The much more practical research that I turned up was the following except from an article by Kelly Luckett, the self-proclaimed “Green Roof Guy” who writes a column for greenroofs.com. In a column from the very end of 2008, Mr. Luckett describes how uneducated project teams may unwittingly expose themselves to unanticipated risks stemming from the maintenance requirements of green roof installations. His remarks also reflect a number of key points we’ve made consistently both here at GRELJ and over at gbNYC with respect to the additional risk management strategies demanded by new green building technologies and third-party certification programs.

It is also interesting to note that, for the particular project that he describes below, LEED certification requirements resulted in the green roof’s irrigation system being disconnected after the initial green roof establishment period, which resulted in a roof that did not appear as anticipated by the owner. One last important thought- Mr. Luckett hints that this project was located in Toronto, which, as you’ll recall, recently passed a green roof mandate. I think this is a great example of how legislation is fueling the types of liabilities that we grapple with here at GRELJ, and why, as always, contract language will remain paramount for green building project teams.

I would like to turn the focus now to an issue that continues to plague the green roof industry: the maintenance-free green roof myth.  Some in the media continue to espouse this nonexistent characteristic of green roofs resulting in many of our customers being painfully uneducated about realities of critical green roof maintenance!

Pretty strong language, I know, but the problem doesn’t seem to be getting better.  Let me tell you a story about my company’s largest project.  It’s a government owned project in the city that has become the nation’s green roof capitol; you know the place.  I sat in on a meeting where the general contractor, the architect, and the roofing contractor removed all mention of maintenance guidelines and the Plant Health Alert System from my submittal package!

For those of you outside the construction industry, a submittal package is a gathering of documents and drawings the subcontractor submits to the architect and owner to demonstrate compliance with the specifications for products or portions of the construction project.  When I questioned why they were removing critical pages of information from my submittals, I was told that they eliminated the irrigation system for this 96,000 square foot green roof based on a tour a green roof provider took the owner on during the preceding spring.  I asked if they had told them about the drought that killed green roof plants all over the region the summer before, to which I only received blank stares.  I practically had to threaten to hold my breath until I turned blue, or at least threaten to walk away from the project to get them to issue a change order to put the irrigation system back in.

The green roof was planted in June and July, 2007, and required routine irrigation throughout the establishment period, a task that could not be accomplished over 96,000 square feet using a garden hose.  After alleviating concerns over the irrigation system conflicting with LEED certification requirements by agreeing to disconnect the system after the establishment period, the change order was issued.  However, I insisted that the irrigation system remain in place as insurance should drought conditions require its activation to keep the $250,000 worth of plants alive.

Now fast forward two years. The phone rings; it’s the roofing contractor.  The ownership is requesting a walkthrough to discuss the condition of the green roof.  I asked our horticulturist to accompany me to the autumn meeting on the rooftop. We were greeted by the general contractor, the architect, the roofing contractor, and a clearly unhappy owner’s representative.  The condition of the green roof?  Starving sedums due to absence of the fertilizer that was supposed to have been applied the previous spring, per the maintenance guidelines that the ownership never got to see.

Also, since the plants did not receive the food required to grow and cover the surface of the growth media, the weeds moved in.  The good news –  the weeds will die over the winter and an application of fertilizer next spring will allow the plants to thrive.  The bad news – the project lost the opportunity for the plants to grow in one of the wettest growing seasons on record.  As you can imagine, there was a round of discussion about who was supposed to have provided the maintenance, a discussion that may wind up being continued in a court room.

However, the owner’s representative asked why the irrigation system was still there.  When the general contractor started to speak he was stopped by the owner’s representative who said the question was directed to me.  Before I could answer, another question was posed, “Do you tell your customers that they need to provide irrigation for their green roof?”  To which I replied, “Absolutely yes, every single one of them.”

