Having gotten past the architect selection and with the design effort underway, Sister Susan and Tribrook set out to hire a construction manager. Nothing I could say served to persuade her to the contrary. My experience convinced me that Construction Management was a sham that would not be in the hospital’s (nor my) best interest.
Despite my warnings, six months after our own selection by St. Margaret’s, the hospital conducted an interview series which included some of the biggest Construction Manager firms in the country. This time I sat in as an observer and advisor, not as an interview subject. It’s now decades later and I still remember and marvel at the slick presentations I heard that day.
Sister Susan and her advisors selected McBro Construction Management of St. Louis, which was a branch of McCarthy Brothers Construction Company. They and the CM system proved to be as ineffectual and weasel-minded as I had anticipated. Thus, early 1977 found me in the most precarious position I had yet faced in the 20 years since PH&J was founded. This was to be the biggest project of my career; the client and I could not get along; I had no confidence in our joint venture partner. I abhorred CM and expected that McBro would do a sorry job, would screw the hospital and all the contractors who worked on the project, and would manage to blame it on PH&J–not on Klein–because they wanted to trade on Klein’s potential national reputation. And to top it all off, the contract was in my name as an individual.
McBro Management Plan
As construction manager, McBro wanted to control everything, but be responsible for nothing. We were on a collision course from the outset, starting with a fight over the legal “general conditions” to be imposed on the contractors who would actually do the work. We even clashed over the amount of contingency money that should be budgeted. McBro wanted $750,000 set aside to cover screw-ups, and I took the position that not more than $200,000 should be reserved, even if heavy remodeling was involved. I knew we were going to relocate every single department in the entire hospital before we were through, but damn, $3/4-million was a lot of money in 1977. I believed that McBro’s real concern had to do with the holes the CM process would create by taking separate bids for each trade with no general contractor to cover the voids. To cover up this basic weakness in the CM system, McBro wanted to blame their huge hedge fund on potential architectural errors and unknown conditions. I suppose I really was a thorn in their side.
As the design unfolded, the Construction Manager divided the work into three phases as follows:
- Bid Package A (the getting ready package): a relatively modest undertaking, mostly involving the relocation of the hospital’s main entrance and its loading dock and service entrance. PH&J did the entire thing.
- Bid Package B (foundation work for the new construction to follow): also a small unit, consisting of excavation, auger-cast piling and huge concrete pile caps. It was essentially done by the local structural and civil engineer, who followed Klein’s design. PH&J wrote the specs and McBro added the “boiler plate” in front.
- Bid Package C (everything else): Pack “C” was huge–projected to be $15-million–with Klein doing design of all of the new construction, and PH&J handling 100-percent of the remodeling work.
As you will see, each phase brought its own set of problems to PH&J.
Through all this I would seek solace from Sister Almeda, the aforementioned Director of Nursing Services. She was as disturbed as I was over Sister Susan’s design decisions, her heavy-handed aberrations, and her misplaced confidence. Ultimately, she became Administrator of the Order’s Saint Vincent’s Hospital in Birmingham. Both Almeda and I felt like outsiders, and we had many whispered conversations over events that were to follow.
Pack “A” Trouble – The Carithers Claim
The temporary west (Ripley Street) entrance provided under Bid Package A was opened in February 1978. The hospital boasted a new asphalt entrance drive, concrete sidewalks, and a temporary entrance walk covered by an aluminum canopy. Even though it was temporary, the new entry path was as safe or better than that afforded by most buildings. From photographs, we knew there was nothing wrong with the way it was poured.
Around the corner on the Adams Avenue side, Pack “B” work had been underway a month and construction activity abounded along the north side of the property. Only minor, intermittent operations continued on the west side, which St. Margaret’s had been reconfigured to face. There is only conjecture as to what debris might have accumulated near the entrance path at any one time.
Then, on June 30, 1978, one Annie Carithers allegedly tripped and fell where the temporary entrance walk and canopy met the new asphalt drive. Apparently Annie went on into the hospital and sought medical attention for her scrapes and bruises, where she encountered an unsympathetic hospital staff. Later, Annie became more incensed when the hospital sent her a sizable bill for emergency room treatment. No one knew about the incident except the hospital, and its administration continued to treat Annie in a brusque and un-conciliatory manner.
