Legal Consequences of Shop Drawings and Submittals

CSI Webinar: No Exceptions Taken:

Understanding the Legal Consequences of
Shop Drawings and Other Submittal

Speaker: Gerald Katz, Esq.

Architects and engineers routinely stamp shop drawings and other submittals with vague language—e.g., "no exceptions taken"—intended to limit their scope of, and liability for, submittal review. This seminar discusses the legal significance of these disclaimers: how do courts treat these disclaimers and what are the consequences for other project participants, such as owners, contractors and subcontractors? 

The seminar also discusses related issues such as the contractual process under which submittals are prepared, submitted, reviewed and approved; the consequences of approving defective submittals; a contractor's obligation to review and approve the submittals of its subcontractors; and statutory obligations affecting submittals. 

The submittals process is vital to any successful project. Delays in submittal submission, review and approval can—and often do—significantly impact the project schedule. This seminar will address the often-overlooked contractual and legal issues surrounding submittals that owners, architects, engineers and contractors face on projects every day.

Learning Objectives
  1. Understand the obligations under standard-from contracts of the owner, architect, engineer, contractor and subcontractors in connection with shop drawings and other submittals.
  2. Understand the legal significance of disclaimers and liability limitations used by the architect or engineer as part of their stamps.
  3. Understand the consequences to an architect for the approval of shop drawings and other submittals.
  4. Understand the architect's liability for delay in approving or taking other action on shop drawings and other submittals.
  5. Understand the contractor's obligation to review and approve shop drawings and other submittals.
  6. Understand the statutory obligations of architects and engineers in connection with shop drawings and other submittals.
Credit: 1.5 AIA CEHs, 1.5 PDHs

Select a Webinar Format:
On-Demand Webinar  $55.00 for CSI Member, $75.00 for Non-member

To Register:

Court demands clear specification of a "2x4"

A Superior Court in Marin County California ordered Lowe’s, a nation-wide retailer and distributor of building products, to pay a $1.6 million settlement over a lawsuit alleging the inaccurate description of structural dimensional building products. Lowe's promoted lumber as 2x4 even though the wood measured less than 1.5 x 3.5 inches, the dimensional criteria established by industry standards. Click to see Order

The judge ordered that Lowe's state dimensions as follows:
  • "Common descriptions" must be followed by actual dimensions and labeled as such. For instance, a 2x4 must be followed with a disclaimer that the wood is actually 1.5-inches by 3.5-inches and include a phrase equal or similar to "actual dimensions."
  • "Popular or common product description," like the word 2x4, must be "clearly described as 'popular name,' 'popular description,' or 'commonly called.'"
  • Dimension descriptions are required to use the "inch-pound unit," meaning they must include abbreviations such as "in., ft., or yd.," and can't use symbols like ' or '' to denote measurements.
 These guidelines are compatible with good construction specification practices; measurements and criteria of any kind are only meaningful when the criteria is defined.  To say that a piece of wood is a 2x4 is an incomplete specification unless I reference NIST Voluntary Public Standard 20-10 - American Softwood Lumber Standards or another standard.

While the Superior Court's decision is applicable only in California retail trade, it puts building product manufacturers on notice that their sales literature, invoices, and product labels need to meet truth in advertising standards. In fact, the Court states that the retailer is can rely on manufacturer's claims.

Change to Wikipedia may affect you.

WikipediaIn 2010, this blog posted:
Have you searched for your product category on Wikipedia? Does the page exist? If so, is your product properly represented? Remember that anyone can edit Wikipedia, so add your information if it's not there. Play fair, though. Wikipedia's community of editors will zap you if you don't, and the backlash can be worse for your reputation than missing information would have been.
What's new?
Wikipedia's parent organization, Wikimedia, has proposed an amendment to its terms of use that puts a control on the "anyone can edit" principle. The amendment states: 
you must disclose your employer, client, and affiliation with respect to any contribution to any Wikimedia projects for which you receive, or expect to receive, compensation. (emphasis added) You must make that disclosure in at least one of the following ways:
  • a statement on your user page,
  • a statement on the talk page accompanying any paid contributions, or
  • a statement in the edit summary accompanying any paid contributions.
As I will explain below, this change may impose difficulties and risks on your company that would make Wikipedia less attractive as a social media platform.

The introduction to the amendment explains:
Contributing to the Wikimedia Projects to serve the interests of a paying client while concealing the paid affiliation has led to situations that the community considers problematic. Many believe that users with a potential conflict of interest should engage in transparent collaboration, requiring honest disclosure of paid contributions. Making contributions to the Wikimedia Projects without disclosing payment or employment may also lead to legal ramifications. Our Terms of Use already prohibit engaging in deceptive activities, including misrepresentation of affiliation, impersonation, and fraud. To ensure compliance with these provisions, this amendment provides specific minimum disclosure requirements for paid contributions on the Wikimedia projects.
What does this mean to you?

Wikipedia depends on the willingness of users to share what they know. Since many building product companies have a great deal of expertise in-house or on retainer, it serves the community spirit of Wikipedia to have your experts contribute information to the online, community-sourced encyclopedia. Under the proposed guidelines however, your employee or consultant would have to disclose that he or she has a financial relationship with your company.

I have three concerns:

1. Will disclosure of your expert's relationship hurt or improve the public's acceptance of the expert's edits. Some people will assume that the pecuniary relationship makes the information biased and untrustworthy. I posit that disclosure of the expert's qualifications could also make the information more credible by establishing it as originating from a source that can be vetted.