The owner’s representative, clearly not expecting this answer, became even more agitated.  That’s when I began to appreciate how serious this problem has gotten for the green roof industry.  The owner’s representative placed in charge of one the city’s largest green roofs, in arguably the most green roof educated city in the nation, was utterly surprised by the fact that plants need food and water.  The building code issue evoked an urgent call to arms that brought about action by many and opened lines of communication among perceived adversaries, while lack of proper green roof maintenance poses far more serious threat to the green roof concept yet the green roof industry remains largely quiet.

Admittedly, nobody uses discussing maintenance during the green roof sale as their go-to closing strategy, but it’s a lot healthier for a green roof business in the long run to address this issue upfront rather than standing in the middle of a problem on a green roof facing an unhappy and uneducated customer the following season.  I’ll keep working on the code issues on behalf of the industry, but it’s time the industry start working on this much larger problem.

• The Green Roof Guy (greenroofs.com)
• Green Roof Archive (GRELJ)

The top five risk categories that were identified during the forums were finance, standards of care and legal, building performance, project consultants and subcontractors, and green building regulations; each of these fell either in the “likely” or “moderate” risk profiles (finance, standards of care, and performance were the top three, all of which were in the “likely” profile, which translated into “likely to occur at least once every three years.”). The lowest risk category? Brand and competitive edge or reputation (which is interesting given the new product from AIG that provides coverage (in the form of a lump sum payment and counseling services) for loss of reputation if a green building project fails to achieve third-party certification).

Within each of the top five risk categories, Marsh asked participants in each forum both to identify specific risks and challenges and propose some general solutions. Many of those risks will ring familiar to you, particularly in the standard of care/legal category. However, there were several that I thought were worth repeating, particularly because we have not mentioned them explicitly here at GRELJ previously.

First, the danger that “more aggressive” design may lead to an increased risk of errors or omissions in contract documents. I think that this risk ties in with many designers having little experience with green building technologies, yet specifying certain materials or systems without performing sufficient due diligence; we’ve already heard of claims arising out of this scenario. Next, potential claims for attractive nuisance from low-rise green roofs that are easily accessible- particularly on schools- as well as graywater collection ponds. While we’ve noted insurer attitudes about green roofs generally from the perspective of potential arson, the idea of the green roof or collection pond serving as an attractive nuisance is troubling (though a quick Westlaw search did not identify any reported decisions involving a green roof in this context), and this Marsh report is the first place that we’ve seen the concept identified. Finally, the report mentions that executives were concerned about the possibility that contractors may be assuming liability for professional design services, yet not procuring professional liability insurance coverage for those efforts. This scenario may arise where a contractor performs LEED certification or building commissioning services but is not obligated by contract (or statute) to procure such coverage. Note our recent article here at GRELJ discussing aspects of this important issue.

I thought it was also interesting to note that the top categories as identified by participants in each city varied widely. In New York City, for example, the top two risk categories were performance and standard of care/legal; in Washington, D.C. they were financial and education. With respect to New York City, it was also interesting to note that the panel considered regulatory risks as low-risk; given the Mayor’s Greener Greater Buildings Plan and the pending mandate for energy efficiency benchmarking and retrofits for every building in the city, this will likely change. Moreover, I have written extensively, both here at GRELJ and over at gbNYC, about how critical it is for project teams to survey and understand the regulatory requirements that may apply to a particular project. In that respect, I was a bit disappointed to note that the report’s composite risk map ranked regulatory risks as “unlikely.” As we noted in the context of the Shaw Development litigation, the issue in that particular lawsuit was the parameters of an applicable green building tax incentive program. As the Marsh report points out, most insurance policies will exclude claims based on non-compliance with controlling laws, codes, or regulations. Although claims- at least in negligence- for failure to comply with controlling green building regulations may be asserted as negligence per se, the idea that insurance may not be available for allegations that a designer (or a contractor) failed to comply with those regulations should be considered seriously by green building project stakeholders.

Finally, I think it is also important to quickly point out that insurance risks will change drastically under the LEED 2009 system if the specter of decertification proves as sinister in practice as many have suggested.

