Manage Legal Risk through HeavyJob

Thank you. My name is John Cappello. I'm the regional one of the regional territory managers for HCSS. So, run one of the sales teams. I've got five people on my team and today we've got a really fun webinar. Ran through this at our user group meeting actually with Andrew Effinger of Mannion Stigger. So, this is about managing legal risk through HeavyJob. So, get ready. What I'm going to do is I'm actually going to start with just a very brief intro on HCSS. So, we obviously have estimating products. We have job costing products that help manage your projects and your time cards and those types of things. But we really, we run the full spectrum. So we have, the construction is complicated and it's difficult, right? So what we've done is we've built a platform that will manage your safety. It will manage your shop and your fleet operations and those types of things as well. But it all starts with good field data. So you've probably heard the proverbial garbage in garbage out. So if you can't get your folks in the field to actually do entry, then the game is lost, and we know that. So what we've done at HCSS is we've tried to make the absolute most intuitive, easy to use field system in the business. And so, we have anonymized statistics on any given day. We have between sixty and seventy five thousand time cards that are processed through the HeavyJob engine, and the average user spends between seven and nine minutes in the app. So, it really is an easy system to use. You can see, we've got a lot of raving fans of the system. So, nine out of four, nine point four out of ten rating, eight out of ten people would recommend HeavyJob. So, can see the stats here. These are twenty twenty three we've grown since then. But one of the other things that we've done is, as we've gotten to the size that we are, we have over five hundred employees. I'm about to show you a picture of that, but we know that when you're managing your construction firm, you're going to need a knowledge base and you're going to need continual updates and you want to stay on top of things. So we've got eighteen of the top twenty transportation contractors, forty three of the top fifty heavy civil contractors, but it really runs the spectrum. So we have people that do two thousand dollars driveways using HCSS products. So we know that no matter what size you're going to need resources, you're going to need a great team that backs you. So we've got twenty 24/7/365 tech support. You can see here this picture of we are located in the Houston, Texas area. We do have employees all over the country, but our largest concentration is we're not a virtual company. We are in Houston, we've got a campus, a lot of people have been to our campus. And then, I was going with this is we do have a continuous learning program. So, we've got our HCSS Academy, where you can go and a lot of people will just treat this as, you know, part of the onboarding. So just to sign out a few classes, have people learn how to do a diary entry, do their photos and forms and those types of things. But what we've really done that I think is quite innovative is we have brought in thought leaders from all over the country to weigh in not just on our products and how we develop our products, but on best practices. And so, that's what today is about. This webinar, Managing Legal Risk, we've brought in, Andrew Effinger of Mannion Stigger, and, I'm gonna turn the presentation over to him, but I've known Andrew for about four and a half, five years now, and he's one of the smartest attorneys I know. So, with that, Andrew, I would like to go ahead and give you, presenter controls. All right. Hello, everyone. I hope you can see my screen now. Down to that work. I don't think so. I don't think you're sharing. There you go. There you go. Perfect. Sorry, one last button I had right there. So, guess I want to start off with a thank you to John and to the HCSS people. Just to give you a little bit of background to start off with here, I got to know John through my role in a leadership role of a deployment of HeavyJob web and HeavyBid throughout an organization over three hundred users that happened over the last four or five years. I recently joined Mannion Stigger which is a law firm here based in the Indiana and Kentucky region who practices construction law for primarily specialty contractors all throughout the country. You can see here on the map the gray states are the states where we have someone admitted to practice and the yellow states are states where we do practice for our clients. So we've got a nationwide presence and we do all kinds of construction contractors. If you can think of it we can give you an example of having a client in that space. Myself I started out as a civil engineer estimator in the heavy highway world managed some projects went back to school came out with a JD MBA focusing on finance, spent four years or five years as a controller in the heavy highway construction business, then went ten years in house counsel for a large mining and construction firm. Then as you can see, like I mentioned before, I was very involved in HCSS implementation and then just about a year ago I joined Mannion Stigger. So what we're going to talk about today is a lot of the learnings that I found going through HeavyJob, the implementation, and how you can implement it appropriately to manage legal risks in a construction firm. To begin with though, we're going do a little bit about the role of the modern construction firm just to kind of get everybody in the right headspace because it's a complicated set of rules that need to be followed for a construction company. Then we're going to talk about the causes of disputes that arise in your typical construction contract setting. I'm sure it's not going to be anything too unfamiliar to those of you with any experience. And then we're going to spend the last section talking about how to use HeavyJob in the best