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Construction Quality Management Resources


  1. The "Definition of Quality"

  2. Managing Construction Quality

  3. Construction Quality Management

  4. Lean Construction

  5. Punchlist Management Software

  6. The Cost of Quality

  7. "Really, Really Good Reading"

1. The "Definition of Quality"


We have found, in our search for a definitive definition of "quality," that a single definition is impossible (I dare you to Google "definition of quality," you'll be going down a rabbit hole). The definition depends on who you are, and what you're talking about.

For the purpose of this "definition of quality" article, here is our definition....


  • For the purpose of aiding owners and contractors in construction quality management, we propose the following definition of "Quality" and a "Quality Product."

  • Quality is fitness for use (Juran 1974), including meeting or exceeding needs, now and in the future, reliably, durably, with limited variation, and virtually defect free; and it helps if joy is sparked in those who recognize excellence.

  • A Quality Product meets or exceeds the customers needs, now and in the future. Aspects of a Quality Product include it being: (1.) fit for its intended use, (2.) cost effective, (3.) delivered on time, (4.) reliable, (5.) durable, (6.) with limited variation, (7.) virtually defect free; and (8.) it helps if joy is sparked in people who are able to recognize excellence. To deliver a Quality Product a system, with the objective to deliver a Quality Product, must be employed. Components of the system must include definition of: (A.) the customer needs; (B.) the product itself and acceptable variation; (C.) the budget/costs; (D.) the time of delivery; (E.) the process for creating the product; (F.) the process for verifying the parties are capable of "doing the right things right, every time"; (G.) the process for verifying the parties involved are actually "doing the right things right, every time" during creation of the product; (H.) and the process for verifying that the right things were done right, at the time of delivery.

2. Managing Construction Quality


Several articles included in the top 10 results for Managing Construction Quality emphasize the difficulty encountered in attempting to manage and/or ensure construction quality. Regulations, communication, measurement, and other techniques for ensuring management of quality are addressed.

Top 10 Results

  1. First Time Quality Blog Post. This is a blog that discusses construction quality control plans and how they should outline a systematic process to manage them to consistently deliver quality results.

  2. Managing Construction Quality by Pete Fowler Construction Services, Inc. This article outlines the Gold Old Days versus the New World in Managing Construction Quality. It outlines the DBSKV Construction Management method and highlights the ABCs of Risk Management. It explains project definition and integrates Quality Planning and having a quality management plan.

  3. This is a link to a Purdue University Catalog for BCM 52500 – Managing Construction Quality and Production. It includes advanced techniques for assessing the success of construction project management including schedule cost, safety and quality measurements. Impacts of pre planning, human factors, and communication systems on quality and productivity.

  4. This is an article outlining public policies for managing construction quality: the grand strategy of Singapore. This article argues that vulnerability of the construction industry to fluctuations in the economy requires the involvement of the government to maintain workload stability in order to deliver high quality standards in the industry.

  5. This link refers to two articles: one on CDM (Construction Design and Management) Regulations and another on Stakeholder Management. The art of stakeholder management is proactively building on shared synergies and heading off any major confrontations. The easiest way to do this is to communicate and consult at all stages so the stakeholders’ needs are understood and impacts are understood by all stakeholders. CDM Regulations apply to the design and construction process on all projects, where construction is to take place (however small), from concept through completion and ultimate de-commissioning.

  6. This article is on Property Analysis by Pete Fowler Construction Services, Inc. It outlines the services offered by PFCS, the types of clients, and links articles and whitepapers as well as the process that PFCS uses for its projects.

  7. This is a repeat of the Singapore article, above.

  8. This links to an article outlining what constitutes quality, how quality can be determined, the ISO definition of quality, difficulties encountered in the process of achieving product quality, development and maturation of IT in terms of improving quality management practices, and the steps for producing product quality.

  9. This article discusses building commissioning: is it really the best method for managing construction quality? Building commissioning provides documented confirmation that building systems function according to criteria set forth in the project documents.

  10. This article discusses a comprehensive process designed to assure quality, implementing quality control plans, assessing safety issues, and other items related to quality control in order to execute a successful project.

3. Construction Quality Management


There are several articles and links in our top ten results that emphasize processes and planning. It includes two training manuals and other writings spotlighting the failures in quality management.

Top 10 Results

  1. eSUB: This is construction software on how to improve construction quality management. This lists some tips for improving construction quality management including; What is Construction Quality Management, Where Quality Management Fails, and Construction Quality Management Process Elements.

  2. U.S. Army Corps of Engineers Professional Development Support Center and U.S. Naval Facilities Engineering Command (NAVFAC): This is a pdf of a student study guide for the construction quality management for contractors. This is to help familiarize contractor personnel with the Construction Quality Management concepts and procedures. This guide was designed to be used as a workbook during the training program. It is intended that, after the training, it be included in your office bookshelf as a helpful tool to be used when needed.

  3. IRMI: This article discusses how to achieve the overall success to a construction project by describing the following steps: the processes of contractor quality management, quality assurance and quality control, elements of a quality management process, and managing quality.

  4. University Northern Florida (UNF) Division of Continuing Education: This is a course catalogue for Construction Quality Management for Contractors (CQM-C).

  5. Eventbrite: This is a website that lists different seminars including Construction Quality Management and other related construction topics.

  6. Eventbrite: This is the same website as #5 but different dates that lists different seminars including Construction Quality Management and other related construction topics.

  7. First Time Quality: This is a blog that illustrates a step by step process on how to write a project-specific quality plan. The following are the steps; project personnel, quality communications, quality assurance surveillance, subcontractors and suppliers, project quality specifications, inspections and tests, control of nonconformances, and project completion inspections.

  8. Layton Construction: This is a manual that can be downloaded and created by Layton Construction for quality management. It includes core values that Layton Construction wants their employees and subcontractors to embrace.

  9. AutoDesk BIM 360: This is software/app that allows the team to participate is quality inspections from their mobile devices. It includes (but not limited to) quality checklists and issues, punch lists, and quality issue resolution.

  10. ETQ: This is a paper that can be downloaded and describes seven key elements for the implementation of a quality management system.They state “Research shows 71% of software rollouts fail, are late or are over budget.”

4. Lean Construction


Many if not all of the articles listed below in our top 10 results for Lean Construction emphasize stakeholders, relationships, and adhering to strict principles. All suggest that improvements are expected when integrating the facets of Lean Construction to project management.

Top 10 Results

  1. This article covers the transformational improvement in the delivery of value to the stakeholders and improvement in the quality of the work environment for all participants. It claims that Lean delivers better employee retention and quality of life, safer worksites, reduced project waste and greater project value.

  2. This article Lean methods seek to develop and manage a project through relationships, shared knowledge and common goals. Traditional silos of knowledge, work and effort are broken down and reorganized for the betterment of the project rather than of individual participants. The result? Significant improvements in schedule with dramatically reduced waste, particularly on complex, uncertain and quick projects.

  3. This article claims that getting work to flow reliably and predictably on a construction site requires the impeccable alignment of the entire supply chain responsible for constructed facilities such that value is maximized and waste is minimized. With such a broad scope, it is fair to say that tools found in Lean Manufacturing and Lean Production, as practiced by Toyota and others, have been adapted to be used in the fulfillment of Lean construction principles.

  4. This article explains that there are guiding principles that help firms achieve lower costs, reduced construction times, more productivity and efficient project management. They represent a holistic approach to the construction process. These are called the 6 Principles of Lean Construction, which include: Identify Value from the Customer’s Point of View, Define the Value Stream, Eliminate Waste, Flow of Work Processes, Pull Planning and Scheduling, Continuous Improvement.

  5. This article is regarding lean construction and is aimed at maximizing value and minimizing costs involved during construction project maintenance, design, planning, and activation. Worldwide, the use of Lean construction increases the productivity of the construction industry.

  6. This article explains that Lean construction is a way of designing production systems in a construction environment with the aim of decreasing time, effort, and a waste of materials.

  7. This article argues that cutting costs, reducing construction times, increasing productivity and efficiently and effectively managing projects can all be achieved through successful implementation of lean principles. These principles should drive and guide you to discovering and developing the tools and methods to achieving the goals of lean construction and taking a more holistic approach to project delivery.

  8. This article attempts to define Lean Construcion. Inviting all parties to the table to plan, design, estimate, budget and optimize. All stakeholders collaborate and plan together; owner, contractor, sub-contractors, designers, engineers, schedulers, cost engineers, etc. The team will often prototype a design, rather than forge ahead and build. Prototyping provides us with a visual and functional model that we test and evaluate.

  9. This article explains applying Lean construction management principles, and some of the key benefits that can be achieved: Higher Quality Work, Increasing Employee Collaboration and Accountability, Greater Project Satisfaction, Increasing ROI and Improving Risk Management.

  10. This article attempts to bridge the divide between Lean Construction and CPM (Critical Path Method). The key is digitizing and simplifying Lean to optimize its impact while providing a unified platform where Lean and CPM can coexist, thrive, compliment each other, and deliver compounded benefits.

