CE_413 CE LAWS, ETHICS AND CONTRACTS

SECTION 1- THE PRACTICE OF CIVIL ENGINEERING WRITTEN REPORT

ALEGRE, HYACINTH CYRENE G.

GODEN, JENNA MAE A.

TADIOS, ARVIE JOHN F.

TURLA, ARVIN ANTHONY N.

BSCE – 4B
 SECTION 1- THE PRACTICE OF CIVIL ENGINEERING

Republic Act 544

The practice of civil engineering within the meaning and intent of this Act shall embrace
services in the form of consultation, design, preparation of plans, specifications, estimates,
erection, installation and supervision of the construction of streets, bridges, highways,
railroads, airports and hangars, portworks, canals, river and shore improvements,
lighthouses, and dry docks; buildings, fixed structures for irrigation, flood protection,
drainage, water supply and sewerage works; demolition of permanent structures; and
tunnels. The enumeration of any work in this section shall not be construed as excluding any
other work requiring civil engineering knowledge and application.

1.1 GENERAL
This manual addresses the procurement of civil engineering services for a quality project.
Quality by definition is one satisfactorily meeting both the expectations of the client or
employer and the requirements of the project. It requires professional dedication, effort,
adequate time for investigation, planning and innovation, fair compensation, and appropriate
authority and responsibility. It cannot be achieved only by the effort at the beginning or end
of a project. These efforts must be conscious, continuous, and consistent throughout all the
phases of a project.
Quality results from team effort and is measure by the degree of satisfaction of all parties
involved. This manual is dedicated to advancing both the understanding and quality of the
practice of Civil Engineering. The development of this manual is predicated on the basis that
Civil Engineering services are accomplished in a manner meeting the standard of care of the
profession of Civil Engineering.

1.2 PROFESSIONAL RESPONSIBILITY

The standard of practice is for Civil Engineering to be given responsibility for studying,
conceiving, designing, observing, construction, and assisting in the programming for
operating and maintaining engineering works. Other services that are unforeseen initially may
be required of the Civil Engineer during the evolution of a project. The health, safety, well-
being and comfort of the public in using a facility, and the ultimate facility cost, all depend to
a considerable extent on how well members of the project team fulfill their professional and
contractual responsibilities. The Civil Engineer, therefore, has obligations as trustee to the
public interest as well as faithful to the private interests of clients. Successfully fulfilling these
responsibilities require candor, mutual trust, and effective communication and understanding
between the Civil Engineer and the client. Only in this way can a professional relationship be
established and a successful project implemented.

Civil Engineers shall conduct themselves in a highly Professional Manner and Serve as Faithful
Trustees or agents of their client or employers.

Civil Engineers are therefore bound by the Fundamental Canons of Ethics contained in this
manual.
Care and protection of the environment is paramount in the Civil Engineer’s work
engagement.
Civil Engineers must always strive to maintain the highest standard of Ethical Professional
Practice in their dealing with Client employees, competitors and the community.

1.3 CLIENT-CIVIL ENGINEER RELATIONSHIPS

Many engineering works are conceived, designed, and constructed through the efforts of Civil
Engineers employed in governmental agencies or in industry. Other engineering projects
come to fruition through the efforts of civil engineering firms engaged for a specific project
or program by public agencies or private clients. Many public and private entities, of necessity
rely on Civil Engineers as their employees. Independent civil engineering firms are also relied
upon to accomplish projects which require special expertise beyond the normal capabilities
of the client. More recently clients have been utilizing new concepts, such as program
management and design-build, to implement projects.

Definition and explanation of proper relationships between Civil Engineers and their public
and private clients are important objectives of this manual. These are discussed below (See
Annex A for Sample Contracts of Services.

