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RE: Engineering from Home - Protecting Personal Assets

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Michelle,
In my opinion, it is impossible to stop anyone who wants to pull you into a lawsuit. You can work as an engineer in responsible charge for another firm - a position where you design, review and stamp plans. You can still be sued and your personal assets can be attacked if the firm is not well covered with E&O insurance.
However, after 15-years in private practice working out of my home, I have been pulled into three suits as a cross-complainant and then dropped because I lacked liability insurance. The attorneys were not interested in going after my personal assets - only the "sure thing". While I still debate with myself the importance of being covered with E&O insurance but sadly, I firmly believe that the legal system is set up to abuse insurance coverage. Lawyers create a market that suggests they are helping people in a humanitarian way by protecting their rights, however, they muddy the water by marketing their services and seeking experts that are willing to compromise themselves with testimony biased to the side that pays them.
Before I get flamed, I am not suggesting that every lawyer or expert witness is dishonest, just that there is enough of them to clog the court system with frivolous cases, or knowingly pressure plaintiffs with threats that the cost to litigate will be much higher than settling that insurance carriers tend to settle rather than meet the challenge of proving their clients innocence. In my opinion, the professional who is innocent pays the price through his premiums, deductible and compromise on his or her ethical integrity by allowing claim to settle that make no judgment of guilt, but anyone on the losing end is tagged with guilt.
 
My point is to suggest that if you really are concerned and worried about personal assets, don't stamp plans, or make sure you spend the money for E&O Coverage. If you do a good job and can justify your work or are willing to seek other professionals for peer review of your work, then you should practice without worrying about being sued.
 
Finally, the best way to avoid a suit is to always take responsibility for your work and not close off the lines of communications once an error is brought to your attention. Although it may not protect you in court, I have a disclaimer that indicates that errors and omissions may occur on a project and that I agree to redesign or modify the drawings accordingly at my expense. However, I do require a pre-construction meeting where I expect obvious problems to be brought to my attention by the builder who should have reviewed the plans and spotted any inconsistencies. While not foolproof, they do limit my liability to my time and expense to correct the designs.
 
Hope this helps you make your decision.
 
Regards,
Dennis
 
 
 -----Original Message-----
From: Structeng1(--nospam--at)aol.com [mailto:Structeng1(--nospam--at)aol.com]
Sent: Monday, April 02, 2001 10:05 AM
To: seaint(--nospam--at)seaint.org
Subject: Engineering from Home - Protecting Personal Assets

This is a question regarding consulting from out of the home.  Normally, I do
not do consulting from my home, however, various Architect/Designer friends
have asked me to do some consulting on some small engineering projects
(additions, custom homes, retaining walls).   I'm not sure whether I'll do
the projects because I have a few concerns regarding protecting my personal
assets (house, savings, 401k, etc.) from lawsuits if (heaven forbid) I get
named in a lawsuit (as in some lawsuits EVERYONE is named on a project).  I
realize no one is really fully protected from being sued, however is there a
way to limit liability and protect my personal assets?  I have heard that if
one incorporates oneself this helps protect personal assets but I'm not sure
what that entails.

Any info. would be very helpful.

Thanks,

Michelle