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A monthly publication from the Wisconsin Society of Professional Engineers
October 2008 Edition
WSPE's President's Corner |
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Fellow P.E.s, Sorry to report: July 1, 2014 Obituary Wisconsin Society of Professional Engineers, 70, Madison, WI. On Monday, June 30, 2014, the WSPE State Board held a special membership meeting and unanimously voted to disband the WSPE organization. WSPE was born on May 12, 1944 to the family of National Society of Professional Engineers in Milwaukee, WI. Over its 70 years of life, WSPE has strived to represent the interests of its members as well as the engineering community in general. During its prime in the 1970s, WSPE had a membership of 1,700 members. During the following four decades, the membership dropped to less than 400. In 2008, life support was attempted by approximately 100 of its most active members. However, due to what appeared to be a general lack of involvement by many of its current members, a decline in membership due to the retirement of the “baby boomer” members, other priorities and commitments of the “X” and “Y” Generations, a loss of potential membership due to P.E. registration changes, and an overall decline in engineering students, the WSPE organization succumbed to its eventual demise. Over the early years of its existence, WSPE was an active organization and was supported by many of its members. It was originally formed with the intent of giving the Wisconsin engineering community a single professional voice and an organization to be proud of. In its early years, the annual membership meetings were generally well attended by over 200 members but eventually declined to less than 30. WSPE’s five Practice Divisions began to disband in 2010 beginning with the loss of the Private Practice Division, soon to be followed by Construction, Education, Government and Industry. WSPE was preceded in death by its chapters: Fox River Valley (first born), WI Valley, Northwest, Western, Southeast and Metro. It is survived by two associated organizations: EFW and BEPR. Its parent organization, NSPE, is gravely ill and is not expected to last through the current decade. Online condolences are welcome at www.wspe.org. The above obituary is, of course, fictitious. It may, however, not be too far from future reality. The State Board met on Wednesday, September 17, 2008 and subsequently voted to approve a deficit budget for 2008-2009. The size of the final end-of-year deficit will be dependent on our ability to manage expenses and at the same time increase membership revenue. Membership declines and non-involvement in WSPE by its current membership continue to be on the agenda of the State Board. Your help in turning this situation around is sincerely requested. Michael J. Lefebvre, P.E. |
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Women in Engineering Fall Career Day Oct. 27, 2008 |
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| Young women in grades 8-12, come join us for various engineering presentations, keynote speakers, and more! Sponsored by UW-Platteville College of Engineering, Mathematics,
and Science; Women in Engineering Program; John Deere, Dubuque Works. |
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College of Engineering, Math and Science (EMS) Expo April 2, 2009 |
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Mark your calendars! This expo has two purposes: to inform youth what engineering, mathematics and science are all about, and to provide incentive for the challenge awaiting those of you who choose a career in one of these fields. You will have the opportunity to observe students and faculty “in action” and to see what people educated at UW-Platteville College of Engineering, Mathematics and Science can do. Look for more information soon at: http://www.uwplatt.edu/EXPO. |
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The Sky’s the Limit: April 24-26, 2009 |
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Please mark your calendars for this special weekend event sponsored by the UW-Platteville Women in Engineering Program. This program is designed for girls ages 13-17 and includes a variety of fun activities to expose girls to the wonderful world of engineering. Check the Web site soon for more details. http://www.uwplatt.edu/wep/programs/Sky's_the_limit.html. |
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Subcontractor Remedies Under the Theft By Contractor
Statute |
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In the May/June 2003 edition of this e-news I discussed the Wisconsin Supreme Court Case of Tri-Tech Corporation of America v. Americomp Services, Inc., where the court held that a subcontractor was entitled to treble damages against a prime contractor who failed to pay the subcontractor for installation of computer cabling, provided that the subcontractor adequately prove the elements of the criminal offense of theft by contractor which are: (1) the defendant acted as a prime contractor, (2) the defendant received money for the improvement of land from the owner or mortgagee, (3) the defendant intentionally used the money for purposes other than the payment of bona fide claims for labor and materials prior to the payment of such claims, (4) the use was without the owner or mortgagee’s consent and contrary to the contractor’s authority, (5) the contractor defendant knew the use was without consent