The Legal Issues Of Engineering And Constructing A Microbrewery

In the engineering and construction of a microbrewery there are numerous areas where legal issues come into play from concept to completion. This article will attempt to outline some of the legal issues one must ponder while progressing through the entire engineering and construction process of a new 15 barrel (bbl) microbrewery. The process will be divided up into two distinct sections - engineering design and construction.

Let us begin the engineering design process with the owner's concept: "I want you to design a 15 bbl microbrewery for me". As an astute engineer, you know that you need a written contract. This written contract must clearly contain several elements in order to be valid. These elements are: competent parties, agreement (offer and acceptance), consideration, lawful purpose, and form. The competent parties would be the owner and you (or your engineering company). The agreement would be your offer to design and engineer the microbrewery, and his acceptance would indicate and agreement. The consideration would be that you receive a fee (for instructional purposes let's say you charge a flat fee to design building plans that will be accepted by the permit office for construction. The owner's consideration would be those completed building plans that are accepted by the permit office, thus being ready to use for construction. The contract must be for a lawful purpose, in this case, the design and engineering of a microbrewery. The form, of course, would be the written form outlining all of the above elements. Now, that the basic elements of the contract are known, you must now work with the owner to get some answers that will help you design this new microbrewery.

Since the microbrewery is going to be a 15 bbl system, you might need details like:

What is the maximum annual production capacity expected?

What type of beer will be produced (ale, lager, stout)?

How will the beer be packaged (bottles, cans, kegs)?

You are asking these questions because they are needed to determine the size of the facility, as well as what special items must be designed. For example, the owner says he wants to be able to brew and store three brews a week. Knowing this you now have to calculate enough space and equipment to handle a maximum annual capacity of 2250 barrels at 50 brewing weeks per year.

Calculation of Annual Production

System Size (Brewhouse Size) x Number of brews per week x 50 weeks per year = Annual Production 15 Barrels (bbls) x 3 brews/week x 50 weeks/year = 2250 bbls/year

The owner also says that he wishes to brew both ales and lagers - 50% ale production and 50% lager production. You also know that each type of brew has a different cycle for brewing, and thus you need a different amount of fermenters per type of beer.

Calculation of Number of Fermenters

2250 bbl Annual Production Capacity (50% Ale, 50% Lager)

14 Day Ales / 28 Day Lagers with full fermentation in fermenters Ales - 25 cycles / fermenter / year (50 brewing weeks / 2 week fermentation) Lagers - 12.5 cycles / fermenter / year (50 brewing weeks / 4 week fermentation)

Ales: 1125 bbls / year / (15 bbls x 25 cycles/year) = 3 Fermenters Lagers: 1125 bbls / year / (15 bbls x 12.5 cycles/year) = 6 Fermenters Total: 9 - (15 bbl) Fermenters to produce 1125 bbls Ales and 1125 bbls Lagers

This information will affect the dimensions of the microbrewery. You know that ales ferment ideally between 65 and 75 degree F, but you also know that lagers ferment below 65 degrees and must age longer in lager tanks, so you must add not only a "hot room" for brews but also a "cold room" for the lager tanks and dispenser tanks. The owner says that he wants to dispense the beers in ½ bbl kegs and 12 oz bottles. He also stipulates that he needs enough space to store a month's worth of each type of container. So, based on this requirement you need to calculate the space required for the bottling and kegging machinery, as well as the storage space for a month supply of ½ bbl kegs and 12 oz bottles.

Of course, you will need to figure out the other requirements specific to the microbrewery, such as water needs, drainage, floor finish, electrical, ceiling heights, venting, loading and unloading areas, etc. Slowly but surely the picture of what needs to be designed is coming together. As an engineer, you will need to ask many questions, and get answers to those questions, so that you can clearly outline the specifications of what needs to be built in the contract. In addition, by getting these specifications in writing you are further eliminating any ambiguities there might be which could be used to not honor the contract, or which could be used against you if you must go to court to resolve a contract dispute.

After several weeks of hard work, you finish the project, submit the plans for approval, and they are approved. You present the approved plans to the owner as consideration for your services, and as consideration you are paid your fee.

After having been pleased with your design and engineering services, the owner now asks you to be the general contractor for the construction phase of the project. He asks you to supply him with a bid as soon as possible. You call your suppliers to get prices, availability, lead time for delivery, etc. You receive bids from subcontractors for the various trades (plumbing, electrical, HVAC, flooring, etc). You pick those subcontractors that you think best fit your needs.