2. The new rule may make many real experts want to avoid Wikipedia. As it is now, your expert can make edits with a certain amount of anonymity. Others can (and usually will) change what your expert contributes, but there is no repercussion on the individual.  By disclosing the individual's relationship with an employer or client, the expert loses anonymity, and may be expose to harassment or other tribulations. 

3. Of most consequence, your employee's or consultant's statements may be interpreted as a warranty issued by your company. (A warranty is any claim you make about your product's performance, not just the things covered in your company's warranty form.) As it is now, edits are made by individuals acting as individuals, not acting on their employer's behalf. The proposed change, therefore, could impose a new legal liability and risk.

Take a look at the proposed changes, discuss this with your PR person and attorney, and let me know what you think about this.

Supreme Court: Architectural Reps ineligible for overtime

A "detailer", in pharmaceutical parlance, is a person that calls on doctors to introduce new drugs and provide samples. There are also building product detailers, the factory representative that calls on architects or engineers, but does not negotiate or handle sales to dealers or contractors. Also known as "Architectural Reps", they introduce products, provide samples, offer continuing education programs, and assist in specification writing.

A recent Supreme Court decision may affect the way Architectural Reps are paid.

Federal law exempts outside sales people from overtime-pay regulations. This was challenged by several drug detailers, in a class action supported by the US Dept. of Labor, that argued pharmaceutical sales representatives were different from traditional salespeople because they don't actually sell medicines to doctors but merely promote them. Court, in a 5-4 decision, didn't by this prescription.

Justice Alito dismissed that argument as "quite unpersuasive," saying drug representatives effectively function as salespeople "in the unique regulatory environment within which pharmaceutical companies must operate," an environment that prohibits MDs from reselling drugs.

Justice Stephen Breyer, writing for the dissenters, said the representatives' primary duty is to provide doctors with information about drugs. If a particular drug is the best treatment for a patient, a doctor will prescribe it "irrespective of any nonbinding commitment" he made to a sales representative, Justice Breyer said.

Pharmaceutical sales representatives are typically paid a combination of base salary and performance-based commission, earning a median pay exceeding $90,000 a year.

It is not clear how this decision will effect industries outside of pharmaceuticals. Building product manufacturers with detailers may want to discuss the new ruling with their HR lawyer.

Photo by RayNata used under Creative Commons License.

Marketing with Standards

Standards: Dense Prose
Industry standards are essential to the construction industry. Yet they are often confusing, out of date, and contradictory. Produced by consensus organizations, they are subject to political pressures that can favor or exclude proprietary products and innovative solutions. Moreover, designers, builders, and building material suppliers are challenged to stay current with revisions to standards.

This complexity can work to your marketing advantage.

First, building product manufacturers should be active in standards writing organizations affecting their work. These consensus-driven committees need your insight into best industry practices, the needs of your clients, and the pragmatic limitations of current technology.

Further, you can keep your clients up-to-date and informed of changes to standards. This will make your firm the "go-to" resource for current and reliable information. For example, changed standards provide a great opportunity for publicity; contact the editors of trade journals and offer to provide an article about the revisions.

Your marketing and technical literature should be up-to-date, and that your sales representatives and customer service personnel are trained. Then use your product literature, e-mail blasts, guide specifications, and continuing education programs to inform your customers.

Your point-of-purchase and packaging provide other opportunities. Imagine a customer that has a choice between two products; one has a sticker proclaiming: "Complies with the New 2011 Industry Standards," and the other is silent on the matter. Which has the greatest appeal?

I recently updated a guide specification for a client that produces pigments for integrally-colored concrete. In the decade since I wrote the original guide spec, most of the standards it references had been revised. The updated standards cost over $100, an expense few construction firms are willing to pay, especially when a firm has to stay abreast of revisions in dozens or even hundreds of product categories. An even greater cost is the time required for a professional to review the steady stream of updated documents. This provides an opportunity for my client to be of service to their customers.

For example, American Concrete Institute document ACI 303.1 - Specifications for Architectural Concrete has not been revised since 1997, but it references another document that has been revised, ACI 117. The 2006 version of ACI 117 changes how construction tolerances are specified. Had my client reissued a guide specification with the obsolete tolerances, it would have been a disservice to their customers, a potential source of embarrassment, and perhaps even a legal complication.

Another document, ACI 301 - Specifications for Structural Concrete, also contains requirements for "architectural concrete." ACI does not offer guidance for coordinating specifications where loadbearing (structural) concrete must also meet rigorous appearance requirements (architectural). Having identified this conflict, my client can now help their clients by offering guide specification language that reconciles the conflicting documents.

Requirements for concrete pigments are defined in ASTM C979. Yet ACI 303.1 adds requirements that are not in the ASTM standard. The added requirements are not representative of industry practices and can actually be a detriment to successful concrete work. One suspects the committee was influenced of the one manufacturer that benefits from the added requirements; my client did not have a representative at the table. My client's revised guide specification explains the rationale for sticking to the ASTM requirements, and tries to paint their competitor into a corner.

I now serve on an ACI committee that is updating some of the outdated standards. While I am there to represent my client's interests, I must always work towards the goal of advancing the entire industry.

Life-cycle assessments of products

This is an encore of an article Michael Chusid wrote 20 years ago. To a limited extent, increased attention to environmental sustainability have increased focus on life cycle performance of buildings. LEED, for example, requires buildings to be commissioned to ascertain that mechanical systems perform as required. Also, the "cradle-to-cradle" concept encourages examination of the flow of materials from extraction to re-purposing.