The report is a quick read and sums up many of the key issues that the green building legal community has been wrestling with over the past two years rather succinctly. A link to the registration page on the Marsh website from which you can download the report is set forth below.

• Green Building: Assessing the Risks, Feedback from the Construction Industry (Marsh- Register)

However, what got me thinking a bit more seriously about the intersection of green building and labor law was an article discussing the California Labor Federation’s two-day conference held earlier this month in San Francisco, where topics across a number of workshops included green real estate development and the creation of green collar jobs. One of the plenary speakers, Greg LeRoy, whose topic was “the emerging green economy,” noted in his remarks that “there are only two reliabile predictors of job quality, unionization and job quality standards. [W]hile some green employers are open to collaboration, others pay poorly and fight unions.” Mr. LeRoy also pointed out that “there are no labor standards in the U.S. Green Building Council’s LEED system.” Is it possible that future versions of LEED might require some type of labor standard for the trades, perhaps by requring that owners who pursue LEED ratings enter into some sort of project labor agreement with local unions or pay prevailing wage rates? Could USGBC itself integrate certain labor requirements into LEED itself? I am not a labor lawyer, but it seems to me that with increasing emphasis, particularly here in New York City, for example, on educating the trades about green construction practices, these types of labor law issues will become increasingly common in the green building context. Any thoughts?

• Green Roof Installers at Target Center Raise Safety, Wage Issues (Star Tribune)
• California Labor Federation’s Rousing Conference (BeyondChron)

Toronto’s mandate is interesting to consider in light of the risks that we have pointed out previously both here at GRELJ and over at gbNYC with respect to green roofs generally. For example, last fall, we noted an article in Property Week magazine that discussed insurer attitudes towards the increased installation of green roofs in the United Kingdom. Many insurers believe that green roofs are likely to become flammable and have identified schools- and their relatively easy low-rise roof access- as particularly troublesome from the perspective of potential arson. Property Week also cited a 2006 report authored by Zurich’s Stuart Blackie which stated that ““[t]his concept of construction is often sold on its environmental benefits. The issue of fire spread, combustibility and indeed fire safety are often overlooked.” Toronto also appears to have ignored some evidence that suggests those environmental benefits may have been oversold. For example, the Canadian National Research Council had previously reported to the city that the energy savings from green roofs would only occur for 3 months during the year and that any claimed water retention benefits simply did not exist. It will be instructive in the coming months to see the reactions- if any- from the property insurance market to the new legislation, or if Toronto’s development community will muster any sort of additional challenge to its implementation.

I think the Toronto mandate is important to consider in the context of other green building policies that have been enacted here in the United States quickly without sufficient analysis. The fact that the Toronto legislation was passed without any real debate- despite significant evidence that its perceived benefits might be less than suggested- suggests the same type of policymaking that here in the United States has already become problematic in litigations such as AHRI v. City of Albuquerque. If policies are implemented poorly, green building goals are not advanced when litigation ensues, either to challenge such policies or as their direct byproduct. I also think it’s clear that this type of green building legislation will continue to be enacted in municipalities of all shapes and sizes regardless of the practical implications for private real estate. Accordingly, it will remain increasingly critical that industry stakeholders monitor such activity in their localities such that they can work with counsel to formulate sufficient risk management strategies that address those emerging implications.

