In this episode…

We sat down with Craig Schlumbohm to discuss his expert witness experience in construction management. Topics include assessing cases and attorneys, as Craig states: “. . . if the attorney doesn’t have a good handle on the case, it’s hard for you to be a good expert.” Craig continues, “We don’t take everything . . . there have been firms . . . that were asking us to do things that either we were uncomfortable with, or they had unreasonable expectations.”

Additionally, we go over friendly relationships with opposing experts, being on the losing side of a case, and realistic expectations, on which Craig asserts, “If the starting point is ‘the Titanic didn’t sink’ you have problems.”

 

Episode Transcript:

Note: Transcript has been lightly edited for clarity.

Host: Noah Bolmer, Round Table Group

Guest: Craig Schlumbohm, President at Pacific Construction Analysts, Inc.

Noah Bolmer: Welcome to Discussions at the Round Table. I am your host, Noah Bolmer, and today I am excited to welcome Craig Schlumbohm. Mr. Schlumbohm is the President of Pacific Construction Analyst. Inc. is a full-service construction consulting firm, which provides construction management, site development, and construction forensic services. He specializes in post-mortem cost analysis of construction projects, and he is a sought-after expert witness in the construction field. Schlumbohm holds a Bachelor of Science in Civil Engineering from San Diego State. Craig, thank you for joining me today on Discussions at the Round Table.

Craig Schlumbohm: My pleasure. Thanks for having me.

Noah Bolmer: Let’s jump into it. You have an incredible amount of expertise in Civil Engineering. Has this always been a passion for you? How did you get started?

Craig Schlumbohm: It was not a passion. I was the kid in grade school and middle school who was getting straight C’s. I never took anything too seriously as a kid. I had, I do not know what they call it now, attention deficit disorder. Sometime around the middle of high school, I realized I did not want to sell french fries. So, I had better find something I liked. I was always good with my hands and liked trying to figure out how things worked, so I went into the engineering field. Even through college, I worked on learning how to get better and better over the years. It was an interesting challenge coming from that kid who could not sit still in a chair for 5 minutes to what I do today.

Noah Bolmer: Sure, and what you do is a broad topic, right? Your work has been extremely broad in scope. You have worked on projects from California’s Lego Land and single-family homes and everything in between. What does it mean to be an expert in your field? How do you remain an expert?

Craig Schlumbohm: Early on in my career, right out of school, and when I was in college, I was working for grading and underground utility contractors. The heavy side of construction in Southern California is that industry died there. We were just not developing 5,000-acre parcels like we used to. The breadth of what I do changes simply because of the industry that I started in. In a way, it died. We still do some from that perspective, but we retooled in say 2005-to-2008 time frame to get into the vertical construction side of things just to survive.

Noah Bolmer: So, your expertise has changed as the industry has changed.

Craig Schlumbohm: I had to, or I would be hungry today.

Noah Bolmer: How did you parlay all of that experience into a career of expert witnessing? You have been doing that for a long time. Tell me about your very first engagement. Were you actively seeking it?

Craig Schlumbohm: No. I worked with the same company that I worked with that did Legoland. I worked as a contractor with a guy that was always causing trouble. He turned everything into a fight. They brought in a consultant on a project, and this guy walked up to me at work and said, “Hey, this guy can fight his way out of a corner.” He took me and hired me. Fortunately for me, because I was going crazy at the other place. He retooled me from a fight to somebody who could analyze the parts of a problem and realize what it is that people fight over and be able to evaluate that. I took that knowledge and started using it. For that company, they had a variety of cases. Many productivities analysis-type projects, and contract disputes, look at it from the perspective of what it is to fight. Why is it that people fight and break those components down? Why is it that people have disagreements and frankly, having worked for a guy that was essentially a walking lawsuit to begin with, I learned what it was to be that guy or not myself. I mean to be working for that company that was always the ones that were causing problems. See that, analyze it, and become good at it. Ultimately, my first expert assignment came as a part of a case for my mentor, Bill Boyd, who became my business partner in minor aspects of cases where he was resolving the large components and some smaller components. They needed some separate expertise. I came in on that almost by accident.

Noah Bolmer: During that first engagement, what was the extent of that engagement? Did you write a report? Did you have a deposition? Were you cross-examined?

Craig Schlumbohm: The earliest one, when I was working for the grading contractors, there was specific software used to compute Earthwork volumes, so I have used that software many times. I became an expert in how one goes about calculating volumes for different kinds of projects. My first two or three assignments were cases, where Bill Boyd was the expert talking about the case’s main components. I focused on the specific question of how we do computations. My first case was an arbitration, and I did not know two weeks before the arbitration that they were going to designate me at the end. I had done much of the background work and had helped Bill prepare but right at the end, the lawyer was like, “Hey, I think we need somebody that can step in and talk about this.” It happened organically, but somewhat pre-planned with my employment and ultimately taking over the reins for Bill.