way possible to mitigate some of the causes of disputes that seem to be most frequent. And then we'll have about fifteen minutes at the end for questions. If John sees one coming through that needs to be answered in the moment, he'll get my attention. But if not, we're just going manage questions at the end. And just a word of caution here guys, we are dealing with some legal stuff here, so please don't disclose anything overly sensitive in the questions. For us to be working for you as an actual client, we'd have to go through an onboarding process and get a letter of engagement and those kind of things. If you want to get into the specifics of any individual claim, you could give me a call later. So let's start off here a little bit and talk about the history of construction. You can't really understand construction law and the way it works today without having some perspective on how it developed through history. I think a really good way to start that conversation out is to look at some, I guess you could call a lot of these wonders of the ancient world, but if you look back at some of the most impressive construction projects in the history of the world and ask yourself some of the basic questions that you ask yourself about construction jobs today, I think it highlights how much things have changed. Just a few examples here. You think the Great Pyramid was a union job or an open shop project? Right? That doesn't make any sense. Things were obviously a lot different then, right? Or one I always think is funny is do you think the contractor was paid on the great wall by the linear foot or do you think it was a lump sum job? Some very simple questions like that highlight that today's world is more complex, there's a lot more rules and things have definitely changed. Skipping away from those projects, let's talk a little bit through the history of construction law. Some of the earliest law on the books is what's known as the code of Hammurabi. Most of you probably heard about that in grade school or high school, but what's interesting there actually are some laws in the code of Hammurabi that don't look too awfully unfamiliar to any construction worker today. For example here, if a builder builds a house and it falls in and kills the owner, the builder shall be put to death. It's rather strict liability there, but you can see that the law was trying to make sure that if people were going to be building buildings they knew what they were doing. If goods were damaged, you have to make compensation, and if you're building something even though it's not complete and it doesn't seem to be working right, if the walls seem toppling as it says, you have to fix it. So the number one legal risk that every contractor bears is its obligation to do what it's supposed to do competently, and that's been the case for thousands of years. Another good source of historical law is Roman law where we get the concepts of what can be called sanctity of contract. Under Roman law contracts had to be honored, but there was a caveat provided the circumstances remain unchanged. There are just an absolute multitude of rules nowadays where there are exceptions to performance based on common law, state law, case law, and we'll get into those a little bit further here. The next body of law that contributes to modern construction law is the laws that came up out of feudalism. I'm sure you guys have heard of serfs, which was close to the word, to the type of relationship of slave, but through the period of feudalism a vassal's duties to his lord were refined and there were rules put in place, there were limits, there were conditions, and those rules that developed ultimately became a lot of the legal premises that later law uses as obligations and how to hold people accountable. Another thing that came up during this period was guilds, which are kind of the predecessors of today's unions. There were groups of people who all did the same trade or craft and they began to have power over the conditions of their work. Then comes British common law which we adopted since the United States was at first a colony. During that period, one of the legal premises that came about was freedom of contract with more expanded citizenship. A citizen had freedom to contract as he saw fit and though you had freedom to contract there were some bounds. You couldn't contract for something illegal or what could be called unconscionable, which is a legal word that is always hard to define. That's where that concept comes from. Then came the industrial revolution, which in some ways changed everything. One of the big changes in the wall that came out of the industrial revolution was what's known as contracts of adhesion. Anytime you go to buy an appliance or a car or a major purchase and you're handed a contract and you sign it, you are participating in a contract of adhesion. The bottom line was for the pace of human activity to keep up with the industrial revolution, there had to be some boilerplate that you took or left. And we had to sort of set aside in certain circumstances that idea of freedom of contract. If you want to negotiate the terms and conditions of your next automobile car warranty, best of luck to you, that you'll run into this reality that much of our economy runs on contracts of adhesion. The number one thing to remember though for all construction companies is that does not apply to construction contracts. We'll get into that a little bit more here later. Another invention of that period was free incorporation where any citizen could incorporate, start a corporation prior to this time frame a corporation was a creature of a statute passed by a legislature. The free incorporation is how every one of the entities you work for today was established I'm sure. Another legal creature of this period is insurance. People started moving around faster, people started having more chemicals and machines and people started to be hurt. So there started to be a