Inside this Issue

Federal Government Tightens Integrity Reporting Requirements for Federal Contractors

By Douglas M. Marrano, Esq.

Pursuant to recently enacted regulations requiring integrity reporting, architects and engineers doing business with the federal government will have to be more vigilant in identifying and reporting potential evidence of criminal conduct, violations of the civil False Claims Act, or significant overpayment of government contracts. This amendment tightens an already strict set of Federal Acquisition Regulations (“FARs”) requiring greater integrity in companies doing business with the federal government.

Limitation of Liability Provisions in Arizona: Enforceable and Distinguishable from Indemnity Provisions and the Assumption of Risk Defense

By Marisa M. Skoglind, Esq.

Limitation of liability provisions are an important tool for design professionals in that they allow a party to contractually limit its potential exposure to an agreed upon amount. While limitation of liability provisions place a ceiling on potential damages, indemnity provisions essentially have an exculpatory effect of relieving one party of the cost of liability that it would otherwise have to bear. The enforceability of both limitation of liability and indemnity provisions is treated differently on a state-by-state basis. As discussed below, while some states have enacted statutes to bar such provisions, others deem them enforceable because they are in the best interests of the bargaining parties.

An Expert Cannot Rely on an Engineer’s Code of Ethics in Establishing Standard of Care in North Carolina

By Sa’adiyah Masoud, Esq.

The North Carolina Court of Appeals recently decided that a plaintiff’s expert could not rely upon an engineering code of ethics in establishing the standard of care applicable to professional engineers. In other words, an engineer’s code of ethics was not a sufficiently reliable method to prove standard of care and, therefore, was not an appropriate area for expert testimony. In North Carolina, as in most states, to establish a claim of professional negligence against an engineer, the plaintiff must show that the engineer’s services did not conform to a so-called professional standard of care. Ordinarily, this requires expert testimony, unless the subject can be evaluated through the common knowledge and experience of a jury. In those cases requiring expert testimony, if a court does not accept the expert’s testimony regarding an engineer’s standard of care, the plaintiff will not be able to support its negligence claim against the engineer.

Texas Case Reviews Power of Discovery Rule

By Samuel R. Pierce, Esq.

In Kizer v. Meyer, Lytton, Alen & Whitaker, Inc., 228 S.W.3d 384 (Tex. App. 2007), Texas’s intermediate appellate court, The Court of Appeals of Texas, recently held that the full extent of damages or claims need not be known by a plaintiff to start the running of the statute of limitations. This holding places a burden on plaintiffs to investigate more fully any damages sustained and provides an opinion helpful to defendant design professionals.

Minimizing Risks Associated with Construction Cost Estimates

By David M. Ponte, P.E., DH Consulting Group LLC

There are several types of construction cost estimates—preliminary or ballpark estimates, intermediate estimates, Engineer’s estimates (sometimes referred to as the owner’s estimate) and the Contractor’s bid estimate. The appropriate estimate type depends on when, during project development, the estimate is required. Regardless of the estimate type there are associated risks for design professionals involved in preparing an engineer’s estimate of construction costs. This article will review those risks and suitable methods to minimize a design professional’s exposure to those risks.

E-Verify is Alive, Well and Gaining Speed

By Gwen P. Weisberg, Esq.

E-Verify (formerly known as the Basic Pilot/Employment Eligibility Verification Program) is an internet-based system operated by the Department of Homeland Security (“DHS”) in partnership with the Social Security Administration (“SSA”) that allows participating employers to electronically verify the employment eligibility of their newly hired employees. E-Verify allows participating employers to electronically compare employee information taken from the Form I-9 against records in SSA’s and DHS’s databases.

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