Last week, we published an article identifying some Things That Can Go Wrong On A Green Building Project. To prepare for these potential problems (and others), here is a list of things you should keep in mind when contracting for a green building project:

1) Define Things: Terms like ‘sustainability,’ ‘green certification’ and ‘high performance building’ do not have any universal meanings. Clearly define the goals of the building and project. Consider adopting a rating system, and specify the system and the version.

2) Designate a responsible party for certification: A green/LEED coordinator can go a long way, designating someone who will be responsible for coordinating all parties, analyzing the work to ensure compatibility with the rating system, and put together all the paperwork required on the project.

3) Responsibility Matrix: Create a “matrix” of who will be responsible for what. This will at least mitigate the finger-pointing if or when something goes arwy.

4) Payment Issues. An especially important consideration for contractors: Be cautious about tying certification with substantial or final completion. Certification may never come, but in all cases, it could take between 6-18 months after substantial completion to get certified. That’s a long time to have money withheld – and this will create payment problems with subs and suppliers. If nothing else, make sure your contracts up and down the chain have the same payment timeframes and expectations.

5) Know Vendors and Products. These technologies are new and can be complex. Don’t subscribe to a technology without investigating. Get to know the products and manage the expectations of the owner. For a discussion of how these new green technologies can present problems, see Paul Beers’ guest post on Chris Hill’s Construction Law Musings.

6) Consequential or Specific Damage Waivers (LDs). Damages for failure to certify or for failure to meet certain benchmarks may be murky. Consider waiving consequential damages, and call out these specific expectations and considering waiving those damages or presenting LDs for them. For a discussion about whether a consequential damage waiver is effective for green building damages, see this blog post: Is Failure To Achieve LEED Certification Consequential Damages?

7) Flow Down. Make sure your obligations up the chain, go down the chain.

Related articles

• Is Failure To Achieve LEED Certification Consequential Damages? (constructionlawmonitor.com)
• Examples of Things That Can Go Wrong on a Green Building Project (constructionlawmonitor.com)
• Think Green Building Is Irrelevant? Think Again (constructionlawmonitor.com)

Green Building is all the rage in the United States. Whether it be a LEED project, or just a promise to the property owner to build or make a building more efficient and sustainable, as 2010 passes onto 2011, those in the construction industry are quite likely to run into projects with at least some green elements.

When bidding, contracting and working on these projects, it’s important to know what might go wrong. After all, if you have no idea what things can go wrong, you have no way to prepare for them (or charge for the extra risk).

There’s no way to enumerate all of the risks…but here are a few to get you thinking about it:

1) Vegetative Roofing: In some areas, these so-called “green roofs” are becoming popular. The most ambitious green roof program is likely found in Portland, which we’ve discussed in a previous post. Essentially, vegetation is planted on the roof of a building to better insulate it, reduce the heat island effect in the area, and better control water runoff. The downside? Well, it’s quite a bit heavier than a standard roof, and the construction and design of the structure should accommodate the extra weight.

2) Rainwater Runoff: Plan on channeling rainwater into storing containers to use within the property as waste water? Be sure to contract with someone with experience, because the control of rainwater is different than the disposing of it through ordinary guttering systems.

3) Greenwashing: It’s popular to be green, and there’s an absence of real regulation prohibiting businesses from advertising its products and services as “green” – which, really, is undefined. So, when incorporating a service or product into your technology, make sure you select vendors, products, services and the like that will live up to their marketing.

4) New, Untested Technologies: Even the stuff that isn’t fraudulently labeled green may still present problems, as many technologies advertised as green may simply not perform as expected, since the technologies and products are new and haven’t been tested over time. The lesson? Keep your vendors on the hook for promises made by their products, and be cautious about relaying promises that are uncertain.

5) Human Interference: Green buildings and green technologies are not insulated from human intervention. Especially considering energy performance, the human factor can be great – as humans are the ones that will control energy use (such as using more than the allocated energy amounts), and generally doing things that can affect energy use (covering windows, for example) .

6) Certification Problems: Rating and certification system (like LEED) are not easy to guarantee. The certification decision is left to a third party, certification can be taken away, and certification can be challenged. Don’t be too concerned – many projects work toward a certification and get it. But know the road ahead.

Related articles

• Is Failure To Achieve LEED Certification Consequential Damages? (constructionlawmonitor.com)

If you were to survey green building critics, it’s safe to guess most will argue that the cost to build green do not outweigh the benefits.

Indeed, many have suggested that the cost of building green (especially gaining LEED certification) is significantly higher than building to ordinary standards. Others argue that LEED certification can be achieved through an everyday budget.

Regardless of where you fall on this issue, everyone should agree that green building projects have certain specifications, and bidding contractors must project the construction costs responsibly.

And so, one of the most challenging components of a constructing a green building may be the process of bidding it.

Since green building work is just starting to take hold in the construction industry, many contractors and subcontractors are working on little-to-no experience on green projects. And sometimes the data behind green building techniques and products are thin (see greenwashing).