body of law around requiring insurance to use certain things, pooling the funds from insurance, and paying out on claims based on very very complicated laws. And the last section in here working up today is a period that I would call the period of uniform law starting back in the late eighteen hundreds early nineteen hundreds. People set about creating legal textbooks of concepts like torts, contracts, etcetera for study in law school. And essentially what they had to do was meld together case law from jurisdictions all over the world and create common themes. So there's common concepts and themes that everyone learns in law school. Another Another thing that went on during this period is a uniform commercial code was drafted and passed in every state in the United States. Section nine I believe it is of the universal or uniform commercial code covers the sale of goods. Going back to that idea of buying a car or a major appliance universal uniform commercial code governs those transactions and that's one of the reasons contracts of adhesion work there are limits set on your contracts of adhesion by the uniform Commercial Code, but again that is for the sale of goods not contracts. Focusing back a little bit more on that industrial revolution, if you do a little bit of research into the industrial revolution you find out somewhat to some people's surprise we are still in it. There have been multiple industrial revolutions. The first starts back when you were told it started in grade school in the late 1700s, 1800s when people started building machines and started using chemicals that were extracted from the ground in various new ways. Then the next phase was a period of machine tools which made people able to work on machines a little easier and steel became available. The third one that started in the 40s and 50s was computers and communications. Part of what I view John's job as is helping construction contractors work themselves out of the third industrial revolution, taking a bunch of stuff from paper and phone calls onto computers and using tools like HCSS to increase your efficiency. And the fourth industrial revolution which I think gets a little bit controversial whether this is still the industrial revolution or not is all of the stuff you're hearing about in the news today AI, robotics, the internet of things, the multiverse things are still changing and changing fast. Meanwhile in that same period sort of the late and early industrial revolution, scientific management of companies came about. My theory is you can distill all scientific management systems, whether it's Six Sigma or TQM or whatever you want to look at, you can distill them all down to two things. Number one is the Gantt chart and number two is the dimming cycle, which is simply process improvement, plan what you're doing do it check on it act to make adjustments accordingly and do it again. That's what's made Toyota what Toyota is that's what makes your company what your company is every time you do something you learn from it you get a little better And then the Gantt chart is just a simple concept. I've heard it cleverly described as a to do list with time on the other axis but essentially it's a tool to make sure we get things done on time which allows the coordination that's necessary today construction world. So to kind of summarize all of that, in the pre modern world you know one hundred plus years ago it was very common to see master builders. Today what you see is a group of architects, engineers, contractors, and subcontractors all working together. There used to be builder or trade monopolies that have really been replaced with a whole bunch of specialized contractors, unions, and competitive bidding for the most part. Where in the past there has been strict legal liability, now there are incredibly complicated agreements between all of those parties mentioned above that are also influenced by case law and statutory law and can't even really be fully understood on their own without looking to external sources. And where most cases were settled by judges in the past, nowadays mediation arbitration contract review boards in certain cases settle a vast majority of claims and barely any claims are litigated as a percentage of the total. So bringing that all together and simplifying as much as possible, the role of the construction firm is basically two things. Number one you need to hold and deploy resources which means you have employees, you purchase materials, you have specialized equipment, you have good relationships with suppliers of the things you need, and you know how to do the kind of work that you do. And then the only other thing you have to do is contract wisely which is another way of saying manage your risks which is what we're going to talk about from this point going forward. Whether it's your bids or your proposals or your agreements with your employees or the agreements to get your materials and supplies or all of the risk management traditional risk management tools like insurance, bonding, financing, and structure of your company. That's all about making sure that you sign the right contracts and negotiate the mark. So to close this section of the presentation, think what's funny is to look at the fact that we just watched where we talked through a lot of technological advances through those projects. We talked about all the legal development that's happened over the last hundreds and thousands of years. And then we talk about scientific management that's been brought to bear on companies all around the world. And what are the results of that? And how to control the presentation. Oh, there we go. This is a chart showing from nineteen forty seven to the twenty ten's the productivity gains in various sectors of the economy. You can see agriculture has led the way getting vastly more productive. Manufacturing and wholesale and retail are about half that made about half as much gains. Overall construction