Operational costs typically, 
exceed construction costs.

Tools that can help architects make life-cycle assessments of products

The architectural community too often disregards the life-cycle costs and operation of buildings. This attitude is not expressed overtly but nonetheless permeates architectural practice:
  • We grovel before a project's bid price and all but disregard a building's cash flow, the streams of operational and maintenance expenses, financing, revenue and tax consequences, which spell economic success or failure to a building owner. 
  • When designing an addition or renovation, we too often fail to involve the building's maintenance staff in a serious discussion about their resources, schedules, and experience with the building's existing materials and systems.
  • We rarely retain qualified building maintenance consultants on our design teams.
  • And frequently, we pass along a hodgepodge of submittals and call it an Operation and Maintenance Manual without considering whether the accumulation really communicates.
Over the economic life of a building, operation and maintenance costs will typically equal or exceed first costs. And when we consider how a maintenance program can affect a building's resale or salvage value, the importance of building maintainability becomes even more apparent.

Building Economics
Building design and product selection decisions should be made with benefit of life-cycle cost analysis. Recently issued ASTM standards provide the building industry with clear guidelines for performing an economic analysis of building designs and components. In a life-cycle cost study, each future cash flow must be adjusted for anticipated inflation and escalation and then discounted to a present value. When performed manually, these time-consuming calculations limit the use of life-cycle cost analysis. New computer-based programs, however, make it much easier to conduct life-cycle installations.

Even though calculations have been simplified, a building life-cycle cost investigation still remains difficult because reliable data on product longevity, maintenance schedules, and operation and maintenance expenses are difficult to obtain. How soon will a roof really be repaired or replaced? How frequently will various types of door operators require servicing? How will the selection of a sealant or weatherstripping affect energy use? Such information is not contained in the typical references found in an architectural office, but a new family of facility management publications and references is beginning to fill this gap. For example, Means Facilities Maintenance Standards [now out of date] discusses the mechanisms that contribute to building deterioration, and building maintenance scheduling and management.

Architects must also take more initiative to discuss maintenance issues with their clients and consultants and to collect and analyze the maintenance history of their buildings. This information must then be transmitted to the drafters and specifiers who actually make product decisions.

Product Data
Although building product manufacturers and trade associations are a primary source of product information, few offer well documented data on their product's life-cycle performance, offering only inconclusive laboratory testing or anecdotal case studies to document their claims. They claim they are unable to predict a product's life-cycle because of conditions beyond a manufacturer's control, such as environmental conditions or maintenance procedures. Yet these variables can be quantified and applied to a sampling of historic product performance data. The resulting analysis could be used as a valid basis for predicting product performance and comparing product alternatives.

Some manufacturers have responded to the need for better information about product life-cycle costs. USG Interiors, Inc., for example, offers a computerized comparison of relocatable partitions and drywall partitions. called DesignAid for Walls, the program enables a designer to consider the economic impact of partition relocation, financing alternatives, tax benefits and accelerated depreciation, and the escalation of waste disposal costs associated with drywall partition remodeling. A similar USG DesignAid program compares several floor construction and wire distribution systems to determine life-cycle costs vis-a-vis workstation relocation. [Chusid Associates wrote both DesignAid programs.]

Building productivity is
also a life cycle factor.

Operational Assurance
Since many architects assume "building maintenance" means "janitorial services" or occasional redecorating, it would be useful to introduce a new term into our professional patois. "Operational assurance" is a concept more familiar to industrial engineers who must assure that manufacturing equipment is kept at optimum operating capacity. An operational assurance approach to buildings must consider the building operational goals and specify systems and products in view of their longevity and the ease and cost of their maintenance, repair, and replacement. Operational assurance can be applied not just to mechanical and electrical systems, but to the building envelope, finishes, and other architectural components as well.

Capability in operational assurance planning would enable an architectural or engineering firm to differentiate itself from its competitors and position itself for growth in industrial, commercial, or institutional markets. Maintenance programming, value engineering, training of the building staff, and post-occupancy evaluation also could be lucrative extended services and could lead to a continuing relationship with a client.

Have a question you'd like us to answer?
Send an email to 

By Michael Chusid, Originally published in Progressive Architecture, ©1991.

Put ConsensusDocs on Reading List

An understanding of construction contracts is essential to anyone involved in building product sales. As a manufacturer, you may not be a party to the agreements between Owner, Designer, and Contractor, but the conditions of their contracts shapes the environment in which you have to perform, including warranties, submittals, access to site, payments, etc.

The American Institute of Architects' contract documents are used for most building projects, and you should be especially familiar with AIA A201 - General Conditions of the Contract for Construction.

Increasingly, however, the ConsensusDOCS system of contracts is being used. These documents have been endorsed by a coalition of 32 construction industry associations, and many find them to allocate risks and responsibilities more efficiently and fairly. Written in plain English and not legalese, they have also been developed to recognize new industry trends such as BIM, green construction, and integrated project delivery. Click here for sample documents.

Court rules Twitter "Not Private"

A UK court recently ruled that Twitter messages are not private, and the press (and by extension anyone) were free to use them without consent.
...the PCC said the potential audience for [the Plantiff's] tweets was much wider than her followers, because each message could be forwarded by others, known as retweeting.

It also agreed with the newspapers' argument that Twitter was publicly accessible and that the complainant had not taken steps to restrict access to her messages and was not publishing material anonymously.