5. Punchlist Management Software


The applications and articles in our top ten results for Punchlist Management Software focus on managing time, effort, and keeping construction professionals up to date with the current technology necessary for effective construction management.

Top 10 Results

  1. The punch list app for the jobsite, Fieldwire. This is an app that provides punch list management. Fieldwire is a popular app that provides many features for a company that is looking for an app that provides an easy to manage punch list. Using the app you can easily include location on blueprints, checklists, categories, and photos when searching for construction deficiencies. This app can be used on your iPhone, iPad, and Android. Fieldwire makes QA/QC review easy to do with the ability of people across the organization to make updates.

  2. Punch List Software. This is a list of Punch List Software companies can utilize. There are numerous apps companies can choose from but the top apps have reviews from numerous people.

  3. Punch List Software Comparison. This is the comparison list of different software that companies use for punch list management. This is a good website to use if you are looking for a comparison tool to use when choosing a website.

  4. SKYSITE is software that can be used for punch list management. This software claims to make punch list management simple by allowing you to see documents and the punch list side by side. This can all be done on your smartphone. Other features include adding custom fields, an app for QA/AC tasks, and hyperlinked task details.

  5. Procure is software for construction. This software allows you to punch list items directly from the field, use QR codes, and maintain a real-time history of all actions. The company offers case studies, webinars, and dates for road shows.

  6. FinishLine is a software app. This app is for construction professionals including owners, architects, subcontractors, etc. FinishLine results in a 30-40% reduction in time to inspect. Some perks include accurate data entry, visual navigation, status at a glance, and checklist ready. Training to use FinishLine is easy to use.

  7. BuildUp is a punch list software app. This app allows construction teams to manage uses for the whole duration of the project. Some features of this app include issue management, collaboration of all construction project stakeholders, and is easy to use for the non-tech savvy users.

  8. PlanGrid is a software app. PlanGrid offers the ability to track punch lists in one place, identify punch list items, and allow your team to complete work on time. You will also be able to close out and inspect straight from the field, identify cost or schedule impacts, and generate rich reports.

  9. KO Punchlist is a software app. This apps is free to download, and every new project has a one time fee of $4.99. This app offers fully functional punch lists, can work offline and can combine punch lists created by other team members.

  10. What is a Punch List? This is a post on how to effectively use a punch list. Punch lists are used to make sure the project has been completed and they are most effective when completed at the start of the project. Punch lists allow for contractors to make sure details are not forgotten and if misunderstandings arise they can be easily solved. Players involved in punch lists include owner/client, contractors, and subcontractors.

  11. Punch List Manager. Punch List Manager is a warranty management software. Features include managing pending requests, service work, and the ability to use a collaborative schedule to know where field technicians and your trade partners are scheduled for inspection and repair.

6. The Cost of Quality


Our research into the Cost of Quality has revealed information related to the comprehensive concepts of poor versus good quality, what the Cost of Quality is and how to measure it, different types of quality costs and the four main categories of the Costs of Quality: appraisal, internal failure, external failure, and typical values.

Top 10 Results

  1. ASQ. This is a website that gives a brief description of Cost of Quality and offers a membership that provides cost of quality support including tools, networking, and knowledge.

  2. SixSigma: Cost of Quality Not Failure Costs. This is a blog that explains the cost of quality as a more comprehensive concept covering the cost of poor quality and the cost of good quality.

  3. Wikipedia. This is someone’s definition of Quality Costs. It also includes quality cost area descriptions and examples defined by Armand V. Feigenbaum in a 1956 Harvard Business Review and Joseph M. Juran.

  4. Quality One International, gives a brief description about cost of quality including an introduction, what it is, how to measure it. It’s a service that offers quality and reliability support for product and process development through consulting, training and project support.

  5. Accounting Tools breaks quality costs into four categories and describes each: Prevention costs, appraisal costs, internal failure costs, external failure costs. 2/4/2018. It also offers accounting CPE courses and books.

  6. Total Quality Management addresses the cost of quality including (but not limited to); definition, historical views, the definitions of the four categories of cost of quality. Joel E. Ross, 9/12/2018.

  7. Tallyfy explains what the cost of quality and how it works including (but not limited to); how it’s evolved, three ways of perceiving cost of quality, the four categories, and quality-related workflows matter. Sonia Perason.

  8. SCORTEX is a company that offers services for quality such as to automate visual quality control. They also explain how higher cost and lower cost differ and define cost of quality, the four categories, and give examples of each type of cost utilizing an automotive company.

  9. This is an article from Quality Magazine explaining how to convey the definition of quality and explain cost of quality.

  10. This is a blog that discusses the four categories; appraisal, internal failure, external failure, typical values, and has examples of each.

7. "Really, Really Good Reading" (a.k.a., Further Findings During the Proving the Obvious Using Google Research)

Article of the Week: How to Celebrate Your Mistakes

Article of the Week: How to Celebrate Your Mistakes

Our goal at PFCS is to do AWESOME work for our clients, but not have to beat the hell out of everyone to get it.  All employees want to feel appreciated and that they are an important piece of the puzzle.  Providing tools to complete our tasks is important, but providing respect and appreciation is vital and is the foundation of PFCS.

OMMA-Goodness!™ Project Management Framework: In Brief


Successful management of projects is difficult, especially with lots of parties involved and more things to do than you can keep together in your mind, or even in your day-planner. A Project Management system is the closest thing we have to a guarantee of success. The OMMA-Goodness!™ Project Management Framework is a simple process that distills the fundamentals of effectively bringing people together to accomplish a project objective. You will not only succeed in accomplishing your objective, the people you work with will say “OMMA-Goodness!™, what a great project manager!”

“OMMA-Goodness!™” is a memory aid (mnemonic device) that stands for Objective, Method, Milestones and Actions. The OMMA-Goodness!™ Project Management Framework begins with a clearly stated objective and a one-minute summary, which are used to orient the team and help maintain focus. We step through a proven method in a project planning meeting to refine our project plan in multiple passes, keeping our critical data organized in the milestones section, and clarifying the scope with a Work Break-Down Structure. We then identify actions required to complete the milestones. From there we estimate duration and decide when and by whom actions will be performed, which gives us budget and schedule data. At the end of the project planning meeting we set the date and time for the first of our regular project status meetings where we compare progress to plan, which creates a natural feedback loop that leads toward success without relying solely on hope, the force genius, or on natural organizational skill. The method naturally lends itself to a built-in quality control mechanism using hold-points.

Planning Steps

Read straight through the steps. Return after reading the Example, referring to definitions of the Project Management Terms as you go.

  1. Select a Project Manager (or Coordinator) who will accept full responsibility for management and execution of the Plan. Print, open or draw a Project Plan form.

  2. Write your Objective; then “One Minute Summary” the basic project info.

  3. Select a Method or use 7-W’s: Who, What, When, Where, Why, How, and How Much.

  4. Make a first-pass brainstorm of Milestones and Deliverables.

  5. Quickly list Actions to complete the known Milestones; don’t linger in details yet.

  6. Convene a Project Planning Meeting. Begin with the One Minute Summary. Update the Objective. Brainstorm more Milestones and Actions. Refine the Scope into a Work Break-Down Structure. Brainstorm the Schedule and Budget. Finalize Milestones, assign Actions and estimate durations. Set the Project Status Meeting date.

  7. Following the planning meeting, update the Project Plan; refine the Objective, use the Method check-list to ensure the Plan is complete, update Milestones including Hold-Points, complete the list of Actions and assign “Priority, Who, When, Duration and Cost” for each.

  8. Organize, lead, direct and manage execution of the Actions.

  9. Compare progress to the Scope, Budget and Schedule in an Earned Value Analysis.

  10. Conduct a Project Status Meeting; compare performance to plan; update the Plan.

  11. Repeat steps 8-10 as necessary. The last “Project Status” is a “Project Close”.


  1. Carl’s Construction is planning their next Project, called Otto’s Outhouse, using their Project Management Framework. Pepe is a new Project Manager. To avoid the distraction of struggling with a technology-based solution, Pepe will use a new spiral notebook, which will also serve as his project diary, instead of a Project Plan form. He formatted the Plan on two opposing pages; Objective, Method and Milestones on the left, Actions on the right including columns for Description, Priority, Who, When, Duration and Cost.

  2. Pepe modified the standard company Objective: “We will complete the Otto Outhouse as promised, within budget and schedule. We will earn referrals from the client and the planned profits.” (See attached Project Plan form)

  3. Pepe’s used the 7-W’s Method. He summarized his project using each line in the method: (1.) Who: Owner = Otto. GC = Carl’s Construction. Roofer = Ron’s Roofing. (2.) What: New outhouse 4 feet square, 8 feet tall. (3.) When: Next Week. (4.) Where: 100 feet from existing residence. (5.) Why: Old one blew over. (6.) How: Two doors and one interior seat. Wood frame, wood siding, wood shingle sloped roof. (7.) How Much: Fixed price contract for $4,693.95.