zero. Construction has lagged every other sector in getting more productive and there's lots of reasons for that. Obviously construction is much more complicated, you're working on owner sites, can't put what you do in a warehouse, you know there's all kinds of reasons. If you can embrace some of the concepts today and using the tools like HCSS, you can be the leader in that construction business and get a little bit more than zero. Alright, in this section, this next section we're going talk about disputes and causes. This is a graphic that I like to show that I think almost anybody that bids or builds construction work understands. In the pre bid phase you receive all kinds of documents explaining what the customer expects you to do. And on the bid date contractor does everything he can to match those expectations in his estimate. It's never perfect but it's close. And then for some reason you get into this performance phase and something happens to the customer's expectations and also something happens to the contractor's plan. Things change. So let's talk through some basic concepts before we come back to that idea of things changing. Part of what lawyers do and what lawyers have been doing for hundreds of years is packing all kinds of meaning into certain words that can mean lots of different things and lots of different contexts. Contract is the first one of these I want to talk about today. In some ways contract is a verb when you contract with someone you create a legal relationship and sometimes contract is the piece of paper it's the lasting evidence of that relationship. But the third definition of contract that I want to discuss today is the specific rights, duties, powers, privileges, immunities, etc. Pursuant to that legal relationship. Because you have reviewed contracts, you've seen how contracts refer to contract documents and draw in all kinds of other documents, it even goes beyond that. The contract is the lasting evidence and it's all the references it refers to and it's the case law and the statutory law in which that contract rests. Talked about contractual relationships and I think relationship is another one of these terms that we need to think about all of the stuff that is packed into that word you know at a very basic level a relationship is the way two or more people get along. If you think about the fact that you use the same word for your spouse and your family and any sports team you've been on and the company you work for, your boss, your direct reports, relationships are just an enormous part of what everybody does every day. So the goal of a construction contract is to create those legal relationships, structure them appropriately, and then guide the parties to a successful management of those relationships. The last bullet point that I like to make sure everybody understands here is that construction contracts are inherently incomplete. You know most of of your good contracts have a process for changes but everyone knows the things are going to change between the date a contract is executed and final completion. That is part of what these dissummer disputes we'll talk about here soon. So digging into the building blocks of a construction contract, one way that relationships are managed are conditions. You guys have all kinds of conditions placed on all kinds of relationships that you manage every day of your life. If you show up to work, you will get paid, all of those kind of things, right? So inside of a construction contract, it will say what the contingent obligations are, what the conditions precedent are for things, conditions concurrent and subsequent, all of those are different types of conditions that say you have to do this before I have to do that or once I've done this you have to do that, right? And what construction contracts do and what people need to understand reading through all of these conditions and all of these clauses is that they create processes. If you're familiar with a contract, you'll see a payment section for example, and that will address all the rules about how you turn in your pay application, what rights the owner has, what rights that your customer has, and all those kinds of things. There are all kinds of obligations that are contingent on things being done right or you don't get paid unless you do X, Y and Z. There are dispute resolution processes, lots of different processes in the contract. The other basic fundamental building block over here on the right is they all flow from the fact that time is always of the essence in a construction contract. So you need to do what you're supposed to do on time. Think back to that Gantt chart that we talked about earlier. Failing to meet conditions can lead to different things along the route here. So if you don't do what you're supposed to do and you don't tell anyone you can end up having waived your rights. Let me restate that even if you do what you're supposed to do but you haven't notified someone that they have based on a contingency you've met, you may voluntarily through lack of notice relinquish your rights to something. Think about a claim when you know something's wrong almost every construction contract says you have a number of days to tell someone or that claim can be considered waived. Notice is the flip side of that. You need to make sure that the people who have an obligation that is contingent on your notice receive your notice so that they have the obligations that are contingent on that. Estoppel is the concept that once a right is waived you are stopped, cannot enforce it, right? So my contract professor in law school used always saying the best way to summarize contracts laws really really briefly is negligence you lose. These three concepts kind of hit that you've got to stay on top of what you're doing. You've got to stay on top of your contract obligations. You've to make sure you don't sit on your rights. Another reality that needs to be remembered by all project managers, all owners