Noah Bolmer: Did you feel prepared early going? Did the lawyers you worked with do an adequate job preparing you for what was expected of you? What would it be like in that case, in arbitration, but also when you have gone to court? Have you been adequately prepared for that, or have you learned some things over the years that you wish you had known at the beginning?

Craig Schlumbohm: That is a fun question. I think much of it simply how good the lawyer is. I think a good lawyer is going to have their experts be prepared. A great lawyer works with their experts to prepare them for what is coming next. I went back over my experience, and I thought about it. There were some assignments early on in my career that I had excellent preparation for, and everything went smoothly. There have been cases later in my career where I do not think the attorneys were doing a good job. I kept asking what the preparation was going to look like. What do we need to do? What do we need to do to prepare? It did not happen, and it was uncomfortable being in a case where the lawyer you are working with asks you a question and you have no idea where they are even coming from.

Noah Bolmer: That is bad news.

Craig Schlumbohm: That is tough. That is bad news. A good attorney does that preliminary workup. As an expert, if you are not getting that kind of support, I think you have to do it internally. To try to be your best. Sometimes if the attorney does not have a good handle on the case, it is hard for you to be a good expert.

Noah Bolmer: Does that calculus enter into the decision to take a case? Do you take most of the cases that you were offered? Some of them? All of them?

Craig Schlumbohm: No, we do not take everything for sure. There have been firms where we have drawn a line in the sand and said we are not going to work with them anymore. They were asking us to do things that either we were uncomfortable with, or they had unreasonable expectations.

Noah Bolmer: Without naming names, can you give me any specifics of a time that you were either asked to do something unreasonable or that was beyond your scope, or anything like that?

Craig Schlumbohm: Sometimes when you are out there looking at a complex or a building or whatever the case may be, and a lawyer looks at you and says, “Hey, I read your report, but there are not any roofing problems. We were right. We were on the roof, and we did not see any problems. Oh, I need some roofing problems so we can go get the roofer in the [case].”

Noah Bolmer: That is blunt.

Craig Schlumbohm: That is blunt, and we do not work with that firm anymore. I had an attorney in a case that asked me for an allocation, and I was uncomfortable working with that allocation. I did not think it was right, and that case went to trial and the judge threw out the questioning and everything else. He cut right to the chase and said, “Where did you come up with this calculation?” I said, “I did not. I did the calculation that the attorney asked me to do.” We said, “That is the only thing that calculation represents?” I said, “Yes, that is it.” As an expert, you need to be honest, and lying is the worst thing you can do. I was uncomfortable. Judges remember that. I think the judge saw the writing on the wall. I was being honest. I did not do that calculation. I did the math, but it was not what I wanted to do. When it came time to answer for that math, I said, “All I did was the math.”

Noah Bolmer: Is that a position you find yourself in frequently?

Craig Schlumbohm: No, that was one instance of an attorney that was in a lot of trouble on a case. and I do not work for him anymore.

Noah Bolmer: So, are you then vetting attorneys? What is that initial engagement like? You get a call and what sorts of questions do you ask? How do you vet the attorney to make sure this is a case? Do you get any paperwork? Do you get a rundown of what the action is? Are they just saying we need some information about some technical details? What is that process typically like?

Craig Schlumbohm: It depends. Much of our work comes from repeat customers or law firms. I think they know what we know, and we know what they know. We get assignments where we do not know the people. We have had a couple through Round Table where people have come to us and said, “Hey, we have a case, and we need to make sure that you fit. Maybe working with an attorney.” You need to learn about the case and whether you are comfortable with the issues. There are times when my expertise is broad, but there are times when I have had to tell attorneys, “Thank you for calling me, but I might not be the right guy because I am not that much of an expert in a certain specialty area.” I think it is going through the process of trying to understand what the case is about, at least initially. The parties involved are important. People know you are familiar with conflict checking and things like that, or hopefully, they do. There have been times when we have looked at a case and said, “We are not too excited about going up against a certain individual named in the case or the representing lawyers.” We have turned them down for that, but it is trying to find out as much as you can about the case and seeing if you think that you are a good fit. It is rare that in those early meetings, we have ever felt uncomfortable with the law firm. They felt that there might be a working relationship problem. It has happened, but normally it is later down the road when some things happen it is not a good team effort. In the early stages. it is trying to find what you can about the project and whether or not the specifics of what they are looking for fit into that mold.

