Managing Sustainability Risks via Contract
We’ve written about the challenges of managing green design project risks (subheading “Green Design/Sustainability”), particularly in using written contracts to manage professional liability and client expectations. Managing client expectations is only the first step in navigating the risks that green designs pose.
With that in mind, the author behind the Green Real Estate Law blog, Stephen Del Percio, offers a law review article to help firms contractually manage their sustainability risks. Green Building Contracts: Considering the Roles of Consequential Damages & Limitation of Liability Provisions, co-written by Professor Darren Prum of Regis University, offers a comprehensive overview of consequential damages and limitation of liability provisions and how these concepts apply to the various stakeholders (design professional, contractor, and owner) in a green design project. The article then talks about the contractual provisions in the documents published by the AIA, EJCDC, ConsensusDOCS, and Design-Build Institute of America, and how these standard forms allocate the risk of consequential damages between the various project stakeholders. As Del Percio states,
"It concludes by providing a set of recommendations for owners, design professionals, contractors, and consultants to consider when negotiating similar provisions, most of which are relevant for any type of construction project whether green or not."