of construction companies, everyone involved, is that regardless of all of the complicated obligations in any contract you sign, as a contractor you are an independent contractor. An independent contractor is a distinction or contract distinction from an employee, so you are not paid based on the time you were there, you're engaged to deliver certain deliverables, you pay your own taxes, you do your own financial statements, you aren't going to be requesting workers comp if you get hurt on your customer's site, right? And the most critical is as an independent contractor, you retain control over the means and methods of your work. That may sound very obvious to you because a lot of times a PM or a operations person will define their means methods in this kind of manner. Generally speaking means and methods if you look at a spec book or a contract is how you're going to do the work right you get to choose the equipment you're going to use you get to choose the amount of people you're going to use You get to choose the technique, right, so long as it is supported by the specifications. But a more interesting definition to me is that when a party has stipulated that someone else will do something for them, there is an implied promise that that person will do nothing that will hinder or obstruct that other in doing that thing. To put it simply, when you have a contract and you are an independent contractor, you have the right to do it in an unimpeded manner and your customer has an obligation not to impede what you do. So after going through those concepts, contracts, relationships, timing, conditions, this is a distilled list. I went through and found several different surveys by several different research firms and if you review them in comparison or distill them down these are the top five reasons that construction disputes happen around the world. Number one is failure to administer the contract. Given what we just talked about about the complexity of the number of parties and the complexity of the agreements that should be no surprise to anyone. Number two is incomplete, poorly drafted or unsubstantiated claims. This one is rather frustrating to people like me. Sometimes we have clients we represent that we know are right but simply can't prove it and that's not a good situation to be in. Number three is errors or omissions in the contract documents. That's one where nothing can replace diligence and thorough review of everything and raising issues when you find errors. And number four is incomplete design informational requirements which is again a communications challenge. The last one is failure to understand or comply with your obligations. And as a reminder here as I told you before these complicated agreements you can't even really thoroughly understand your obligations without some background understanding of the statutory and common law in the jurisdiction you're operating. So from here forward what I want to do is I want to talk about turning these top five challenges into opportunities and making sure that if these are the problems that contractors run into how do you avoid them. So let's just flip the script here. We're going to understand the contract documents, we're going to understand design requirements, we're going to understand and meet obligations, going to administer the contract correctly and we're going to substantiate our legitimate claims properly. So the remainder of this presentation I've kind of tailored to the HCSS and HeavyJob tools specifically. So we're going go through strategies for accomplishing those goals that we just talked about. I like to show this image here because I want people to think about from this point on as a strategy to the extent you can to for a lack of a better term stack the deck. You are always allowed as we discussed before the right to control your means and methods and you're an independent contractor you are not required to sign contracts of adhesion, your contracts are negotiable and no one should understand what you do any better than you. So when it comes to scope, resources, time, cost, quality, risk, all of the things that have to be managed to run a construction company, The goal here is to put yourself in the absolute best situation you can be in to manage and stay under control around those parameters. So first let's talk about number one, understand the contract requirements and you'll have to forgive me I don't mean to offend anyone with this piece of the presentation. Step number one is you take the contract. Step number two is you point your eyes in the direction of the contract. Step number three is you engage your brain and read the contract. You should read every contract that you sign with a eye toward those six factors I just talked about the scope, the resources, the time, the cost, the quality, and the risk. If you need assistance with this, this is we have two staff members on here that do nothing but read and review contracts. But the bottom line is if you're signing things you don't understand you're out of control. The next piece of understanding the contract requirements specifically with the HCSS suite of tools is to take that contract, the understanding you gain by reading it and build an estimate and HeavyBid. And then also take that HeavyBid estimate conform it which I believe is still the right term into HeavyJob with the same criteria as your priorities. Making sure that you're documenting your scope, your resources, your time, quality and risk to the extent you can. I'll get to this a little bit later but the way to think about what you're doing with all of this is documenting your assumptions, documenting what was included, documenting what you did agree to, what you didn't agree to, and it needs to match the contract obligations. I left the Gantt chart down here because I believe HCSS is not trying to create your Gantt charts for you and replace Primavera or Microsoft Project. So there may be a role for the Gantt chart