Noah Bolmer: There is not a ton you can do at the outset to make sure you do not find yourself in the position where you might have to do some quote-unquote calculations that are not quite what you want to say or what you want to do or are being asked to do something unethical. That typically happens after it is quote-unquote too late.

Craig Schlumbohm: That gut feeling comes into play, but the two times I was put in that weird corner, I would say both times were for law firms I had done a number of cases with before. I was not put into the weird position of telling the lawyers what they need to know as early as I know it. One of my mantras is when I get involved in a case if my lawyers do not know something, or I think that they are cruising for a bruising in a case, they are going to lose that case. The faster I can report that information to them, the better, so we do not find ourselves 8 months to a year down the road fighting a bad case. There may have been a reason to do it. They may know that they had a bad case, and especially on the defensive side you may have a bad case, but you need to put up a fight. That happens but as quickly as people can find out what you know, and what your initial feelings are, the better. It avoids uncomfortable situations later.

Noah Bolmer: Craig, do you have any interesting stories or cases that you have worked on that you would like to share?

Craig Schlumbohm: They are all interesting. No, it is funny because we have seen experts that we have met with say we are working on a case and again missing the details of whom we are talking about here, talking broad terms. Often, experts from different companies come together to represent the same client. They each have separate expertise. It goes back to what I just said about speaking to your mind and your truth from day one. We were involved in a case where we had multiple experts from multiple companies, and it was a linchpin of the case. There was an expert that spoke to one scientific topic. In his deposition, and this was an arbitration case, an arbitration expert said some things that we had not heard from him before. After many meetings and conversations regarding aspects related to a building for the first time, he started talking about different components. There were structural issues on a building, and we had heard him say things about maybe this was a problem. It beat us up as an expert team because we are all sitting back and had to recover because of that one. I was dealing with some of the architectural issues and the cost of repair, and suddenly my foundation fell apart because the building foundation fell apart because of the way case the case went on from there. We had different experts on structure, windows, and roofs, it shot the whole thing out of the water because we had an expert that, for whatever reason, went a different direction.

Noah Bolmer: That is interesting. Is vetting the other experts’ something that typically happens? Do you know who your team is? Do you know who you are up against?

Craig Schlumbohm: Usually yes. Most good attorneys make sure that the experts on the same team are talking because the last thing you want is what I just described where everybody is building off somebody else’s foundation, and then that foundation crumbles. Again, if the foundation was not there, to begin with, that is fine. We never want to be untruthful. We always want to tell the truth and we always want to be using good scientific principles. When one of those experts yanks one of the Lego pieces out of the tower, and suddenly the whole tower is ready to fall over, it puts you in a difficult position. I cannot remember ever being in a case where I looked at the rest of the experts and said this is not something I am interested in. Most guys are good. I think the fun part about that Is sometimes you work with an expert, and then two weeks later you are doing another mediation and you are on opposite sides. We see that often and I like that. I love sitting around and joking in a case where there is some kind of testing. Last week you wanted to do it this way, but this week it is “Hey, Joe. Now you want to do it the other way.” What gives? No, because you were working with the plaintiff last week, and the defense this week. Living with each other on the construction side of things. Almost everybody came out of the construction industry. We have all been called horrible things. We have all had rocks thrown at us, so it might be a different scenario than many other industries. I do not think doctors throw organs at each other.

Noah Bolmer: Hey, man, we do not know what goes on in the Emergency Room in the afternoon.

Craig Schlumbohm: I do not know. Many of the guys that I know, we have down in dirty holes together, in the mud and the muck looking at different things. We all know what we look like when we have had a dirty day, climbing around on an investigation. Working with those people, and against them is one of the things I relish. It is fun.

Noah Bolmer: Is it ever a problem where those friendships can get in the way of taking the opposing expert down a peg because, at the end of the day, you are each engaged by your attorneys and doing your job? You might be contradicting each other and does your camaraderie ever come into play there?

Craig Schlumbohm: Yes. I guess my best way to answer that is I normally do not attack the expert, I attack principles, analysis, or discovery.

Noah Bolmer: Okay.

Craig Schlumbohm: No, I can tell you your math was wrong. You made a mistake. You can handle that differently. You can say, “Hey, I looked at your analysis, and I do not think it included the information that it should have included. I think it overreached here or there.” I think you can delicately work around that. I do not like coming out with name-calling anybody. It has happened once or twice where people I think are grossly overrated. but for the most part, I think we all act professionally.