  4. Pepe’s first-pass brainstorm of Milestones and Deliverables was easy since he composed the estimate, Carl already signed the contract with the Owners, and the company always begins with a Scope, Budget and Schedule on the list. Estimate categories included: Grading & Excavation, Framing, Roofing, and Final Clean-Up so Pepe added these as Milestones. He also knew they needed to get a permit and have a final inspection.

  5. Pepe listed Actions to complete the known Milestones, but didn’t linger in details yet.

  6. Pepe and Carl met for a Project Planning Meeting and began with the One Minute Summary. They updated the Objective and brainstormed more Milestones and Actions, including adding the Estimate and Contract with the Owner both marked as DONE, as well as the contract with the Roofer that was not yet complete. They decided to use the list of Milestones as the Work Break-Down Structure which would serve as their Scope summary for what they agreed to in the Contract with the Owner. Pepe used the WBS as the outline for a Budget and Schedule. They set a date and time for the first Project Status Meeting which Carl insisted happen before construction started, so the meeting became a Hold-Point.

  7. After the Planning Meeting, Pepe updated the Plan, refined the Objective, used the Method as a check-list to ensure the Plan was complete, updated the Milestones, and completed the list of Actions, assigning “Priority, Who, When, Duration and Cost” for each item.

  8. Pepe organized and managed execution of the Actions, marking those completed as DONE.

  9. Pepe completed all pre-construction activities, updated the Plan, Scope, Budget and Schedule, and prepared an Earned Value Analysis. He prepared an Agenda for his meeting with Carl.

  10. As planned, Pepe met with Carl to compare his progress to plan in a Project Status Meeting. Carl was thrilled! They walked through the agenda and composed and prioritized a list of actions to move through construction, including: a Project Kick-Off Meeting, beginning and inspecting grading & excavation, beginning and inspecting framing, Project Status Meeting #2, beginning and inspecting roofing, final sign-off of the permit, final clean-up, Project Status (Close) Meeting #3 and sending all project documents to storage.

Example Project Plan


“We will complete Otto’s Outhouse as promised, within budget and schedule. We will earn referrals from the client and the planned profits.”


  • What: New outhouse 4 feet square, 8 feet tall.

  • Who: Owner = Otto. GC = Carl’s Construction. Roofer = Ron’s Roofing.

  • When: Next Week.

  • Where: 100 feet from existing residence.

  • Why: Old one blew over.

  • How: Two doors and one interior seat. Wood frame, wood siding, wood shingle sloped roof.

  • How Much: Fixed price contract for $4,693.95.

 Milestones & Deliverables

  1. Pre-Construction

    • Estimate

    • Contract with Owner, including the Scope

    • Budget

    • Schedule

    • Permit: Get it.

    • Contract with Roofer

    • Agenda for Project Kick-Off Meeting

    • HOLD-POINT: Project Status Meeting #1

  2. Construction

    • Milestone: Project Kick-Off Meeting

    • Grading & Excavation

    • Framing

    • Project Status Meeting #2

    • Roofing

    • Final Clean-Up

Project Close

  • Permit: Final Sign-Off

  • Application for Payment

  • Project Status (Close) Meeting #3


Project Management Terms

  1. Project: A temporary endeavor, that includes a beginning and an end, to create a product or service.

  2. Project Management: The discipline of organizing and managing resources to deliver a defined outcome (Objective / Scope), within the constraints of the Budget and Schedule.

  3. Project Manager (or Coordinator): A PM (or PC) is a professional responsible for planning, budgeting, scheduling and managing all project resources, including personnel, to deliver the project Objective; one who executes and follows-up on the Project Plan and reports Project Status.

  4. Project Plan: A document that defines the project Objective, Method, Milestones, and Actions; contains a list of documents that define 100% of the Scope, Budget and Schedule.

  5. Scope: The Scope of Work is the sum total (100%) of all a project’s products and their requirements or features, including all labor, materials and equipment required to complete it; a Scope document is the written representation (100%-summary) of the scope, often best depicted in a Work Break-Down Structure.

  6. Budget: An itemized list of expected costs or available funds for a project or specified Scope, often based on the Work Break-Down Structure. A control mechanism to compare to actual expenses.

  7. Schedule: A list or graphic of activities and associated dates, often based on a Work Break-Down Structure; may include who is responsible and how activities relate to each other. Common forms are the Bar (Gantt) Chart or Critical Path Method.

  8. Objective: A concisely written goal of specific, measurable outcomes including a 100%-summary of the Scope, Budget and Schedule.

  9. Milestone: An event that marks the completion of a Deliverable, a Hold-Point on a schedule, or a flag in the Project Plan to highlight completed work; often used to ensure project progress.

  10. Deliverable: A measurable, tangible item produced during project execution. Some are external and subject to approval, but some are internal only.

  11. Action: A discrete, specific, measurable task, often performed by an individual, usually between 1/10-hour and 8-hours and rarely more than 80-hours.

  12. Hold-Point: Milestone or critical stage in a project for verifying conformance with plan or quality standards.

  13. Problem-Solving: A learning situation involving more than one alternative from which a selection is made in order to attain a specific goal (Objective); usually to move the situation from where it is to the best available alternative. One METHOD: (1.) Define the Problem (2.) Identify Options (3.) Identify the Best Solution (4.) Plan How to Achieve the Best Solution (5.) Evaluate Results.

OMMA-Goodness!™ Components

  1. One Minute Summary: An A to Z, 100%-summary “restatement of the obvious” to describe “who, what, when, where, why, how and how much” (7-W’s), in 250 words or less to orient everyone to the bigpicture before emersion into the details.

  2. OMMA-Goodness!™ Project Planning Form: Planning form with sections for writing the Objective, Method, Milestones & Deliverables, and Actions for a project. For use in Project Planning, Project Planning Meetings and Project Status Meetings.

  3. Method: A problem-solving framework or check-list that we apply the specific facts of our project to, as an aid in Project Planning. Some Methods have a check-list or “Menu of Deliverables”. EXAMPLES: Scientific Method, AA’s 12 Steps, Deming’s 14-Points, PMI’s 9 Categories and even the 5-W’s.

  4. Menu of Deliverables (or Milestones): A list of common Deliverables (or Milestones) associated with a specific problem-solving method or project type, used as a check-list during project planning.

  5. Project Planning Meeting: A meeting to perform a structured Problem-Solving session. AGENDA: 1. One Minute Summary, 2. Plan Review, 3. Review Scope, Budget & Schedule, 4. Method and Menu, 5. Brainstorming and Update Plan, 6. Update Actions, 7. Arrange Status Meeting. PM (or PC) deliver complete Project Plan following meeting.

  6. Work Break-Down Structure (WBS): A project management technique for defining and organizing the total Scope using a hierarchical tree structure. The first two levels (the root node and Level 2) define a set of planned outcomes that collectively and exclusively represent a 100%-summary of the project Scope. At each subsequent level, the children of a parent node collectively and exclusively represent 100% of the scope of their parent node.

  7. Earned Value Analysis (EVA): Technique for measuring progress which combines measurement of actual performance of Scope, Schedule, and Budget, organized using a Work Break-Down Structure, and compares them to plan in an integrated methodology.

  8. Project Status Meeting: A meeting for a structured review of project progress compared to plan. AGENDA: 1. One Minute Summary, 2. Plan Review, 3. Review Scope, Budget & Schedule, 4. Old Business, 5. Method and Menu, 5. Performance Analysis, 6. New Business, 7. Brainstorming and Update Plan, 7. Update Actions, 8. Arrange Next Meeting. PM (or PC) deliver complete Project Plan following meeting.

  9. Brainstorming: An activity used to generate many creative ideas that have no right or wrong answers and are accepted without criticism.

Copyright 2008, Pete Fowler

Common Plumbing Construction Defects

  1. There have been numerous leaks in the copper domestic hot and cold water piping, resulting in property damage. 

  2. The soldered joints in the copper water piping were over fluxed. This has caused flux corrosion and leaks. 

  3. The copper water piping was not reamed at the tubing ends. This can cause internal erosion of the tubing and fittings. 

  4. The water heaters have no drain pan, as per manufacturer's installation instructions. This will likely cause water damage to property in garage. 

  5. The shut-off valves for the water supply are corroded and leaked and caused damage. The valves were not properly selected by the contractor for this service and are dezincing. 

  6. Certain high-efficiency water heater PVC flue vents are not insulated, as per manufacturer's installation instructions. 

  7. There is no insulation on the hydronic hot water supply and return piping that provides hot water heating to certain fan coils. California Title 24 requires this piping to be insulated. 

  8. Certain laundry washing machine indirect drains are not readily accessible and the water valves are not accessible. They are located behind the stacked washer/dryer. 

  9. Certain 3" PVC water heater flue vent penetrations are not properly fire rated through the all in violation of the building code. This occurs through certain units and in the electrical rooms. 

