October 1, 2017
A primer on shop drawingsBy Robert Kennaley and Josh Winter
Anyone involved in construction to any great extent will eventually come across shop drawing requirements. Shop drawings are typically required by the contract documents issued by the owner, in relation to prefabricated components and specialty installations. They are required where the drawings and specifications prepared by the architect or engineer are not detailed enough, and where only the supplier/fabricator has the expertise to detail what is actually going to be installed.
In landscaping, shop drawings are often required for a myriad of installations and components: from pre-cast retaining walls, to water features and splash pads, to lighting systems and other outdoor mechanical and electrical installations. Even outdoor playing fields can come with a shop drawing requirement, as the primary consultants rely on the suppliers to ensure they are installed to comply with league and sporting requirements.
The contract documents will also generally require that shop drawings be submitted by a certain time, or in accordance with a certain schedule. They will then also require the shop drawings be reviewed and accepted by the primary consultant before the work in question can begin. If the primary consultant has any questions or concerns about the shop drawings, he or she will request they be revised and resubmitted. Indeed, an instruction to ‘revise and resubmit’ a shop drawing to meet the requirements of the prime consultant is commonly given.
Generally, the contract documents will require the prime consultant(s) to simply review and accept, but not “approve” shop drawings. This is because the owner and prime consultants wish to make it clear the suppliers of shop drawings are responsible for the design laid out in those drawings. This, of course, makes sense: the shop drawing supplier is the one that is expected to have the required expertise in the area in question.
From the owner’s and consultant’s perspective, the need to review and accept the shop drawings is based on the need to ensure the work described in the drawings will meet the needs of the over-all design and integrate properly with the rest of the work. In addition to complaining when the shop drawings come with insufficient detail to allow them to confirm that design requirements are met, owners and consultants will also often complain that delays in the provision of shop drawings for review can have costly impacts on a project’s schedule.
On the other hand, contractors, subcontractors and suppliers often complain that prime consultants will over-step their bounds when it comes to the “revise-and-resubmit” process, by assuming responsibility for the actual design of the shop drawings themselves. In addition, subcontractors and suppliers often complain that delays attributable to the prime consultants during the shop drawing review process can lead to project delays.
In our view, the two risks that need to be managed when it comes to shop drawings lie within design responsibility and with delays. With design, those who supply shop drawings need to understand they are just that: design. Accordingly, the impacts of an error in design should be respected and understood. First, those who provide design should be insured for it. As we have discussed in other columns, the standard CGL liability policy will exclude errors of design. Insurance for design errors generally requires ‘errors and omissions’ insurance. When a supplier provides shop drawings, you should ensure either you or the supplier is properly insured for errors in design.
Second, the impact of an error in design can be costly. If the design turns out to be incorrect, the purchaser of the design is entitled to be put in the position he or she would have been in had the design been correct. Damages for an error in design can include the cost of having someone else prepare a proper design, the cost of removing or remedying the work that failed, the cost of a completely new design, if necessary, and any impacts associated with delay.
In the event the shop drawings turn out to be wrong, the consultants will generally argue they were not “approving,” but only “reviewing,” them. Accordingly, those who are required to supply shop drawings need to be careful not to go beyond the scope of what they believe they were hired to provide, vis-à-vis design. This is particularly so where a consultant wants the supplier to solve a problem that goes beyond the supply and installation of the work of the supplier but, rather, is a problem the primary consultants themselves are responsible for. Where suppliers of shop drawings do not agree with a direction to ‘revise and resubmit,’ they should make their objections clear. If they do not believe the design being requested is their design responsibility, they should refuse to provide it (as far as possible). As we have said before, there is a world of difference between recommending a design, and suggesting the other side might want to consider an option, while insisting the other side has to make the ultimate decision.
In regards to delay, suppliers of shop drawings should keep in mind that a failure to provide the drawings, or revised versions of them as required, can lead to delays. They should be aware of the submittal scheduling requirements, and either make sure they meet them or give notice, in writing, of why they cannot be met. For example, if a fabricator cannot commence shop drawing preparation until field measurements are obtained, timely notice of any potential delays in obtaining access to take them should be given. In addition, because fabrication and installation cannot generally start until the shop drawings are accepted by the consultant, notice of any delays in the turn-around of the shop drawings by the consultant should be flagged and followed up on, in writing. Where there might be an impact on schedule, this should be set out, in writing.
Rob Kennaley and Josh Winter practice construction law in Toronto and Simcoe, Ont. They speak and write regularly on construction law issues and can be reached for comment at 416-700-4142 or at email@example.com and firstname.lastname@example.org. This material is for information purposes and is not intended to provide legal advice. Readers who have concerns about any particular circumstance are encouraged to seek independent legal advice in that regard.