1.3.1 OBLIGATIONS OF THE CIVIL ENGINEER

The Obligations of the Civil Engineer include:
1. The Civil Engineer shall perform Scope of the Services as stated in SECTION 2.
2. The Civil Engineer shall exercise reasonable skill, care and diligence in the
performance of his obligations.
3. The Civil Engineer shall act independent and, as required by the contract, perform
with the necessary skills and professional judgement, when required to certify, decide
or exercise discretion between the Client and a Third party with whom the Client has
a contract.
4. The Civil Engineer is authorized to act as the Client’s faithful agent when required
but only as implied in SECTION 2 or implied in the contract adopted for the Project.
5. When aware of any matters which may will change or has changed the scope of the
services, the Civil Engineers shall give written notice to the Client containing
particulars of the change.
6. For Specified Staged Services, the Civil Engineer shall not initiate or proceed with
any subsequent stage of the Services without the approval of the Client.
7. When required, the Civil Engineer shall direct and co-operate with all other
professionals and integrate their work where applicable into that being undertaken
by the Civil Engineer and other professionals, but shall not be professionally liable to
their work.
8. The Civil Engineer may recommend specialist suppliers and/or contractors to design
and execute certain parts of the Works, in which case the Civil Engineer shall
coordinate the design of such parts or parts with the overall design of the Works but
he shall be relieved of all responsibility for the design, manufacture, installation and
performance of any such part or parts of the Works. The Civil Engineer shall not be
liable for acts of negligence, default or omission by such person or persons.
9. The Civil Engineer shall notify the Client of any interest the Civil Engineer has which
may significantly conflict with the interest of the Client under their Contract.
1.3.2 OBLIGATIONS OF THE CLIENT
The Client has the following obligations.
1. The Client shall pay the Civil Engineer for his Services, the amount of fees and
expenses set out in or determined in their Agreement.
2. The Client shall provide the Civil Engineer within reasonable time (that does not
result in delay to the provision of the Services), all information required by the Civil
Engineer in the performance of his services and a decision in writing on matters
properly referred to the Client in writing.
3. The Client shall cooperate with the Civil Engineer and shall not interfere with or
obstruct the proper performance of the Services.
4. The Client shall, as soon as possible as practicable, make arrangements to enable
the Civil Engineer to enter the site and inspect facilities needed in the performance of
his services.
5. The Client shall arrange for the provision of services from other professionals or
others as may be required and bear all costs.
6. When the Civil Engineer is required to administer the work of other professionals
or other third parties who are directly contracted by the Client or when the Civil
Engineer is required to act as Engineer-to-the-Contract for any contract on behalf of
the Client then all instructions by the Client shall be given through the Civil Engineer.
7. When aware of any matter which will change or has changed the Scope of the Civil
Engineer’s Services, the Client shall notify in writing within 7 days the Civil Engineer
containing, as far as is practicable, the particulars of the change.

1.3.3 LIABILITY OF THE CIVIL ENGINEER AND THE CLIENT

The Civil Engineer shall only be liable to pay damages to the Client arising out of or in
connection with their Agreement if a breach of duty of care is established against the Civil
Engineer.

The Client shall only be liable to pay damages to the Civil Engineer if a breach of the Client’s
duty to the Civil Engineer is established against the Client.

Resolution of any conflict arising from the Agreement between the Civil Engineer and the
Client shall be done by giving preference to the process of arbitration.

Establishment of the breach of duty on the part of the Civil Engineer and that of the breach
of the Client’s duty to the Civil Engineer shall be undertaken by a third-party arbitrator
mutually acceptable to the Client and the Civil Engineer.

1.3.4 a. Limitation or Civil Engineer’s Responsibility

1. The Civil Engineer shall have no responsibility or liability for costs, loss or damage
of whatsoever nature arising from any errors in or omission from data, documents,
plans, design or specifications not prepared by the Civil Engineer, or other personnel
under the direct control of the Civil Engineer, and arising from any act or omission or
lack of performance or any negligent or fraudulent act or omission by the Client or any
employee or agent of the Client, Other Consultants, Contractor or suppliers.
2. Notwithstanding any recommendation or lack of recommendation made by the Civil
Engineer to the Client, the Civil Engineer shall not be held to have made any warranty
 of promise as to the suitability, competence or performance of any Other Consultant,
Contractor, supplier, or other third party.
3. The Civil Engineer shall not be responsible for the techniques, methods, programs,
sequences or procedures adopted by any Contractor or other third party responsible
for executing any aspects of the Project, nor for their performance on time, their
failure to carry out the work in accordance with any contract documents or for any
other acts or omissions.