On Wolfe Law Group’s Construction Law Monitor, we published a 2-part article on the Bidding Process and Change Orders: Bidding Errors and Change Orders: Avoiding a Nightmare [Part One and Part Two].

How do we suggest you avoid Bidding Error nightmares? Spend time with the Contract Documents pre-bid.

With green building projects, this is more true than usual.

When preparing your green bid, here are some example thoughts that should be considered:

• If the project is being certified with LEED or another standard, who will be responsible for the submittal process? Who will be responsible for monitoring the construction process?
• Contact vendors who will be providing the project’s materials, and review the data they have to back-up their performance and environmental claims. It would be a pity to plan on using one product, and being forced to later use a more expensive substitute. See this article on how to shop for green building materials.
• If the builder is anticipating a tax credit, do you understand the requirements to qualify for the credit? Will this increase your construction costs?

A successful green building project starts where successful ordinary projects begin: during the bidding and contracting period.

Whether your green building project will increase costs, or not, understand the green building expenses associated with your project, and avoid bidding errors and change order nightmares.

There are a growing number of construction attorneys getting certified in green building professional courses and touting themselves as “green litigation attorneys.” Our friends over at the Best Practices Construction Law blog just posted an interesting blog article about whether there is a difference between “green building law” and ordinary run-of-the-mill “law.”

The article is titled: Green Building for Attorneys: Is It Merely Hoopla? (spoiler: author concludes that it is not merely hoopla). The article discusses another blog post on the subject from LAW/ARK: The Real Green Goblin – Emerging Legal Liability for Green Design Professionals and Contractors (Part 1).

Since we’re writing this article on the “Louisiana Green Building Law Blog,” you likely know where we come down on this issue. And we clearly have a dog in the fight. But our reasons might surprise you.

Here is the argument

Here is a quote from the LAW/ARK post, in support of the position that “green building law is just law:”

The bad news is that attorneys, especially those already practicing in construction law, will soon realize that aside from green design and construction�s sometimes specialized and occasionally ill-defined vernacular, there�s no real novelty in the types of claims that might arise. No new frontiers of jurisprudence need be explored � a leaky green roof is still a leaky roof � whether it also requires regular mowing and landscape maintenance changes little from a legal perspective.

In response, Matt DeVries at the Best Practices Construction Law blog says that while it may be correct that there is no novelty to the types of claims that may arise in green construction disputes:

The novelty in the green building industry is the new set of standards that will inevitably become part of the legal dispute. In other words, while ‘a leaky green roof is still a leaky roof’…there will be new risk to be allocated, different types of damages lost, additional players involved, varied proof required, and yes, perhaps a novel cause of action alleged because that leaky green roof system failed.

Here is our voice

There is something important that is not discussed in LAW/ARK’s post about green building law: the underlying claims themselves.

The leaky roof analogy is actually not spot-on, because if the roof was leaking, the claim wouldn’t necessarily be a “green building claim.” It would be an ordinary claim. A green building claim would occur when the green roof didn’t perform as it was anticipated from an energy savings or environmental perspective. Or, if the green roof didn’t meet the standards of the Green Building Council or other accreditation organization, and the property lost a valuable certification.

Of course it all boils down to unfulfilled expectations, but what separates a green building attorney from an ordinary construction attorney is that they have a true understanding of the expectations. It’s what Matt DeVries points out: understanding the “new risk,” “different types of damages lost, additional players invovled, varied proof required,” and more.

After all, what really separates a construction attorney from an ordinary business attorney? Breach of an ordinary contract and breach of a construction contract involve the same claims…but what separates the construction attorney is her familiarity with the construction industry, and the types of damages, players, risks and claims that frequently arise.

The same must be said for Green Building counselors. It’s not a new body of law, it’s just a new set of situations.

On March 26, 2009, in Portland, The Green Building Initiative (GBI) and the American Institute of Architects (AIA) joined forces and each of its leaders signed a memorandum of understanding.

In a co-press release from the two organizations, they state that the memo pledges “to work together to promote the design and construction of energy efficient and environmentally responsible buildings.”

Ward Hubbell, President of GBI expressed his excitement about the venture:

We look forward to continuing our work with them (AIA) towards our shared goal of achieving widespread acceptance of sustainable design and construction practices.

Chris McEntee, Executive Vice President and CEO of the AIA, boldly stated that they “look forward to working with the GBI on our common goal of reaching carbon neutral buildings by 2030.”

The high points of the agreement are:

- Through education and training, promote design of energy-efficient, healthier and environmentally responsible buildings;

- Research green buildings to see what the outcomes are related to economic and environmental performance;

What does this mean for Louisiana green building projects?

We’re not entirely sure yet, but hopefully partnerships like this will spur on other organizations to step up their commitment to greener construction.

Further, with the AIA / GBI partnership, and the AIA’s “Walk the Walk” green promotion, we’ll soon see some interest in blending green building principals, submittals and issues in the popular contract documents.