  10. Hot water takes over a minute to warm up in the bathrooms. One minute was used at the criteria even though most reasonable homeowners expect hot water in less than 30 seconds.

Common Electrical Construction Defects

  1. The unit sub panel enclosure is setback and has gaps in the drywall greater than the code allowance. 

  2. The A/C unit disconnects have inadequate working clearance. 

  3. The cables are insufficiently supported as required by code. 

  4. The cables within 6 feet of the attic access are not protected from damage. 

  5. The recessed lights fixture sockets have been over sprayed with paint/or drywall texture. 

  6. The electrical device boxes are setback and have gaps in the drywall greater than code allowances. 

  7. The boxes installed in rated walls are improperly installed. 

  8. The conduits and/or cables are insufficiently supported as required by code in the electrical closets. 

  9. The exterior exposed light fixtures are not sealed to prevent water intrusion.

  10. Quality of Workmanship.

Common Mechanical Construction Defects

  1. Certain flexible A/C ducts are not supported or installed properly, and are kinked.

  2. The A/C condensate drain piping was not installed properly. Based upon the installation instructions, it does not contain proper traps, and is not vented or supported properly. This has caused premature flow to secondary drains causing damage.

  3. The condensing units are not identified with the unit address as is required by the mechanical code.

  4. Clearance around the outdoor condensing units is not adequate and does not comply with the manufactures requirements.

  5. The condensing units are not level as required by the unit manufacturer.

  6. The refrigeration tubing insulation at the outdoor condensing units was not rated for exterior application and is deteriorating from exposure to ultra violet light.

  7. The refrigeration tubing penetrations of the exterior walls are not sealed as required by building code and energy code.

  8. The flexible dryer vents are kinked in the laundry closets. This causes poor dryer performances and creates a fire hazard.

  9. There are no check valves on the hot water recirculation fan coil heating loop. The check valves should be located at the recirculation pump discharge.

  10. The laundry closets were not provided with an exhaust fan. This is a code violation.

Habitability Claims

Habitability Claims appear to becoming more and more common, and, although there is no concise, statutory definition of the term, there are LOTS of regulations mandating the minimum performance requirements of residential property being rented by owners to tenants. We’re providing a FREE, one-hour webinar on investigation and evaluating Habitability Claims from the construction expert’s perspective.

Comparison of Common Law (US) and Civil (EU) Litigation Practice

Comparison of Common Law and Civil Litigation US vs EU_ SOCIAL 2018-11-21 B.png

To make sense of our research on “A Comparison of Construction Claims Handling Practices in the U.S. and the E.U.” we must understand the litigation processes in both the E.U. and U.S. There are similarities and differences to both approaches.

What is a Lawsuit?

A civil lawsuit or a legal action is a method of dispute resolution. Two or more parties have some kind of dispute which they are unable resolve it amongst themselves. Sometimes parties may have used some kind of alternative dispute resolution process like negotiation, mediation (where a neutral third party tries to help the parties reach a resolution) or arbitration (arbitrators are hired to act as judges in a private version of a trial) instead of a complaint being filed in the appropriate court.

If the parties leave it up to the legal system to work out their differences then to certain extent they give up control of the outcome and are left to advocate for their interests, providing facts, witness testimony, evidence and legal arguments in the hope they’ll prevail.

There’s virtually no limit to the types of parties who could be involved in a civil action, from individuals to multi-national corporations, government entities to non-profit organizations. Courts can handle disputes that are in the hundreds of dollars to potentially limitless amounts of money. The outcome of a civil lawsuit may just impact parties living next to each other or countries in different parts of the globe.

What are the Key steps in a Civil Lawsuit in the U.S.?

Generally, litigation in the U.S. goes through a number of steps or proceedings, which can vary from jurisdiction to jurisdiction, including,

  • Pleadings

  • Discovery

  • Trial

  • Appeal


To start the litigation process the plaintiff files a complaint. It lays out the basic facts of the dispute, states the legal theories for recovery and what’s sought to resolve the matter (which could be a sum of money or specific action by the defendant, the party against whom the complaint is filed). The defendant responds to the allegations with an answer, states possible defenses and may make counter-claims against the plaintiff.

The defendant may ask the court to dismiss the complaint in whole or part, either because what’s being claimed doesn’t amount to breaking the law (a motion to dismiss), or, with the filing of affidavits, claim since there are no material, disputed facts in the case the defendant is entitled to judgment as a matter of law (motion for summary judgment). Normally if a complaint is dismissed, in whole or part, the plaintiff has an opportunity to amend or re-file the complaint.


Discovery is a critical part of the civil lawsuit process. Through it both parties should have all the relevant facts of the dispute. With the benefit of these facts the complaint may be amended or could be withdrawn. With newly acquired information a defendant may file a motion for summary judgement. The parties may also have a greater understanding of the strengths and weakness of the case and choose not to risk a negative outcome at trial and negotiate a settlement.

Discovery allows the parties to submit written questions to each other, ask for copies of documents or evidence and ask each other to admit or deny statements of fact. During depositions parties and witnesses are asked questions under oath by attorneys for both sides. Not only can depositions produce facts that the opposing party didn’t know before but both sides see first-hand how well both sides’ witnesses may perform during a trial. How well or poorly a party’s witnesses do may be critical to the decision to proceed to trial or settle the case.

Discovery can be simple and straightforward or drawn out and complex. Parties can object to questions and requests and seek protective orders to limit release of information. One party may seek court help to obtain information, evidence or to depose an individual. Because of the importance of discovery parties may be very aggressive in seeking information or trying to prevent the other party from obtaining it.

Trial – the Third Step

Most civil lawsuits are resolved prior to trial because it can be very expensive, consume a lot of time and energy and depending on the nature of the dispute, emotionally draining or painful. Without a resolution agreed to by the parties it will be decided at trial. Disputed facts and verdicts can be decided by a judge or jury.

Armed with what they learned during discovery the parties tell their stories through documentary evidence, evidence in the form of objects, graphs or charts, testimony of parties and witnesses. Both sides try to simplify the issues and create sympathetic narratives they hope will win the day. Attorneys on both sides try to show the opposing side’s witnesses aren’t credible and their arguments don’t make sense while at the same time bolstering and polishing their version of events.

Trials start with opening arguments and end with closing arguments by the attorneys. Attorneys can ask the judge to rule on evidentiary and legal issues during the trial and object to submission of evidence and of questions to their witnesses. The plaintiff has the burden of showing, in most cases, it’s more likely than not its version of the truth is more credible, the law was broken in some way and the plaintiff is owed an amount of money and/or some action by the defendant for it to be made whole.

The judge or jury makes its decision which may be a dismissal for the defendant or a total or partial victory for the plaintiff. The plaintiff should be awarded the relief sought if the legal claims are successful, though it may get much more or less than it sought.


The appeal is a process by which rulings by judges and the outcome of trials may be reviewed by panels of judges. The appeal process isn’t an opportunity to re-try a case, though an appeal can be based on a claim that a verdict wasn’t based on the evidence used at trial. This is a difficult and usually unsuccessful approach. Generally, a party that feels aggrieved by a decision because it violated the law or a rule of procedure can ask the issue go back to the trial court so the decision can be corrected or at least reviewed again by the judge.

After both sides submit briefs containing their arguments why a decision should be overturned or upheld attorneys have an opportunity to make legal arguments before the appellate court judges. They can ask questions of the attorneys and seek additional briefs on particular topics of interest. Eventually the appellate court issues a decision to uphold or overturn the lower court decision. If it’s overturned often lower courts will be issued directions on what to do next. The decision need not be unanimous. The majority opinion is the final decision.

What are the Key steps in a Civil Lawsuit in the EU?

In most E.U. countries the civil lawsuit process is defined by the civil procedures of each of its 28 countries. Generally, the civil lawsuit process in the E.U. breaks down to,

  • Pre-trial pleadings

  • Pleadings

  • Production of Evidence (Discovery)

  • Trial

  • Appeal

Pre-trial Pleadings

In the pre-trial pleadings phase the parties, without the involvement of the court, try to resolve the disputes between them. The parties make various requests, with letters or notices sent between them, where the parties attempt to substantiate their positions on the merits of the case. If the parties fail to reach a resolution the civil lawsuit process continues.


The aggrieved party submits the complaint, with documentary evidence, to first instance court in accordance with the country’s applicable procedural laws, starting the legal action. The party receiving the complaint typically answers the complaint and produces all available evidence to support its arguments that the complaint be dismissed.

Production of Evidence (Discovery)

In E.U. countries the burden of production of evidence (discovery) rests on the claimant/plaintiff, the party seeking the remedy.