As a result, the commission ruled that the articles did not constitute a breach of privacy. 
Of particular note in this case is that the tweets in question were from her personal account, and used to shine a negative light in an article about her employer, the Department of Transport. A good reminder that, no matter what distinction you may make between your home and work communications, the Internet sees no difference.

My recommendations for dealing with this are to be very conscientious about what you post on behalf of your company, or in a professional capacity, and maintain high privacy settings on your personal accounts. (I also recommend the general guideline Vivian uses that you shouldn't say anything online that you wouldn't say at a cocktail party.) This is not a perfect control, as your posts may be copied or repeated without your consent or knowledge and privacy standards tend to change suddenly with little warning, but it should be enough protection for most people.

If you keep a personal blog, consider using a pen name (like "Lulu Brown" does on her blog). For most people this is probably an unnecessary step, though.

Despite the paranoid tone of this article, I want to encourage you to continue using your personal social media in a personal way. These are important tools for building and maintaining relationships, and it is ridiculous to cut out curtail these social interactions just because it might come back to haunt you at work. Just keep in mind that what you say to your friends may travel beyond them, so be cautious saying anything you would not want your boss, or your clients, to hear.

Hyperbole vs. Credibility

I received a bit of spam from an individual named Stephen Sands, who made me an offer I could so easily refuse.  His spam began:

“With stronger web placement on the major search engines, your online results could be infinite.” That was all I needed to read to know that I never want to do business with this guy, even if he’s right.   I have a kneejerk reaction to people who toss around promises with the concept “infinite” in them: I figure they’re probably just blowing smoke in the first place.  They’ve got nothing and they’re trying to hype into something, so it’s no worse a lie to hype it into ‘everything.’

Perhaps Stephen Sands actually has a lot to offer, I don’t know; but his opening line made me certain that I’ll never find out.

In an atmosphere of so much competition for communications channels, the temptation to speak ‘louder’ is more intense than ever.  But we also live in an atmosphere of consumerist defensiveness and distrust, where hyperbole often has a negative impact.  That means we need to be both careful and thoughtful about what we claim in ads, sales literature, and other statements about products. 

Careful, because some statements may have legal implications such as an implied warranty. 

Thoughtful, because inflated claims create a credibility problem.

The first job of advertising and sales literature is, certainly, to get attention.  But we all know from grade school that there are both productive and unproductive ways to get attention.  Don’t choose a way that torpedoes the second job, which is to create the foundation for trust.  If the nature of your claims is too good to be true, people won’t believe them.  If the tone you set is over the top, people will  be suspicious.  If the crafting of the message impairs your credibility, it doesn’t matter how good your product is.

If, on the other hand, you can state some significant truths in an interesting manner, readers may trust you long enough to find out more.

Resist the temptation to hype, for truly, it is a fate worse than death.  (Oops!  I mean, resist the temptation to hype because you’ll probably do yourself more harm than good.)

The simplest test is to step back, look at your literature, and ask yourself, “If my competitor were saying this, would I believe it?”

Trade Association Antitrust Guidelines

When called upon to participate in trade associations, employees and agents of building product manufacturers must understand and comply with antitrust laws.

Antitrust laws prohibit firms in the same industry from conspiring to restrain trade. There are potential civil and criminal penalties for violations under United States antitrust laws. Potential consequences of violating or appearing to violate antitrust laws can be severe for trade associations, member companies, and their employees.

When attending trade association meetings and other activities, you must follow general guidelines in order to avoid violations of antitrust laws.

Topics that must be avoided include:

  1. Pricing: This includes current or future prices or costs; what is a fair profit level; increases or decreases in price; standardizing or stabilizing prices; and pricing procedures.
  2. Sales Territories: Dividing customers or allocating sales territories or markets.
  3. Limiting Supply: Agreements encouraging or discouraging members from purchasing equipment, supplies, or raw materials from any supplier or from dealing with any supplier or restricting the volume of goods produced or made available for sale.
  4. Boycotts: Restricting the purchasing or dealing with particular outsiders.
  5. Discussions concerning specific agreements or disputes,  past or present, between members.
Administrative guidelines include the following recommendations:

Meetings must have an agenda that should be strictly followed. Minutes of each meeting should be prepared. The minutes should accurately reflect the subjects discussed and actions taken at the meetings.

Members should not hold informal gatherings. No substantive discussions should take place outside official meetings.

Association membership should not be arbitrarily awarded. It is assumed that members derive an economic benefit from being association members; therefore denial of membership to an otherwise qualified applicant can be seen as restraint on trade since it might limit the ability of the applicant to compete.

Specifications or standards developed shall not be based on any anticompetitive purpose. Adherence to specifications or standards shall be voluntary.

Please note that these guidelines are recommendations and are not comprehensive. Legal counsel should be contacted when potential antitrust issues arise.

Chusid Associates has worked with many building industry trade associations to develop promotional, technical, standards writing, educational, and marketing programs. We also serve on industry committees to serve our clients' interests. Contact Michael Chusid if we can be of assistance to you.

Cost to Correct Errors in Construction Documents

This graph illustrates that the cost of correcting defects in design and specifications can quickly escalate if not mitigated early in a project.

For building product manufacturers, this suggests the benefits of having a proactive sales force during a project's design phase, and of reviewing bidding documents carefully prior to entering into a contract. If you can help an architect, engineer, or other specifier to use your product correctly during the design phase, there will be less economic risk during construction.

