Published In October 2001
The electrical contractors I know are intelligent, honest, and intent on doing a good job. These traits are significant and worthy of respect. But, by themselves, they will not protect you from “ailments” that are endemic to the profession. One such ailment is “concession.” Loosely translated, it means that when a problem arises, you want to avoid conflict. You would prefer to concede (compromise, trade-off, walk away), rather than protect your financial position and enforce your legal rights. This “bug” tends to reappear in almost predictable ways, typically toward the beginning and the end of a project. This article discusses “concession” and other bugs, and suggests nonpharmaceutical cures for each ailment. The “foreman’s lament” bug The job is big, but not large enough to justify having a full-time project manager. So, you assign a foreman who is experienced, knowledgeable, and reliable. He has run similar jobs for you before. Then the foundation pours are late, the electrical drawings are incomplete and defective, and the bricklayers are in the way. Your foreman calls home, but you are busy with other matters and do not give him your full attention. The ailment: The foreman documents his frustrations and complaints into a journal, includes names, and sometimes blames his workers and your own home office staff. These diary entries are killers when a contract dispute goes to trial. The anti-depressant cure: Foreman training is critical not only for health and safety issues, but also for keeping job records. Supervisory personnel should be instructed to keep meaningful daily reports, job foreman logs, and other periodic data. Of equal importance, these documents should be kept both in the field and in the home office for review. The “mea culpa distress” bug You’ve got an overrun on labor. The general contractor is doing little to coordinate the subcontractors, and the original planned sequences have gone south. The losses have reached such a point that the president of your company is now involved. Review the documents? Of course not! An hour or so prior to the meeting, the president meets with the general foreman on the claims with the general contractor’s representative. The president thinks: “I can’t go into the meeting and say that the contract has been breached. That’s too aggressive. I can’t say the schedule has been abandoned. That’s too confrontational. What I will say is that both of us have made mistakes, no one’s perfect, and we could have done better, but we need more money.” The be-straightforward cure: Modern contracts contain various notice requirements, all of which have legal ramifications. For example, failure of “notice” can act as a waiver of requests for extras. Even so, contractors are hesitant to use the clauses required by the owner for fear of seeming contentious. A notice letter does not need to be accusatory; it needs to be factual. “Just the facts” should be your rule. Statements in the notice letter criticizing your own company are unnecessary. The owner may interpret your honesty as an admission of fault. The “Meeting Minutes” infection Each week, the construction manager holds a coordination meeting. Every subcontractor presses their concerns, plans, and need for information. All this is very typical. The CM, however, puts his own judgment on who is late, who needs more manpower, and who needs to coordinate better with other contractors into the Minutes, which are then typed and distributed. You had problems that were not discussed at the meeting, and issues that were discussed do not appear in the Minutes. Later, when there is a claim, the Minutes do not help you. There is no confirmed written “notice” of delays, extra work, or interferences. Worse, the Minutes make it appear that your company caused the problems. The antibodies in the Minutes cure: Weekly Meeting Minutes are kept, among other reasons, to confirm job status, track problem areas, confirm agreements, and assist in scheduling. All of these are good reasons to ensure that they are accurate. If you do not correct misstatements at the meeting, then follow up with a corrective addendum to the Minutes. Better yet, bring your own written agenda to the meeting and ask that it be added to the record. The “unnoticed schedule modification” disorder Picture a new prison. The general contractor produces an original CPM schedule showing an 18-month completion schedule. Occasionally, during the project, revised schedules in the form of CPMs and bar charts are issued. What your foreman did not see is that milestone dates are being changed, references to other activities are being altered, and even the completion date is being moved. All of this is happening without a written order regarding time extensions, suspensions of work, resequencing, etc. Maybe these changes are a result of negotiations between the general contractor and the owner. It is important that you did not catch what was going on. As the job is nearing completion, the general contractor starts sending you letters saying you are not keeping up with the “agreed” modified schedule, and that you will be held liable for liquidated damages. The Visine solution cure: Keep your eyes open! Even though your contract states that only certain named supervisors have the authority to change the agreement (time or money), your field representative may, by his actions, modify that provision. A regular schedule review is a practical necessity that should not be ignored. The “concession” ailment This is the “bug” you give yourself. Although you may think you have acquired the illness from your customer, you are the one who actually created the ailment. If you don’t confront a problem—whether it is with the work quality, the customer’s unreasonable expectations or demands, delay caused by others, or anything else—you give in immediately. The steady heartbeat cure: “The customer is always right” should not be used as an excuse to avoid dealing with problems. The cure is to be assertive. Assertiveness does not require that you be aggressive or demanding. Instead, you need to detach your emotions from the problem, analyze how the problem arose, and then list and rank the available solutions. The healthy contractor You may need a construction attorney’s help to evaluate the harm and identify the preferable remedies. Do not hesitate to investigate the merits of your position alone or with the aid of others. Get into the habit of reasoning through problem situations and devising solutions. For the best results, use healthy, successful conflict resolution methods. Have you contracted or fought off any bugs? If so, please send me a note by fax at (202) 232-1334 or e-mail. This information may be useful in a follow-up article. ITTIG, of Ittig & Ittig, P.C., in Washington D.C., specializes in construction law. He can be contacted at (202) 387-5508, e-mail: USBuildlaw@aol.com, or his Web site, www.ittig-ittig.com.