Engineering and the Law
Nonetheless, a prudent practitioner should be aware of recent legal developments regarding licensing requirements, expert engineering testimony, statutes of repose and the economic loss doctrine. The purpose of this article is to provide information that may affect an engineer's insurance premiums, legal liability and future practice.
Licensing RequirementsRecent court decisions have made it clear that the practice of forensic engineering requires a state license. An Illinois decision is illustrative. In Miller vs. Dept. of Professional Regulations, the Appellate Court of Illinois, 2nd District, held that Miller, who holds a bachelor of science degree in electrical engineering and had been consulting and investigating electrical systems for over 20 years, did not have a due process right which would exempt him from the requirement to register.
In 1989, Illinois changed its Professional Engineering Practice Act and specifically included the practice of forensic engineering within the Act's requirements for registration. Previously, it was unclear whether the practice of forensic engineering required a license. Miller argued that he should be grandfathered into a license under the new Act because he had been practicing for years in apparent compliance with Illinois state law. However, the Illinois Appellate Court found that Miller was not prevented from practicing his profession by a statutory requirement he could not hope to meet. Rather, Miller could sit for an eight-hour written exam in the fundamentals of engineering and another eight-hour written exam in the principles and practice of engineering.
Miller further argued that there was no rational basis for requiring professional engineers to pass an examination in order to obtain a license when interior designers, nutritionists, water pump installers and wrestling promoters were not required to pass a similar licensing examination. Miller stated that this differentiation was without a rational basis and violated the equal protection clause of the U.S. and Illinois constitutions. The Appellate Court quickly rejected this argument stating that there was a rational basis for the state's regulation and that the classification reasonably furthered a legitimate government interest of insuring public safety in the inherently complex area of professional engineering.
In 1998, the Illinois Appellate Court, 2nd District, again upheld an order of the Dept. of Professional Regulation which found that a forensic engineer had violated the Illinois Professional Engineering Act and ordered the engineer to cease and desist from engaging in the practice of engineering without a license.
Plaintiff VanBreeman detailed his education and work experience in a resume and correspondence to the department. The department, without a hearing, then ordered VanBreeman to cease and desist engineering activities until he was properly licensed. The department found that the correspondence and resume advertised services, which fell within the definition of professional engineering practice. The Appellate Court decision makes clear that neither document stated that VanBreeman was a registered professional engineer.
Nonetheless, VanBreeman's reiteration of his educational background and employment history and information about his forensic work and industrial failure investigations were deemed to be examples of VanBreeman holding himself out to be able to perform many of the services recognized as professional engineering practices. The court agreed with the department's finding that VanBreeman was offering to practice and was practicing professional engineering by virtue of the representations in the letter and resume.
The application of a Professional Engineering Act to forensic engineering activities is important to engineers for several reasons. First, engineers should not engage in industrial failure investigations, accident investigations or forensic work without first securing a license. Failure to do so could result in both civil and criminal penalties.
Second, engineers who are wrongfully sued for claims of negligent engineering activities should carefully review the qualifications of forensic engineers who have been retained to testify against them. If the opposing engineer does not have a license, the Dept. of Professional Regulations should be willing to issue a cease and desist order for that forensic engineer's unlicensed practice in violation of the act.
Third, companies should consider whether consulting engineers who were hired to perform industrial failure investigations and accident investigations will be useless in later litigation if they do not have a license.
Engineers as Testifying ExpertsThe U.S. Supreme Court recently made an important pronouncement regarding the admissibility of opinion testimony by engineering experts. In Kumho Tire Co. vs. Carmichael, the court held that the gatekeeping and reliability factors apply to the
testimony of engineers and other experts who are not scientists. This decision is important to engineers because it defines the requirements for engineers who try to testify against other engineers in litigation and clarifies the standards upon which an engineer's testimony on behalf of clients will be screened by the trial court.
Rules of evidence have long held that witnesses may only testify to the facts about which they have personal knowledge. Only when scientific, technical or other specialized knowledge would assist a jury in understanding a fact, may a person qualified as an expert render an opinion. The courts have struggled with a practical application of these general principles caused by a reported proliferation of opinion testimony given by witnesses who rely on "junk science."