Graph is from "Using Spec Writers Properly" by Derek B. McCowan, PE in the June 2010 issue of Consulting-Specifying Engineer.

Engineering Design and Its Relationship to Product Liability

Guest post from Mark Pasamaneck, PE 
In this article, I will explore the relationship between the engineeringdesign process and the failure of a plumbing component as it
relates to product liability.
     In the litigious society in which we live, everyone connected to
the life-cycle of a plumbing component should be concerned with
its long-term suitability as it exists in any plumbing system. As an
engineer or designer of a plumbing component, you should have
a desire to go beyond just limiting liability. As described in the
codes and most engineering ethics documents, a designer must be
concerned with protecting the people and property exposed to his
design from seen or unseen damage and hazards.

While the political, social, and legal reasons are beyond the
scope of this article, the decade of the 1970s was largely considered
the decade of safety awareness. While a few federal
acts were aimed at safety in the 1950s, the majority of the
safety acts in use today were developed in the late 1960s and
first published in the 1970s, including the Consumer Product
Safety Act of 1972. The Magnuson-Moss Warranty Act of 1975
gave broad powers to the Federal Trade Commission regarding
product warranties.
     Of particular interest to the plumbing community is that
the majority of the plumbing components in use today were
conceived of and designed well before the 1970s. Many manufacturers
have never evaluated their components or designs in
light of the safety acts and standards implemented in the 1970s
and after. While the building codes commonly grandfather in
outdated technologies, there is no such provision for an old
product design that was produced in the modern era. It is also
obvious that courts have held that the “product” for which a
designer or producer is responsible includes such items as the
warranty, instructions, packaging, labels, and warnings (note:
not an all-inclusive list).

While the topic of engineering design in general would take many
articles, this discussion on product liability requires an overview of
the engineering design process. The design process commonly is
called iterative since it is very rare that an idea can go through the
steps of concept to finished product without changes. The design
process outlined below is considered the standard in all types of
industry. While many more steps may be encountered in a complex
part or system, the following serves to define the general steps
useful in the design iteration. This process also incorporates the
cradle-to-grave responsibility of the designer and manufacturer.

1. Define the function of the product within a system or as a
stand alone.
• If the product is itself a system, define each subsystem and
initiate an independent design iteration until each component
is uniquely defined.
• If the product is within a system, define system parameters
and environments in which the product will operate.
2. Identify prior designs that may assist or preclude (patents)
the design process.
3. Identify all laws, codes, or standards that apply to
the product or system.
4. Brainstorm possible design concepts.
5. Remove concepts that are not viable due to manufacturability,
regulations, cost, hazards, complexity, integration,
functionality, or aesthetics.
6. Choose a design concept.
7. Create the design using accepted design practices applicable
to the field of interest. These will necessarily include
factors of safety, dynamic loads, static loads, wear, compatibility,
environment of use, durability, cost issues, and
materials (suitability, durability, strength, degradation,
fabrication, identification of failure modes, and predictable
failure locations).
8. Evaluate functionality: geometry, motion, size, complexity,
and ergonomics.
9. Evaluate safety: operational, human, environmental, and
failure analysis.
10. Evaluate energy: requirements, created, kinematic, thermodynamic,
and chemical.
11. Evaluate quality: marketability, longevity, aesthetics, and
12. Evaluate manufacturability: available processes and new
13. Evaluate environmental aspects: materials, fluids,
wastes, interactions, phase changes, flammability,
and toxicology.
14. Iterate the design. (Redo steps 7 through 13 based on
the analysis.)
15. Lay out the design.
16. Obtain manufacturing criteria.
17. Create a prototype and test (optional).
18. Create the product.
19. Test the product.
20. Reiterate through the entire design process based on
testing and analysis.
21. Produce the product. Some changes may occur, but they
should not impact the actual design.
22. Perform quality control, which is used to evaluate the
compliance of the produced product with the design.
23. Deliver the product. Packaging, labeling, instructions,
and warnings are included in this step, but they also
must be considered throughout the process.
24. Consumers use the product. The producer must consider
the environment of intended use as well as anticipated or
probable misuse of the product. These must be addressed
appropriately throughout the design process.
25. Dispose of product. The end of use must be considered
by the designers. Fail-safe designs should be incorporated,
and any hazards associated with disposal and/or failure
must be addressed appropriately as well.

Steps 7, 8, 9, and 19 are where a defect or hazard (such as that
shown in Figure 1) should be detected in most cases. When
detected, the question must be answered as to whether the
defect or hazard was foreseeable or unreasonably dangerous.
If it was, the commonly held approach in the engineering community
to solve the problem is known as the safety hierarchy.
This process is based on sound engineering principles coupled
with economic considerations and human factors. The first
reasonable item in the hierarchy must be utilized, and skipping
steps is not appropriate.
The steps are as follows:
1. Design it out.
2. Guard it out.
3. Train it out.
4. Warn it out.
5. Don’t make it.
    The hierarchy is intended to evaluate if the problem can be
corrected by engineering measures. However, those measures
also can be evaluated in and of themselves. For example, were the
warnings understandable, sufficiently broad, or used as a substitute
for design or guarding?
    The design process and the safety hierarchy outlined above
almost always include other sub-processes and evaluation techniques.
Severity indices, fault trees, failure mode and effect analysis
(FMEA), root cause analysis, and design checklists all are tools
that if sufficiently designed and used within the design process
will aid the designer in his goal to make a safer product.