Annie must have contested the bill and fumed over the imagined slight for almost two years, after which she hired a lawyer and lashed out. As a result, on March 28, 1980, PH&J, yours truly, John McDonald, Klein, McBro and the Pack A contractor, Stallings & McCorvey, were all served with a lawsuit to assuage Annie’s hurt feelings. (Note that PH&J was named three times to Klein’s one, which explains my demand three years earlier that our several legal listings be balanced–not that it did any good).
None of us were aware of the accident prior to the Sheriff’s service. It seems that the suit had been filed against St. Margaret’s and the Daughters some months before and the rest of us were added in an amended complaint when no relief was offered. Annie Carithers and her lawyer demanded $10,000 in compensation.
No one knew why the old lady fell, not even her own attorney. Thus her claim alleged that we had “negligently constituted the temporary entrance which caused her to slip when she stepped on the curb”. We didn’t even know where she had mis-stepped, nor if debris was involved. By 1980, the temporary walk was long gone and the permanent entrance walk was in place. How do you defend in that circumstance?
Our insurance carrier, Imperial Indemnity and Casualty, retained our new young lawyer, Charles Paterson, to represent all the architects in the fray. The renowned Thomas F. Sheehan of Chicago, national advisor to all insurance companies who defend architects, monitored developments.
Trial was set for June 16, 1980, but at a preliminary hearing a few weeks earlier, Paterson was startled when a Philip Gidiere walked in and insisted that he represented the Klein Partnership, not Paterson. That stirred the pot. Then McBro’s lawyer claimed that his client, whose offices were in St. Louis, had not been “adequately served”, and further confusion ensued. The trial date was delayed two months.
Legal sparring continued. I was deposed on June 2nd in connection with the matter. Facing a no-win situation in which our legal fees would surely exceed a settlement even if we won, the defendants agreed to settle the case for $7,000, of which the architects were to pay one-fourth. The hospital paid one-fourth, and in addition, waived its bill for medical services. If it had made the waiver two years before, the legal brouhaha would never have occurred.
Pack “B” Trouble – The Harrington Episode
Bid Package “B”, the foundation work, included only two contractors, but it turned out to be the most contentious aspect of the entire St. Margaret’s project. It also served to expose the fallacy of the construction manager system in general, and the ineptness of McBro in particular.
Pack B was to provide the mass excavation in front of the old hospital, and then produce the auger-cast pilings and concrete pile caps for the foundation of the giant new north wing. You can envision the pile caps as giant blocks of concrete, say 10 feet square by 5 feet deep. Each separate cap sits on top of a score of grout piles which are drilled about 35 feet into the earth below. In this segment of the work, Harrington Construction Company, a local contractor, was to dig the pile cap holes and fill them with concrete.
The Lee Turzillo Contracting Company of Ohio, the nation’s largest and best known piling contractor, was to drill in the auger-cast piles beneath the caps.
The controversy was over who should go first, which sounds easy to resolve, but in actuality, was a most complex issue with much extra expense accruing to the loser. In essence, Turzillo wanted to do its drilling from the bottom of Harrington cap excavations, but Harrington knew that if he dug first, the drilling operation would cave in the sides and thus destroy the excavation of every pile cap.
In conventional construction work, the general contractor coordinates these trades, assigns the resulting extra work and pays additional remuneration to whichever trade he chooses. In CM work, the construction manager does this. The problem here was that our CM, McBro, had this theory that he should not solve the conflict. McBro, instead, just took bids and allowed the affected contractors to fight it out between themselves. Then to develop a national alliance, McBro took Turzillo’s side in the argument and demanded that I take the same position.
To view this in context, you might think of the big, ugly, hard-nose Yankee contractors (McCarthy Brothers of St. Louis, allied with the Turzillo outfit from Ohio) vs. the small, naive Montgomery contractor, Harrington Construction–the latter in way over his head. Also, you should know that Turzillo was not even the low pile bidder. The Berkel Company out of Florida was actually low, but Turzillo’s man on the scene sneaked over to the State Licensing Board and reported that Berkel did not have a general contractor’s license, which every trade had to have under the CM method of contracting. Before they were bounced, the Berkel group had worked out most of the difficulties with Harrington, but when Turzillo seized the contract, they assumed a less accommodating position.
