Engineering Inc. - March/April 2005 - (Page 36)

ONE ON ONE Financial Pressures, Economic Realities Make Tort Reform Vital for Industry, Says Syska Hennessy Group's John Magliano mined by which party has the such uniform standards? engineering firm must make on largest insurance policy, rather a day-to-day basis? A. than the correct assessment of As a national firm, we A. Risk plays a significantly responsibility. This process is have an interest in encouraging exacerbated by owners who the promulgation of uniform greater role in our decision- attempt to use the design team's national standards in connection making than ever before. Con- insurance as a substitute for with litigation-threshold ques- tracts for major projects have proper budgeting and contin- tions. Statutes of repose vary grown to 100 pages or more with gency planning, particularly on widely among states and often onerous clauses and risk-shifting large, complex projects. are unreasonable. Recently, we mechanisms that sometimes successfully defended ourselves make the work uninsurable and Q. against a claim brought by an put the firm at significant risk. As part of a strategy to owner whose building was We actually are turning down reduce the cost of health care, John Magliano is chairman designed and constructed more projects on the basis of unaccept- Congress soon will consider and CEO of Syska Hennessy than 20 years ago. We encourage able contract terms. For example, medical malpractice reform leg- Group in New York City. the uniform adoption of potent we recently came very close to islation to put a halt to these Certificate of Merit and joint declining a project with a high ever-increasing insurance premi- and several liability restrictions. seven-figure fee after selection ums. How beneficial do you feel Q. based on an inappropriate/unin- that this would be to engineer- As you know, the issue of Q. surable standard-of-care clause. ing firms? tort reform at the federal level What can you and other We have a firm policy that pre- has been dormant for many ACEC members do to ensure A. cludes accepting condominium years, but is now on the front that tort reform legislation As an engineering firm design projects, since our burner. How important is the favorable to the engineering that specializes in the health care research has indicated that the issue of tort reform to the engi- community is enacted? industry, we have a vested inter- vast majority end in lawsuits neering industry as a whole? est in seeing Congress address A. involving the design team. We medical malpractice reform. The ACEC members should A. Tort reform, which has have retained general counsel on funds currently spent on lawsuits vigorously support tort reform staff, formed a risk management would be better spent on facili- efforts. Participation in lobbying been highlighted by the Bush committee consisting of many ties and practitioners who will efforts arranged by national and administration, seeks to impose senior staff and have committed deliver improved health care to local ACEC organizations can uniform limits applicable to all far more resources to risk man- the public. The engineering create the awareness and sensi- states, and is very important to agement than in the past. community may very well bene- tivity necessary to gain support the engineering community. fit by associating with the from our elected officials. The industry is under great Q. medical profession to pass this Involvement in the engineering financial pressure due to frivo- Syska Hennessy Group legislation. community's various risk- lous lawsuits, which often have has locations all over the coun- management committees can no relationship to the design try and therefore deals with Q. help to foster awareness on the work. In addition, the economic numerous variations of state tort A recent report found part of individual firms as to realities of the litigation process laws. ACEC will be working in that U.S. tort costs grew by 5.4 where their time and money will often make it expedient to pay this Congress to enact uniform percent and cost $240 billion be most effective. The important large settlement sums in order to federal standards for statute of in 2003. What kind of negative thing to remember is that a large avoid even larger litigation costs, repose, joint and several liability effects do you feel this cost constituency pushing for a regardless of the adherence to and Certificate of Merit. What has on the economy and your uniform agenda is most likely to applicable standards of care. kind of benefits do you think business? How does this cost be successful. Claim settlement often is deter- that your firm would see from affect the decisions that an 3 6 ENGINEERING INC. M a r c h l April 2005

Table of Contents for the Digital Edition of Engineering Inc. - March/April 2005

Table of Contents
From ACEC To You
Ask Members
News & Notes
Market Watch
Legislative Action
COVER STORY: A Perfect Legal Storm
Interview With F. James Sensenbrenner, Jr.
Is There an Engineer in the House
ACEC/PAC Donations Break All-Time Record
ACEC Roundtable
Members In the News
One on One

Engineering Inc. - March/April 2005