The plaintiff has the burden of proof., however the plaintiff does not have the discovery rights similar to the legal system established in the U.S. To further substantiate then any evidence required has to be requested to the court. The court further assesses the necessity for it and if deemed necessary then requests the opposing party to provide it in accordance with the law. If the dispute wasn’t settled and goes to trial, the judge presumably will have looked over all evidence and paperwork submitted to the court and will guide the parties through the trial. The parties call witnesses and produce more evidence, which is relevant or important to the case at hand. The judge generally acts in an investigatory role, seeking out the truth of the situation then applies the law.

Appeal - the Fifth Step

The appeal is a second stage litigation process, because in almost all cases, the case at hand, an appeal will be submitted to the Court of Appeal (the procedure on how that’s done will vary from country to country). The Court of Appeal consists of two general directions first is an ordinary appeal and second is cassation. An ordinary appeal, when a case is appealed every aspect of it is reconsidered and a new examination of the facts may take place if necessary. However, a court of cassation has limited freedom, especially where the facts are concerned. In cassation it is required by law to base its deliberations on the facts as established by the lower court and cassation would mean quashing a judicial decision on a point of law, including procedural law.

Major Differences Between U.S. and E.U. Civil Litigation Process

Production of Evidence (Discovery)

Discovery is much more limited in the E.U. There are no requests for production of documents, interrogatories or depositions. Documentary evidence is produced by the parties during the course of the litigation.

Pre-trial Pleadings

There are no motions to dismiss or for summary judgement in the E.U., which can be critical tools by defendants in the U.S. system to end a legal claim early in the process or at least narrow its scope. This can greatly reduce the cost for a defendant and the outcome of these motions is an important factor in whether a case will settle and if so, for how much.


No European civil procedural system uses juries, except the court of Great Britain/United Kingdom. Litigation costs in the E.U. are generally much lower than in the U.S. While in the U.S. the majority of civil cases will settle before a trial verdict, the opposite is true in E.U. where most civil cases are decided by the judge and most of those decisions are appealed.

Roles of Experts/Expert Testimony

This is one of the most important differences. Both regions use expert testimonies differently.

In U.S. civil cases the use of experts is common, especially in more complex cases. In the E.U. it’s rare for a civil case to include use of expert witnesses. If there is such a witness he or she will be named by the judge to help determine the facts, not by a party to help put its case in a favorable light, nevertheless parties may provide their experts as well.

The Roles of Judges and Lawyers

In the U.S. judges are more of a director who must consider court procedure and prior court decisions. The judge is neutral and normally doesn’t intervene in fact-finding except to interpret and enforce rules of evidence.

In the E.U. litigation system a judge is more a referee and the trial is a more investigative process. E.U. judges are also not strictly bound by case precedent, except the courts of Great Britain/United Kingdom, however high authority, even though formally not binding, is possessed for the pronouncements of the Highest or Constitutional Courts. Case law is more informative than dispositive. Greater sources of law for judges and lawyers are legislative statutes and codes.

E.U. lawyers need to demonstrate that statutory law applies in the case for a particular fact so their role is more to advise, inform and point the judge in the right direction, and the procedure largely is in writing. U.S. lawyers engage in more debate, oppose what the other party seeks and are more active, use much more case law, and try to convince the jury and/or judge to believe their client’s side of the story.

In both systems, judges and lawyers interact with each other and depend on each other.

The Scope of the Appellate Process

The difference in this area is at least formally significant. In the civil systems, an appellate court has plenary authority to review an inferior court's judgment, not only as to issues of law but also as to issues of fact.

The underlying theory is that the civil codes determine the substantive basis of the case and the higher court judges have a more authoritative understanding of the code's provisions. The underlying civil-law theory regarding issues of fact traditionally has been that evidence is a legal science and that the strength of an item of evidence is governed by a set of rules. Note

In most civil case appeals in the U.S. the evidence on record is accepted as the fact finder (judge or jury) accepted them. That deference doesn’t happen in the E.U. In common law systems the appellate court reviews for “error” in jury-tried cases and “abuse of discretion” in most judge-tried cases. Note

The E.U. appellate process in civil cases may look more appealing to lawyers and their clients, because they see the first instance courts as a preliminary run or try-out of the case.


It’s worth noting the differences for each type of litigation process: jury trials, the roles of judges and lawyers, the scope of appellate process/review, the role of experts and production of

evidence. These differences significantly impact each litigation processes within each region. They do so by impacting the length and cost of litigation process.

When approaching it from a legal theory point of view, both systems have defined their litigation processes based on their own values concerning justice, fairness and equality.

Articles in This Series

  1. Introducing Our Latvian Interns

  2. Construction Risk & Claims Management in the US vs. EU

  3. Construction Management Process in the US vs. EU

  4. Comparison of Common Law (U.S.) vs. Civil Litigation (E.U.) Practices (THIS ARTICLE)

  5. Top Issues in Construction Projects in US vs. EU (COMING SOON)

  6. Construction Risk Management in the US vs. EU (COMING SOON)

  7. Construction Claims Management in the US vs. EU (COMING SOON)


  1. Civil Procedure Rules for European Courts by Geoffrey C. Hazard Jr

  2. Civil Lawsuit – The Civil Litigation Process Explained In Steps by TorHoerman Law, LLC

  3. Major Differences When Litigating Under Common Law or Civil Law by Howard Colman (Partner at Colman Coyle Solicitors )

  4. Common Law And Civil Law: A Brief Comparison by Legal Language Services

Construction Project Management in the US vs. EU

Construction Project Mngmt US vs EU_ SOCIAL 2018-11-19 A.png

In this article I am going to review construction project management practices across the Atlantic. The topic is related to the construction management process which is often the main area of concern for successful construction project implementation. The client expects that effective project management will enable the project’s completion, by the time when it is wanted, of a standard and quality that is required, and at a price that is competitive. Our goal in the series of articles is to help the owners minimize adverse impact on their business from failures in project delivery and increasing construction disputes and claims, focusing on the role of risk management as a proactive approach to project planning in order to make timely and informed decisions towards reducing negative effects to project goals.

What is Construction Management and what it is not?

Project management was introduced to construction projects in the late 1950s. Much of the earlier codification of the principles and practices of project management was developed in the United States and in the United Kingdom.

The Construction Management Association of America (CMAA) is the leading professional association serving the construction industry in the US.

CMAA definition: “Construction management is a professional service that uses specialized project management techniques to the planning, design, and construction of a project.”

The Chartered Institute of Building (CIOB), UK is the world’s largest and most influential professional body for construction management, with nearly 50,000 members in more than 100 countries.

CIOB definition of project management: “The overall planning, coordination and control of a project from inception to completion aimed at meeting a client’s requirements in order to produce a functionally viable and sustainable project that will be completed safely, on time, within authorized cost and to the required quality standards”

There are four types of construction projects:

  • Residential construction

  • Heavy industrial construction

  • Commercial and institutional construction

  • Civil engineering construction

Essentially, a construction manager is project manager with a specific area of knowledge in built environment. Construction management is compatible with all project delivery systems including design-bid-build, design-build, design-build-operate and construction management at-risk.

For all types and scale of projects (large, small, vertical, horizontal, domestic, or international) a construction manager is the person who ensures the scope of work is skillfully adhered to and the project is successfully delivered. At its core a project involves three main parties, excluding the construction manager,

  • The owner, who commissions and funds the project

  • The architect or primary designer, who designs the project

  • The general contractor, who oversees day-to-day construction operations and manages specialized subcontractors

An owner’s project manager is controlling and monitoring the full scope of project from inception to close-out. A construction manager works as the owner’s representative, and this role often is limited to the construction phase of project. Construction managers involvement in planning, pre-design and hiring of architect, designer, and general contractors can assist owner to make informed decisions at the earlier stages of construction project.

Project management is the professional discipline which separates the management function of a project from the design and execution functions. Professional construction managers are not GC’s nor are they constructors. They typically do not perform the actual construction tasks, but act as advisors, assuring the project progresses according to plan and that it achieves the owner’s business objectives.

Construction Management in the U.S. vs EU

American construction management and leadership thinking historically comes from the United Kingdom (UK), which is the also the home of the European construction management certification system widely validated in the construction industry globally.

There is a great migration of engineers and construction managers in the construction sector due to the different states of economic development of different countries worldwide. For this reason, it is extremely important that construction managers’ qualification and skills are recognized and certified in a comparable way.

Construction has taken on an increasingly global character. US based firms are providing services to international clients just as international firms have become more active in the Americas. Owners in major markets all over the world insist on high performance in every aspect of construction project management: the planning, execution and operation of their capital assets.

In recent years owner priorities are shifting emphasis from initial construction costs to “triple bottom line”, including an asset’s lifecycle performance, environmental and social impacts. Traditional project constrains in terms of cost, time, quality extends for function and sustainability.

Are there differences between the Old World and North America?

The main differences in the approach to construction project management were discovered during this research are in the structure all involved parties and specialists bring their knowledge and experience into the project team and contribute to decision making at every stage of projects.

In construction projects, there are too many specialists involved for it to be practical to bring them all together at every stage.

The different stages of the project lifecycle across the industry in the US and EU have been summarized below. In the UK Code of Practice has defined eight project stages while CMAA have established five phases of main project management activities.