The U.S. Supreme Court in Daubert vs. Merrell Dow Pharmaceuticals, in 1993, focused on the admissibility of scientific ex-pert testimony. The court set a new standard requiring federal trial judges to act as a gatekeeper for expert opinion evidence and required trial courts to determine that the testimony was based on a reliable foundation. The court in Daubert identified four specific factors which could be used to test for reliability: testing, peer review, error rates and acceptability of the methodology in the relevant scientific community.
The Supreme Court in the 1999 Kumho Tire decision made it clear that the same analysis applies to engineering testimony. The court reviewed the decisions of the trial and appellate courts regarding the admission of the opinions of an engineer whose qualifications included a masters degree in mechanical engineering, 10 years work at a tire manufacturing company and prior recognition as an expert in litigation. The court affirmed the rejection of the admission of that expert's opinion testimony on the issue of whether a tire's failure was caused by a manufacturing defect or by a customer's misuse. The Court stated that the expert's analysis depended on acceptance of the proposition that his visual and tactile inspection could determine that the tire had not been abused, despite some evidence of the very signs which he typically looked for to find abuse.
The Court said that it found no indication in the records that other experts used the engineer's test, found no evidence of any articles or papers that validated the expert's approach, nor found any evidence that he would have reached a similar conclusion using the identical methods if he were still working for the tire manufacturer. In other words, the Supreme Court did not find the expert's methodology to be reliable.If engineers are called on to give testimony as engineering experts, they should be aware of the Kumho Tire reliability requirements. It is not only important to establish qualifications and the work done in analyzing the issue, an engineer must also show that the analysis and methodology indicate reliability. The Kumho Tire decision makes it clear that there is not a rigid standard for establishing reliability.
Nonetheless, Kumho Tire identifies some factors that bear on reliability. First, an engineer may want to show that the theory or technique can be and has been tested and found to be reliable. Second, an engineer can show that the methodology has been subjected to peer review and publication. Third, any evidence regarding the known or potential rate of error may be considered. Fourth, an engineer may prove that there are standards controlling the technique's operation. Finally, an engineer may want to show that the methodology enjoys general acceptance within the relevant engineering community. Of course, all of the same factors and the need to prove reliability apply to an opponent in litigation to the same extent as to the admission of expert engineering testimony. Thus, any engineer testifying against another engineer's design or compliance with a proper engineering standard of care (malpractice) should also have their analysis and methodology reviewed for reliability using factors such as those identified in Kumho Tire.
The new standards on expert engineering opinion evidence were meant to rein in the proliferation of irrelevant and unreliable opinions rendered by crackpots using junk science. Unfortunately, the factors to be applied by trial judges are discretionary and not clear cut. Their application will be arbitrary and inconsistent when applied on a national basis. A careful practitioner must buttress all opinion testimony with sufficient evidence to establish relevancy and reliability.
Statutes of ReposeMost engineers are familiar with statutes of limitation, but may not be aware of the protection afforded by a statute of repose. In general, a statute of limitation requires that an injured party file a lawsuit within a few years of the time they knew or should have known of the defendant's alleged act or omission which caused the injury. In contrast, a statute of repose is an absolute bar to a plaintiff's ability to file a lawsuit after a defined, longer period of time. States typically have statutes of repose that apply to actions based upon product liability and to actions based upon design and construction activities related to real property.
The purpose behind the better known statute of limitation is to force an injured party to give timely notice to a defendant so that the defendant can investigate the occurrence and determine whether a defense is available. Statutes of limitation are of relatively short duration and begin to run from either the time when the injury occurs or when the cause of action accrues. For example, the state may have a statute of limitation, which provides that a plaintiff must commence an action for their personal injury within two years from the date they knew or should have known of the defendant's wrongful act or omission which
caused the injury. Similarly, a state may require that actions to recover damages for loss to property be commenced within five years after the cause of action accrued.
In contrast, a state's statute of repose for product liability actions might provide that the plaintiff cannot commence a product liability action after 12 years have expired from the date of first sale of the product by a seller, 10 years from the date of first sale to the product's initial user, or 10 years from the date of any alteration or modification of the product. Thus, even if the injured plaintiff files suit within five years of loss to his property, and thus would not be barred by a statute of limitations, the lawsuit might still be barred if the filing of the lawsuit occurred more than 10 years after the date of first sale to an initial user.