to play alongside HeavyJob on a sufficiently complicated contract. So this chart walks through a set of concepts that shouldn't be too hard to understand based on our conversation so far and then carries them over from the contract to the HCSS tools and even a scheduling tool if you're going to use it. Simple concepts are number one deliverables. As an independent contractor you're paid based on what you deliver. There are ways to define what you are doing in clear and simple chunks so that your customer can pay you. You need to structure HeavyBid items, HeavyJob pay items, and then perhaps schedule milestones and summary bars to match those deliverables. The next concept as we discussed before is your means and methods. Beauty of the HCSS system is the activity based estimating and then the activity based job costing. But by building out the activities under your bid items and then your cost codes related to your pay items you are again declaring your means and methods, the time you intend to spend on things, the cost you expect to spend, the quality level based on what materials you call out, the types of equipment, resources of all kinds. You'll see in bold across the rack here in all of these this is just a note to help with communication and helping people understand when you're building your means and methods. Do everything in your power to make your activities and your cost codes and even your WBS in your schedule have a verb noun structure. Get a lot of job cost reports in here to look at to try to decipher whether there is a legitimate claim or not. And when job cost items are simply nouns, it leaves one wondering what exactly is and isn't included in any given activity and analysis sort of falls apart. And when analysis falls apart, then you're left with people's testimony, which means depositions, which means expense and a lot of uncomfortable conversations. So to the extent you can be clear about what each activity, each cost code, each bid item mean in your business records and they're understandable by the average high school grad, it can save everyone a lot of time and effort downstream. Where all of those concepts, the resources, scope, and activities and durations and everything, where the rubber hits the road, in my opinion, is the HCSS web progress billing system. If you can get your pay items related to the activities that are required to use your means and methods and satisfy the deliverables of the client and build out the relationships between those activities and those bid items in such a way that when your field people report the completion of activities, your office folks are prepared to bill your customer, then you've really embraced what I've talked about here today. You can deploy resources, keep track of the resources you deployed, keep track of the activities you completed, drives the bid items or pay items that have been delivered, and you can send out a bill. The next number one or the next, I should say number two, the next dispute challenge that we are trying to remedy here is misunderstandings of design requirements. Now it's really really hard at a high level to talk about anything specific about what can go wrong with design but if there's something that can go wrong it eventually will on some design somewhere. The bottom line here is anytime there are any challenges and you have any questions do not allow confusion. The tools in HCSS allow for you to submit RFIs, submittals to clarify what does and doesn't meet the specs, and generally just issues if there's a problem you can track issues in the HeavyJob platform. The bottom line is going back to the concepts of notice and time being of the essence and waiver. If you don't get certain things on the record in certain people's inboxes or documented somehow through a letter, etc, you can have problems. So you want to be as proactive as possible and make sure you understand clearly as soon as possible. The third here is understand and meet obligations and again just like design being very complicated trying to talk about all the different obligations of all kinds of different contractors it's hard to do any level of specificity But the bottom line is you have to have processes in place where you perform work, you do a certain level of quality control, you report what you did, you then have entitlement to bill and then you get paid. And then you go the circle keeps going around, deploying resources all the way through to getting paid. And, again, I slip the gap chart in here as well. Along with that cycle of nonending process improvement you need to meet your schedule. The next broad category is to administer your contract correctly. This is a callback to that earlier slide where we talked about conditions and time and waiver and a stop estoppel in the course and those kind of concepts. You need to understand the processes, Here are some examples, payment, scope changes, disputes, claims, termination. You need to ensure that the conditions that you need to have met are met. You need to document if they are or aren't at the right time. Again, over on the right, lack of notice can equal waiver, waiver can lead to a stop all. A couple practical notes here, don't sit on your rights. And then you always need to be aware of a course of dealings. In the legal world one thing that can always be alleged is that another course of dealings outside of the contract is what is actually going on. So if you ever feel like you're operating in a situation where rules that aren't in the contract are ruling your relationship instead of what is in the contract, you're putting yourself at risk because then there is another set of rules and both sides get to take a swipe at proving what those rules were. This slide is a message for the PMs and then also for the bosses of PMs. Just some practical advice here about optimism, pessimism, being realistic and being professional. There are too many times when people tell themselves for all kinds of self