'Independent Consultant' for Large Construction Project to Bring in Own Contractors

Started by SamE1 • 10 replies • 1548 views

💬 Join us to post & get advice from 50,000 HOA & Condo leaders.

⚡ Takes 30 seconds

Already a member? Log in

SamE1 (California)
Posts: 32

Posted:

Our Board has hired an "independent consultant/expert" to oversee/advise a large construction project on our building (in California). He was hired to ensure the general contractor is held to the strictest of standards, is performing all the responsibilities correctly, all the work is done right etc.

He is supposed to be a completely independent consultant/expert and represent the HOA's best interests.

Our Board is now telling us that this so called "independent advisor" is referring two (of the three) general contractors that will bid on the project. (The third bid is now coming from an attorney that was hired to review all contracts etc. and is also supposed to be completely neutral. A bit of the same problem here as well...).

I have been told by numerous people with a lot of experience in this area that it is VERY important that the "Independent Consultant/advisor" does not have any relationship w/ the general contractor as there is high probability of kick-backs, incentives, less strict oversight etc. (which makes perfect sense). (If they are friends, the independent consultant/advisor is less likely to point out flaws in their workmanship, force them to do work over, tell us when their quality is not good etc.)

Is there any rule/law or further justification I can site that mandates this so called "independent consultant/expert" have no prior connection/relationship with the general contractors he's overseeing? The Board just responds telling me that this relationship ensures we are getting a good general contractor as he is coming recommended etc. I've been searching Davis-Stirling and found 10 Bidding Mistakes etc., but nothing exactly specific to this...

Any advise? Thanks!

TimB4 (Tennessee)
Posts: 21,059

Posted:

Sam,

All you can really do is raise the issue of a conflict of interest. Perhaps bring the consultant in to answer those concerns.

GlenL (Ohio)
Posts: 5,491

Posted:

As long as the Board is aware that the person is referring contractors he knows, it is not a conflict of interest. While you have valid concerns and it should be watched, it is just as likely he is simply referring people he knows to do excellent work.

Studies show that 5 out of 4 people have problems with fractions

DavidW5 (North Carolina)
Posts: 565

Posted:

It is very likely that any "independent consultant" in a particular industry, has had some previous relationships with all of the contractors in that field. The fact that the consultant "referred" two contractors does not preclude the board from soliciting and evaluating bids from any and all contractors. If you suspect some sort of kickback scheme or collusion between the consultant and contractor, then the matter should be referred to the police. Otherwise, you should ask that the consultant disclose any conflict of interest he may have with reference to the two contractors. Then the board can decide if he is sufficiently independent.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By DavidW5 on 10/10/2012 6:18 AM
It is very likely that any "independent consultant" in a particular industry, has had some previous relationships with all of the contractors in that field. The fact that the consultant "referred" two contractors does not preclude the board from soliciting and evaluating bids from any and all contractors. If you suspect some sort of kickback scheme or collusion between the consultant and contractor, then the matter should be referred to the police. Otherwise, you should ask that the consultant disclose any conflict of interest he may have with reference to the two contractors. Then the board can decide if he is sufficiently independent.

Well said.

KellyM3 (North Carolina)
Posts: 2,239

Posted:

The independent consultant should be considered a contractor who is sub-contracting the actual construction. Without true independence, I think this HOA may be unnecessarily spending money on an extra consultant who'll not perform a tangible service other than hang around and make sure the crews show up on time, etc. This may be needed since most HOAs are volunteer operated but I'm sure this consultant is highly expensive.

SamE1 (California)
Posts: 32

Posted:

Thanks Kelly. Those are some of my concerns. This 'independent consultant' is supposed to be ensuring we get the most competitive bids (which would seem unlikely if he's hiring friends/colleagues etc.), that the work is done with the highest standards etc. The Board seems very taken by this man and doesn't question any of his motives since he is a so-called expert. We (the HOA) will end up paying way more than necessary in this situation. They are also paying him an hourly fee - which would seem to have an incentive to expand the scope of the project...

If anyone has expertise in this area, would appreciate some insight.

Thx.

LarryB13 (Arizona)
Posts: 4,099

Posted:

Sam,

It is not likely that anyone on your BOD has the experience to supervise a large construction project. Hiring in someone to supervise is a wise move.

An experienced consultant ought to know at least some companies who can do the work and others to avoid. I would not dismiss his recommendations out of hand just because he may have a good rapport with one or two construction companies.

I would not put too much emphasis on competitive bidding. You should be more concerned with getting a good job at a reasonable price than with getting just a low price.

KellyM3 (North Carolina)
Posts: 2,239

Posted:

A construction company sub-contracts jobs. The recommendation is to hire a contractor to oversee the contractor who will oversee sub-contractors. Meanwhile, county inspectors will be on site and permits will be issued for various aspects of the job. How much redundancy does a board need?

TimH7 (Alaska)
Posts: 1

Posted:

Quote:

Really well said..

hr consultancy

MelissaP1 (Alabama)
Posts: 13,836

Posted:

This is an old post from 2012...Please no more replies. Thank you.

Former HOA President

🎯 You've read this entire discussion

Join the conversation with 50,000 HOA & Condo Leaders:

✓ Ask follow-up questions
✓ Share your experience
✓ Get expert advice
✓ Access 350,000 discussions

Create Free Account →

⚡ Takes 30 seconds

Already a member? Log in here