ce 401 civil engineering seminar professional liabilityjrchee0/ce 401 old (no longer...

CE 401 Civil Engineering Seminar Professional Liability

•Quiz 8- 6 Questions-10 minutes max. •Quiz 7: 2-10, 6.5; 2-10, 6.3 •Review of Anecdotes From Last Week •Importance of Innovation •Tort Reform-Continued from Last Week •Tort Law •Statutes of Limitation and Repose •Dispute Avoidance and Loss Prevention •Next Class, Bring hard copy of Page 213 Tally Sheet


REVIEW OF THE LAW VIA ANECDOTES •Anecdotal Stories illustrate how the system is broke

•Too many lawsuit-filed at the drop of a hat •Lawyers generally get the blame

•Lawyers are not driving this run away Bus •May be on board •But not behind the wheel •Types of calls I get as a lawyer


REVIEW OF THE LAW VIA ANECDOTES


WHAT IS INNOVATION?


WHAT IS INNOVATION? •The process of translating an idea into a good or service that creates value

•Idea must be replicable at an economical cost, •Idea must satisfy a specific need •Idea involves deliberate application of imagination and initiative in deriving greater or different values


WHY IS INNOVATION IMPORTANT TO SOCIETY?


WHY IS INNOVATION IMPORTANT TO SOCIETY? •Improves efficiency and effectiveness


WHY IS INNOVATION IMPORTANT TO SOCIETY? •Improves efficiency and effectiveness •Produces a higher standard of living

WHAT IS THE DOWNSIDE OF INNOVATION?


WHY IS INNOVATION IMPORTANT TO SOCIETY? •Improves efficiency and effectiveness •Produces a higher standard of living

WHAT IS THE DOWNSIDE OF INNOVATION? •The Innovative Idea provides the potential benefits at the risk of failing to work as envisioned •When the innovation fails, innovator often blamed and held responsible for the failure


WHICH SOLUTION CARIES LESS RISK? •OPTION A: The Tried And True Solution that has been replicated dozens of times successfully? •OPTION B: The Innovative Solution that has never been tried, but holds promise for future savings?


WHICH SOLUTION CARIES LESS RISK? •The Tried And True Solution that has been replicated successfully dozens of times? •The Innovative Solution that has never been tried, but holds promise for future savings?

WHAT INCENTIVE DOES AN ENGINEER HAVE TO TRY THE INNOVATIVE SOLUTION?


WHICH SOLUTION CARIES LESS RISK? •The Tried And True Solution that has been replicated dozens of times successfully? •The Innovative Solution that has never been tried, but holds promise for future savings?

WHAT INCENTIVE DOES AN ENGINEER HAVE TO TRY AN INNOVATIVE SOLUTION?

•When Potential For Gain Innovation Provides outweighs the Risk of Trying to do it.


HOW DOES THIS BROKEN LEGAL SYSTEM AFFECT INNOVATION?

•Is a Designer More or Less Likely to Attempt Innovation if he is almost certain to be sued if the innovation does not exceed the client’s expectations?


HOW DOES THIS BROKEN LEGAL SYSTEM AFFECT INNOVATION?

•Is a Designer More or Less Likely to Attempt Innovation why he is almost certain to be sued if the innovation does not exceed the client’s expectations?

•Engineers are discouraged from this type of risk taking •Rewards generally flow to society and clients if successful, not the engineer directly, but •Punishment for a failed Idea is certain for the Engineer who Sponsors it.


TORT REFORM PROPOSALS •Tort Reform Needed because Current system is:

•Too Slow •Too Expensive •Discourages Innovation •Destroys existing business relationships •Even when a party is “proven” right, the party is still a loser at the end of the process


TORT REFORM PROPOSALS •Tort Reform Proposals (Last Week):

•Pre-certification of negligence prior to filing suit •Reasonable caps on Punitive Damages •More efficient Discovery Procedures •LOSER PAYS!!!

•Even when a party is “proven” right, the party is still a loser at the end of the process •Why shouldn’t the Loser have to pay for the Winner’s Cost


TORT REFORM PROPOSALS •LOSER PAYS IS THE LAW IN ENGLAND, BUT NOT THE UNITED STATES

•Doesn’t Loser Pays make perfect sense? •Why Don’t we have that in the US?




•The US will NEVER have a standing Loser Pays rule!

