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Getting Paid for structural observation

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         (__)                  Dennis S. Wish PE                    

Dear SEAINT Listservice member, 

I am having a problem billing my time for structural observation. It is my 
understanding that it would be a conflict of interest to bill Observation to 
the General Contractor.
I do not include Observation in my contract other than to specify that it 
will be billed separately and is the responsiblity of the owner or the owners 
In most cases, the contract works through an escrow account and all 
sub-contractors are to issue statments or invoices to the GC for billing 
through the escrow account. Here are some of the problems that I have come 

1. The code implies that the Observer is to be hired and paid by the Owner or 
Owners representative - in most cases this excludes billing through the 
escrow account which the contractor has control over.
2. The owner refuses to pay for additional services for engineering to repair 
errors and omissions caused by the contractor. The owner argues that this is 
the contractors responsiblity not the owners.  The contractor refuses to pay 
the bill, the report either does not get issued and a war breaks out blaming 
the omission on the engineer, architect and back to the contractor. Nobody 
gets paid.
3. On more complicated projects, I have chosen to recommend a registered 
deputy inspector to perform observation requirments. I believe that this 
serves a number of advantages for the owner. Although I am the EOR, I do not 
feel confident in identifying certain deficiencies that I believe a deputy 
inspector has more experience. For example, if epoxies were used without 
inspection, a deputy is better able to spot an improper mix than i would be. 
An inspector can spot the type of nails used (size and type) easier than I 
can. Although this is a minor point, I trust that a deputy inspector will 
have a better understanding for the deficiencies which he must identify and 
may also know, from experience, what shortcuts are taken by a specific 
contractor and which might be concealed from view. 
I have had a difficult time convincing owners of the advantages to them to 
hire a deputy over my services.

I was unable to receive payment by a contractor who was billed for 
observation as requested by the owner due to the terms of the escrow account 
for the construction loan. I demanded payment by the architect who finally 
paid my bill. The owner is now refusing to reimburse the architect because he 
believes that the contractor misused the construction funds. Although the 
observation was never submitted to escrow for payment, there are no funds 
left and the owner is refusing to reimburse the architect.

We are at a loss for how to contract observation services and how to insure 
payments. The code requires the engineer to submit reports with deficiencies 
and to submit subsequent reports when the corrections have been made. This 
means multiple trips to the site which I expect to be paid for. Each trip 
opens up an argument between the contractor and owner whose relationship is 
stronger than the owner and engineer.

I would appreciate any suggestions that others have used to guarantee payment 
and what types of fees are being charged for Structural Observation services.

Dennis S. Wish PE


Dennis S. Wish PE
Structural Engineering Consultant