When product liability theories are evaluated, three general areas
are considered.
1. Design defect:
• Was the product designed to do the job based on the reasonable
expectation of a consumer, without undue risk?
• Was it designed for the environment of intended use?
• Was the design properly engineered and tested?
2. Manufacturing defect: Despite a sufficient design, was there a
flaw in the:
• Processing?
• Assembly?
• Raw materials?
3. Warning defect: Did the manufacturer fail to properly advise
• Assembly?
• Use and maintenance?
• Hazards?

Hopefully, if you have made it this far, you now are asking yourself
how you can improve your products to both reduce liability and
improve safety. Much of the general information on design is
contained herein, but a more in-depth understanding obviously
would be beneficial for the designer.
    Let’s look at design defects first. It is important to document
what sources of information were used or considered in the design
process of a component. The specific issues for the plumbing component
designer that account for a large number of design-related
defects are related to stress concentrations and material selection.
ASPE publishes the Plumbing Engineering Design Handbook,
and Volume 4 covers plumbing components and equipment. I
have utilized this reference for years to illustrate what a designer
“should” have included in a design. While a lot of good information
is available online, if you use it in a design, be sure to properly
record and document the source. Materials, machinery, and
design handbooks are prevalent and should be sourced for relevant
design information. One of the various texts on design and
product liability (see Figure 2) also should be included. One of the
best for a general understanding is Managing Engineering Design
by Hales and Gooch.
    Manufacturing defects come in two main areas: assembly
and cast/mold defects. This is an area that the designer typically
cannot control, but can influence. Some issues of quality control
and tolerances have to be determined within the design, and
others will be left to the assembly workers, a quality control (QC)
department, or line design. When it comes to casting and mold
defects, those processes should be considered and properly speci-
fied in the design. Then a QC program to ensure compliance must
be implemented (see Figure 3).
    The third area is related to warnings. Step 3 of the safety hierarchy
would be evaluated in this step as instructions for installation
and maintenance (training). It is the responsibility of the
design engineer and producing company to ensure that a product
brought to market is reasonably safe and suitable for the environment
of its intended use. A product subject to degradation,
corrosion, catastrophic failure, or other risk of damage to people
or property should adequately warn of the risk or danger if there
was no other reasonable way to eliminate the risk or failure mode.
The product instructions might address, but not be limited to,
warnings, providing maintenance instructions, and warning of the
consequences of failing to heed the instructions.
    The design of warnings should follow American National Standards
Institute (ANSI) standards regarding the identification and
warning against potential safety hazards. In 1979, the ANSI Z53
Committee of Safety Colors was combined with the Z35 Committee
on Safety Signs to form the Z535 Committee, which develops
the standards that must be used to design warnings, labels, and
instructions intended to identify and warn against hazards and
prevent accidents. The relevant standards for products are:
• ANSI Z535.4: Product Safety Signs and Labels
• ANSI Z535.6: Product Safety Information in Product Manuals,
Instructions, and Other Collateral Materials

    For a warning to be effective, there must be a reasonable degree
of certainty that the end user will receive and understand the
warning (see Figure 4). The use of warnings also must follow the
safety hierarchy. Since warnings are the fourth step, available
design alternatives must be considered in the design process.
Guarding out of a hazard and subsequent training must be undertaken
before warnings can reasonably be considered or designed.
    Our society, as stated in the various plumbing codes, relies on
the engineer, designer, and manufacturer to produce products that
are safe and durable. Society also recognizes and accepts some
level of risk, provided that they know about it beforehand and that
companies must be economically viable to survive. Don’t shirk your
responsibility to the public, your profession, yourself, or your company
by producing a product based on an insufficient design.

This article was reprinted with permission and all copyright remains with the American Society of Plumbing Engineers.

Tax Benefits for Designers

Tax benefits can be a powerful tool for promoting certain building products. Chusid Associates, for example, has worked with producers of demountable partitions and access flooring systems to explain how the accelerated depreciation of these products can create bottom line benefits for a building owner.

The following article, reposted from the
Xella (producers of Hebel autoclaved aerated concrete) website, explains a little know tax benefit that can accrue to design professionals:

The Federal tax laws provide a significant tax benefit for designers of energy-efficient commercial buildings for public entities, such as government buildings and public schools. A designer such as an architect, engineer, contractor, environmental consultant or energy services provider who creates the technical specifications can deduct the cost to the public entity of “energy-efficient commercial building property expenditures” up to a cap of $1.80 per square foot of the energy-efficient commercial building property expenditures that are made.[1]

The deduction is allowed in the year in which the property is placed in service and is in lieu of depreciating the amounts qualifying for the deduction over 39 years.[2] .The tax laws define energy-efficient commercial building expenditures as property:

  1. Installed on or in any building located in the United States that is within the scope of Standard 90.1-2001 of the American Society of Heating, Refrigerating, and Air Conditioning Engineers and the Illuminating Engineering Society of North America,
  2. Installed as part of (i) the interior lighting systems, (ii) the heating, cooling, ventilation, and hot water systems, or (iii) the building envelope, and
  3. Certified as being installed as part of a plan designed to reduce the total annual energy and power costs with respect to the interior lighting systems, heating, cooling, ventilation, and hot water systems of the building by 50 percent or more in comparison to a reference building which meets the minimum requirements of Standard 90.1-2001 (as in effect on April 2, 2003).[1]
This deduction generally is available to owners of buildings. However, because the owners public buildings, such as schools and government offices do not generally pay taxes, the tax laws provide a special rule allowing the owners to pass the benefit through to the designer. If there is more than one designer, the governmental owner of the building can allocate the full deduction to one designer that is primarily responsible for the design or, at the owner's discretion, allocate the deduction among several designers. The governmental owner of the public building is not required to include any amount in income on account of the deduction allocated to the designer, but is required to reduce the basis of the property by the amount of the deduction allocated. Note that a person who installs, repairs, or maintains the property is not a designer.[3]

