Death of Principal Engineer
10

Question

Death of Principal Engineer

zclarson82 (Structural)

(OP)

17 Apr 24 18:28

Hi everyone,

I work at a small structural engineering firm in Utah where we had only one licensed engineer who was a SE and the owner. The rest of us are EIT's, drafters, or secretaries. The principal engineer passed away unexpectedly two weeks ago leaving the company without a licensed engineer. The owner's wife is our secretary and is now the majority owner of the company.

I'm seeking any advice that I can get about how to best handle this situation. Hopefully we will be able to find somebody that we can hire that will step in and take over the company, but it doesn't seem very likely considering the liability and amount that we would be able to pay them. We are currently in discussions with another engineering firm who have offered to review all of our work and stamp things while we find a replacement for our principal. Some engineers in our state have advised us that we can't legally do that without a licensed engineer in our firm providing oversight while others say that there is no problem with that. Is this something that differs from state to state?

Our clients (understandably) have been requesting that we send them updated sets of plans, complete RFI's, and give general engineering advice. Without licenses, we are assuming that we can't legally do any of those things. We have been getting more and more pushback from clients who are concerned about the status of their projects, and for now all that we can tell them is that we are trying to figure it out as quickly as possible.

Any ideas, feedback, perspectives, or advice that you can offer are greatly appreciated.

Thanks in advance!

zelgar (Civil/Environmental) · Answer 1 · 2024-04-17 18:43:28

I would go to Utah's website to get the information: https://dopl.utah.gov/engineering/
Looking at the rules 58-22, it appears that without a PE, the firm you work at cannot perform any engineering services, nor could you partially perform the work for another PE to sign since they do not have direct authority over the staff of your firm. I would suggest you contact them at (801) 530-6628, (866) 275-3675 Toll-Free in Utah or b5@utah.gov as I'm certain they have dealt with this situation before.

TigerGuy (Geotechnical) · Answer 2 · 2024-04-17 19:06:22

First of all, many condolences. Death is difficult enough without the ramifications your group is facing.

Communicate with all clients and advise them on the situation. This won't be a 5-minute fix, it's going to take time. The widow/owner now needs to be able to think through the next steps. Probably the easiest and fastest solution would be to broker a sale to another local firm. Otherwise, a search for a licensed SE that can step in and take the reins could take months.

Best wishes in this difficult situation.

zclarson82 (Structural) · Answer 3 · 2024-04-17 19:16:05

Zelgar,

Thanks for your input this is very helpful. I just sent an email to the engineering board over Utah. Which section in 58-22 did you find that excerpt from?

zclarson82 (Structural) · Answer 4 · 2024-04-17 19:39:42

TigerGuy,

Thank you for the condolences, it has been challenging. We have had a couple of firms offer to buy us out, I think this will likely be the easiest solution.

phamENG (Structural) · Answer 5 · 2024-04-18 13:57:50

A buyout is likely the only viable solution you have.

The owner certainly needs to consult with an attorney. Are you a professional corporation? If the letters after the firm's name start with P (PC, PLLC, PLLP, etc.)...then there is likely a requirement that a majority or even ALL of the ownership of the firm be held by licensed professionals in the field you offer services (% varies by state). If that's the case, the company likely isn't allowed to conduct any business at all unless there are exceptions or carve outs for this scenario (they'd likely be limited to winding down or selling if they exist). If this is the case, even hiring somebody wouldn't be enough as the late owner's widow is now the owner and does not hold a PE.

Clear communication with clients is essential. Even if a wholesale buyout can't be found, you may be able to assign individual contracts for projects that are in the works to other engineers so clients don't have a disruption. The tradeoff there is a reduction in value should they still be looking to sell. But it may be necessary to avoid a lawsuit if your lack of operating ability is causing financial damages to a contractor or building owner.

zelgar (Civil/Environmental) · Answer 6 · 2024-04-18 17:35:17

Here's a few PE rules that I think prevent you from working until you have a PE that's in charge at your workplace:

58-22-305 Exemption from licensure allows the non-engineers to do engineering work, provided they're working under a PE.

58-22-603 Seal -- Authorized use. Item (1)(b) allows the PE to sign off work prepared by an employee, subordinate, associate, or drafter under the supervision of a licensee, provided the licensee or a principal affixing his seal assumes responsibility.

Rabbit12 (Structural) · Answer 7 · 2024-04-19 16:00:01

I have to think there is a way to work with the board to find a temporary solution here. What's worse, working with another engineering firm to ensure the projects get completed safely and the clients are successful or just throwing your hands up and walking away leaving everyone high and dry?

A well-developed plan that lays out how things will be done, and everyone agrees on is a great solution to the projects that are already being worked.

Any new work wouldn't apply to that agreement.

GeoEnvGuy (Geotechnical) · Answer 8 · 2024-04-19 16:39:36

Condolences for your loss. I think a immediate strategy would be to hire a senior engineer as casual employee to close out the exiting projects. The casual hire part would allow for the PE board to allow you to practice with an engineer on staff. The hours would be as much as the senior would be willing to offer to complete the work on the timetable that works with your clients. You may also want to consider dropping some projects if they just started and take the loss if you can't find a suitable candidate for a full time replacement.

Not being from Utah but general engineering regulations prohibit non engineers from designs of structures or engineering opinions on technical matters. RFI's on how to do something or will doing this meet the design intent form an engineering opinion that workers or the public will depend on.

glass99 (Structural) · Answer 9 · 2024-04-26 14:32:42

The buyout option seems like manna from the heavens in a horrible situation like this. Selling a small firm is hard at the best of times.

What kind of projects do you guys do?

btw asking the Utah PE board is only going to yield you the obvious conservative answers about all the stuff you can't do. You obviously need someone to take over the firm, and they wont be able to help with that.

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Death of Principal Engineer
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