Eric L. Singer
Wildman, Harrold, Allen & Dixon
2300 Cabot Drive, Suite 455
Lisle, Illinois 60532
(630) 955-0555 (main) | (630) 955-5826 (direct) | (630) 955-0662 (fax)
singer@wildmanharrold.com
Chances are that you have read a few things about the coming of the new millennium. There are any number of people making predictions and providing advice on a variety of topics. The predictions range from minor, computerized hiccups to a global industrial seizure with biblical consequences. Whomever you choose to believe, and whatever the measure of the coming plague, a few conclusions seem clear:
Given these uncertain conclusions, complete interdependence of systems and the vast range of differing predictions of the future, all out panic seems unwarranted. On the other hand, some level of diligence is appropriate to minimize your risk, both electronically and contractually. This article will provide you with some suggestions.
A Frame of Reference:
The Y2K problem is based upon the use of two-digit date codes in software and some hardware components. The problem is apparently complicated even further by leap year calculations. If the problem were limited to desktop PC's, the fix would be easy and would be accomplished by gradual obsolescence of older machines and software. The problem extends to many other applications, all of which can affect your ability to run your business.
As a frame of reference, one only needs to look at Microsoft's Year 2000 Compliance Statement. The statement contains approximately 90 words, and is followed immediately by a "Disclaimer" of approximately 120 words. (See for yourself at http://technet.microsoft.com/cdonline/Content/Complete/Analpln/y2000/y2kcompl.htm). This illustrates the interdependence of many factors in determining your Y2K risks. Your computers may be ready and humming for the coming millennium, but they will not work if your elevators fail, your voicemail implodes and your security system locks you out of the building. This is the reason for rational assurances and appropriate disclaimers.
Design Professionals' Unique Risks:
Lawyers cannot predict with any certainty whether, or how, a design professional may be held liable for Y2K problems. Do you have an obligation to specify products or systems which have proven themselves Y2K compliant? The number of systems in a building subject to such a standard could be staggering. Elevators, security systems, fire protection systems and HVAC controllers. Design professionals are placed in an unusual position, first with respect to specifying products and systems, and later by certifications to clients and third parties (e.g. lenders). You already know not to specify a product containing asbestos, but you cannot guaranty a lender that the contractor did not use such a product. Nor can you certify or warrant that every element of a building will be Y2K compliant.
You know that design professionals are judged by a standard of reasonable care and skill. Architects must perform as other architects would. Other architects will be taking some steps to determine their own Y2K readiness, and may be specifying that Y2K information be included with submittals and shop drawings. You will need to be able to demonstrate that you exercised some level of diligence.
Some Obvious Suggestions:
Hire a consultant, get certifications or warranties for your own equipment and software and buy insurance. Consultants and warranties provide you with a first level of assurance. Insurance backs up that assurance. Some professional liability carriers have expressly agreed to include Y2K risks in their coverage, while others intend to exclude such risks. Ask today, not on 1/2/00, then consult with your insurance advisor. Are there risks which could arise only as Y2K risks, without other covered exposures?
You are probably inundated with Y2K statements from vendors and manufacturers. Autodesk has established its own Y2K compliance information on the Internet (www.autodesk.com/support/resource/year2000/2000text.htm). So has Primavera for its scheduling programs (www.primavera.com/news/y2k.htm). These give some assurance that these individual products, without any add-ons or user-customizable products, do comply. A consultant can look at all of your applications and give you some qualified comfort. But is your consultant insured for Y2K risks?
Contracts and Warranties:
As discussed above, you want to avoid giving unqualified warranties of Y2K compliance, for your practice and for products and systems in a project. When you receive a letter or questionnaire from one of your clients, be cautious about the statements being requested. You can tell a client that you have undertaken a program to determine your firms Y2K readiness, but you should not tell a client that you have warranted or guaranteed such readiness. If there is no room on the questionnaire for disclaimers and qualifications, send a cover letter reminding the recipient that the enclosed should not be interpreted or misunderstood to be a warranty or guaranty of Y2K compliance. You also need to remember that professional liability insurance generally excludes coverage for warranties or guarantees.
Your certifications to clients or lenders may state that you have undertaken to obtain information from manufacturers regarding Y2K compliance of their products and that you have not specified any products which you know not to be Y2K compliant. On the other hand, you may wish to impose Y2K compliance on the contractors in your specifications or require submittals to include Y2K conformance information.
Finally, and perhaps the most important suggestion, your agreements should treat Y2K like the ADA. You may not know how the ADA will be interpreted either, but you can include statements that the ultimate decisions regarding ADA compliance belong to your client. Similarly, your agreements may include a statement that "Architect will endeavor to specify products and systems that are Y2K compliant whenever possible. Owner understands that Architect cannot control or warrant the Y2K status of any particular product or system, such status and compliance being entirely within the control of the manufacturer or installing contractor. Owner agrees to hold Architect harmless for liabilities arising out of Y2K matters, and to rely exclusively upon warranties and assurances given by manufacturers and installing contractors for all Y2K liabilities."
If you are lost in a sea of predictions of doom, hiding in a cave and waiting for the angel of Y2K death to pass, you have watched too much of the Ten Commandments and probably need a vacation. Have someone check your systems, verify your insurance coverage, change your specifications to accommodate Y2K submittals and qualify your statements regarding Y2K readiness. Then hold your breath for the next 15 months.
P.S. Some Additional Web Sites of Interest:
www.e-architect.com (AIA)
www.boma.org/year2000.htm (BOMA)
www.sba.com (United States Small Business Administration)
www.ibm.com/IBM/year2000(IBM)
www.apple.com/macos/info/2000.htm(Apple)
www.year2000.com
www.mbc.com (McBride Baker & Coles)
Manufacturers:
www.doverelevators.com
www.honeywell.com
www.montgomery-kone.com
www.us.schindler.com
www.stfi.com (Shared Technologies Fairchild)
www.trane.com
www.utc.com (United Technologies)
www.york.com
About the Author: Eric L. Singer is with Wildman, Harrold, Allen & Dixon, Lisle, Illinois. His practice concentrates in construction law and in the representation of design professionals in all aspects of construction claims and dispute resolution.
NOTE: This article is intended for general discussion of the subject, and should not be mistaken for legal advice. Readers are cautioned to consult appropriate advisors for advice applicable to their individual circumstances.
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