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CMAA Construction Management Standards of Practice define 10 core responsibility areas of a construction managerI:

  • Project management

  • Cost management

  • Time management

  • Quality management

  • Contract administration

  • Safety management

  • Program management

  • Sustainability

  • Risk management

  • Building information modeling

CBOI suggested project managers duties is an extensive list of responsibilities that may be modified depending of client’s needs and nature of project. All duties can be eventually summarized under similar core areas of responsibilities as provided by CMAA.

Key aspects of Success

Success of project can be measured in terms of the actual time, budget and quality of the completed work against the planned goals. The following are key aspects in the CM discipline before and during the project execution that are considered essential by most of construction industry professionals (including developers, owners, GC’s, insurance specialists), both in the US and Europe:

  1. Clearly defined goal and objectives

  2. Defined plan and responsibilities

  3. Informed, timely decision making

  4. Proven risk management system

  5. Effective communication system

  6. Complete and accurate project documentation

  7. Quality control system

Construction management competencies usually are built around these key factors:

  • Competencies = the ability to meet goals by drawing on and mobilizing resources and capabilities on personal and organizational levels

  • Resources = physical assets, human resources, and organizational capital

  • Capabilities = operational activities that are practiced and honed over time until they are mastered, they contribute to the company’s competitive advantage and profit potential

Risk Management As A Core Competency of Project Management

A capability or resource is valuable when it allows the company to capitalize on opportunities or defend against external threats. In theory both opportunities and threats are considered risks. Construction risk management competencies are essential to build and protect competitive advantage in the volatile construction industry, both in the US and EU.

Competitive advantage can be maintained in the construction industry if efficient risk management decisions are made in the earlier phases of construction project management.

Depending on a construction business’ scale, project portfolio risk management competencies vary from entirely informal (ad-hoc) to fully integrated and formal (optimized) risk management systems. More optimized risk management use feedback from the lessons learned for continuous improvement, the advancing and complex global construction industry demands more efficient management systems.


Using proven construction management practices is essential in the inherently risky and volatile construction industry. Many companies still rely on individuals’ expertise and experience when it comes to identification, assessment, mitigation and monitoring construction project risks. Sadly, there are growing number of construction claims and disputes which increase both the costs of the projects, as well as cause headaches for construction professionals. Most of the claims resulting from failures in project delivery can be related to failures in risk management in the earlier phases of construction project management, including making sure there is adequate construction project management expertise among project stakeholders

In my further articles I will offer some findings how construction management processes can benefit using past construction claims and litigation data and improve risk related decision making at each phase of construction project management.

Articles in This Series

  1. Introducing Our Latvian Interns

  2. Construction Risk & Claims Management in the US vs. EU

  3. Construction Management Process in the US vs. EU (THIS ARTICLE)

  4. Comparison of Common Law (US) vs. Civil Litigation (EU) Practices

  5. Top Issues in Construction Projects in US vs. EU (COMING SOON)

  6. Construction Risk Management in the US vs. EU (COMING SOON)

  7. Construction Claims Management in the US vs. EU (COMING SOON)


  1. What is Construction Management? by CMAA

  2. Construction Management Evolution of a Profession by CMAA

  3. Construction Management Standards of Practice by CMAA

  4. Code of Practice for Project Management for Construction and Development 5th edition by The Chartered Institute of Building (CIOB)

  5. Redefining Construction Management by CIOB

A Homeowners Association in Trouble

This is another edition in our “How To Save Your Community A Million Bucks” series.

The Problem

This project was a 132-unit multifamily community in the Pacific Northwest, constructed in 1977 as apartments and converted to condominiums in 1981. There are six 16-unit buildings, one 24-unit building, one 8-unit building, one 4-unit building, and one clubhouse. The 4-unit building and the clubhouse are single story, the remaining are two-story, and all are wood-framed structures on slab foundations. All upper floor units have wood-framed decks and landings with wood stair treads at the entries. All buildings were clad with Masonite siding and painted wood trim. Sliding glass doors and windows were a mix of flanged aluminum and unflanged vinyl (replacement windows). The units are designed in a back-to-back style so the front and back elevations are similar.

The exterior cladding of the project was in terrible condition. In 2014 the HOA and Previous Community Manager hired a building consultant who proposed a design they budgeted at $3.8 to $4.3 million in repair and improvements. In 2015 a second building consultant / engineering firm was hired to refine the scope of work in hope that the bids would be less expensive; but they came in at $3.6 to $5.7 million. For projects like this, based on similar projects in the region, the Owners would need to add for design (10-15%), construction management (5-15%), and change orders (10-25%) for a minimum of 25% over bid price. Up to 55% over the bid price would not be unheard of, and even more if the project did not run smoothly. The 25-55% would take the lowest bid of $3.6 million to a total of $4.5 to $5.6 million in total project cost. But the HOA only had $600,000 in reserve and limited capacity to borrow for the project. At this point, the HOA decided to hire a New Community Manager.

We Know Buildings Residential Results SOCIAL 2018-03-22 A.png

The Solution

In the Fall of 2016 PFCS was contacted by the New Community Manager to (1.) review and reduce existing scope of work, prepare a new budget, oversee the bid process; and (2.) act as Owner's Representative / Construction Manager (CM). By the end PFCS had managed the scope, budget, schedule, and quality for a complete rehabilitation of the exterior building walls for $3.0 million; a savings of $1.5 to $2.6 million, that is savings of at more than 33% in total project cost.


  • 9/2016 PFCS Proposal

  • 11/2016 Updated PFCS Proposal and attend HOA Meeting

  • 1/2017 Delivered Scope Comparison and Options Summary report with a Project Summary Memo

  • 3/2017 Delivered Bid Analysis and Recommendations

  • 9/2017 Executed a contract between Architect and HOA

  • 11/2017 Architect submitted plans to City and PFCS Delivered RFP to 3 contractors

  • 1/2018 Contract between General Contractor and HOA.

  • 1/2018 Revised Drawings submitted for Permits.

  • 2/2018 Project Kick-Off Meeting and works begins

  • 2/2018 Railing Contract between trade contractor and HOA

  • 3/2018 to 11/2018 Inspections, Change Management and Payment Application Approvals

  • 11/2018 Project Completion and Closeout Memo

Final Project Costs

  • $25,000 Architectural Design

  • $2.6 million Original Contract Price with General Contractor

  • $240,000 Deductive Change with General Contractor

  • $190,000 Contracted Directly with a Subcontractor (saving $50,000)

  • $260,000 Change Orders (+/- 10%) which included improvements not included in the original scope of work

  • $210,000 Construction Consulting & Management (less than 8% of construction cost)

  • $3.0 million Total Cost

  • $1.5 to $2.6 million Total Savings

Construction Risk & Claim Management in the US vs. EU

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Introduction to Our Research Project

So you’ve been introduced to our Latvian Interns Anete and Helmuts. Now it’s time for me to introduce our research project. Since Anete is an engineer and construction manager, Helmuts is a construction lawyer, and PFCS is in the business of building inspection, construction management, and building claims & litigation, it seemed natural to investigate and summarize best construction risk & claim management practices from both sides of the Atlantic.

As I often do at the beginning of an investigative endeavor, I used our "Proving the Obvious Using Google" method to begin this research. I searched the terms "Construction Risk Management" and "Construction Claim Management." The full results are below in the respective sections and at the bottom of this article in the "Research" section. The point is that construction risk & claim management are topics deeply considered by professionals at the top of the construction industry all around the world, and there is a lot to learn and consider for our projects.

A Map of the World

For those new to construction risk management and/or construction claim management, we want to create "a map of the world" so that anyone interested can understand the big picture, and more quickly learn to recognize important landmarks along the trail. One of the many things that makes construction an interesting business is that no two projects are exactly alike. Of course, this also creates difficulty, since construction projects are generally expensive and complex, which creates risks. And sometimes these risks turn into claims.

Construction risk management happens primarily before and during construction, and construction claim management takes place mostly during and after construction. Professional risk and claim management are deeply integrated. In the most sophisticated organizations, claims that arise downstream were considered early in the project, and processes were outlined for what to do, first to avoid them, and second to mitigate the harm they can cause.

The Size of the Global Construction Industry

The global construction industry generated an estimated total revenue of $8.6 trillion in 2016, representing a compound annual growth rate (CAGR) of 7.1% between 2012 and 2016. According a to report by ResearchMoz ("Global Construction Industry Guide 2017…") growth is forecast to accelerate and reach a value of more than $13 trillion by the end of 2021.

In the U.S. the construction industry has more than 650,000 employers with over 6 million employees and creates nearly $1 trillion worth of structures each year. Construction is one of the largest customers for manufacturing, mining and a variety of services. A study performed for AGC by Professor Stephen Fuller of George Mason University found that an extra $1 billion in nonresidential construction spending adds about $3.4 billion to Gross Domestic Product (GDP), about $1.1 billion to personal earnings, and creates or sustains 28,500 jobs.