Hebel AAC’s energy-efficient properties help meet their requirement for this tax-deduction credit level. Its unique closed cellular structure and thermal mass contribute to a high R-value and air-tightness, which reduce heating and cooling costs and improve indoor air quality. Buildings using Hebel Autoclaved Aerated Concrete have seen up to a 35 percent decrease in cooling costs.

In the case of a building that does not meet the overall building requirement of a 50-percent energy saving, a partial deduction is allowed with respect to each separate building system: (1) the interior lighting system, (2) the heating, cooling, ventilation and hot water systems, and (3) the building envelope. The maximum allowable deduction is $0.60 per square foot for each separate system.

Case in Point 1: 50% Energy Savings A school spends $200,000 in qualifying costs on a new 100,000 square feet, energy-efficient building using Hebel AAC. 100,000 sq. ft. X $1.80 = $180,000 Tax Deduction to the Designer

Case in Point 2: <50%> Same school as above, yet only the Hebel AAC building envelope qualifies. 100,000 sq. ft. X $.060= $60,000 Tax Deduction to the Designer
Certain certification requirements must be met in order to qualify for the deduction. The IRS has published guidance concerning how to meet these requirements.[4] In general, these calculations must be performed using energy simulation models found in computer software approved in the guidance and not by measuring actual electricity usage. Under this guidance, calculations are made by comparison to a reference building that is based on a building that is located in the same climate zone as the taxpayer's building and is otherwise comparable to the taxpayer's building except that its interior lighting systems, heating, cooling, ventilation, and hot water systems, and building envelope meet the minimum requirements of Standard 90.1-2001. Calculations must be certified by a licensed professional engineer or contractor that is not related to the taxpayer and meets certain other tests.

In determining energy and power cost savings for purposes of partial deduction described above for an energy efficient building envelope, the proposed building is a building that contains the building envelope that has been incorporated, or that the taxpayer plans to incorporate, into the taxpayer's building but that is otherwise identical to the reference building.

The deduction is effective for property placed in service after December 31, 2005 and prior to December 31, 2013.[5]

It may be possible to meet the energy efficiency standards set forth above using Hebel AAC.

Please consult your own tax advisor to determine whether your project can qualify for this significant tax benefit. IRS Circular 230 disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any tax advice that may be contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding any penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction(s) or tax-related matter(s) that may be addressed herein.

Notice 2006-52 can be found:
Notice 2008-40 can be found:
[1] Code section 179D(d)(4); Notice 2008-40, 2008-14 I.R.B. 725.
[2] Code section 179D.
[3] Notice 2008-40, section 3.
[4] Notice 2006-52, 2006-26 I.R.B. 1175, clarified and amplified, Notice 2008-40.
[5] Code section 179D(h).


The specification of a single building product does not, by itself, qualify a project for this tax credit. The credit requires the design of energy efficiency into an overall building project. Still, building product manufacturers can gain from understanding and explaining how their product contributes to the overall result.

Contact Chusid Associates to explore whether this law can benefit your company and to discuss the best way to incorporate it into your marketing program.

How Will the International Green Construction Code Affect Your Product?

The International Code Council's newest effort is its International Green Construction Code. This new code will address communities' need to adopt model sustainable design regulations, in order to meet their sustainability goals and mandates. The intent of the code is that it "should provide a new regulatory framework built with leading recognized rating systems in mind, and that it should provide criteria to drive green building into everyday practice." In other words, it is to provide an enforceable set of requirements for sustainable commercial construction, available for cities and states to adopt into law.

The IGCC's scope (excerpted from the IGCC's Development Update page):

  • The Code should be developed to apply to commercial buildings in a manner that is consistent and coordinated with the ICC Family of Codes and Standards.
  • The Code should be applicable to the construction of buildings, structures, and systems, including alterations and additions.
  • The Code should set a baseline of green requirements that build upon the ICC Family of Codes; further options beyond the baseline should also be included.
  • The Code should address: energy use efficiency; water use
    efficiency; materials and resource use; indoor environment quality; the
    building’s impact on environment; site design; sustainable building
    owner/facility management education; and, existing buildings.
The ICC Board of Directors has convened a Sustainable Building Technology Committee (SBTC), with the goal of creating a draft IGCC to be submitted for public comment in Spring 2010. Meetings began in July of this year and will continue until January or February 2010. The third meeting begins this Thursday, October 8, in Philadelphia. After a full cycle of code development, final action hearings will be held in Fall of 2011.

Now is the time to get involved with the development of this new code. Happily for building product manufacturers, the code development process is quite accessible. To participate in the current phase (excerpted from the Development Updates page):

  • Attendance at all meetings of the SBTC and its Working Groups is welcomed. Please consult our website for more information.
  • Interested parties participating in the Working Groups are afforded the opportunity to submit comments for Working Group consideration. In all cases, Working Group recommendations will be submitted to the full SBTC for final disposition.

To follow the code's development, keep an eye on the First Draft Development page, where you'll find the latest drafts with commentary from each working group, rosters and scopes for each working group, and meeting agendas.