Noah Bolmer: Before the show, we were talking about your experience as a juror and how that impacted the way that you view experts. I think that our audience could benefit a little from that discussion.

Craig Schlumbohm: Everybody, when they get their jury summons in the mail, takes the first one and throws it in the trash. Then they get the second one, they are too busy and cannot possibly do jury duty. I have learned a lot from jury duty. and I was telling you that I was involved in a case dealing with a relatively minor theft from a Sears store. They asked me to be the jury foreman. I had some experience. We went around the room and talked about what everybody did. Everybody told me that I was going to be the jury foreman in that case. An interesting fact came up in the case regarding a witness and whether or not that witness had had conversations with one of the defendants in the case. It came off poorly. Everybody in the room knew this lady was lying because of her demeanor. All the signals that you get from a person that is lying and, so that was an issue. The other issue was two people that were not to be friendly with each other. On an intermission, the entire jury walks out and looks down the hall, and these two people are giggling, laughing, and talking with each other. So, this notion that these two people hated each other was wrong. It came down to reasons other than the words that were spoken. A couple of the jury members had a hard time with that, and it was interesting to be in the room and to hear other people discussing why they thought a person was a liar. Strong words were used. Two jurors struggled and it ultimately came down to one of the jurors being uncomfortable voting on innocence or guilt. We ultimately had to go back and ask the judge one specific question. The judge responded 3 minutes later we took a vote and convicted the person. Interestingly, little things can be said or done in the courtroom to foster a feeling of untruth. It is hard. Everyone knew this lady was lying.

I did jury duty another time. There was an expert on the DUI case. Nobody believed her. She was there because she was getting paid to be there. It is just the way it felt. I love jury duty for that. I love being in there and seeing things from the perspective of not knowing all the details, not knowing all the characters, and being able to see what people say to make you not believe them. But maybe more what kind of things people say that causes people not to believe what is being said. That to me is key.

Noah Bolmer: How do you integrate that into your expert witness practice? What are the lessons that you take knowing how the jury might perceive you? How do you use that to improve your performance as an expert?

Craig Schlumbohm: People I know will stretch the truth on data. You must be comfortable with your analysis and with people attacking that analysis. It is knowing and being confident in the work that you have done. Being honest with yourself, if you are honest with yourself and you did a competent analysis, people might be able to argue a point, but they cannot throw out the analysis. I have been honest when somebody pointed something out in my analysis, and said, “Hey, do you think that is the case?” Well, I do. If it is a minor component and if you would disagree, I am willing to accept that we disagree on this.” It is picking and choosing your battles, doing an analysis that you believe in, and knowing that analysis, I know many experts will rely on staff to do many computations and are handed documents that they have not always reviewed. That shows and it does not come off well when you do not know what is on a piece of paper and it has your letterhead on the bottom. That is problematic for people, so it is knowing the data and being comfortable with what you are going to present.

Noah Bolmer: I imagine that would come up during cross-examination when you are being grilled about your data knowing how not only the jury perceives you, but how the jury perceives you under pressure when pressed about your data. That is an interesting thing. I do want to pivot to one other thing before we end. This is something that I ask everybody. Is it important to you that the case is won? Do you care about the way that the case concludes? Is that something that comes into your calculus when you are deciding whether or not to choose a case? If your side is likely to win.

Craig Schlumbohm: The case in my career that I am the proudest of as an expert, I told the lawyers on my side that we were going to lose and lose big within the first couple of days of being assigned the case. They knew it. We worked the fence. We had to put up a fight, and never shied away from the fact that our guy messed up. We wanted to point out that they did not mess up in a vacuum. Other contributing factors caused our client to stumble. Our guys stumbled but, they did not stumble in a vacuum. When you walk into a deposition knowing that you are going to get difficult questions like “Are you going to argue that your client did not mess this up?” No, you must be honest and know your data set. I am not going to sit here and say the guy did not make a mistake. He made a mistake, but what we did at the end of the day was get the other side to understand that there were four or five other parties that were responsible for and contributed to what had happened. Ultimately, we got to a position where instead of paying for the whole thing, it was split five ways. There were some serious problems. Our guy messed up because somebody put an impediment in front of them to mess up. Knowing that you have a strong case or a weak case. Sometimes you can do good in the weak case. from that perspective. Especially on the defense side, I think you have to be helpful to the process. Never hide from the fact that you might have some problems in your case, and maybe you will go so far as having those problems. On the plaintiff’s side, sometimes that is a little more present from the simple fact is not that I am keeping a scorecard. At the end of the day, it can be hard client control on the plaintiff’s side. You are what everybody is looking at. This is a losing case. It gets hard to get paid for those cases. Not because of an expert position but the business administration, and accounting that comes into play sometimes.  Many other industries and many other experts work with big retainers, but it is a different beast on the construction side. So, that would be the only time that we would shy away from, say, a potentially losing case would be because of the ability to get paid.

