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Close-Up: Jeff Powell

Former general contractor gives up office to consult on defect litigation

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Despite working from his Del Cerro home, having only four employees and conducting a majority of business electronically, Jeffrey Powell serves an important behind-the-scenes role in the California construction industry.

As owner of San Diego-based Powell Construction and Real Estate Consultants, Powell acts as an expert witness in construction-defect litigation cases and as a consultant for banks involved in construction lending.

The ability to serve in both of these roles rests on his previous construction experience as a craftsman and general contractor.

Jeffrey Powell

"I know how to physically build a house. I've done every component," said Powell, who ran his own general contracting company locally for 12 years before selling it in 1990 to concentrate exclusively on consulting while working from home.

"I liked the idea of not having the large office and all the employees and headaches that go with it," Powell said. "It's something where people don't really think where I'm located. Our work is in the field and everything is transmitted electronically."

Early on, the company's source of business came primarily from inspecting construction sites for banks, typically conducting 200 inspections a month throughout the state.

Currently, Powell has three inspectors in the field who are on the road daily traveling to different building sites.

An inspector's duties for the banking industry include: assessing the conditions of a building to determine what deferred maintenance costs exist, and verifying the completion of a project when a request for payment by a contractor occurs.

"That's a big part of our business right now," despite the recent slowdown in the building economy, he said.

Because the company is commonly paid $200 per inspection, Powell said it's all about finding banks that have a large portfolio of projects -- at least 20 -- in one city or area and inspecting them in several days.

As with any construction-focused company, retaining clients is the key to maintaining a constant workload. Past or current clients of Powell include Commercial Capital Bank, First National Bank, Dixieline Fund Control, Liberty Mutual Insurance and Citizens Business Bank, according to The Daily Transcript's 2007 Sourcebook.

As the cost of construction has increased over the past several years, banks are also looking to Powell for project budget analysis. Prior to approval of a construction loan, banks request that Powell examine a project's plans and costs to determine if the loan is large enough to cover the project's budget.

While consulting still represents a significant chunk of the company's business, since 1996 Powell has focused on serving as an expert witness in construction-defect cases where injuries to persons or flaws in a building occur.

The majority of defect cases stem from mistakes in the building process of master-planned communities that result in water intrusion and mold.

In legal cases Powell is also responsible for cost estimating, which involves testifying about what the cost of repairs stemming from a defect should be.

Typically he serves as a witness for contractors, and the lawyers and insurance companies that represent them. Unlike consulting, this work can't be delegated to one of his inspectors.

"Attorneys want to hire somebody's that's already experienced," according to Powell, who said the pool of defect litigation experts locally is small.

Powell constantly remains updated on construction trade issues, building trends and construction costs through various databases and publications. The other half of his business, consulting for banks, also aids his expert witness status, as talking with his inspectors and personally inspecting sites keeps him keen to what is actually occurring in the field.

"It would be hard to be an expert witness if you haven't gone out on the construction site and continue to do so," he said.

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