The European construction industry as a whole is worth more than $1 trillion. With 3 million enterprises and a total direct workforce of 18 million people, the construction sector contributes at around 9% to the GDP of the European Union. 99.9% of the European construction sector is composed of small and medium-sized enterprises (fewer than 250 employee). In the EU, the average size of construction enterprises is of 4 workers (employees or not). Small and medium businesses produce 80% of the construction industry's output. Small enterprises (less than 50 employees) are responsible for 60% of the production and employ 70% of the sector's working population.

Construction Risk Management

When you search "Construction Risk Management" in Google you get "Risk management in construction is designed to plan, monitor and control those measures needed to prevent exposure to risk. To do this it is necessary to identify the hazard, assess the extent of the risk, provide measures to control the risk and manage any residual risks."

Our top-level framework, we call the ABCs of Risk Management, includes:

  • Avoid potentially dangerous situations

  • Be really good at what you do

  • Cover your assets

In the following articles we will examine sophisticated strategies for identifying risks and the steps professionals take to mitigate them. The point of all this is to identify (inventory) potential risks, then analyze and control them. Common strategies include transferring risks through contracts and insurance, and reducing them through process management and quality control.

Common Construction Project Risk Management Activities Before and During Construction

  • Composing or adopting and customizing a Risk Management Plan

  • Composing or adopting and customizing a Quality Management Plan

  • Making sure all key team members are adequately skilled, experienced, and capitalized

  • Insurance requirements that are appropriate for all applicable team members

  • Contract terms that distribute risks to the appropriate parties

  • Building in quality control check points and verification mechanisms

  • Documenting the quality of the processes and work, sometimes by independent third parties

  • Identification of potential claims and addressing them prior to their becoming a dispute

Construction Claim Management

We have been working on construction claims since the 1990's, and writing and presenting on the subject for almost 20 years now. As with risk management, there is a spectrum of professional practice that runs from "close to criminal incompetence" at one end, to "so much management that you might as well pay your opposition whatever they have asked for." We want to teach people to avoid either of the extremes.

After more than a decade in the business of dealing with claims (in 2010), we outlined our "Claims Management Strategies" continuum:

  1. Head-In-Sand: Delegation outside the organization = Abdication

  2. Hope and Prayer: Hope is a strategy. But a bad one.

  3. Cowboy / Caveman / Swashbuckler: Yee Haw!! Usually O.P.M.

  4. Project “Piles”: Most common.

  5. Force of Genius: Closely related to Project Piles, only better.

  6. Project Files: We’re getting there :-)

  7. Project Level Data Structure & Analysis: Yea Baby!!

  8. Portfolio Level Analysis & Analysis: The Promised Land.

Common Construction Claim Management Activities During and After Construction

  • Understanding the contract documents, especially as they relate to the scope of work, and change management

  • A professional file (document) management process discipline, so that all relevant files can be easily and quickly retrieved (this is WAY harder than it seems like it should be)

  • A mechanism that verifies files and project documentation are being managed consistent with the plan (inspect what we expect)

  • Structured training for construction managers in documenting changes in the scope, budget, and schedule for the purposes of assigning responsibility for these variations from plan (or contract)

  • Third-party verification of conformance with plans and contracts compared to actual scope (including quality), budget, and schedule

  • Regular (monthly) reports to management regarding potential claims or quality problems

  • A team “First Responders” is identified prior to or immediately upon notice of a potential claim: Lawyer(s). Expert(s) (internal and third-party)

  • A written Claim Management Plan

  • A Claim Management Budget (best, probable, and worst case scenarios) that considers the cost of lawyers, experts, expenses, time, and settlement or verdict

  • A structure for regularly updating the Claim Management Plan and Budget to reflect current realities

Our Method

We always make a preliminary review of the existing literature.

Then we have meeting and conduct interviews with the smartest people we know. In this research, this will include:

  • Contractors

  • Risk Managers

  • Insurance Brokers

  • Lawyers

  • Mediators / Arbitrators

From there, we will publish our findings via this blog, eventually more formally in printed articles, and maybe even presentation at a construction risk and claim conference.

Articles in This Series

  1. Introducing Our Latvian Interns

  2. (THIS ARTICLE) Construction Risk & Claims Management in the US vs. EU

  3. Construction Management Process in the US vs. EU

  4. Comparison of Common Law (US) vs. Civil Litigation (EU) Practices

  5. Top Issues in Construction Projects in US vs. EU (COMING SOON)

  6. Construction Risk Management in the US vs. EU (COMING SOON)

  7. Construction Claims Management in the US vs. EU (COMING SOON)


  1. Google "Construction Risk Management"

    1. Construction Risk Management by IRMI

    2. http://constructionexec.com/article/the-basics-of-risk-management-in-construction-contracts

    3. https://blog.capterra.com/the-ultimate-guide-to-construction-risk-management/

    4. https://www.stakeholdermap.com/risk/risk-management-construction.html

    5. https://cdn.intechopen.com/pdfs/38973/InTechRisk_management_in_construction_projects.pdf

    6. https://www.fminet.com/fmi-quarterly/article/2016/06/a-blueprint-for-risk-management-in-construction/

    7. https://www.spireconsultinggroup.com/en/professional-services/risk-management/

    8. https://geniebelt.com/blog/risk-management-plan-in-construction-guide

    9. http://www.cbre.us/real-estate-services/investor/construction-risk-management

    10. https://www.constructconnect.com/blog/operating-insights/identifying-managing-construction-project-risks/

  2. Construction Claim Management

    1. https://www.pmi.org/learning/library/construction-project-claim-management-7582

    2. https://www.sciencedirect.com/science/article/pii/S2212567115003275

    3. http://constructionexec.com/article/claims-management-a-problem-solving-approach

    4. http://constructionexec.com/article/claims-management-a-problem-solving-approach

    5. https://www.hillintl.com/PDFs/How%20to%20avoid%20CC,%20and%20what%20to%20do%20about%20them%20if%20they%20occur-MGriffin.pdf

    6. https://www.researchgate.net/publication/215908277_Contractors'_Construction_Claims_and_Claim_Management_Process

    7. https://www.managementconcepts.com/Course/id/1020

    8. http://www.xperagroup.com/services/construction-claims-management-process

    9. https://www.petefowler.com/construction-claims-management/

    10. https://www.projectcubicle.com/claim-management-in-construction/

A Custom Home in an Upscale Neighborhood with Water Intrusion and Habitability Claims

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The Problem

The project was a 3 bedroom, 5 bath, 4,500 square foot custom single family residence in an expensive neighborhood overlooking downtown Los Angeles. The residence was originally built in 1961 and recently completely redesigned, renovated, and modernized, including a wine cellar, an infinity pool, and a basement gym below the pool.

The Owner of the residence was a single purpose limited liability company (LLC) owned 100% by the Previous Owner of the property, who was the individual that transferred the property into the LLC. The 2015 lease with the Tenant was made with the Previous Owner, prior to the property's transfer in ownership to the LLC.

In mid-2017 the Owner sued the Tenant for back rent and in return the Tenant sued the Owner and Previous Owner for uninhabitable conditions and alleged defective conditions such as flooding, black mold, failing air conditioning, pool, electrical, and AV systems defects. The cross-complaint from the Tenant contained an extensive list of defects and documentation of leakage and mold issues dating to early 2016.

The Solution

PFCS was hired in January 2018 to represent the Owner of the residence (the LLC) and the Previous Owner. Counsel for the Owners asked PFCS to perform a general habitability inspection prior to the Owner starting repairs.

PFCS investigated the allegations using our standard Building Performance Analysis Process that virtually always includes collecting, organizing, indexing, and summarizing key project documents and information, conducting meetings and interviews with key players, organizing key building information into a players list, timeline, and issues list, and preparing to conduct on-site investigation by creating an inspection checklist. We conducted an exhaustive inspection, documenting observations with hundreds of photos, field notes, and diagrams, including sketches of the site, floor plans, and a roof plan so that we could easily compare exterior observations to the interior manifestation of leakage. Repairs were taking place during our inspection, so this documentation was similar to conducting an invasive investigation (testing). At the conclusion of the inspection, we immediately uploaded the photographs and notes to our cloud-based, password protected, Client Access system because our clients, who did not attend the inspection, were anxious to review the documentation.

Then, in the quiet of our office, we analyzed all of the data and developed working hypotheses for each of the discrete issues and presented our thoughts to our clients in a telephone conference. We observed interior damage related to leakage caused by construction defects in 4 locations including from the roof, plumbing, a door, and the swimming pool. We believed that the issues were complex and would have been difficult to diagnose, so some delay in solving the building problems would be reasonable, even for the most professional and competent property manager, but that ultimately the outcome of the case would probably be related to how the Owner handled the issues with the Tenant.

