also large. And he approached it with the same mindset was also in place....meaning build the project as cost effectively as possible. Unfortunately, he went with an young up and coming GC with little experience, and there were indeed issues a year late. ...Although it very well could have easily been lawsuit time - rather than taking action, he made the contractor fix the leaky doors and windows which was no small task.
All this to say, that the concern of being trounced upon by a lawyer when things go wrong is not a paramount issue, but it is something to think about. Third party suits are always a possibility. ...I will definitely keep an open mind, but only with an excellent contract in place. Ideally we shouldn't live in fear of our work, but there comes a time when being naive and trusting can lead you down the wrong path, and that's why every good architect should take time to have a kick ass attorney review their agreements.
We all remember our early years, and the excitement that came with it. On a positive note, I still try to keep that outlook, but with age comes experience, and there comes a time when you figure out that this profession has a slightly dark side to it. - Miles, your father had given excellent advise. Money isn't everything.
Thank you again guys. The comments are greatly appreciated, and I'm very glad to have stumbled across this forum.
Seems like a shit situation, but I have worked with GCs that have useless supers as well. If they hire somebody that can truly manage the project who cares if they are under a GC operation or not...
Owner wants to be the GC :(
Here's a question which doesn't come up to often, but any input would be appreciated. I'm working a large residential project. It involves 3,000 SF cottage, and 14,000 SF main dwelling.
The owner recently decided to step away from using a qualified GC based purely on the fees associated with the work. (In our area, it's a minimum of 10% for profit and overhead.) ...So the owner hires a "project manager" with limited understanding of house construction, who is taking the construction docs, and sending them out to bid with the various trades and local vendors. The part where it gets scary is that the owner and his PM intend to hire their own "site supervisor" who will supposedly manage the project from a job site trailer.
Would you run for the hills before this train wreck leaves the station, or get some kind of bullet proof limit of liability letter from your attorney? It's a really nice project, but the circumstances seem awfully sketchy.
Do get the limitation of liability, (you should try get those on EVERY project) and wait and see.
The owner may realize the error of their ways at some point and bring in a GC.
On the other hand, it's not uncommon in my town for high-end homeowners to take on the GC role. They are usually retired or housewives and thus have the time to spend on assuming the GC role. Some of them are good at it, some are not.
RUN THE FUCK AWAY
is this really a big enough to hire a site supervisor? I don't see how they are saving any money.
I'd stick around but tell them that you plan on saying "I told you so"
maybe I don't understand, he is hiring a PM and a site superintendent instead of a GC?
haha, been there, done that. set up a camera and enjoy for years to come. slow-motion train wrecks can be fun. depending on your level of masochism.
To answer a few questions - I have worked for this client before. He's a nice guy but can be cheap as hell. The typical NYC multi-millionaire. Fighting people over ten dollars is literally sport for them ...So he decides to hire a friend's PM which might better be described as an "owner's rep". This guy has experience in very high end New York City town houses, but knows only enough to be dangerous when it comes to house construction.
The idea of trolling the local lumber yard to hire some flunky - to sit in a trailer and drink coffee all day - whose job is to report back on whether or not the trades have shown up. This has to be the stupidest thing ever.
Granted the GC fee would have been in the range of 1.5M (for a 14 million dollar project), but this still sounds scary. Without the presence of a GC,when shit goes wrong as it always does, all fingers will point to who knew best, and I've worked on well over 200 houses in my 30 year career.
Thank you all.
...I do like the suggestion of RTF Away.. lol. That was my first instinct.
...or without jumping ship, there must be a way to draft bullet proof limited liability clause. Between the questionable site manager, and God knows who shows up with a 7-11 coffee cup, this whole thing is a bit unsettling to say the least.
14 MILLION? yeah that's a big train wreck, lol
It's an ultra modern with tons of glass.
...this whole thing is like going to the walk-in-medical clinic and asking if they can do a little brain surgery, because the Mayo Clinic is too pricey.
Instead of pure white, can we substitute it with beige?
when he starts seeing the sub standard work and over the budget invoices, he will understand.
Document the shit out if everything. Every phone call, email, text, site visit. Not that it will protect you but it will help when you have to defend yourself.
A$$holes with money think they know everything, and basically there is no way to convince them otherwise. Because they have money. When shit happens it is always somebody else's fault. You're in line whether you know it or not.
Placing non-professionals in positions of power on a complex, expensive project is a guarantee of disaster. Kickbacks, buck-passing, blame games, blatant self-interest, etc. are the norm. In the end it will be a crap project that cost more and took longer than if the best builder used the most expensive subs. 10% is a very reasonable construction fee for this kind of work.
