Independent Engineers in construction may have important role to play.  They especially caught my attention since I worked on a contract for one of our clients.  The client, who was the owner in the construction contract, told me they do not quite have the capacity to look for an engineer.  They want the contractor suggest few candidates and the client will select one of them.  They specifically needed an engineering company for inspection purposes.  I came up with a clause something along these lines (see the first clause in the list at Intelcontracts.com) (I keep improving it to this day).  

But I kept wondering about the issue… 

Role of independent engineer

Especially in large scale construction contracts an Owner appoints its engineers-advisors, unless it has necessary inhouse capacity.  This is quite normal – it needs someone to advise on all sorts of technical matters.  But “independent engineer” is a special one.  See brief description here (you need to be logged in, which is free for now).  In a nutshell, an Independent Engineer could be a mechanism that helps to preclude disputes between Owner and Contractor over range of technical issues. 

Use of independent engineer typically (perhaps not always) makes a construction contract less pro-Owner.  Some of the matter to be decided by the Owner (and accepted by the Contractor), would be decided by an Independent Engneer.

How to appoint Engineer

Given this, its appointment could be important matter.

It appears (from number of contracts we have reviewed) that in most cases an Engineer would be appointed prior to signing the Contract.  The definition of Engineer refers to a particular person – See 3 (third) definition here.  That makes sense – why wait until after signing the Contract (not that there are never reasons for that).  The parties hope they do not have to go back to selecting another one.  But unexpected events do happen, so even where identity of the Engineer is known at the time of signing the Contract, still there must be a mechanism for its replacement.  

Another way of dealing with the initial appointment of the engineer is to have the Owner appoint it anytime – whether before or after signing the Contract.  Again, there is a need for clauses on the replacement, otherwise (i.e., if the Owner were to appoint and replace without any restrictions) the Engineer would not be quite “independent”.  

Neutral vs pro-Owner

FIDIC is an example of a contract that contains relatively more netural provisions on replacement of the Engineer.  Under provisions of Red Book, the Employer (Owner) proposes (or nominates) the replacement, while the Contractor can object to the candidate.  If the objection is “reasonable” the Employer cannot appoint that person as the Engineer.  

Under this arrangement, the Employer retains certain control.  It is the Employer who proposes the candidate.  Further, there may be dispute as to “reasonable” objection. Still this appears to be a very good neutral solution.  

We have come up with this Clause.  Clauses 2 and 3 in our example are desgined to be pro-Owner.  This particular clause limits the grounds for the Contractor’s objections, which can be based on eligibility requirements (contrast this with “reasonable” in FIDIC) and gives the Owner an edge in case of a dispute.  

What do you think?  Let us know your thoughts. 

You can visit intelcontract.com and write to use by going to “Contact” section, or you can comment on that particular Clause by clicking on the “Comment” button.