The work got underway in February 1978 and then stalled, as each contractor claimed the other was delaying him, and each of them demanded extra compensation from the hospital. The Turzillo claim was a sham and was quickly dismissed. Harrington was really getting hurt, but McBro could ill afford to admit the validity of the claim. By May of ‘78, all the work was in place but McBro and the hospital refused Harrington’s claim of extra cost.
In frustration, Harrington hired attorney Bill Coleman of Capell, Howard, Knabe and Cobbs to take up his cause. McBro kept demanding that I say which sequence the Klein drawing depicted. I replied over and over that the drawings did not show sequence, only results. Attorney Coleman, twisting my words, kept insisting that “the architects supported Harrington’s position”, which irritated the hospital administration. I would counter, “My letter only says what it says.” In August, Chip Denton, Associate Administrator of the hospital, formally rejected the Harrington claim, and the stage was set for legal action.
Six months later, in February of 1979, attorney Coleman filed a lien on the entire St. Margaret’s property in the amount of $98,000, and the bickering began anew. Then, on March 24, 1980, a full year after the lien had been filed, I received a call from the hospital’s attorney, Harry Cole, who reported that St. Margaret’s had failed in its negotiation with Harrington, and that the hospital was now considering a cross-file action against PH&J. Zounds! That showed what great rapport I had with the hospital–as if it were my fault that they had chosen to take the CM path, and compounded that mistake by selecting an incompetent and unscrupulous construction manager.
This news bore out my earlier fear that McBro would screw up the bid between parallel trades and somehow blame it on PH&J. This particular construction was under the Klein wing, and the foundation details were done under their supervision. The contract general conditions and scope part of the specifications were prepared by McBro. Yet McBro had slicked the problem onto yours truly because I refused to lie and dump on Harrington.
I probed Cole, and then Denton, for a more detailed explanation of the hospital’s position. How, I asked, had McBro managed to con them into believing that PH&J was at fault for a clear McBro dereliction? I was even able to point out that, after this controversy first arose almost two years earlier, I had demanded that McBro establish contract language to insure that the same type issues would not arise in Pack C. At that time, McBro refused to clarify such overlaps, saying it was better “to let the trades fight it out between themselves”. Say what you will, that McBro crowd was nothing if not slick. Denton agreed that he would take the matter to the full Hospital Board before it went further.
In view of Harry Cole’s threat, Bill, Renis, and I saddled up Charlie Paterson again and notified our insurance of the potential claim. I had to give a deposition on December 23, 1980, but somehow we escaped being joined in the suit. The near miss did unnerve our insurance carrier, however, and it provided further evidence that architects and CM’s mix like oil and water.
Pack “C” Trouble – A Bidding Disaster
As was pointed out, 90-percent of the mammoth St. Margaret’s construction effort was embodied in Bid Package “C”, and it was in Pack C that McBro’s ineptness and arrogance were demonstrated even further. Their first mistake was poor estimating. During a trip to St. Louis and the McBro office, John Zgouvas and I both tried but failed to convince them that their cost estimate for the job was low by about $1.5 million. Part of our assessment was based on McBro’s disdainful treatment of the local sub-contract bidders, who Zgouvas and I feared would extract some sort of revenge for their treatment by McBro during the bid process. We were afraid that some trades would bid high, while others would refuse to bid at all.
As we told the McBro’s project manager, Mickey Morrison, small contractors and subs from the Deep South may have less than their quotient of skill, but, boy, do they have pride. Morrison haughtily replied that they had managed construction bids around the entire country, and that contractors and subs are the same everywhere. I dutifully warned Sister Susan and her assistant, Chip Denton, of my fear, a caution which both of them chose to ignore. Bids for Pack C were to be received on June 20, 1978, just three days before I was scheduled to take my daughter Sally to Southern Regional Roller Skating Championships in Louisville, Kentucky. Sally finally had a dance partner and was going to participate in her first skate dance “Regional” competition. I was not going to miss Sally’s debut, and had carefully warned all parties two months ahead, even before the bid date was set.
