Managing design professional risks arising out of the Prime/Subcontractor relationship
June 8, 2017
This briefing will look at strategies that both Primes and Subs can use to manage their risk from subcontracts.
Subcontracts are common on design projects. On all but the smallest projects, the Prime Consultant is likely to have professional Subconsultants. In addition, Architects/Engineers who provide services such as structural evaluation or geotechnical investigation often engage trade Subcontractors to provide drilling, sampling and testing services. Subcontracts present unique risks to the Prime Consultant. While the Subconsultant or Subcontractor may only be performing a very small portion of the services required under the Prime Contract, if the Sub defaults, the default can have a domino effect on the project. Subcontracts also present unique risks to design professionals working as Subconsultants because they often have very little control over the terms they have to agree to.