serving reasons that they don't even understand themselves that things are going to get better, that if they talk to the customer that's going to make it worse, that putting anything in writing is just going to get somebody upset, and ultimately sometimes as long as the job ends up going okay people aren't held accountable for failing to recognize the problems timely and do the right notices and follow the right processes. So from a supervisor of the PM level, one of the messages that we always hit working with our clients is you need to know if your PMs are doing the right things and following the contract before there are problems. Know there's a lot of things that can happen to help your company out through relationships and we understand that's a reality but if you don't have a training manual and some kind of supervision over the PM doing the right things and doing it timely whether there ends up being a claim or not then you're not prepared when there are claims. Just a little bit further on administering the contract correctly, we talked about process improvement in the Gantt chart, we talked about cost tracking QCE which is again another one of those where we can't get into too much detail unless we're talking about a specific kind of construction but your progress units you're paying your bill items. The last piece here I want to talk about is planning and forecasting. You know HCSS has a project planner tool and you can also build forecasts. The bottom line is PMs and people running construction companies have to be living in the future to some extent. You have to be looking through the windshield forward and if you're not forecasting, you're not really doing that. This is a chart just to give you guys an example of the concepts I'm talking about here. This is a chart that at any at a little bit different ratio is every construction project ever. There's some phase where you begin, you start up, you mobilize, there are low costs, you're not getting much done. Then there's a high section of productivity where lots of activities are happening, you're doing a lot, you're spending a lot of money and you're also accomplishing a lot. And then there's a phase where you close out and you demobilize. You don't spend much and you button up the remaining work punch list if you will. But here's the situation almost every job is almost all the time. You've got you're supposed to have sixty percent of the work done you only have twenty percent of it done. You're supposed to have spent forty seven percent of the money you've only spent thirty percent of the money. So what's the situation here? Right now cash on a cash basis you've lost money so far. Are we getting ready for a home run where here the remainder of the job you end up getting paid a lot more than you end up spending? Or are we not prepared for a looming disaster? Are your costs going to outpace your pay based on all kinds of reasons that could exist in the future that someone on the job site knows about but not everyone knows about? The bottom line is no one knows unless you're forecasting. The person with the best knowledge of what the rest of the job is going to cost needs to be putting something in a system to share with others. Forecasting can lead to all kinds of conversations that are very painful because people start to think that you're rebidding the job, you're having to have every item down to the penny. I would encourage everyone to think about forecasting as a leading indicator dropbox. When you see something coming that is going to be a problem, you indicate it financially through a forecast and it triggers the conversations that need to happen. Kind of wrap that section up, if you've controlled your scope, you've declared your means and methods, you know that interference by your customers have breached a contract, you know that interference by anything anyone else is something that you could get excused for from any time constraints you may be able to get compensated for and you know that notice is key then basically any forecast loss is a potential claim that you need to research and see if there's a notice and see if there's a way to recoup for it. Any loss that is not forecast may be a legitimate claim waived because you didn't get notice. I'm going to speed through this real quick but the last one was the failure to substantiate legitimate claims properly. Anytime there's a claim you've got an issue needs to go through a process you need to get a thumbs up and if you get a thumbs down you've got options like an appeal mediation arbitration or litigation but if you fail to bring the timeline and the facts and the obligations and the rights including the legal realities outside of the contract you may not have a fully fleshed out package and you may be putting yourself at a serious disadvantage. Another call out along that line is that if you get processes built and you are documenting what you're doing, there's an exception to the hearsay rule where you might be able to save yourself from being deposed about exactly what business records mean. You guys can put in place regular practices of keeping track of things in your systems, then there is not a need to have someone be interrogated about what every document needs. That flows right into the conversation about diaries and tags. John mentioned it at the very top of the show here anything that's happening on the job that potentially interferes with you get it documented ASAP. An example here of what happens when there is a legitimate claim is something impacting your production To do the kind of analysis that has to happen in a legal setting you need to know when you were impacted and when you were not how productive you were on those days and how productive you were on those other days. Using HeavyJob right you can do that analysis and an expert can look at what you've done and come up with a really defensible claim really quick. In the absence of that it can be very costly and your odds