When Pack-C bids came in, the combined prices from all the various trades was $2-million above the McBro estimate and St. Margaret’s maximum approved expenditure. As I had feared, for two of the 17 trades there was only one bid, for two others there was no bid at all, and other trades were obviously high. It was a crushing defeat for McBro, and a terrible disappointment for Sister Susan, who had placed all her faith in the CM process. Susan called for a giant work conference to find a way out of the setback; it was to include all the parties–St. Margaret’s, Tribrook, McBro, Klein, PH&J, S&Z, even some of the bidders.
When I reminded Sister Susan that I would not be available for her cost reduction strategy session, that I would be in Louisville, Kentucky, she became furious. I never had much of a relationship with her, but this refusal on my part wiped out what little there was. Also, it didn’t help when I reminded her that McBro had created the problem over my protests, and that McBro should get her out of it.
I really can’t say what was said and done at the meeting, because I was not there. But at least six of the 17 trades were rebid 35 days after the initial bids were taken, and much of the remodeling of the nursing unit areas (PH&J work) was deleted from the bid package.
Pack “C” Trouble – The Triangle Conflict
The Triangle matter arose late in 1980, and to fully appreciate it, you must be made aware of the salient circumstances. First, the Triangle Electrical Construction Company was owned by one H.B. “Mac” McKinney. He was, on the one hand a feisty small business proprietor, but at the same time he was an outspoken, part-time politician who at that time chairman of the Montgomery County Commission. Ergo, we find the Chairman of the County Commission was the electrical contractor on St. Margaret’s Pack C.
Next, as you will learn in a later chapter of these chronicles, it was probably Mac McKinney, a good friend of Renis Jones, who was primarily responsible for PH&J’s selection as architect for the new Montgomery County Courthouse and Jail. Thus, later in 1980, while I was yet embroiled in the St. Margaret’s Hospital saga, I had already begun the first few months of my next eight-year saga. When the dispute arose between Triangle and St. Margaret’s, it established for Renis and me one of life’s great conflict of interest, one that would probably have defied Solomon himself. Renis and I well knew that, despite all of our efforts to be scrupulously fair in dealing with the matter, we were likely to wind up only affronting both of our combative clients.
Construction managers love to trumpet their axiom that CM’s can deliver a project “on time and within budget”. Having already failed on the latter part of the boast when Pack C bid high, McBro was determined to at least get the work completed on schedule. Accordingly, you can appreciate McBro’s anguish when the final package of work drifted behind schedule. After Pack C had been underway for almost two years, McBro’s inept and abrasive management style began to manifest itself in an uncooperative relationship between themselves and the 17 separate contractors. No amount of threat or cajoling seemed to improve progress.
Finally, McBro was forced to admit the project was a whole year behind schedule and they were desperate for a scapegoat. They decided to heap all the blame onto Mac McKinney and his Triangle Electric, which was a group that routinely refused to genuflect every time McBro issued an order. A serious personality conflict had already developed between Triangle’s foreman and McBro’s project representative. Then McBro brought in a second electrical sub, which is an absolute no-no in the construction industry, and this infuriated McKinney. The fuse was lit.
Around February of 1981, relations between Triangle and McBro grew so bad that McBro demanded that PH&J authorize no further payment to Triangle. Understandably, that only exploded an already volatile situation. Approving pay requests fell within the PH&J jurisdiction, and we found ourselves in an excruciating conflict of interest and loyalty with regard to a situation only fraught with shades of gray. It was truly a time of “peril in architecture”.
By this time Sister Susan had been replaced, and the new Hospital Administrator, Sister Almeda, was not inclined to get into these disconcerting “down and dirty” issues. She turned the matter, and all similar unpleasantness, over to Associate Administrator Chip Denton. Renis Jones headed our field operations, and his every attempt to mediate the conflict only angered McBro and alienated the hospital. They both felt that Renis was leaning too far toward Triangle and his “other client”. In any case, it was my name on the contract, and Denton kept demanding a response from me.
