Southern Builders v. Shaw Development: The Most Important Part!

This week at GBLU, we are focusing on the Shaw Development v. Southern Builders case, the first significant example of green building litigation.  On Monday, GBLU explained the importance of the case and reviewed the basic facts.  Today GBLU will review the most important part of the case, the contract between the parties and accompanying green building responsibilities.  

Why is the contract the most important part of this case?  The contract is the primary means for dictating a contractor’s green building obligations.  Shaw Development and Southern Builders relied on an AIA A101-1997 Standard Form of Agreement Between Owner and Contractor as their general contract, which did not include green building requirements.  Additional requirements were incorporated through a Project Manual that made specific reference to green building certification:  

Project is designed to comply with a Silver Certification Level according to the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) Rating System, as specified in Division I Section “LEED Requirements.” 

Shaw Development’s AIA contract and incorporated Project Manual lack clarity in articulating Southern Builders’ responsibility for constructing a LEED Silver certified project.  While the Project Manual does state that the project was designed to comply with LEED Silver certification, it does not assign the contractor responsibility to construct the project according to LEED Silver certification.  Instead, as stated in A101-1997, the contractor is responsible for building according to the designs and specifications.  Thus, the contractor could be liable if it failed to build according to plans and specifications, which resulted in a failure to achieve LEED certification. 

Owners and contractors are well served to clearly describe the contractor’s responsibilities related to the construction of a green building project.  If your green building contract looks anything like the contract from Southern Builders v. Shaw Development, you should think about revising it. 

Related Links

 

Trackbacks (1) Links to blogs that reference this article Trackback URL
http://www.greenbuildinglawupdate.com/admin/trackback/88688
Green Building Law Update - October 3, 2008 8:20 AM
"Southern Builders", "Shaw Development", Litigation, Claims, Liability
Comments (1) Read through and enter the discussion with the form at the end
Jason Kasparek - October 1, 2008 9:46 AM

Chris Posted:
"Owners and contractors are well served to clearly describe the contractor’s responsibilities related to the construction of a green building project."

I think this is especially true given the nature of the LEED documentation and submittal process itself. When submitting for certification, the documentation is divided into two submittals: Design and Construction. Members of the design team have all the information necessary for the design submittal; on the other hand the information required for the construction submittal is primarily in the hands of the contractor and their subs, who also bear a lot of repsonsibility for tracking and overview during the construction process.

As a result, contract language that states the contractor is responsible for building according to the designs and specifications is really only ensuring they comply with the LEED Design submittal, and may unintentionally absolve them of Construction submittal responsibilities it was assumed they would take on.

Of course, some Division One LEED Spec sections are clear about the contractor's responsibilities, but the deeper into the contract documents they are spelled out, the greater the opportunity for them to be overlooked. Successful LEED certification can sometimes hinge on correct procedure from the instant construction begins, and time spent wrangling over who has responsibility for what can easily translate into points lost.

Post A Comment / Question Use this form to add a comment to this entry.







Remember personal info?
Send To A Friend Use this form to send this entry to a friend via email.