In addition, you have done your due diligence by making sure all your subcontractors are licensed, that they are carrying their own forms of liability insurance, and that their workers will be covered in the event of injury. As a general contractor, you, of course, must also be licensed, possess liability insurance, surety bonds, workman's compensation insurance, etc. These are all instruments that help protect you legally in the event that any liability or injury issues arise during the construction of the microbrewery.

When preparing the contract for the bid (and the job) you ensure that the specifications contain all of the critical elements such as: general provisions, the schedule of work, change order procedures, drawings, receipt and storage of materials, warranty on labor, warranty on materials, methods of payment, procedure for lien release, etc.

Once you have collected your information you submit your bid, and the owner accepts. Of course, there may be many different contracts involved here: the contract between the owner and you (the general contractor); the contracts between you and the subcontractors; and the contracts between you and your suppliers.

Finally, the first building supplies arrive, construction begins, and within several months, you and your team have constructed a new top-of-the-line microbrewery, adding value to the community, the nation's economy, as well as putting a little money in your pocket.

Now, let's review. Along the way there were several areas where you could have encountered potential legal pitfalls. In the engineer role, you made sure that the contract contained all of the elements necessary for it to be valid: competent parties, agreement (offer and acceptance), consideration, lawful purpose, and form. Also, based on the owner's input, you made very detailed specifications of the microbrewery design and you put it in writing. This helped prevent any ambiguities between what the owner wanted and what you thought the owner wanted; furthermore, you put the design specifications in writing.

In the general contractor role, you had to deal with potential legal pitfalls involving the contract between you and the owner, you and your subcontractors, as well as you and you suppliers. You possibly had to encounter labor issues, liability issues, injuries, workman's compensation insurance claims, incorrect building supply deliveries, theft or damage of materials or equipment on the job site, or maybe even attractive nuisance issues. Whatever you might have encountered as an engineer and as a general contractor you know that you are armed with the knowledge to jump over any legal issues you may encounter. It's time to have a beer!

Michael Frick has worked his way through the ranks of the Information Technology field for the past 17 years, as IT Director, system coordinator, programmer, and linguist. He currently holds the title of President for a network engineering and application development company in Los Angeles, California. Before that, he had worked for the Drug Enforcement Administration, and had served several years in the Signals Intelligence/Ground Electronic Warfare field in the United States Marine Corps as a Signals Intelligence Cryptologic Technician. He brings his years of experience, as well as, his real world, common sense approach to consistently remain at the forefront of software development and deployment of contemporary business solutions. He is fluent in Spanish and is learning Japanese.

One Size Does Not Fit All When It Comes To The Applicability Of Code Issues And Compliance

Whether using one of the model codes or a site-specific code, such as New York City's Building Code, the task of analyzing and applying the applicable code requirement for a particular situation is best suited to a professional code consultant who understands the variations in codes from location to location. Owners and facility managers, primarily concerned with minimizing their risk on any scale of a project, need to understand which design professional is responsible for ensuring code compliance where the project is being built.

Domestic codes

The applicability of various domestic and international building codes reveals why owners should become aware of the assignment of responsibility for building code standards and/or oversee building code compliance for the projects they develop. A building code is a set of specifications and procedures designed to cover all aspects of construction. These codes stipulate the products or materials that can be used for a building or structure, what construction processes are permissible, and who can perform specific construction activities. Underlying all principles applicable to building codes is the protection of the public health, safety, and welfare as it relates to the following design/construction disciplines: structural, mechanical, electrical, plumbing, life safety (egress), fire safety (protection and suppression), natural light and air, accessibility standards, and energy conservation.

Since standards are at the heart of any building code, they attempt to be exact but they also allow flexibility for improvement. Building codes represent a composite of three sets of discrete information: (1) definitions of terms; (2) licensing requirements; and (3) the building standards themselves. These standards find their way into local codes either through one of the model code associations discussed below, federal law, or through direct lobbying at the local level.

There currently exists a complex web of hundreds of divergent national, regional, and local codes, which are all in a constant state of flux. This collection of building codes makes it extremely difficult for owners to provide oversight and building code expertise for the numerous projects it may undertake locally or globally.

For the reasons set forth below and because of the complexities and associated liabilities involved with assuming responsibility for the various codes, owners are encouraged to take more active roles in the preparation of their design services agreements to ensure who is responsible for code compliance for their projects. Responsibility for this area should be placed in the hands of local architectural and construction professionals retained for each project. Furthermore, owners who create a contractual framework which indemnifies owners from claims and liabilities associated with the services performed by architectural and construction professionals will be better protected should the project not pass inspection.