There is little nationwide uniformity regarding statutes of repose. Injured parties typically challenge statutes of repose as being special legislation in favor of designated defendants, such as product manufacturers and the construction industry, in violation of the constitutional protections of due process and equal protection. Defendants are ever seeking to expand the identity of parties who would be protected by a statute of repose, to shorten the time period for the statute, and to expand the types of actions that are barred by the statute. In some states, statutes of repose have withstood constitutional challenge and remain enforceable. In other states, statutes of repose have been declared unconstitutional in whole or in part.
The status of each individual state's statute of repose is important for several reasons. First, an engineer's exposure for design and manufacturing errors related to products and construction activities that occurred 10 or more years ago may be terminated by a statute of repose in that engineer's state. This limitation may affect the engineer's risk factor and may be considered by the engineer's insurance carrier in determining exposure and the engineer's premium.
Second, a state's statute of repose may eliminate some causes of action. For example, actions based on strict liability premised on an unreasonably dangerous and defective condition may be barred from proceeding.
Third, a plaintiff's action against an engineer may be able to be terminated at a very early stage based on the statute of repose, which should result in substantial savings on costs of litigation and an engineer's insurance policy deductible. For these reasons, careful engineers should have a good understanding of the statute of repose in their state and always ascertain that their attorney has considered how the statute might affect any litigation involving the engineer.
Economic Loss DoctrineThe Economic Loss Doctrine may limit a defendant's liability and damages exposure under certain circumstances, and engineers should be aware of the protections which the doctrine affords. Initially, the Economic Loss Doctrine provided that a commercial buyer could not recover economic damages, defined as repair costs and loss of use, from a defendant commercial seller when only the product itself was damaged, the buyer's loss arose purely from disappointed commercial expectations, the buyer had an opportunity to protect himself at the time of contracting for the purchase of the product, no other property was damaged, and the loss occurred as a result of gradual deterioration, internal breakage, or other non-accidental causes.
For example, a purchaser of a tank could not recover from the seller when the tank failed and the purchaser was forced to incur costs to repair the tank and expenses related to the loss of use of the tank. The Court reasoned that the plaintiff buyer had the opportunity when the contract to purchase the tank was agreed on to protect itself and to define what damages would be recoverable in the event the tank failed.
Thereafter, the states began to diverge and modify the Economic Loss Doctrine within their own jurisdictions. Some states have eliminated exceptions to the Economic Loss Doctrine that allowed these lawsuits to go forward. The major exceptions that were affected include circumstances where there is damage to other property and where loss events are of a sudden and calamitous nature.
Currently, there are conflicting positions among the states regarding issues of this type. For example, one state will allow an action for economic damages in tort to go forward if there is damage to property other than the product itself. A neighboring state might hold directly to the contrary and bar an action for economic losses using the rationale that the damage to other property is irrelevant and the same opportunity was available to the purchaser to protect itself at time of purchase. Similarly, one state might allow an action for economic loss where the event was of an unexpected, sudden and calamitous nature. At the same time a neighboring state might hold directly to the contrary on the premise that the timing and manner of the loss is irrelevant.
One of the more interesting recent cases dealing with the Economic Loss Doctrine arose out of the great Chicago flood in April 1992. The Illinois Supreme Court recently affirmed the application of the Economic Loss Doctrine to that loss for those plaintiffs who did not incur personal injury or property damage and were affected only by physical flooding losses at distant locations. At the same time, the Illinois Supreme Court allowed plaintiffs to recover for loss of perishable inventory as a result of electrical service that was interrupted by the flood. The Court reasoned that the inventory damage was above and beyond the plaintiff's disappointed commercial expectation in continued electrical service.
The Economic Loss Doctrine may not provide a total defense to an action brought against an engineer. Nonetheless, in the right jurisdiction, the doctrine may bar a civil action in tort based on a negligent act or omission. The doctrine could limit plaintiffs to their remedies in contract. The doctrine might also limit the categories of damages which the plaintiff could pursue by eliminating damages for loss of use of the property. For these reasons, it pays to be aware of your state's Economic Loss Doctrine and its effect on litigation.