• Toronto Adopts Mandatory Green Roof Requirements (PR)
• Toronto Mulls Mandatory Green Roofs (Green, Inc.)
• Green Roofs a Hidden Risk? (gbNYC)

Green roofs have been a part of building for over a thousand years. The current green building movement has, however, had the greatest impact on the growth of the green roofing industry. A green roof is commonly defined as a roof that consists of vegetation and soil, or a growing medium, planted over a waterproofing membrane. There are two basic types of green roofs: (i) an extensive roof, which has a few inches of soil cover; and (ii) an intensive roof that has two feet or more of soil for a variety of grass, trees, bushes and shrubs. Green roofs are used in a multitude of buildings, including industrial facilities, commercial offices, retail properties and residences. The benefits of a green roof include reduced storm-water runoff, absorption of air pollution, reduced heat island effect, protection of underlying roof material from sunlight, reduced noise, and insulation from extreme temperatures. A green roof can thus be a critical design element for a green building. As more properties across the country are attempting to obtain LEED certification, it is worth noting that a green roof can help a property obtain over a dozen LEED credits, including credits for reduced site disturbance, landscape design that reduces urban heat islands, storm water management, water efficient landscaping, innovative wastewater technologies and innovation in design. The increase in green roofs and the green building movement is also resulting in an increase in liability resulting from errors in the design, installation or maintenance of green roofs. As a result, owners, design professionals and contractors should carefully consider ways to mitigate the potential risks involved with building a green roof.

In order to mitigate liability, the stakeholders in a project that features a green roof should clearly detail their expectations and performance requirements in their contracts. This will require preparing contracts that might not easily fit within standard forms of architect and construction contracts. A clear example of green roof liability was detailed by Frank Musica at the AIA Convention 2007. In that instance, the green roof contractor and structural engineer failed to communicate the specifics of the green roof. The result was water leakage and significant structural damage. This scenario could have been avoided by simple communication. One can easily imagine potential disputes arising from any of these following situations: (i) failure to deliver the energy efficiency levels claimed by the installation of a green roof; (ii) failure to deliver a green roof that results in the claimed number of LEED credits that should be awarded by the USGBC; (iii) mold or other environmental hazards as a result of poor maintenance of a green roof; or (iv) a roof collapse resulting from a green roof that was not properly constructed, installed or maintained. Parties should look to limit unnecessary liability by drafting contracts that clearly detail how the applicable parties will be responsible for each of the above-mentioned items. Although liability for said items is not able to be eliminated, it is important to all stakeholders that it is appropriately detailed in contract form, instead of by a judge or jury.

Green building owners and general contractors should engage experienced green roofing professionals when building a green roof. The green roofing industry has begun to assist in this regard by designating such professionals in a manner similar to that of the USGBC’s LEED Green Associate or Accredited Professional designations. Green Roofs for Healthy Cities has established the Green Roof Professional (“GRP”), which designation was created to distinguish certain individuals that have achieved a specific knowledge level with regard to green roof design, project management, installation and maintenance.  The goal of the designation level is to allow green roofing professionals to differentiate themselves, establish an increased level of professionalism in the green roofing industry and help protect the public health, safety and welfare by the building of better green roofs. I would strongly encourage clients to seek GRPs when working on a green roof in an attempt to mitigate unforeseen liability. It is worth noting, however, that one likely unintended consequence of this accreditation program for GRPs is that they could very well be held too a higher standard of care should any problems occur following the installation, repair or maintenance of a green roof.

Green roofs provide a benefit to the environment, energy efficiency related savings to property owners and tenants and potential credits for owners seeking LEED or other third-party green building certification for their property. The legal risks and potential liabilities of green roofs should, however, be carefully examined, both by companies considering installing a green roof and by green roof professionals themselves before getting involved with any green roofing project.

Geoff White is a Senior Associate in the Commercial Transactions and Real Estate Group at Frost Brown Todd.  He is a LEED Green Associate (LEED GA) and a Fellow of the Institute of Green Professionals (FIGP).  A sizeable portion of his practice is spent advising clients on the legal issues of green building and sustainable development.  He recently co-authored the chapter “Understanding and Mitigating the Legal Risks of Green Building,” in the Aspatore Books Inside The Minds – Negotiating and Structuring Construction Contracts.  Mr. White is licensed to practice law in Kentucky and Ohio.  Contact him at gwhite@fbtlaw.com or (502) 568-0202.

• Green Roofs a Hidden Risk for Insurers (gbNYC)