One project does not fit all

Despite the push towards one universal code, every community in the United States has adopted one of many building standards. Building code regulation, like construction itself, has long been considered a local activity. The prevailing pattern of regulatory use in the United States regarding building codes is one best described as being laissez faire, with each community determining its own building code requirements. Even with state codes, a pattern of local independence has evolved and efforts in achieving an all-encompassing national measure that is reciprocal among states has, for the most part, been difficult to adopt universally.

There are three model code associations in the United States which actively solicit member cities and municipalities to adopt their model code. While there is some overlap regarding the jurisdiction of these code associations, the country is generally divided into areas dominated by one of the model codes: (1) the International Conference of Building Officials ("ICBO") predominately is adopted in the West; (2) Building Officials and Code Administrators ("BOCA") in the Northeast; and (3) Southern Building Code Congress ("SBCC") in the South.

There has been a push over the last several years by a fourth model code association, the International Code Council (ICC), to consolidate the three major codes into a single unified national code. Despite the ICC's attempt to draft and seek endorsement of a single national building code, known as the International Building Code ("IBC"), many municipalities have hesitated to adopt the new code because it was merged too quickly, and as a result, lacks the specificity most local jurisdictions want in their code.

Furthermore, the possible emergence of a universal building code has given rise to the development of an alternative model code based on performance. As the ICC struggles to merge the three model codes, a subgroup of the ICC has prepared the International Code Council Performance Code for adoption by municipalities as an alternative to the IBC. The fundamental difference between the two codes is found in their structure. The IBC is a conventional prescriptive code that details exactly how a building component or system must be designed. The performance code, on the other hand, explains the intent of a code in a specific situation and lets the designer figure out how to meet that objective. This fundamental difference in the structure of these codes adds a new level of complexity for design/construction professionals charged with code compliance and interpretation.

The reality of complying with local codes

While the adoption of model codes at the municipal level has been an ongoing trend dating to the early 1960s, the elimination of locally drafted codes will most likely never take place as long as municipalities and cities choose to retain their unique identity and character owing to each location's practice of design and construction. The existence of a wide variety of building code requirements from one city to another, even among neighboring cities, will likely remain in the construction industry. Many municipalities in the United States have retained their local codes and show no sign of adopting model codes to replace their own because of their particular unique social, political, and building environment.

A considerable measure of variation has produced divergent building codes where regions differ characteristically by way of urban planning, built environment, local climate, and geology. For example, northern cities must provide for snow loads while southern cities must contend with other environmental conditions such as solar heat gain and hurricane/tornado season. Furthermore, many of the largest cities in the United States evidence special code requirements that manifest their own special problems. For example, New York City, has a unique high-rise/high-density urban condition not found in other large cities. As a result, New York City applies its own code as separate and distinct from New York State and Federal regulations.

The international building code jungle

Building code compliance becomes more complex for projects located outside the United States. As in the United States, many of the countries we researched have no one unified national standard. Rather, each region or municipality customarily applies its own unique building code.

What makes providing building code expertise more complicated abroad, is the potential lack of understanding of foreign municipal resources which work hand-in-hand with any design/construction discipline. For example, if one is not aware of a local jurisdiction's fire-emergency protocols such as the correct sizing and fittings for the standpipe connections, then it is difficult to determine fire-safety standards. Additionally, without the basic understanding of an area's regional sewage treatment infrastructure and its unique irregularities, it is impossible to identify the appropriate building sanitation system.

Compounding the problems when working internationally is that foreign countries often assert direct governmental oversight which infuse political restrictions over the applicable building code. For example, Japan applies stringent import restrictions which bar foreign building materials which would otherwise be preferable or acceptable for a particular project.

Performance-written building codes versus design-written codes, local codes versus national codes, and required or non-required filing with building authorities, are just a few of the issues owners are faced with when dealing with assignments of responsibility. If the owner retains a licensed professional, will that entity retain a code consultant? In some cases, the owner is unaware of third-party relationships formed by the architect or engineer, unless counsel has addressed this issue with the owner. If so, who assumes liability concerning the code compliance of the design drawings, the architect or its code-consultant? Reliance on the architect does not always guarantee that he or she will also be fluent in relevant code meaning and interpretation.

Steps owners should take

It is difficult, if not impossible, for owners to effectively monitor and be responsible for providing code compliance services in the diverse jurisdictions, as well as for future projects and their existing facilities. For those issues which involve code compliance obligations owners should take the following steps:

a. Require each local owner to contractually obligate the local architect and construction professionals to assume responsibility for code compliance and interpretation obligations.

b. Require sufficient professional liability and general liability insurance coverage, naming the owner as an additional insured, for each project covering claims for design and construction defects.

c. Recommend that local code standards be substituted for the general, or non-site specific "boiler plate," owner-written building standards.

d. Seek indemnification from the applicable design and construction entities for future liability related to code compliance and interpretation issues.

e. Require indemnification provisions in all agreements with design and construction professionals charged with code compliance and interpretation issues such that the owner is indemnified and held harmless from and against all liabilities, damages, losses, claims, demands, and actions of any nature whatsoever which arise out of or are connected with the performance of such design and construction services.

f. Ensure that all agreements with design and construction professional, who provides code compliance services, provide for adequate insurances which name the owner as an additional insured to cover any claims which may arise out of code compliance issues.

