I was curious if anyone could explain how an engineer becomes personally liable for design errors on projects. I believe that a PE is personally liable in the US if they seal a set of drawings and a claim occurs. So does E&O insurance cover both the company as well as the individual? What about the personal liability to other PE’s and EIT’s working along on design teams that complete the majority of the design?
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Personal Liability 2
- Thread starter Mark10
- Start date
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- #2
Mark10:
The company you work for should (and I say should) have liability insurance and they submit a list of PE's to their carrier as additional insureds. If you are not with a company then you should have liability insurance if you practice. If you don't fit either of those then the lawyers will go after you personally. The company I work for is a consultant and we carry 10 million on our engineers.
The real proplem for engineers is when an industry exempt engineer dispenses advice outside their company with or without knowledge that they need a PE to do it. The lawyers all know to look for this and it is a fairly lucritive practice for them because these engineers are easy pickings and cannot get liability insurance because they are not licensed.
EIT's do not do design work, they only work under the supervision of other PE's so their supervising PE's are liable for their work.
Hope that gave you a better picture of how the system works!!!
BobPE
The company you work for should (and I say should) have liability insurance and they submit a list of PE's to their carrier as additional insureds. If you are not with a company then you should have liability insurance if you practice. If you don't fit either of those then the lawyers will go after you personally. The company I work for is a consultant and we carry 10 million on our engineers.
The real proplem for engineers is when an industry exempt engineer dispenses advice outside their company with or without knowledge that they need a PE to do it. The lawyers all know to look for this and it is a fairly lucritive practice for them because these engineers are easy pickings and cannot get liability insurance because they are not licensed.
EIT's do not do design work, they only work under the supervision of other PE's so their supervising PE's are liable for their work.
Hope that gave you a better picture of how the system works!!!
BobPE
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Under common law there is a doctrine of agency. As it applies in the employer/employee relationship, it holds that an employee, while acting in the scope of his or her duties is acting as an agent for the employer. In that way the employer is liable for the actins of his agent and the agent is not liable. (Note the disclaimer within the scope of duties. If you are outside the scope of duties then you are most likely on your own.)
The reasoning is that the employee is acting as an extension of the employer and under the employer’s direction and control. Therefore the agent is not liable but the liability falls back to the principal. If the employer is a limited company, the company has the liability not any individual person. (A limited company is a legal fictional person with all the rights and liabilities of a person in contract and tort.)
Your locality jurisdiction may have modified this general rule of agency and it would be a good idea to get legal advice if this is other that idle curiosity causing the question. If you are engaged as other that a pay rolled employee, i.e. contract or other arrangement, then you may not be the agent but an arms length contractor. In this case the client would be able to sue you or any losses suffered as a result of your actions.
Professional liability is different than personal liability. If you are a P.Eng or equal, then your local association will have the responsibility to take action against you professionally. This could mean placing restrictions on your ability to practice up to and including permanent expulsion from the profession and or administrative fines and other penalties. I do not believe that they could order you to pay damages and restitution out of your own pocket.
Once again, I caution you that if this question is other than simple curiosity, get competent legal advice on your specific circumstances. I’m not a lawyer and the above is simply my understanding of common law.
Rick Kitson MBA P.Eng
Construction Project Management
From conception to completion
The reasoning is that the employee is acting as an extension of the employer and under the employer’s direction and control. Therefore the agent is not liable but the liability falls back to the principal. If the employer is a limited company, the company has the liability not any individual person. (A limited company is a legal fictional person with all the rights and liabilities of a person in contract and tort.)
Your locality jurisdiction may have modified this general rule of agency and it would be a good idea to get legal advice if this is other that idle curiosity causing the question. If you are engaged as other that a pay rolled employee, i.e. contract or other arrangement, then you may not be the agent but an arms length contractor. In this case the client would be able to sue you or any losses suffered as a result of your actions.
Professional liability is different than personal liability. If you are a P.Eng or equal, then your local association will have the responsibility to take action against you professionally. This could mean placing restrictions on your ability to practice up to and including permanent expulsion from the profession and or administrative fines and other penalties. I do not believe that they could order you to pay damages and restitution out of your own pocket.
