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Wednesday, July 1, 2009

What Can Happen in a Confict of Interest Situation

Design/Build - Why wouldn't you do it?

Is it really cheaper?

No, it's not - not in the long run.

I have had to deal with clients sold that "Bill of Goods" - and wound up losing tens of thousands of dollars, and more - $200,000 in the illustration below. Plus now legal fees, time - and the loss of twins while distraught in dealing with all the duplicity, and pregnant, for the wife.


Laws in the United States were set up regarding Owner's relationships with Contractors - and how to protect Owners (or tenants) from gouging and taking - through the use of licensed Architects and Engineers, overseeing the whole process.

It's not about drafting.

It's about a process - and if you keep your eye off that ball, you can and will get "taken."

Don't be cheap and not think it won't come back to haunt you. It will.

What happened below to this wonderful young couple is not the first time by far I have seen this happen. Please be aware - and don't do yourself in for perceived "lower" fees on the front end. You will pay for it later - and at a very high cost indeed.


A Stockbroker’s Three-Flat Renovation in the

Pacific Heights Area of San Francisco, California

A Classic Example of what happens under Design/Build Contracts

The Owners called me when a Garage Contractor who had used his own Designer

under contract to the Contractor, an Engineer, could no longer

do work without an architect involved – and the city forced the issue during construction.

The Contractor, acting as a Design/Builder, had originally told the Owners

they did not need an architect, only his engineer.

Unfortunately, the Design/Builder had promised a 2-car garage in the original contract,

and as shown on the title block on the approved drawings, but had instead

designed and delivered a one-car garage, denying it was not a two-car garage.

Worse, somehow, the Design/Builder got the San Francisco Planning Department to approve it.

The garage had only one small door in that design and was too short by half the length

needed by City Planning Standards for a 2-car garage with one, 8 foot wide door.

The garage should have been 35 feet deep - well into rock - or have two, 8' wide doors.

It was no more than 20' deep, with one, 8' wide door.

The Owner was unable to park two cars in the Garage.

The contractor kept insisting you could park two cars in the garage - backing

out into Pine Street - a very fast and

very heavily-traveled, major east-west thruway in the City.

The Owner, already stuck with a lot of work done without permits from multiple changes

made in the field due to ignored programming requests at the outset to the Design/Builder,

wound up with a one-car garage, a stair in the wrong place coming up

into a lower room – with very little space left to make the room usable.

No space was planned for the required exitway from the rear of the structure, nor

were the walls designed to have the proper hour ratings, no garbage or

meter-reading areas were designed.

The Garage Contractor acting as a Design/Builder also provided horizontal boards for

the exterior rather than the Planning-approved cedar shakes, which matched the existing.

He finished the new area in a light, golden brown while the rest of the

facade was almost black, clashing in finish and color.

When the Owner and the Architect went into the San Francisco Building Department to

get permits finalized, the head of one of their departments looked at he Building Permit,

shook his head, and said,

"The Unable and the Inept."

He had known them for years, and dealt with problems with them

for that peroid of time.

Very telling.

You can see here that the Owner is now attempting to get the cedar shakes to match the new work.

With a new Contractor, who has the good sense not to make the mistake of

committing a conflict of interest to the benefit of himself, not the Owner of the structure.

A Picture of what not to do: Not hire an architect from the beginning.....

And use a Contractor and his Engineer only......

acting as a "Design/Builder".

No designer working on the Owner's behalf should ever work

for the builder - a Conflict of Interest.

A more serious issue was created: the Contractor talked the Owner into the newest fad -

horizontal boards that do not shed water -

it could be only a few years before the whole of the horizontal boards

will have to be replaced - with the cedar shakes it was approved

to have been installed by Planning.

The Contractor did not listen to the original request from the Owner to design

in a separate outdoor deck for them above the garage -

the stair design did not work.

This design is a compromise sure not to please Planning,

if they ever come back and look at it. It is not built as approved, and they may

make it be torn down or go through months of planning reviews - again,

which are extremely costly.

The room going out to the new deck above the garage was an illegal flat

we ensured (as a separate architect, brought in after the work was done)

was removed and that space added to the Owner’s unit.

As a result, we had to add numerous details to the original set

for construction of the garage and added program items

somehow “jockeyed” in to the badly-planned design.

The Owner, due to the process of not using an architect and

ensuring all their program items were in the contract

and drawings, spent around $200,000 more

than their original budget (approximately).

By City Building Permit Pricing Standards, that was about $150,000 more

than normal costs – essentially double what it should have been.

Had the 2-Car garage actually been designed, and built, one would see two,

8’ wide garage doors, or a much deeper garage (minimally 35 to 40 feet deep).

And all of the program requirements would have been included, properly -

at a much lower price and time to construct.

The contractor sued for slander, when the Owner realized that they could not get

two cars into the garage and maneuver in and out, telling others about it.

The Owner has countersued - with the

help of their Insurance Company.

The hassle and emotional factors caused the couple great distress,

and she lost two babies in the process.

These Owners have said that they will never employ anyone other than

a licensed, knowledgeable architect in the future for such work -

and to be the buffer when working

with contractors - one of the roles of an architect.

If you are reading this - spare yourself the eventual hassles - and keep yourself

out of the hands of those that use Conflicts of Interest to gouge - either by high prices for

continuing construction, or by hidden high fees - for what you don't get and should.

Remember - Contractors are not allowed to collect more than $1,000 in a deposit from any client.


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