From the owner's perspective, a discussion on code compliance is often placed on the back burner until many other design-related issues are resolved. Discussions about code compliance are not glorious or fashionable and are rarely, if not implicitly, the arena where owners want to invest great quantities of time and energy. However unpopular, the assignment of responsibility for code compliance is an important reason why owners and their in-house facilities and design professionals should be aware of the code and liability issues that arise during the planning stages of a project.

Julian Arhire is a Manager with DtiCorp.com - DtiCorp.com carries more than 35,000 HVAC products, including industrial, commercial and residential parts and equipment from Honeywell, Johnson Contols, Robertshaw, Jandy, Grundfos, Armstrong and more.

Texas Relates To Import Safety Issues As China Executes Its Top Food and Drug Administrator

China's official Xinhua news agency announced yesterday the execution of Zheng Xiaoyu, the former head of its State Food and Drug Administration, in an attempt to show the country's seriousness about cleaning up obvious problems with exporting contaminated food and drugs.

Xiaoyu was convicted of accepting bribes totaling the equivalent of one million USD to approve untested drugs. The Beijing No. 1 Intermediate People's Court carried out the sentence after denying appeals from Xiaoyu, who argued the punishment was too harsh for the crime, and that he had confessed to his wrongdoings. Evidently, it wasn't enough. Xiaoyu was the first ministerial-level official executed in China in seven years, and only the fourth within the past thirty.

The execution is expected to be met with mixed reviews by the American public, which has been outraged by China's continuous problems with contaminated food and drugs. Numerous industries -- from major retail chains, to the health insurance and health care industries -- have been trying to contain serious health and safety risks from the products. Hundreds of human and animal lives have been affected in the U.S. alone.

But putting an individual to death for accepting bribes also is riling up human rights' activists, many of whom argue that, no matter one's stance on the effectiveness of the death penalty, it should not be considered for nonviolent crimes. China's reputation for violating human rights, after all, is no better than its reputation for exporting dangerously contaminated goods.

The nationwide contamination earlier this year of some of the U.S.'s top pet food brands by wheat protein imported from China was only the latest in a series of scandals involving compromised products from the country, including tires, children's toys, vitamins used for baby formula, and toothpaste. Even phony anti-malarial drugs have been exported and used, killing or further sickening desperately ill patients.

Texas understands this issue well. With so many products legally and illegally imported from the border, and with only 1% of all of the nation's imports being inspected by the Food and Drug Administration, it's likely that nearly any establishment in the state selling almost any goods -- from Dallas, to Houston, to Austin, to the tiny border towns -- is making available a product American regulatory industries would never allow to be produced in the U.S. Even fruit is subject to different regulations in Mexico, and is often sprayed with chemicals now banned in this country. The problems with Chinese imports, then, which circulate throughout every state, only adds to the problem, and Texans have been shown to be less than tolerant about products on the market that could put public health at risk.

China knows America's outrage, and is making overt efforts to reassure the Western public of its commitment to safety, including the conviction and execution of Xiaoyu. Without its exports, the Chinese economy would collapse. Wal-Mart alone is China's eighth largest trading partner, and over 90% of the vitamin C sold in the U.S. is produced there. In fact, Americans would be surprised to know that much of their aspirin, pain relievers, and antibiotics, including penicillin, are produced in China. Labels stating a vitamin or drug's country of origin are not required in the U.S., however, and few products actually reveal it. Fewer Americans probably even think about it when picking up a prescription from the pharmacy.

This is certainly not to say that all products from China are dangerous, or even of poor quality. It's the fact we simply don't know that makes us cringe. We don't know which exports are safe or, at times, even when we're buying imported products, let alone imported drugs from a facility in China that may or may not be clean, and that may or may not be producing untested products. Xiaoyu's willingness to accept bribes to approve untested drugs forces most of us to count our blessings that we weren't one of the many malaria patients trusting phony medication, or one of the many beloved pets ingesting contaminated wheat protein. Perhaps this will be a turning point for China's regulatory industry. Perhaps. But until then: buyer beware.

Making sure the products you buy are safe is one very important part of taking care of your health. How you take care of yourself will certainly affect you as you age, and eventually your wallet, as well.

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