A comprehensive review of the different relationships - and risks - in the use of Design-Build and EPC as project delivery methods.

The use of EPC and Design-Build as project delivery methods has increased significantly in both the public and private sectors.

The movement away from the typical "design/bid/build" method to EPC and/or Design-Build has altered the traditional relationships among the owner, the owner's representative, the architect/engineer, the construction manager, and the contractor. These altered relationships have shifted the risks assumed by each party to traditional construction contracts. This course outlines and examines these risks.

This course is designed for those new to the EPC and Design-Build processes as well as those with experience in them. In addition to contrasting the various project delivery methods to identify the true subtleties of EPC/ Design-Build, the course will present in-depth and practical information on the roles of each party and the new technical and contractual risks each party adopts when entering into an EPC/Design-Build contract.

The course follows a natural progression from the decision making process in choosing the delivery method, to procuring the Design-Build contractor, to measuring the performance, to project close-out issues. The instructor will cover the "Do's and Don'ts" of EPC/Design-Build contracting gained from actual experience—advice that will be useful for the owner and the contractor, as well as for those companies that support the process.

An interactive problem solving session is a part of the course. Participants will assume the roles of parties in a contracting relationship, be provided with typical problems that arise, and be given the opportunity to present solutions to the problems. Interactive discussion will be encouraged.

1. Addressing Risk for the Various Project Delivery Methods
   1. Design-Build
   2. Turnkey
   3. Engineer-Procure-Construct
   4. Build/Own/Operate
   5. Build/Operate/Transfer

2. Factors Affecting Choice of Project Delivery Methods
   1. What is a Successful project? An Owner's Perspective
   2. Technical
      1. Schedule
      2. Cost
      3. Knowledge of scope
      4. Public vs. private sector
      5. Knowledge of marketplace
   3. Contractual
   4. Legal
   5. Owner's Capability, Experience and Staffing

3. Unique Risk in Lump Sum, Turnkey, EPC and Design-Build Work
   1. Use of EPC Contracts on Large Domestic and International Infrastructure and Industrial Projects
   2. High Risk International Projects (Regional Political, Economic and Labor Instability, and Other Force Majeure Considerations)
   3. What does Turnkey Really Mean?
   4. Payment and Performance Assurances
   5. Using Letters of Credit and Guarantees

4. Procurement Methods
   1. Conceptual Design by Owner (ITB's)
   2. Performance Specifications by Owner
   3. Team Competition
   4. End Product Specification

5. The EPC/Design-Build Contract
   1. Recommended Terms and Conditions
   2. Identification of Risks Unique to the Project
   3. Negotiation Appropriate Risk Allocation
   4. Dealing with Subcontractors, Suppliers, Third Parties and Governmental Authorities

   PERFORMANCE ON AN EPC/DESIGN-BUILD PROJECT

6. Controls for EPC and Design-Build Contracts
   1. Cost Control Mechanisms (Addressing Cost Overruns Early and Often)
   2. Schedule Controls (Realistic Baseline Schedules and Updating the Schedule)
   3. Timing of Key Decisions (Who Has the Authority to Make Decisions and When are They Made?)
   4. Division of Responsibilities (Including Owner Responsibilities for Certain Activities)
   5. Problems in the Design Development Process (Including Changes Made After Basic Design)
   6. Special Considerations for Commissioning and Start-up of Process and Power Facilities

7. Monitoring and Managing Claims
   1. Contractual Safeguards
   2. Submission and Evaluation of Claims
   3. Early Negotiation of Claims and Conciliation
   4. Domestic and International Arbitration

   SPECIAL ISSUES

8. The Validity of EPC/Design-Build Contracts
   1. Federal Law
   2. State/Local Law
   3. Professional Registration and Licensing Issues

9. Special Focus on Risks/Rewards for All Players

10. Frequently Encountered Legal Issues
    1. Ineffective Risk Allocation Clauses
    2. Liability for Late Completion
    3. Performance Shortfalls
    4. Warranty Claims
    5. Indemnification
       1. Between owner and design-build team
       2. Within design-build team
    6. Bonds, Liens and Insurance
    7. Standard of Care
    8. Enforcement of Dispute Resolution Requirements
    9. Common Law versus Civil Law on International Projects

11. Case Studies
    Practical lessons learned from actual case situations will be discussed to illustrate and explain project issues throughout the course.

12. Problem Sessions
    The seminar features an interactive problem-solving exercise where teams of participants will analyze real-world problems and recommend solutions.

The Course Faculty

Jim Butler Partner with the Atlanta law firm of Smith, Currie & Hancock LLP, in the firm’s Construction and Environmental Litigation Department. He is a graduate of Duke University and the University of Kentucky College of Law. He is admitted to practice in Florida, Georgia, Kentucky and Texas.

He has extensive experience with design-build projects and environmental remediation work. He worked with members of the National Society of Professional Engineers Design-Build Task Force to develop a design-construct curriculum for the engineering community and construction industry and was awarded the Rich Meritorious service award by NSPE’s Professional Engineers in Construction Division for his efforts. He has also presented design-build programs for the Army Corps of Engineers, ACEC, Georgia Tech, Stanford University, the New York City Metropolitan Transit Authority, and the American Bar Association, the Construction Superconference and the Design Build Institute of America.

His practice is concentrated in the negotiation, arbitration and litigation of government contracts, hazardous waste issues and construction contracts. He has experience with a variety of sites and projects, including semiconductor facilities, power plants, water and wastewater systems, airports, office buildings, schools, casinos, condominiums, prisons, highways, manufacturing and industrial plants, hospitals, asbestos abatement projects, superfund sites and government facilities.

Mr. Butler also writes and speaks on construction contract claims, the quantification of damages, claims avoidance, environmental auditing, alternative dispute resolution, indoor air quality and asbestos abatement contracts.

Eric Nelson Partner with Smith, Currie & Hancock in Atlanta and practices in the area of construction law and government contracts. His practice includes representing owneres, engineers, general contractors, EPC contractors, construction managers and subcontractors in dispute resolution, contract negotiation and administration, and project performance.

Mr. Nelson's practice includes dispute resolution of construction related claims for both public and private projects. He has trial experience in federal and state courts and before the various government Boards of Contract Appeals. He has also participated extensively in alternative dispute resolution, including negotiation, mediation and arbitration, both nationally and internationally. In addition to dispute resolution, Mr. Nelson has assisted clients in negotiating and drafting construction related contracts and has also been involved in developing and implementing project documents and policy and operations manuals for the construction industry. Mr. Nelson received his law degree from Washington & Lee Law School and his undergraduate degree from California Polytechnic State University at San Luis Obispo.