What should you watch for? Think beyond LEED; while this code is informed by current green building guidelines and rating systems, it is not bound by them. Look for:

  • Your product's classification in the Material Selection section;
  • Service life requirements for projects and components of projects;
  • Life cycle analysis requirements;
  • Mandatory and elective compliance;
  • Envelope energy performance,
  • Moisture management;
  • Material emissions, not just for indoor air quality but for greenhouse gas emissions.

Chusid Associates is already helping clients to shape this document. We are available for you, as well.

FTC Rules about Endorsements

New guidelines from the FTC may have a significant impact on building product marketing communications. Additional analysis will be posted in this blog in the weeks to come:

"For Release: 10/05/2009 (Excerpted Below)

"FTC Publishes Final Guides Governing Endorsements, Testimonials -- Changes Affect Testimonial Advertisements, Bloggers, Celebrity Endorsements

"The Federal Trade Commission today announced that it has approved final revisions to the guidance it gives to advertisers on how to keep their endorsement and testimonial ads in line with the FTC Act.

"The notice incorporates several changes to the FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising, which address endorsements by consumers, experts, organizations, and celebrities, as well as the disclosure of important connections between advertisers and endorsers. The Guides were last updated in 1980.

"Under the revised Guides, advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect. In contrast to the 1980 version of the Guides – which allowed advertisers to describe unusual results in a testimonial as long as they included a disclaimer such as “results not typical” – the revised Guides no longer contain this safe harbor.

"The revised Guides also add new examples to illustrate the long standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers – connections that consumers would not expect – must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers. The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. Likewise, if a company refers in an advertisement to the findings of a research organization that conducted research sponsored by the company, the advertisement must disclose the connection between the advertiser and the research organization. And a paid endorsement – like any other advertisement – is deceptive if it makes false or misleading claims.

"Celebrity endorsers also are addressed in the revised Guides. While the 1980 Guides did not explicitly state that endorsers as well as advertisers could be liable under the FTC Act for statements they make in an endorsement, the revised Guides reflect Commission case law and clearly state that both advertisers and endorsers may be liable for false or unsubstantiated claims made in an endorsement – or for failure to disclose material connections between the advertiser and endorsers. The revised Guides also make it clear that celebrities have a duty to disclose their relationships with advertisers when making endorsements outside the context of traditional ads, such as on talk shows or in social media.

"The Guides are administrative interpretations of the law intended to help advertisers comply with the Federal Trade Commission Act; they are not binding law themselves. In any law enforcement action challenging the allegedly deceptive use of testimonials or endorsements, the Commission would have the burden of proving that the challenged conduct violates the FTC Act."

Twitter's TOS: Who Owns Your Tweets?

Twitter announced updates to its Terms of Service last week, throwing additional fuel on an already heated debate: who owns the content you post online? The seemingly obvious answer, the user-creator is owner, may not be the case. For example, your tweets can be used for:
  • Data for an API
  • Retweets
  • Display on someone else's website
  • Quotation, with or without attribution
All of these are ways for someone else to profit from your writing, without the benefit ever reaching you. To further obscure the issue, the new TOS includes this:
You retain your rights to any Content you submit, post or display on or through the Services. By submitting, posting or displaying Content on or through the Services, you grant us a worldwide, non-exclusive, royalty-free license (with the right to sublicense) to use, copy, reproduce, process, adapt, modify, publish, transmit, display and distribute such Content in any and all media or distribution methods (now known or later developed).
Within a single paragraph, ownership is granted to the user-creator while usage is granted to Twitter. WebProNews quotes one user as saying, "If Twitter can do what they want with ‘our’ tweets, including reproduction for their own (financial) gain, what do we actually 'own'?"

The issue has come up from the other side as well, notably the recent "Facebook Murder" case and various cyber-bullying trials. Here the question is what responsibility does Facebook bear for the content posted by users? Combined, these questions of ownership and responsibility mean that most social networks and other online services gain the benefit but not the liability for all user-generated content.

This mirrors the debate about liability in BIM (read the comments from this BD+C post about mandatory BIM in Texas); everyone wants credit for their work on the project, but no one wants liability for bad information, faulty design, or whatever other problems might occur. Furthermore, once a model is designed, who owns the information?

In light of these issues, how can building product manufacturers protect themselves and their information?

The first key step is to be sure that any information posted online is technically accurate: guide specs, BIM models, CAD details, technical literature, MSDS, etc. should be reviewed carefully, preferably by a third-party architect, engineer, or other technical specialist. This may require a material testing program to get independent confirmation of the qualities claimed, especially for life-safety issues such as surface burning characteristics.

Secondly, refer people to the company website wherever possible. Twitter makes this easy; it's hard to fit extensive product detail into 140 characters or less, so tweets usually redirect users to the full article elsewhere. On blogs and networks like LinkedIn, however, there can be a temptation to post full-text of data sheets. Avoid this impulse; link to the appropriate page on the website instead. That way users will always find the most current information, and the issue of content-ownership is diminished. If Twitter or another network claims usage rights, all they have to use is a tweet saying "For more information, visit....".

The issue of content ownership is going to evolve rapidly over the next few years. Lawsuits are already testing the issue. Until a clear path emerges, the best way for manufacturers to protect themselves is focusing on these fundamentals.

Specification Quiz

Question: What is the difference between a "plan room" and a "court room"?

See comment below for answer.