Delegated Design Is Gaining Momentum
Following his presentation on delegated design and alternate dispute resolution at last year’s Construction Super Conference, Anthony Byler was interviewed by Third Thursday to discuss the growing prevalence of delegated design in the construction industry. In the interview, Tony emphasized the importance of carefully reviewing subcontract agreements to avoid unintended design responsibilities and shared insights into resolving complex disputes through alternative methods, such as AAA mediation.
The latest on delegated design and alternate dispute resolution with attorney Anthony L. Byler.
PHILADELPHIA – What should attorneys be looking for when reviewing delegated design agreements? Third Thursday sat down with Anthony L. Byler, partner, Cohen Seglias Pallas Greenhall & Furman PC, Philadelphia, to explore the nuances of the topic.
Third Thursday: You spoke on Delegated Design at Construction Super Conference (CSC) 2024 in Hollywood, Fla. Eight months later, how prevalent is delegated design?
Byler: The practice of delegated design is gaining momentum. I recently received, reviewed, and revised a substantial electrical contracting subcontract agreement between a general contractor, who I do not represent, and an electrical subcontractor who I do. The work is for a major waste water treatment plan, part of a public utility. In the contract between the general contractor and my electrical subcontractor, I noticed that the general had included a whole series of delegated design contractual requirements—and I suspect that my client does not have any responsibility for design.
Third Thursday: What’s your advice to fellow attorneys reviewing these types of subcontract agreements?
Byler: Keep an eye out for these delegated design provisions, because it assigns, as you might expect, a tremendous amount of responsibility to the delegated entity, which in this particular case was the electrical subcontractor. A contractor who does not expect to receive an assignment of Delegated Design does not want to have anything to do with those responsibilities. And for their benefit, I crossed out most, if not all, of the delegated design clauses because I didn’t think that they applied. And if in fact there is going to be some design aspect that is subsequently required of my client, then we could revisit those clauses and negotiate them as necessary. I don’t want those delegated design clauses to be in place if my client has not priced, or otherwise expected, that it would be carrying out any design responsibility on the project.
Third Thursday: How would you describe what you do?
Byler: What I do, and what many of the construction lawyers here at this firm do, is we pursue a purpose. That purpose is to keep the money in the pockets of our clients, and to obtain money from the pockets of others for our clients when our client has been damaged. With that very simple purpose in mind, we end up representing, and I end up representing entities in the various construction tiers—owners, general contractors, trade subcontractors, and suppliers. My clients and the matters that I handle are fairly diverse and can range all over the place.