If you have to take it on plan on writing a book about it afterwards. Take copious personal notes for reference. The experience will likely be the basis for a screenplay that blows Mr. Blandings Builds His Dream House right out of the water.
...Thanks Miles. Lol Those are some priceless words of advise. ...How very true that the richer they are, the dumber everyone else is. Money sure has a way of clouding one's judgement. It's like putting Miracle Growth on someone's ability to go from minor asshat, to the greatest one of all times.
Aside from all the potential building flaws (w/o a GC), architects should also be concerned about the third party lawsuits. Our regional work force is primarily comprised of most immigrant workers.
There are horror stories where these sneaky bastards drive their injured friends and relatives to the site with a broken limb, and then say that they had a "work related" accident. Everyone gets a love note from a lawyer a few days later. You can't make this stuff up!
"the richer they are, the dumber everyone else is." awesome
Others have touched on some of this...I went through a similar situation, but w/ about 1/10th the budget.
I would:
If I didn't get items 2 and 3, I'd likely walk. And when everything goes to s**t, I'd pull out that letter and say "I told you so," you should have listened to me.
One of my biggest worries would be that an experienced GC is going to have an ongoing relationship with their subs. And fabricators etc. in the area who they might not have worked with will likely be motivated to do a good job because they want to be the GC's stair fabricator for their next 20 projects. With the owner on their own, subs/fabricators have no incentive to keep to schedule/price, as the project's a one off. So when they have to be in 3 places at once, they'll go to the 2 projects with GC's who can bring them more work in the future, and leave your guys project unmanned.
For CA services, I recommend setting out how many hours are included as part of your basic services. If you exceed that number of hours, it's add'l services. Otherwise you'll get into arguments with your client over whether particular CA hours were needed to to poor management of the job, or something else.
For my project, it was tough - lots of arguments between construction manager, owner, and us - but we stuck it out. Construction took a year instead of 6 months, and we billed almost as much in add'l services as our whole base fee because we had to be on site all the time to prevent/fix problems.
Thank you jcarch. Great advise. I really appreciate the detailed reply. You are so right about having a team in place. There's always a really nice synergy and efficient flow to the work, particularly when everyone knows each other.
Quite frankly, if the roof leaks, or the siding starts coming apart, the owner would rectify those issues on his own dime, without question. Foolishness is one thing - being mean spirited is another.
At the end of the day his primary objective is in saving roughly a million dollars in GC fees. Hiring his own motley crew for construction administration could be likened to having a very hefty line item for errors and omissions. ...As arrogant as the type A's can be, they do understand risk to a certain degree - but the majority of them are not so likeable as Miles pointed out.
The biggest concern on any project is the liability factor, and in being protected from the potential of third party lawsuits. We have an excellent structural engineer, so all should go well, assuming that the pilings, steel and framing are executed correctly. But what if someone gets injured? The blame invariably will be passed onto the one with either the deepest pockets, or the folks with the most experience. Spending time in court sounds like a nightmare.
All this to say...you guys have been great. I am a sole practitioner, and my only moral support are my dogs. The Mrs.does not need or want to hear about any of this B/S. as null pointer suggested...Run TF Away has been on my mind for the past week, but I may stick this one out - only if the correct legal duct tape is placed into a revised contract.
David Curtis: "little pink houses for you and me". ...Those were the days. Why doesn't anyone want a farm house anymore?!
We all know the - I'm smarter than everyone else - type.
99% of the time, they're dead wrong, but you'll never get them to admit it. There's danger there because when things go wrong, it couldn't have been them who screwed up, so it must be some else, like their architect.
1% of the time they're actually a Steve Jobs type. I have yet to have that be the case though.
how could they be smarter than everyone else when they are not an architect? seems pretty clear to me
To add to jcarch's excellent advice, do all CA on time + expenses billed bi-weekly at a serious hourly rate. This will keep you out of a deep hole when Mr. Big Wad decides not to pay you. Which he probably will when the project goes south.
As to liability the only escape is not to do the project. Standard language "Architect not responsible for acts of omissions of the contractor ..." is meaningless because in a real lawsuit everyone gets named and you have to sort it out with lawyers. Which pretty much means that even if you win you lose.
If it was me I'd politely decline the work because "it's not in the client's best interest". He's doing you a favor by tripping on his dick at the beginning of the project rather than halfway in.
