Civil Engineering Reference
In-Depth Information
The purpose of this chapter is to investigate how the DB delivery method can be
employed to help the parties involved in water and wastewater projects manage these
risks and achieve their contracting objectives. As part of this analysis, this chapter first
addresses the specific issues unique to the owner/design-builder relationship and the
strategies available to help the owner and the design-builder overcome certain project
constraints. The chapter then focuses on the DB team and shows how members of the
design team can structure their relationships to ensure the project's success.
THE OWNER AND DESIGN-BUILDER RELATIONSHIP
The unique aspects of the relationship between the owner and design-builder are pre-
sented in the following sections.
Selecting the Right Design-Build Team
The success of any project delivery system is tied to the selection of the right team mem-
bers. Because DB contracting presents some unique challenges such as managing the
design process, fast-tracking construction, and committing to a contract price in the
absence of a complete design, it is important that the owner select a design-builder that
possesses the requisite skills.
As is often the case on DB projects, construction and design firms often join forces
with other firms for the purpose of satisfying the owner's selection criteria. This is the
case even when the design-builder is an integrated firm (design and construction exper-
tise under one roof). As noted in DBIA's
Manual of Practice
(2008), from both the owner's
and design-builder's perspectives, it is important that firms joining forces for a particular
project select their partners wisely. An owner needs to inquire whether these firms have
worked together before, how this new entity will be managed, and whether this new entity
has mechanisms in place to ensure that it will in fact function as one cohesive entity. An
integrated firm also has to demonstrate that its design and construction sections function
efficiently and that it can also work with other design and construction firms included as
part of its team. An owner cannot afford to hire a design-builder only to discover that the
DB team it has selected fails to understand the DB process and the necessary mechanisms
that must be established to ensure that the project satisfies the owner's requirements and
is brought in on time and on budget.
Owners must also ensure that the design-builder does not create a legal entity that
will not provide the owner with adequate recourse if the design-builder fails to perform
its obligation. For example, a design-builder that organizes itself as a limited liability com-
pany (LLC) should present concerns to a prudent owner, because the LLC business for-
mat permits the members of the LLC to limit their liability to the extent of the LLC's
assets. Thus, an owner should contract with an LLC only if it obtains a sufficient security
in the form of bonds and/or a personal guaranty from the LLC's members, whereby they
jointly and severally guarantee the obligations of the LLC.
From the design-builder's perspective, it is critical that partners are selected wisely.
A contractor serving as the design-builder that subcontracts the design services will be
legally liable to the owner for the performance of its design professionals. Likewise, a
designer serving as a design-builder that subtracts construction will be legally liable to
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