•Violates the Constitutionally Guaranteed Full Access to Court For All Citizens




•The US will NEVER have a standing Loser Pays rule! •Violates the Constitutionally Guaranteed Full Access to Court For All Citizens •BUT, The courts will enforce a Loser Pays provision in a contract between two willing parties


TORT REFORM PROPOSALS •ADDITIONAL TORT REFORM PROPOSALS:

•Prevent a plaintiff from Venue Shopping •Reform Joint and Several Liability law •Adopt Statutes of Repose for Construction •Shorten the Statute of Repose time


NEGLIGENCE

•Failure to use REASONABLE CARE -Breach •In the fulfillment of a duty to a person to whom is owed a legal duty to protect-Duty •That causes - Causation •Real damage, injury, or harm – Real Damage


ELEMENTS OF NEGLIGENCE-DUTY •Duties are created by:

•Constitution •Statutes •Regulations •Rules •Common Law •Contracts •Custom and Practice •Prior Dealings Between the specific parties


ELEMENTS OF NEGLIGENCE-DUTY •At one time, Duties owed were limited by PRIVITY (Contractual Relationship between the parties)

•California State Court Stripped Away Rule of Privity •Found engineers and architects owed duties to third parties not privy to their contracts •Expansion of Third Party Duty Occurred over several Decades •Today, Rule of Privity has fallen in all states

•Today, Duty Owed to anyone who can foreseeably be injured by the Engineer’s work


ELEMENTS OF NEGLIGENCE-BREACH •How Is Breach Determined? Breach when test fails

•Reasonably Prudent Person Test: •What would a Reasonably Prudent Person have done? •Standard is flexible, varies by nature of the action/actor

•Reasonably Prudent Driver •Reasonably Prudent Pedestrian •Reasonably Prudent Child •Reasonably Prudent Civil Engineer •Reasonably Prudent Geotechnical Engineer

•Bottom line – Comply with a Standard of Care


ELEMENTS OF NEGLIGENCE-BREACH •Standard of Care is:

•The Ordinary Skill and Competence •Exercised by Members of the profession in good standing •In the community where and time when •The Event Creating the lawsuit occurred


ELEMENTS OF NEGLIGENCE-BREACH •Standard of Care is:

•The Ordinary Skill and Competence •Exercised by Members of the profession in good standing •In the community where and time when •The Event Creating the lawsuit occurred

•Standard of Care is Used by Courts to establish the Breach Element based on Expert Witness Testimony


ELEMENTS OF NEGLIGENCE-REAL DAMAGE •Damages Must Be Real:

•Not anticipated •Not Speculated •Actually Incurred and Proven


ELEMENTS OF NEGLIGENCE-CAUSATION •Evidence Must Establish a Causal Link between:

•The Breach of Duty and the Real Damages •Must establish Causation two ways

•Factual Causation (Cause In Fact): •But for the negligent conduct, the injury would not have occurred

•Legal Causation (Proximate Cause): •Was the injury that occurred reasonably foreseeable to the defendant at the time the negligent conduct occurred?


ELEMENTS OF NEGLIGENCE-UNJUST ENRICHMENT •Not All Increased Costs That Occur due to an apparent breach are CAUSED by an actual Breach

•Some Plaintiffs Want To Get Something For Nothing from a Defendant •Courts Do Not Award Such Costs-UNJUST ENRICHMENT •Example: Missing Elevator Costs $250,000 To add

•If Engineer had included Elevator in design, bids would have been $250,000 higher •Therefore, the owner should have to pay for the elevator if he wants it


ELEMENTS OF NEGLIGENCE-WHO CAN SUE YOU •Any person who can foreseeably be injured by the engineer’s work is a potential plaintiff

•Your Client •Third Party Beneficiaries of your Work such as Other Design Professionals, Contractors, prospective buyers, etc. •Users of a finished facility, workers, customers, public


GOALS FOR A SUCCESSFUL PROJECT •A Satisfied Client, and •A Project that is:

•On Time •Within Budget •Functions Properly, and •Has No Latent Defects

•A Project performed in manner that ”Avoids Disputes and Prevents Losses”


LOSS PREVENTION •Select Clients With Care •Evaluate Project Risks Carefully •Understand the Contract Before You Sign •Document Relevant Project Activities •Apply Internal Quality Control •Other practice tips but these are the main components of a Loss Prevention Program


STATUTES OF LIMITATION AND REPOSE •Statute of Limitation

•Specifies Maximum Time To File Lawsuit •Clock Starts to run when Plaintiff knows or should have known of a cause of action •Not a safe haven, liability exposure may never end

•Statute of Repose •Specifies Maximum Time To File Lawsuit •Clock Starts to run when Project is Substantially Complete •Provides the Engineer a time certain for liability exposure


STATUTES OF LIMITATION AND REPOSE •Kentucky Supreme Court Struck Down Kentucky’s Statute of Repose-Unconstitutional •Kentucky Court of Appeals has ruled that Engineers can make the Statute of Limitation operate like a Statute of Repose with Contract provision that says the time starts upon substantial completion. •Remember the Loser Pays Rule can be had through good contracting procedures too

ce 401 civil engineering seminar professional liabilityjrchee0/ce 401 old (no longer...

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