Noah Bolmer: I do want to point out that to drive a point home to our listeners, is that not every win is a win with a capital W. There are win-wins. Winning is a scale right and if paying less or like you said having contributions from a lot of different parties that is another type of win. On the defense side, it is getting the best outcome for your client, and it sounds like in that case that was the best possible realistic outcome for your client. That is still a win after a fashion.

Craig Schlumbohm: Yeah, that was an insurance case on defense and the insurance company was thrilled that we paid policy limits.

Noah Bolmer: And your reputation, right? When you are part of a case like that, I imagine that that brings in more business.

Craig Schlumbohm: That one did. Partly through the deposition, one of the attorneys leaned over to the attorney that I was working for and said, “Hey, before he goes out of here today, I want to make sure it is okay with you, that I can approach about another case that had a similar set of circumstances. It was a bad case. It was a losing case. It was just let’s lose a lot less than we might lose otherwise because, at the end of the day, there are mistakes that are made in the construction industry. People make mistakes and trying to say that a leaking building is fine is insane. Arguing that our guy has zero liability many times is insane, and I even like doing expert meetings and things like that. We see this when experts take the attitude that our guy is perfect and did not do anything wrong. It is like there is no way. So, taking that attitude does not do anybody any good. Posturing does not do anybody any good. Whether you are in the room with the attorneys or a room of experts with you or against you. Be realistic, know what the problems are, and it is much easier to get things settled.

Noah Bolmer: Before, I let you go. You brought up getting paid and that is a question that comes up. How do you bill your time? Are you a project-based business? Do you bill on hours? Do you take a retainer? How do you recommend that experts get paid on time and fairly?

Craig Schlumbohm: It is funny because I have read books and things like that on experts and how you do things. Different industries and different disciplines of being an expert are different on the construction side,. it is rare to have anything other than just say a nominal retainer, which is a kickoff fee more than anything else. Most companies and we have done a lot of work with insurance companies. They are not paying for a retainer. That is not going to happen. After the hundredth time of being told no we sort of abandoned it. Many times, the insurance companies are slow in paying but you get paid. We had one law firm; it is public record. It was a San Diego-based law firm that filed bankruptcy and owed many Southern California experts a lot of money. It was not just us, so it is difficult. You have to make good business decisions. I did not.

Noah Bolmer: I am sorry to hear that, but it sounds like by and large you have been successful. Do you have any last advice for either experts or attorneys?

Craig Schlumbohm: As I said, it has been kind of a theme here. We have been talking about the theme of knowing your position and owning it. I know for attorneys sometimes must argue and defend their clients, and I understand that. Where your case is weak you could spend a lot of time and energy trying to deflect what is going on, but most people in the room know what is going on. When you look at the situation from the standpoint of okay, we know that our guy made this mistake, whatever that mistake was, they made it. Why did they make it? Do not argue. Do not try to argue that they did not make the mistake. Try to find out why they made that mistake and try to figure out who else was involved in their failure. That is the way that you can do the best job of defending your position. At least this is from the defense side, and honestly, the plaintiff’s side.  It is getting people to understand that. There is a mistake. There is what happened. Be good. Be reasonable. Be willing to talk. But if the starting point is the Titanic did not sink. You have problems. Look, the boat sank. Okay, we know it hit an iceberg. So now let’s just start realistically talking about what the result of that is. I think people oftentimes want to be so set on that win that we are going to get 100% verdict. Many times, they provide bad information and I see the same thing on the plaintiff’s side. It is overreaching in a case to try to get 27 subcontractors in the case and at the end of the day, you do not have anything on half of them except ill will coming back at you. To me, it is being reasonable.

Noah Bolmer: It is a keen observation and sage advice. Thank you, Craig, for joining me here.

Craig Schlumbohm: It was my pleasure. Thank you.

Noah Bolmer: And thank you to our listeners for joining us for another Discussions at the Round Table.

 

Craig Schlumbohm, President, Pacific Construction Analysts, Inc.

Craig Schlumbohm is the president of Pacific Construction Analysts, Inc., a full-service construction consulting firm specializing in post-mortem cost analysis of construction projects. He is a sought-after expert witness in the construction field with decades of experience. Mr. Schlumbohm holds a B.S. in Civil Engineering from San Diego State.