AE Blog - Risk Management Topic – Stop Work Authority
Having the contractual right to direct a contractor to stop work should be held by the contractual entity that is in the best position to deal with the consequences of that action. In almost every case, that entity would be the Owner. The moment that a “stop work” direction is received by the contractor, a whole host of complications and cost and schedule related claim items will begin to be tracked. Since dealing with these claims will ultimately become the responsibility of the Owner, only the Owner should make the call to “stop work”. Unfortunately, not all Owners understand this and frequently attempt to shift that responsibility to the design professional. Along with the contractual acceptance of the authority to stop the work, can come the implied responsibility to stop the work when the design professional deems that to be an appropriate action. Additionally, damages resulting from a design professional stopping the work may not be covered by professional liability insurance.
When asked by the Owner to accept the contractual authority to stop work, here are some strategies to consider:
- § Attempt to redirect the Owner for him/her to have the stop work authority.
- § Offer an alternative that you will recommend that the work be stopped when, in your judgment, it should be.
- § Offer an alternative that you will accept responsibility to reject or recommend rejection of work that, in your opinion, does not meet the requirements of the contract documents.
- § If the Owner insists that you have the stop work authority, seek an indemnification from the Owner for any and all damages that result from the your giving stop work direction.
- § If you have the stop work authority, you should also have a comprehensive role in the construction observation process.
- § If you have the authority to stop work, extraordinary diligence in documentation of all construction activities is warranted.
Get ready for serious conflict resolution if you have to stop a project.