1.3.3 b. Damages
If found that the Civil Engineer undertaking Services is liable to the Client, damages shall be
payable on the following terms:
1. Damages payable shall be limited to the amount of reasonably foreseeable loss and
damage suffered as a direct result of such breach;
2. The maximum amount of damages payable in respect of liability, whether under the
law or contract, or otherwise, is limited to the amount specified in the Specific
Provision or, if no such amount or provision is specified, to the lesser of P300,000 or
10% of the total amount of damages of the portion of the work attributable to the Civil
Engineer’s breach f duty or twenty percent of the total of fees payable under their
agreement;
3. If found to be liable, in circumstance where the acts or omissions of a third party
have contributed to the loss or damage, the proportion of damages payable by the
party found liable shall be limited to that proportion which is attributable to that
party’s breach of duty, whether the claims are made under contract or otherwise.

1.3.4 SUSPENSION OR TERMINATION OF SERVICES

If circumstances arise for which the Civil Engineer is not responsible and which make it
impractical or impossible for the Civil Engineer to perform in whole or in part the Services in
accordance with their Agreement then the Civil Engineer shall promptly notify the Client of
the same.

If by reason of the abovementioned circumstances certain services has been suspended, the
time for their completion shall be extended by the extent of the delay pus a reasonable period
for the resumption, or if the speed of performing certain Services has to be reduced, the time
for the completion shall be extended as is necessary by reason of the circumstances.

The Client may suspend all or part of the Services or terminate the Agreement by written
notice of not less than 30 days to the Civil Engineer who shall immediately make
arrangements to stop the Services and minimize further expenditure.

The Civil Engineer by written notice of no less than 30 days may terminate the Agreement or
at his and or her discretion without prejudice to the right to terminate, suspend the
performance of the whole or part or the Services under the following conditions.

1. When 30 days after the due date or payment of any account the Civil Engineer has
not received payment of that part of it which has not by that time been contested in
writing, or
 2. When Services have been suspended for a period exceeding 6 calendar months, or
if it is clear to the Civil Engineer that it will be impossible or impractical to resume the
suspended Services before the period of suspension has exceeded six months. When
the Services are suspended or terminated the Civil Engineer shall be entitled to
payment for the Services carried out including consequential costs, expenses and
disruption fees incurred as a result of the suspension or termination, and
remobilization fees on resumption. Suspension or termination of the Agreement shall
not prejudice or affect accrued rights or claims and liabilities of the parties.

1.3.5. SETTLEMENT OF DISPUTES

If a dispute arises on either party, then that party shall by notice in writing served on the other
party of the details of the dispute and request that the dispute be resolved by conciliation. If
the matter in dispute is not resolved in conciliation between the parties within the prescribed
time then the matter in dispute shall be referred to arbitration.

1.3.6 OWNERSHIP OF DATA, DESIGNS AND DOCUMENTS

The design analyses, drawings, specifications and reproductions thereof are instruments of
service owned by the Professional Engineer and shall be use only for the specific project
covered by the agreement between the Client and Engineer.

1.4 CIVIL ENGINEERING SERVICES

Civil Engineer and civil engineering firms, whether they serve public or private employers
(clients) can provide a variety of important services which are described in Section 2. Typical
services may include:
• Design, consultations and advice.
• Feasibility studies
• Field investigations and engineering data collection
• Environmental assessments, impact statements or Engineering reports
• Opinions of probable construction cost
• Preliminary and final designs, drawings, specifications and construction bidding
documents
• Assistance in securing construction bids and in awarding contracts
• Construction administration and observation
• Arrangements for or performance of testing of materials and equipment
• Assistance in start-up, assessment of capacity, and operations of facilities
• Preparation of operation and maintenance manuals
• Appraisals and rate studies
• Value engineering
• Expert testimony
• Assessment of risks
• Structural remediation or rehabilitation
• Project Management and controls
• Provision of supplemental temporary staff
• Teaching
Civil Engineers may also serve as construction managers or program managers and may
employ other sub-consultants and subcontractors as part of their services.

