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Professional Liability Question- E/O contractor disobeyed plans

Professional Liability Question- E/O contractor disobeyed plans

Professional Liability Question- E/O contractor disobeyed plans

(OP)
We designed a shoring job a few years ago for a client. A claim was made on our insurance. I thought that this claim had gone away as I had not heard of it. We issued plans and a sealed submittal. Months later when the contractor was doing the work they disobeyed the plans by driving the piles in to the ground without drilling the pilot shafts and when installing the beams they started to sink. They were told that they needed to plate the beams or change to sheetpile. During this time period an error on the calculations was found. The contractor installed the shoring anyways and failed to disclose monitoring data that they had that indicated that the soldier piles had sunk up to a foot in the corners and continued to sink. They also continually surcharged the excavation as both field inspections I showed up and there was an excavator and 15 foot spoil pile with the excavator on top right next to the excavation. They also drove over the beams with the excavator. During this process one of the whalers started to buckle. There was a modeling error. We told the contractor to back fill the excavation until a solution could be presented. The contractor continued reinforcing the shoring with out any sealed documents from us. Eventually the contractor cut off communication and I never heard about this again as the contractor would not respond to communication . I have our files with pictures of the site conditions as well as the excavator damaging the beams. The claims process had an engineer company do a report on the engineering error. I’m wonder what the thoughts are on this. We were never given ample time to fix the error and the contractors negligence and carelessness is a big part of why this snowballed. I’m wondering how much I should fight this. The shoring was temporary and from what I know the beams deformed but there was no sudden failure or anyone hurt.

RE: Professional Liability Question- E/O contractor disobeyed plans

Why is it your fight?

Surely this is for the insurance company to determine?

That's kind of what they are there for.

Remember - More details = better answers
Also: If you get a response it's polite to respond to it.

RE: Professional Liability Question- E/O contractor disobeyed plans

Yeah...tough spot. If it didn't go to court, there's not much you can do.

The insurance company is there to shield you from financial loss, not ensure any sort of justice. They are also going to shield themselves from financial loss, and they will put that that objective over your long term benefit to the maximum extent permitted by their contract with you. If that means settling and paying out a claim rather than rolling the dice to see if a judge/jury decides you weren't liable, then that's their prerogative. You likely agreed to it when you accepted the terms of your policy.

RE: Professional Liability Question- E/O contractor disobeyed plans

Think of the alternatives -

The main one is, your insurance company pays this out and then either drops you or raises your premium on the grounds of the original error. Which, were I in the insurance business, is what I would be considering. However, insurance companies have experience with far more than one client and, maybe, errors like this are a dime a dozen and major losses are rarely due to them.

So what would you do if they drop you or raise your rates? Would you s ue them and say "Well I don't think the error was all that bad," in front of a jury, making a searchable public record? Bold move, let's see where that goes.

Keep the evidence you have safe; make copies to store elsewhere in case the insurance company side steps and says "All yours." Keep a record of all conversations. Memories go bad; contemporaneously written notes are far better.

After that? Worry doesn't fix things; understand what went wrong and decide how you could have detected it earlier. Perhaps, as far as the job site, there wasn't. Not possible to specifically predict what a contractor will do or how they will respond to a "wait a minute" request.
---
I see Steve Lehto - a lawyer doing Lemon Law work. Absolutely will not touch an RV lawsuit because RVs aren't covered under lemon laws. He did for a while and learned not to do it anymore. Same thing here. Decide if this is the sort of work you want and if not, stop doing it.

RE: Professional Liability Question- E/O contractor disobeyed plans

(OP)
I’m looking for advice on how the insurance company will react and what to expect when it comes time to renew. The actual damage was the deformation of temporary structure. Maybe 20k in steel that is somewhat disposable. I’m worried about being dropped even though the company has been doing this 34 years and only had one other claim that had nothing to do with us and we were ousted dragged in the suit by an ambulance chaser. Looking for input from people who have been through this. I know PLI covers this but what good is insurance if the process of using it puts you out of business. I’m not concerned with the defense I’m concerned with how insurance companies react.

RE: Professional Liability Question- E/O contractor disobeyed plans

Quote (3DDave)

I see Steve Lehto - a lawyer doing Lemon Law work.

Love Steve Lehto

RE: Professional Liability Question- E/O contractor disobeyed plans

Talk to your agent. You have paid them a boatload of money over the years to cover this sort of event and it it up to them to decide if they wish to continue providing coverage in exchange for money. Is it your company for 34 years or the insurance company for 34 years? Not too bad an idea to look for other bids to at least compare prices.

RE: Professional Liability Question- E/O contractor disobeyed plans

Best case: Your insurance premium will go up - probably by a lot.
Likely case: Your insurance company won't renew you and your premium at a new insurer will go up - probably by a lot.
Worst case: You will not be able to purchase future liability and E&O insurance anywhere.

No other cases.

Anyway, this whole discussion is hardly an "Engineering Failure and Disaster", and should move to some other forum here.

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