On March 23, 1981, I sent Denton a two-page position paper in a futile attempt to explain and justify the PH&J position. My letter closed with the following:
“Frankly, we see the McBro letter as an attempt to escape responsibility. The job is already nearly a year behind schedule. Their letter is divisive and uncalled for.
McBro has only to submit a formal recommendation for withholding payment and we will act on it, based on the supporting documentation, and without regard to the wisdom of such a step. However, from what we have seen so far, generally in minutes of meetings, there is hardly sufficient grounds for such a move.
Our greatest authority (GC 9.5) to recommend withholding arises from an ‘indication that the work will not be completed within the Contract Time.’ Unfortunately, we believe the Contract Time is no longer contractual. ‘Unsatisfactory prosecution of the work’ is most difficult to establish, and to this date no really sound and defendable grounds have been presented.
Supplementary Conditions 9.3.4 speaks to the reinstatement of 10% retainage upon the Contractor’s failure to meet his ‘schedule commitments’. Schedule commitments are established in GC 4.11.1, and refer to a CPM network which has been abandoned, an overall phasing which has been changed, and a collaboration which is not documented. Very shaky ground; at best, ground which applies to several Contractors.”
By May, despite our best efforts to diffuse the situation, Triangle threatened legal action, McBro avowed that we had undermined their leadership and St. Margaret’s belligerently insisted that PH&J had not taken their side in the debate. It was an awfully unpleasant experience. Everyone hired a lawyer. Despite the fact that there was no genuine substance to the claim and stance taken by any of the parties, Triangle filed suit against McBro in State Court. Then McBro went into Federal Court and demanded that the issue be resolved by arbitration. Triangle objected, arguing that there was no contract between the parties and therefore no arbitration provision. The U.S. District Court found for McBro and Triangle appealed. Four years after it all started, the United States Court of Appeals, Eleventh Circuit, issued a landmark ruling that upheld the initial finding. Sixteen years later, PH&J would cite the cases while seeking to force a suit against it into arbitration.
I have no clue as to the ultimate outcome of the Triangle-McBro dispute. That PH&J escaped without being dragged into the legal action was a small miracle. At the hospital dedication on September 20, 1980, I beamed with joy. Not with pride, mind you. It was pure relief that my six years of hell was finally over, and PH&J and I had survived.
Pack “C” Trouble – The Mary Owens Matter
This issue involved a design debate between Sister Susan and Klein on one side, and yours truly on the other, and a related accident which occurred almost four years after construction was completed. Susan selected as a decorative theme for the rejuvenated hospital enlarged photos of scenes of old Montgomery, calling attention to an earlier time when St. Margaret’s ruled the roost in these parts. As part of that theme, she wanted strip hardwood floors in the new main lobby. Having encountered many problems with hardwood floors in commercial settings, especially with those installed on concrete slabs below grade (which this one was), I strongly counseled against that choice. I cited difficult maintenance, danger of floor buckling and the likelihood of slipping on high humidity days. As usual, the Sister went ahead with the wood floor despite my sage advice and warning.
Some five years later, in January of 1986, PH&J received a “Civil Subpoena on a Non-Party” to produce all plans and specs that pertained to construction of the lobby. Then it came out that lots of people had slipped down on the highly polished oak floor, and that finally a Mary Owens fell and injured herself sufficiently to precipitate a civil suit against St. Margaret’s.
In fear that we would soon be joined in the legal action, PH&J saddled up its lawyers to ponder the ramifications of the subpoena. Should we notify our insurance carriers of a potential complaint (which notice would be an admission of culpability) or should we act nonchalant and risk voiding our coverage by failure to give prompt notice of a pending claim? Tabor Novak was our lawyer by then, and he drafted a masterful letter of notice. Thus, all three of our insurance carriers were saddled up and braced for a blow that never fell.
Quite likely, St. Margaret’s saw to it that we were left out, because they could ill afford to have me testify “that PH&J told them not to do it”. The suit was finally settled a year and a half later, in late 1987, and the oak floor was quietly carpeted over.
-Charles Humphries (“Peril and Intrigue Within Architecture”)