Many Civil Engineers and civil engineering firms specialize in specific areas of engineering,
such as: structural and foundation, geotechnical and environmental, water resources and
hydraulics, transportation, and construction management and engineering.

Professional Civil Engineer firms draw upon the combined talents of various disciplines such
as economists, planners, engineers and designers, estimators, architects, scientists, technical
analysts, specification writers, drafters, field representatives, surveyors, and others. The
expertise of practitioners and specialist in other fields, particularly as the use of computers
and computer-aided design and drafting increases, is also utilized. Likewise, Civil Engineer are
employed by these practitioners to assist them in the performance of their respective
services.

The Civil Engineer provides services which may result in the client’s committing financial
resources for construction of a proposed project. The suitability of the constructed project for
the intended function must often be accepted at face value by the client, who may be
unfamiliar with the technical and civil engineering aspects of the project. Thus, civil
engineering services must be performed in a competent and efficient manner, on a highly
professional and ethical plane, and in an atmosphere of mutual respect and trust.

Project implementation has become increasingly complex, involving financial, environmental,

regulatory, technical and managerial matters. As a result, clients have opted to pursue a
number of implementation approaches. One such approach in commonly called program
management. The client retains a program manager to perform specialized tasks necessary
to the development or construction of specific project. Alternatively, the client may retain a
program manager to develop, define and oversee the program, prepare budgetary estimates
of program costs, prepare program schedules, evaluate and select members of the program
team, and provide periodic program status reports. In other cases, the program manager’s
staff would in essence act as an extension of and interact with, the client’s staff through the
life of the program. In most cases, the client continues to be the contracting agent with all
members of the program team and the contractors hired to construct the project. The
Program Manager is generally a Civil Engineer.

1.5 SPECIALIZATION IN CIVIL ENGINEERING

Within the practice of civil engineering, the PICE recognizes the initial five areas of
specialization. A Civil Engineer who has demonstrated his knowledge, experience, education
and training in accordance with the requirements of the concerned Specialty Committee of
the PICE is awarded a certificate of specialization by PICE. Those awarded with the certificates
are considered qualified for positions in the respective areas of specialization.

The PICE recognize specializations in the fields of structural engineering, geotechnical

engineering, water engineering, transportation engineering, and construction management
and engineering. A Civil Engineer who has specialized in any area of civil engineering may be
considered as a specialist in the appropriate field as enumerated.
1.6. SELECTION OF A CIVIL ENGINEER
The engagement of a Civil Engineer is one of the most important decisions to be made during
the development of an engineering project. The accomplishment of the client’s objectives and
commitment of financial resources, soundness of design, and suitability of the proposed
project for its intended function rest upon the experience, organization, skill, integrity, and
judgment of the Civil Engineer. The Civil Engineer’s recommendations based on these factors,
affect lifecycle costs and thereby influence the economic feasibility of the undertaking.

The cost of the full range of engineering services typically amounts to not less than 1 to 2% of
the life-cycle cost of most construction projects. It is, therefore in the client’s best interest to
engage the most qualified and reputable Civil Engineers or Civil Engineering firm available. It
is usually advantageous for the client to select a Civil Engineer who can support the project
from conception through design, construction, and project start-up. Continuity of service aids
in developing a relationship between the Civil Engineer and the client, which will add to the
success of the project.

