By Mark Jackson, JCJ Insurance Agency
Design professionals are expected to perform their services consistent with the standard of care for their profession. What is the standard of care? When a negligence claim is made against a design professional, this is a typical standard of care definition:
Negligence is the failure to use reasonable care. Reasonable care on the part of an architect/ engineer is the care that a reasonable careful architect/engineer would use under like circumstances. Negligence is doing something that a reasonably careful architect/engineer would not do under like circumstances or failing to do something that a reasonably careful architect/ engineer would do under like circumstances. – Florida Standard Jury Instructions. Section 402.5
While we see many variations in the contracts we review, the intent of this provision is the same – the design professional will use the same skill and care ordinarily exercised by other members of their profession. This is not a standard of perfection. The design professional is considered negligent only when they fail to use reasonable care.
So, is designing to code considered reasonable? Is code compliance enough to satisfy the standard of care? How do environmental factors, such as rising sea levels and climate change, affect the standard of care?
Climate change and its impact on our infrastructure and buildings is becoming more evident. Although there are different opinions on the cause of rising sea levels, global warming, and climate change, the evidence of weather related damage is overwhelming. In 2017, an unprecedented series of natural disasters cost the global insurance industry an estimated $135 billion, with more than 83% of those losses coming from North America alone, according to one of the world’s largest reinsurers, Munich RE.(1) And, according to NASA and NOAA, 2019 was the second warmest year on record for both ocean and land temperatures, trailing only 2016.(2) With an increase in storm frequency and severity, code compliance is not enough to avoid a negligence claim against a design professional. The purpose of building codes is to establish the minimum requirements to protect the public health, safety and general welfare of buildings and other structures. The trend with natural disasters is most likely going to require that you design based on expected climate changes, as seen in the claims example below that questions the integrity of the FEMA-designated 500-year floodplain.
There is a current case in Texas where the developer and stormwater engineer are being sued by a group of residents. The tract of land for the development had a low area that included both a FEMA-designated 100-year floodplain and a 500-year floodplain. The design avoided the 100-year flood zone and located the houses in the 500-year zone. Heavy rainfall during and after Hurricane Harvey in 2017 caused several feet of water to flood the streets and houses of the development. The residents contend the flooding was foreseeable based on past flooding of the area. The lawsuit alleges that the engineering defendants “made errors when designing the storm water management system,” and that it “was not designed to handle rainfall amounts that should have been reasonably anticipated.” Should the Engineer of Record have recommended elevating the development above the 500-year floodplain? Would the developer be willing to pay the extra cost to elevate the development?
Legal Risk for Design Professionals
Climate-related claims against design professionals are unusual, but there are signs, as this case shows, that this will change in the future. Design professionals need to be proactive in understanding the climate changes affecting their communities as the professional standard of care may require going beyond current codes. As we learned in the Texas claim example, design professionals can be judged on whether their design was reasonable under specific circumstances that should have been considered based on climate change.
In anticipation of this evolving trend, many design firms are focusing on sustainability and resiliency. The Resilient Design Institute defines resilient design as:
the intentional design of buildings, landscapes, communities, and regions in response to vulnerabilities expected with a warming planet: more intense storms, greater precipitation, coastal and valley flooding, longer and more severe droughts in some areas, wildfires, melting permafrost, warmer temperatures, and power outages.
Most of the industry trade groups, including NSPE, AIA, and ASCE, have also started to address the importance of resiliency in design.
- ASCE issued a policy statement in July 2018 that supports “revisions to engineering design standards, codes, regulations and associated laws that strengthen the sustainability and resiliency of infrastructure at high risk of being affected by climate change.”(3)
- The AIA states that “Architects have the responsibility to design a resilient environment that can more successfully adapt to natural conditions and that can more readily absorb and recover from adverse events”(4)
- US Green Building Council’s release of RELi™ 2.0 in December 2018 states that, “the need for resilient design is urgent. Societies and structures must anticipate weather extremes, economic disruption and resource depletion.(5)
The Transportation Infrastructure Act passed in August 2019 includes a provision to invest $4.9B over five years in a resiliency program to protect roads and bridges from natural disasters.(6) In December of 2019, FEMA published a new policy that was designed to promote resiliency and achieve risk reduction in regards to recovery funding for public facilities and infrastructure. The policy also states that it aims to:
Support the Efficient Use of Federal Dollars – Applicants using consensus-based codes, specifications and standards that incorporate hazard-resistance criteria for federally funded projects will reduce future vulnerability of disaster damaged facilities thereby reducing the need for future Federal disaster recovery funding and other assistance.(7)
With an increased focus on resiliency – by design firms, industry associations, and public policy – design professionals may be at risk for negligence claims if they fail to take these environmental trends into consideration. If the standard of care is evolving to require resilient designs, why are design professionals designing only to code?
One main reason is the increased cost to meet anticipated climate changes. The cost of construction will most likely increase with sustainable and resilient designs. While the building owner will benefit long term from this type of design, will project owners and developers be willing to spend the additional costs necessary to exceed current codes? Design firms need to educate project owners on the need for resilient designs.
If project owners are not willing to build to a higher code, firms will need to protect themselves from future claims by either walking away from the project or by adding additional language in their contract for the owner to indemnify the design firm. Regardless of decisions made by the project owner, design professionals still have an obligation to meet the prevailing standard of care. And based on an environmental perspective, the standard of care is increasing.
Sources
(1) www.athenium.com
(2) www.nasa.gov
(3) www.asce.org
(4) www.aia.org
(5) www.usgbc.org
(6) www.capito.senate.gov
(7) www.fema.gov
Mark Jackson is a founding partner of JCJ Insurance Agency. Mark specializes in professional liability and other commercial insurance for architects and engineers. Mark provides an array of services, including contract review and continuing education seminars. He serves as President for a/e ProNet, a network of insurance brokers and attorneys who specialize in serving design professionals. Mark graduated from UCF and has earned the Associate in Risk Management (ARM) designation from the Insurance Institute of America.