After further document analysis and numerous consultations with the Owner's counsel, they were able to settle the claims equitably. And although no one on the Owner’s side was excited to hear that there were construction defects leading to property damage that could be legitimately used in a Habitability Claim, the Owner’s counsel was pleased to have this information soon after our investigation was conducted.

Project Images

The main image above is not the actual home (although it’s quite similar). The images below are all actual project images.

Sketch of Site and First Floor Plan

Sketch of Site and First Floor Plan

Sketch of Second Floor Plan and Low Roof

Sketch of Second Floor Plan and Low Roof

Remodeled Kitchen

Remodeled Kitchen

Master Bedroom.

Master Bedroom.

Bar Area with Ceiling Leak from Roof

Bar Area with Ceiling Leak from Roof

Bar Area with Ceiling Leak from Roof

Bar Area with Ceiling Leak from Roof

Roof area above leak in Bar with liquid applied waterproofing in failed attempt at repair.

Roof area above leak in Bar with liquid applied waterproofing in failed attempt at repair.

Master Bath with ceiling leak from plumbing above.

Master Bath with ceiling leak from plumbing above.

Master Bath with ceiling leak from plumbing above.

Master Bath with ceiling leak from plumbing above.

Plumbing above Master Bath ceiling with evidence of leakage.

Plumbing above Master Bath ceiling with evidence of leakage.

New infinity swimming pool with numerous leaks below.

New infinity swimming pool with numerous leaks below.

Numerous leaks in living space below new infinity swimming pool.

Numerous leaks in living space below new infinity swimming pool.

Numerous leaks in living space below new infinity swimming pool.

Numerous leaks in living space below new infinity swimming pool.

Laundry Room door with leaks and damage.

Laundry Room door with leaks and damage.

Laundry Room door with leaks and damage.

Laundry Room door with leaks and damage.

Handwritten floor plan drawn by the inspector in the field during the inspection.

Handwritten floor plan drawn by the inspector in the field during the inspection.

A Condominium Conversion with Habitability Claims


The Problem

The project was a 23 unit multi-family building located in the San Fernando Valley area of Los Angeles county, constructed in 1983. All units were two bedrooms and two bath and were rented to individual tenants as apartments. The project was purchased by our client, the New Owner, in 2006 with the intention of converting the units to condominiums.

Upon initiating the eviction of the tenants, to begin the conversion of the apartments to condos, six tenants filed suit claiming "habitability" issues including building leaks and flooding, unannounced water shut-offs for 3 days, construction that was unannounced and disruptive to the tenants, vermin (rats and cockroaches) caused by poor housekeeping of the construction crews, and parking problems related to safety and handicap access. The tenants were mostly over 65 years of age, the majority of whom are retired, had limited financial resources, and were foreign born. Some tenants were disabled and difficult to relocate due to limited mobility. The initial question from our client included answering whether or not as-built configuration of the building egress conformed with current condominium code?

The Solution

PFCS investigated the allegations using our standard Building Performance Analysis Process:

1. Document & Information Management included collecting a large volume of source documentation including the history of building maintenance and improvements, some of which was the subject of the Tenant's complaints.

2. Meetings and Interviews with Key People included long discussions with the insured's attorneys as well as the insured. We also analyzed more than 10 deposition transcripts.

3. Building Information Management, including making a discrete list of all the known issues (allegations) from their complaint and other sources including sworn declarations. We also made lists of all the units and building areas with issues, project players, timeline of events, and performed a forensic audit of the construction invoices.

4. Inspection occurred over two days where we collected hundreds of photographs, drew diagrams, and filled out checklists. The information collected with detailed enough that it allowed us to map and reference photo documentation for every allegation at every location.

5. Analysis: In sorting through all of the who, what, when, where, how, how much, and how many, we realized that three of the units had real issues that required repair, and three did not. The egress was configured in a way that was acceptable for the time of original construction so no repairs were required.

6. Testing (Only as Necessary): None was required.

7. Estimate: We composed an estimate to repair the problems, using Civil Code §1941.1 and Health and Safety Code §17920.3 as the criteria, for a total of just under $70,000 in three of six units. There were zero repairs in the other three units.

8. Report: We were set to deliver sworn testimony 4 years after we had delivered all of our analytical work, and the matter was finally settled; favorably for the three units where we called for zero repair... less favorably where violations of the standards and repairs were clearly required.

Photographs from the Project

Deck Problems


Exterior Wall Problems


Interior Damage from Leaks


Damaged Interior Finishes


Professional Construction Contracting Discipline

What it is and how to get it

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The ability to define precisely a 100% complete scope of work for a construction project, to budget and schedule that work, to professionally contract for that work at the prime level (directly between the Owner and Contractor), to break that 100% scope-budget-schedule into manageable chunks by trade or subcontractor, to contract for each of those individual trade or subcontract scopes of work with a corresponding budget and schedule, to coordinate all of those scope-budget-schedules in executing the construction, to manage changes to the scope-budget-schedule at the prime and sub levels, and to verify with precision that each of those scope-budget-schedule packages is being executed in conformance with the plans, specifications, trade standards, budget, schedule, and contracts. 


Date: Wednesday, Dec. 18
Time: 10 a.m. PT
Duration: 60 minutes


Pete Fowler Construction does three things: building inspection & testing of many types; construction management, specifically estimating and building maintenance and rehabilitation management for owners; and building claims and litigation consulting related to everything imaginable that could make someone sad about real estate. We have refined processes, technology, and staff who are experts in building performance analysis, building economics, and construction management.

Since so many of our technical staff are "forensic consultants" who testify as expert witnesses, we have to create plain English definitions of what otherwise could have stayed techno-speak in the Nerdville that exists in the engineering and construction management departments of universities. We have to do this so that the non-technical people we work for can make informed and smart decisions, And this exercise has helped us to improve our own construction management practices and processes. As we have written in our internal training documents: (1.) Define what awesome work looks like, and (2.) train to mastery.



Professional Construction Contracting Discipline

Level 1 Work Breakdown Structure (WBS)

  1. The ability to define a 100% complete scope of work for a construction project, 

  2. to budget and 

  3. schedule that work, 

  4. to professionally contract for that work at the prime level (directly between the Owner and Contractor),

  5. to break that 100% scope-budget-schedule into manageable chunks by trade or subcontractor, 

  6. to contract for each of those individual trade or subcontract scopes of work with a corresponding budget and schedule, 

  7. to coordinate all of those scope-budget-schedules in executing the construction, 

  8. to manage changes to the scope-budget-schedule at the prime and sub levels, and 

  9. to verify with precision that each of those scope-budget-schedule packages is being executed in conformance with the plans, specifications, trade standards, budget, schedule, and contracts. 

Professional Construction Contracting Discipline
Level 2 WBS with discussion and key deliverables

1. The ability to define a 100% complete scope of work for a construction project, 

  • A. WBS (Basis of Schedule of Values)

  • B. Estimate Details with trade/sub scopes broken down (No Prices) 

  • C. RFIs / RFI Log

2. to budget and 

  • A. Budget (Worksheet - Basis of Schedule of Values)

  • B. Estimate Details with Labor, Material, Equipment, and Trade Contractor Prices

  • C. Budget to Actual Comparison

3. schedule that work,

  • A. Progress Schedule

  • B. Progress Schedule Updates / Comparison of Plan to Actual

4. to professionally contract for that work at the prime level (directly between the Owner and Contractor),

  • A. Prime Contract

  • B. Insurance Requirements

  • C. RFP

  • D. Other Addenda

5. to break that 100% scope-budget-schedule into manageable chunks by trade or subcontractor, 

  • A. Trade/Sub Scopes of Work

  • B. Trade/Sub Budget

  • C. Trade/Sub Progress Schedule (Integrated with the Project (Master) Progress Schedule)

6. to contract for each of those individual trade or subcontract scopes of work with a corresponding budget and schedule,

  • A. Subcontracts

  • B. RFP

  • C. Contractor Solicitation & Pre-Qualification

7. to coordinate all of those scope-budget-schedules in executing the construction,

  • A. Project Kickoff

  • B. Meeting Management

  • C. Trade/Sub Progress Payment Application Processing

8. to manage changes to the scope-budget-schedule at the prime and sub levels, and

  • A. Prime Contract Change Order Processing

  • B. Trade/Sub Change Order Processing

  • C. Change Order Log

9. to verify with precision that each of those scope-budget-schedule packages is being executed in conformance with the plans, specifications, trade standards, budget, schedule, and contracts. 

  • A. Progress Schedule QC Hold Points

  • B. Inspection Checklist(s)

  • C. Managing Construction Quality

  • D. Inspection

  • E. Issues Management, Followup, and Closure

  • F. Punch List

  • G. Payment Application Approval memos

  • H. Report to Management (As GC this is prior to Payment Application. As CM this is between receipt and approval of payments.)

Project Team

  • Construction Manager

  • Project Coordinator

  • Project Executive(s)

  • Other

Meeting Rhythm

  • Project Kickoff

  • Daily

  • Weekly

  • Monthly

  • Project Close