Civil Engineer who can support the project from conception through design, construction, and
project start-up. Continuity of service aids in developing a relationship between the Civil
Engineer and the client, which will add to the success of the project.
Qualifications, experience, reputation, and quality of client service are of critical importance
in the selection of a Civil Engineer as a consultant. Selection based primarily on cost of
services, with limited consideration of the competence or expertise if the consultant, can
result in unsatisfactory service to the client and in higher overall project costs. The Civil
Engineers competence in specialty fields, performance on other projects of similar nature,
interrelationship with the design team members, personnel assignments, provision for
independent reviews, and costs, insurance and other annual charges and the resulting life-
cycle costs of the project. Importantly, the client should recognize that selecting an engineer
based on the quality and expertise is somewhat subjective. It is imperative that clients assign
those individuals who are best suited within their organizations to make that selection.
Once a Civil Engineer is selected, detailed discussions between the engineer and client to
define the scope and expectations of the engineering services to be provided, are essential
before negotiating a fee for services. A clearly defined scope of services greatly reduces the
potential for misunderstandings or confusion which can later evolve into project delays and
claims for additional compensation. A detailed scope of services protects the interests of both
the client and the consultants.
The Philippines Institute of Civil Engineers support procedures such as those specified by CIAP
Documents 101 and 102, Executive Order 164, and PD 1594 as amended. In applying these
procedures, the selection, procurement and administration of engineering services should be
the responsibility of the owners or the owner’s engineering staff.

1.7 PRIME PROFESSIONAL PRACTICE

The guidelines in this manual refer specifically to the engagement of engineering services
where the consulting Civil Engineers serve as the client directly as a prime professional, and
where the client is usually also the owner of the project. Some information in this manual is
also applicable when the Civil Engineer serves the client indirectly as a sub-consultant through
another engineer or architect who serves as the prime professional. These services may also
be performed through another entity on a design-build construction management, or turnkey
project.

1.8 EMPLOYMENT
The guidelines in this manual also refer to Civil Engineers employed by professional consulting
firms, government agencies, educational institutions, construction firms, manufacturing and
commercial entities and other entities.

1.9 DESIGN COMPETITION

Design competition is a process through which a Civil Engineer is selected above other
competitors based on proposal or an innovative approach to solving a client’s needs.
Competing firms are normally shortlisted from a number or engineers responding to a client’,
solicitation either directly, by a letter request or indirectly through a newspaper or other form
or publication. The civil engineer should be aware a stipend to participate in the competition.

1.10 CONTINGENCY BASIS OF EMPLOYMENT

Canon 5c or the PICE Code or Ethics provides that “Engineers may request, propose or accept
professional commissions on a contingency basis only under circumstances in which their
professional judgments would not be compromised. “Although contingent commissions are
permissible, it is the general view of PICE that it is not in the best interest of the client or the
public for the Civil Engineer to provide professional services on a contingency basis.

1.11 PROFESSIONAL PRACTICE OF FOREIGN CIVIL ENGINEERS

Foreign Civil Engineers are allowed by law (See RA 8991) to practice civil engineering in the
Philippines under the following instances.
1. The laws of the foreigner’s state or country allow the citizens of the Philippines to
practice civil engineering on the same basis and grant the same privileges as those
enjoyed by the subjects or citizens of such foreign state or country.
2. Allowed under international agreement.
3. Consultants to be engaged in foreign-funded, joint venture or foreign-assisted
projects of the government.
4. Employees of Philippine or foreign private institutions pursuant to law.
5. Civil Engineers who were former citizens of the Philippines, who had been
registered and issued a certificate of registration and a professional identification card
prior to their naturalization as foreign citizens, and who, while in the country on a visit,
sojourn or permanent residence, desire to practice their profession.
The application of the law is however not automatic. Foreign civil engineers must still secure
certificate of registration/license or special permit from the Professional Regulation
Commission. Agencies, organizations or individuals, whether public or private, who secure
the services of a foreign Civil Engineer, are made responsible by law (R.A. 8981) for securing
a special permit form the PRC and the Department of Labor and Employment pursuant to
their respective rules.
 References

Philippine Institute of Civil Engineers, Inc. (2003). Manual of Professional Practice for Civil
Engineers, 2nd Edition. Manila: Philippine Institute of Civil Engineers, Inc.

Paras, E. (2005). Civil Code Of The Philippines. Commission of Human Rights Library General
Circulation.