I've had a few projects in the past where the owner decides this after getting bids. It's been a train wreck every time and a time sink for me. My contact now states that If the owner decides to be his own contractor my services will not continue into construction. Not worth it. Also, when the dummy doesn't know how to do something he will be ringing you non-stop for everything from where do your get this, to how do you do that. FOH
Don't run, just don't show up.
More excellent advice.
...I was looking for an AIA contract which might limit the services to design only, but they don't seem to have such a thing. The B101-2017 has wording which drags the architect into site visits to periodically review the work - even though they have that very nice follow up provision stating that the architect is not responsible for any errors or omissions by the contractor or his sub-contractors. Any attorney worth their salt would do their best to argue their way around this. That's why an LOL (limit of liability clause) should be placed in every contract, no matter how small the project is.
"If it was me I'd politely decline the work because "it's not in the
client's best interest". He's doing you a favor by tripping on his dick
at the beginning of the project rather than halfway in."
Excellent advice Miles. One note on the second comment...This may be a physical impossibility in that most of the 1%-ers have needle dicks, and that's why they can be so incredibly difficult.
Final decision... I am not boarding the crazy train before it
leaves the station. Period. As much as this seems like a great
opportunity, this thing has all the earmarks of headaches waiting to
happen. As of now, I refuse to meet with the owner's rep. order to vet
any of the knuckle heads that he's trolling for at the lumber yard. This
only creates potential implication (for me) for when the farking house
falls down after it gets hammered by its first hurricane.
My father said you have a choice - you can eat or you can sleep. Sometimes it's not an easy choice to make. I walked away from a guy who owned 7 high rises in Manhattan after three rounds of design when he unilaterally decided to "adjust" my fee. I really couldn't afford to lose the job but the alternative was losing my mind. I was having chest pain from the stress. A paycheck can cost far more than it's worth. Since then it's simple, I have a zero tolerance policy for bullshit and assholes.
The fact that the guy is a know it all cheapskate whose hobby is fighting about meaningless sums of money should tell you everything you need to know. He'll make all the decisions and then blame you when they don't turn out well. It's a time sink and you won't get paid, but probably will get sued if anything goes wrong, which it probably will. Too many red flags.
You didn't say what he does for a living. If he's a lawyer, run twice as fast.
You said the PM doesn't have much residential experience - but what is his experience in? And same question for the "site manager".
If the PM has construction experience, even if not residential, and if the site manager is experienced enough to be an effective clerk of the works, then it could work out to be a pretty normal project.
I've worked on Owner-GC projects that went fine, and others that didn't. The common denominator on the ones that went bad wasn't owner's inexperience - it was owner's stinginess and stubborness. Inexperienced owners who are open-minded, willing to bring in experienced help, and willing/able to spend what quality costs can pull this off.
Thank you all again, for the additional insights.
Looking at this from the initial perspective, the bottom line is that the situation certainly has the earmarks of trouble written over it. On the other hand, I have worked with the owner before, and knew what I was getting into - to some degree. The decision to not hire a GC is where the surprise came from. That said, the owner is not malicious, albeit he knows how to split a nickel in two if it came down to it. (He deals with very high end commercial real estate, and being frugal just seems to be the nature of the game).
His last house was also large. And he approached it with the same mindset was also in place....meaning build the project as cost effectively as possible. Unfortunately, he went with an young up and coming GC with little experience, and there were indeed issues a year late. ...Although it very well could have easily been lawsuit time - rather than taking action, he made the contractor fix the leaky doors and windows which was no small task.
All this to say, that the concern of being trounced upon by a lawyer when things go wrong is not a paramount issue, but it is something to think about. Third party suits are always a possibility. ...I will definitely keep an open mind, but only with an excellent contract in place. Ideally we shouldn't live in fear of our work, but there comes a time when being naive and trusting can lead you down the wrong path, and that's why every good architect should take time to have a kick ass attorney review their agreements.
We all remember our early years, and the excitement that came with it. On a positive note, I still try to keep that outlook, but with age comes experience, and there comes a time when you figure out that this profession has a slightly dark side to it. - Miles, your father had given excellent advise. Money isn't everything.
Thank you again guys. The comments are greatly appreciated, and I'm very glad to have stumbled across this forum.
The price of anything is the amount of life you exchange for it. -- Thoreau
Seems like a shit situation, but I have worked with GCs that have useless supers as well. If they hire somebody that can truly manage the project who cares if they are under a GC operation or not...
Wondering what happened to Quick Draw McGraw and this project ...
The owner probably decided that they would design the project as well
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