and contrary to his authority, and (6) the defendant contractor used the money with the intent to convert it to his own use or the use of another. In State v. Keyes, decided on June 3, 2008, the Wisconsin Supreme Court went further and clarified that even where a prime contractor was acting as a subcontractor, if that contractor received construction loan monies and failed to distribute proportionally those loan monies to all other unpaid subcontractors, a theft by contractor has been prima facie established. In State v. Keyes, the owner ultimately lost trust in and terminated the prime contractor and the State brought a criminal complaint against the prime contractor alleging that it had violated § 779.02(5), Stats., by failing to distribute proportionally the construction loan monies to all unpaid subcontractors. The prime contractor filed a motion to dismiss the criminal charge arguing that it was simply keeping the money for materials purchased and work performed as a subcontractor. The thrust of the decision was to clearly place upon all prime contractors and subcontractors in Wisconsin the full burden of the theft by contractor statute which includes the obligation of a prime contractor or subcontractor to distribute construction monies proportionately if the amount available is not sufficient to pay all subcontractors. In State v. Keyes, the owner may have been acting as its own general contractor and the prime contractor may have been acting as a subcontractor, which lessened the clarity and value of the court’s decision. However, the Supreme Court chose not to decide whether the defendant was acting as a prime contractor or a subcontractor, and did not comment on whether the owner was acting as its own general contractor and simply focused upon the obligation of any prime contractor or subcontractor to use construction monies received for improvements to real estate only as a trust fund until all subcontractor claims have been paid. The court held that the use of any such monies by a prime contractor or a subcontractor for any other purpose until all claims, except those which are the subject of a bona fide dispute and then only to the extent of the amount of the dispute have been fully paid or proportionally paid in cases of a deficiency, constitutes theft by contractor a criminal act, subjecting not only the contractor but its officers, directors, members, partners, or agents to criminal prosecution. Under the Tri-Tech decision the prime contractor or subcontractor breaching the trust may also be pursued by the unpaid subcontractor for the recovery of treble damages. A portion of the Supreme Court’s decision in State v. Keyes discussed whether a prime contractor or subcontractor receiving construction monies must pay all their subcontractors in full or proportionally in cases of a deficiency, before paying themselves a profit. The court in essence held that while profits may be part of a contractor’s pay application, construction monies paid to that contractor were still trust fund monies until the unpaid subcontractors were either paid in full or proportionately in the event of a deficiency. Professional engineers are often officers, directors, members, partners or agents of prime contractors and subcontractors. They are vitally and directly involved in understanding and adhering to the provisions of § 779.02(5) of the Wisconsin Statutes, known as the theft by contractors statute. However, professional engineers who are engaged in the practice of engineering relating to real estate improvements should also be aware of and concerned about the distribution of construction monies. Unpaid subcontractors have lien rights which the Wisconsin legislature has protected from erosion. Section 779.135 of the Wisconsin Statutes provides:
Since professional engineers in private practice often draft construction contracts in addition to project specifications, careful attention must be paid to the legislative provisions voiding certain contract terms requiring a waiver of lien rights, making the provisions of the contract subject to the laws of some other state and making payments to a prime contractor a condition precedent to the prime contractor’s obligation to pay a subcontractor. During the 50 years that this writer has practiced law in the area of design and construction, the legislature has made substantial changes in Wisconsin’s construction lien law, giving it more muscle and emphasis. The cases of Tri-Tech Corporation v. Americomp Services and State v. Keyes represent examples of our Wisconsin Supreme Court giving full force and effect to what the legislature has provided in Chapter 779 of the Wisconsin Statutes. Attorney Robert J. Kay is the senior partner in the law firm of Kay & Andersen, S.C. and devotes his time to representing professional engineers, architects, contractors, material suppliers and owners of construction projects. Please feel free to contact him at (608) 833-0077 or visit www.kayandandersen.com. |
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Welcome New WSPE Members |
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The WSPE board of directors would like to extend a heartfelt welcome to the following new WSPE members:
New members contribute to the growth, strength and leadership of the WSPE in enhancing its recognition as a leading voice for Professional Engineers throughout Wisconsin and promoting excellence in engineering. |
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