can be very very low. So this you guys will get this slide deck you guys can look at this on your own the bottom line is pulling all of this together in HCSS and having good legal controls around your risk management processes means you stay in control. The way we like to think about it here at Manion's Figure is that there is a maturity model to this just like any teenager learns to balance their checkbook and becomes a competent adult. Firms need to go through a process where the firm may have been started with individual heroics, people that knew the business better than anybody else. But sooner or later you've got get repeatable, defined, capable, and efficient processes for that firm to grow and for that firm to be an ongoing concern. Don't rely on staying lucky, right? And we can help. So again, this is us. We do processes that correlate to this presentation. We do enterprise risk management processes where we sit down with companies and go through everything they do and assist where we can get them the other help they need where they need it. Come up with project delivery manuals, operation manuals, suites of communication for you to get those notices out, and we handle all kinds of claims and disputes, mediation, arbitration, litigation. And with that, I'm going to hand the screen back to John. Yeah. So Andrew, thank you for that. We did have somebody raise their hand. Nick, okay. He accidentally raised his hand. Well, do we have any questions? I am watching the chat as well. Thanks, Bill. Yeah. Thanks, Bill. Well, we'll hang out another another couple minutes as, the chats come in. I do believe you can take yourself off mute if you need to, if you'd like to ask a question directly. Alright. Well, it doesn't look like we've got any questions coming in. Let's see. Oh, okay. So it seems like much of the success hinges on properly setting up your project controls cost code and linking between HeavyBid and HeavyJob with all your materials, sub vendors available to leverage. So it looks like just a comment, but I think, Andrew, do you want to weigh in on that? Yeah, I think the beauty of those systems are ways to force people to agree on concepts. Know, I've got the engineering and the accounting background and a lot of the HCSS conversation is about the tool and about where things go in the tool, but I think the larger value of all of those projects or all those processes is getting people to agree on the concepts and that's the hardest part of it too. It's the shared understanding of what people are doing when they're getting things into those systems and getting them linked and correlated, making sure that person A understands what person B did when they did it, coming up with those protocols. But essentially yeah like I said at that at one point in the presentation, negligence you lose and it sometimes if one person in your organization doesn't understand what the other person put into a system you put your organization at a disadvantage. There was a question do you have any operations in Canada or a network like a referral? We have assisted, well one of our biggest clients is actually a Canadian company, but we do a lot of their U. S. Stuff, we don't do much of their Canadian work. So it depends on whether you're a Canadian firm or you're doing work in Canada. You reach out we could have further conversations on that but we can even when we do have to refer people out we can help with a lot of the substantive stuff people need and have someone local show up in a courthouse or things like that if anything. Need to do that. Any thoughts on enforcing SBPW in California on payment terms? Oh, it's jumping around. Sorry. In California, on payment terms and interest accrued, basically GC is delaying payment past the thirty day terms for SB. Are we allowed to incur interest? Yeah, don't to assume what SB and PW mean, but I assume that's some kind of a prompt pay statute. Getting attorney's fees in those settings likely requires going all the way through the process, which sometimes means mediation or litigation. You can always threaten that and you can always make sure that people know in that first notice that you have rights to them and sometimes that motivates people, sometimes it doesn't. There's always a basic reality of getting money from any other entity sometimes it's the proverbial blood from a turnip they don't have the money to give you. Other times people are playing games with you when people are playing games with you those kind of statutes do give us all kinds of recourse to get creative. So if you've got a specific situation, we could take a look at it. Right. It looks like the questions are slowing down. Yeah, like that comment from John about the younger team members. I think anybody in this industry knows that a lot of really good talent is retiring every day, And you're having to take, no offense to our younger audience, but you're having to take people off of the Xbox and teach them how to do construction stuff. Right. So when we talk about the operations manuals and the project delivery manuals, having something that a young member of your team can sit down and read and reach out if they need help and learn is an absolutely critical role for some of these processes as well. Yeah, that's, we've noticed that, working at HCSS, we have an empirical view of that as well. Software is a great knowledge transfer tool. So, you can see how somebody who is retiring, it's, it's got that information, you know, what their activities were, what their production codes were, and those types of things in their production quotas. What is a realistic goal? And then you can see it on a digital platform. Awesome. Well, we will be sharing this presentation out, so thank you for everyone who attended, and thank you Andrew for such an excellent presentation. Just reading through the chats, a lot of people got a lot of great information. So, I m going to go ahead and wrap this up. Thanks. Take care, everybody. Bye.