Choose the Right Partner for the Project
The first, and most significant, factor to consider when evaluating the risks on a design-build project is choosing the right partner. There are several important considerations when deciding who to partner with on a design-build project:
Checklist for Evaluating Potential Design Build Partner
- What prior experience do you have with your potential design-build partner?
- What prior experience does your potential design-build partner have with design-build projects?
- Will you be able to effectively communicate with your design-build partner and will your design-build partner be receptive to your concerns?
As the design-build team is responsible for both design and construction of the project, prudent risk management requires design professionals to understand who their partner is, how their partner operates on a construction project, whether their partner understands the collaborative nature of a successful design-build team, and how their partner communicates.
When choosing a design-build partner, the design professional should consider teaming with a contractor with whom it has prior positive experience. The Design Build Institute of America (“DBIA”) advises that one commonality of the worst performing design-build projects is “limited or no prior team experience” between the contractor and the design professional. A design professional should consider both their previous experience with the contractor as a firm and with the contractor’s employees who will be working on the design-build project. While it is important to know the contractor’s firm-wide values and practices, it is equally important to know how the contractor’s employees, whom the design professional will be dealing with on a daily basis, interact on a construction project. A design professional’s previous experience with the contractor’s “A-team” may not be reflective of how the contractor’s “B-team” assigned to the design-build project will act as a partner.
A design professional’s experience with a potential partner on traditional design-bid-build projects should inform your expectations on a design-build project. How did your potential partner handle RFIs and proposed change orders on traditional design-bid-build projects on which you worked? Were your potential partner’s RFI’s and proposed change orders reasonable? Did your potential partner review and vet subcontractor RFI’s and change orders before passing them along or simply “rubber stamp” everything? Did your potential partner interact and communicate effectively with you and with its subcontractors? The way in which your potential partner communicated with its subcontractors is how you should anticipate being treated as a part of a design-build team.
The design professional should also consider its potential design-build partner’s experience with design-build procurement when deciding whether to partner. A DBIA “best practice” for delivery of design-build projects is that “[a]ll design-build team members should be educated and trained in the design-build process, and be knowledgeable of the differences between design-build and other delivery systems.” For the design professional, being educated and trained in the design-build process entails understanding how to communicate effectively and collaboratively to prepare a design in accordance with the standard of care in the time-frame and within the budgetary constraints established for the project.
For the contractor with no, or limited, design-build experience, being educated and trained in the design-build process, and understanding the differences between design-build and other delivery systems, starts with a discussion regarding the standard of care for design services. Contractors are used to guaranteeing and warranting their work. Contractors, familiar with the Spearin doctrine, are used to owners impliedly warranting the suitability of the design documents for the project. Contractors may be surprised that the design professional does not provide a similar warranty to the owner, but instead agrees to use professional judgment to prepare the design documents in accordance with the standard of care.
Finally, the prudent design professional recognizes that—just as on any project—excellent communication with its partner is critical to a successful design-build project. Communication begins when discussing how various risks will be allocated between and among the parties before agreeing to partner for a design-build project. If the parties fail to communicate regarding how risk will be allocated between and among the parties early on, finding the discussions uncomfortable, then it may create issues down the road when issues arise. If the design documents are not perfect, many contractors with limited design-build experience view the design professional as “just another subcontractor” and look to their design professional to pay for the entire cost of all errors or omissions, withholding payment for the costs associated with overcoming the design issue. More experienced design-build contractors recognize that there may be errors or omissions in a design, but accept that risk because the construction cost savings realized through a collaborative relationship with the design professional, over time, outweighs the risk of design-related issues.Experienced design-build partners understand that the “[i]ndividuals not only need to be competent in their specific areas of responsibility, but they also must understand the design-build process and that success is directly depending upon the ability of the entire team to work together collaboratively.” If the design professional chooses a design-build partner with whom it is able to effectively communicate, then this will be a good first-step in managing the risks associated with design-build project.
 “Fundamentals of Project Delivery” dated 2011, Design Build Institute of America, http://www.dbia.org/resource-center/Documents/cii_penn_state_study.pdf, last accessed February 5, 2016 (identifying “contractor’s…experience with project delivery system,” “excellent team communication,” and “prior experience of team as a unit” as contributing factors for success on a design-build project).
 “Design-Build Done Right: Best Design-Build Practices” dated August 19, 2013, Design Build Institute of America, p. 8, http://www.dbia.org/resource-center/Documents/bestpractices130819.pdf, last accessed February 5, 2016.
 “The Spearin doctrine’s roots and name come from a 1918 United States Supreme Court decision, United States v. Spearin, 248 U.S. 132 (1918), which held that a contractor will not be liable to an owner for loss or damage that results solely from defects in the plan, design, or specifications provided to the contractor. Effectively, Spearin created a doctrine whereby the owner impliedly warrants that the plans and specifications, if followed, will result in a functioning system. Spearin holds that if a contractor is required to build according to plans and specifications prepared by the owner (or the owner’s representative), then the contractor will not be responsible for the consequences of defects in the plan.” Wally Zimolong, “The Spearin Doctrine as a Defense to Defective Workmanship Claims,” dated April 11, 2012, http://apps.americanbar.org/litigation/committees/construction/email/spring2012/spring2012-0402-spearin-doctrine-defense-defective-workmanship-claims.html, last accessed February 5, 2016.
 “Design-Build Done Right: Best Design-Build Practices” dated August 19, 2013, Build Institute of America, p. 8, http://www.dbia.org/resource-center/Documents/bestpractices130819.pdf, last accessed February 5, 2016.