Once again, I caution you that if this question is other than simple curiosity, get competent legal advice on your specific circumstances. I’m not a lawyer and the above is simply my understanding of common law.
Rick Kitson MBA P.Eng
Construction Project Management
From conception to completion
- Thread starter
- #4
Thankfully this is just curiosity, I’m an EIT planning on taking my PE exam in the Fall. I read about the associated legal aspects of engineering design in trade magazines each month that attempt to define various situations. I have not come across a lot of information on the subject, which leads me to believe that many engineers lack thorough knowledge on the subject. Looking into the future I was curious to find out the details on why and how personal liability could enter into the equation for an engineer. A very frightening thought.
Mark10, it would be frightening to be on a bridge or in a building during an earthquake if no one was responsible for the design. Like having your gall bladder removed and no one in the operating room feels responsible for the outcome. If you are confident that your engineering skills are good enough to do your work properly then you should have no problem accepting responsibility for it. Your PE will only let others know that at some point in time you met minimum requirements.
krd:
Your post sounds a bit confusing. The PE is them minimum to be responsible for design work which requires professionals and really has nothing to do about proving you met a minumum standard, other than passing the tests. Now that is not the case in industry, that is why accountants and lawyers run industrial engineering decisions and not engineers. Tha bridge you stated would have needed a PE if made in the States, without exception,without a PE the bridge would not have been designed.
Out of all engineers, only 20% are registered professionals and Mark10 is right, the other 80% of the engineers don't give professional or personal liability much thought.
BobPE
Your post sounds a bit confusing. The PE is them minimum to be responsible for design work which requires professionals and really has nothing to do about proving you met a minumum standard, other than passing the tests. Now that is not the case in industry, that is why accountants and lawyers run industrial engineering decisions and not engineers. Tha bridge you stated would have needed a PE if made in the States, without exception,without a PE the bridge would not have been designed.
Out of all engineers, only 20% are registered professionals and Mark10 is right, the other 80% of the engineers don't give professional or personal liability much thought.
BobPE
You can contact your state/provincial licensing/registration board for help in this too. They should be up on the various issues. Check with their practice regulators.
In Ontario, we always get a "blue page" where they publish an Engineer that has been "brought up on charges." The Engineer never wins - I guess if he did, they wouldn't have published it. I wish that they would publish the name and experience of the person bringing the allegations. You might be surprised in that a good many of them are brought up by city planning departments (they guys who accept or reject the building plans). How many of them are professional engineers? Most are very good at what they do; but I do believe that for some, it is a matter of frustration that they aren't professional engineers in title. I sort of got turned off by this professional charges by the associations a few years back when, if you read the whole article, the Provincial's own specialist had to come back two or three times with "new calculations" to prove the charged engineer negligent. This was after the accused had designed something like 3000 structures with NO failures!!!![[cry]](/data/assets/smilies/cry.gif "[cry] [cry]")
in your ![[cheers]](/data/assets/smilies/cheers.gif "[cheers] [cheers]")
In Ontario, we always get a "blue page" where they publish an Engineer that has been "brought up on charges." The Engineer never wins - I guess if he did, they wouldn't have published it. I wish that they would publish the name and experience of the person bringing the allegations. You might be surprised in that a good many of them are brought up by city planning departments (they guys who accept or reject the building plans). How many of them are professional engineers? Most are very good at what they do; but I do believe that for some, it is a matter of frustration that they aren't professional engineers in title. I sort of got turned off by this professional charges by the associations a few years back when, if you read the whole article, the Provincial's own specialist had to come back two or three times with "new calculations" to prove the charged engineer negligent. This was after the accused had designed something like 3000 structures with NO failures!!!
in your BobPE, Mark10 sounds like a young engineer who is a little nervous about the ramifications of getting a PE so I was intending to reassure him that it's not as daunting as it might seem as long as you have the skills to do proper work and have confidence in your judgements. While all PE's should have liability insurance it's those that do things like guess at solutions who should loose sleep and really need the insurance. In the good old days when I got my PE the only test I had to take was an ethics exam.
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