CONSTRUCTION LAW
as well as to promptly notify the owner and architect of any errors
or inconsistencies in those documents. However, the “conditions
indicated in the contract” may be unclear, or there may be a conflict
between drawing sets or drawings and specifications. Most
contracts include an “order of precedence” clause that is intended
to resolve such conflicts. While such a clause can be helpful, the
ideal resolution of conflicts, if caught early on, is to submit a
request for information at the bid stage and seek written clarification
of the conflict from the owner. Depending on the jurisdiction,
a bidder that could reasonably discern a conflict, but fails to raise
it to the owner, may do so at its own peril.4
3. Do the contract documents make affirmative
representations about the condition that gives rise to
the claim?
In many cases, an experienced bidder may be able to infer or
closely approximate soil conditions, utility locations or excavation
needs based on limited statements made in the contract documents.
However, inferences and assumptions (even reasonable
assumptions) are not enough – only an affirmative representation
of underground conditions is sufficient to give rise to a subsequent
claim under the differing site conditions clause. As explained
by one court, “if a contract is silent as to the particular physical
conditions at the project site, there can be no…differing site condition
because no contract indications exist to compare actual
conditions.”5 In Manuel Bros. v. United States, the court rejected the
contractor’s claim for delay and lost productivity because pre-bid,
oral representation that soil conditions were “normal” were not an
affirmative representation that could justify a claim.6
4. What is the significance of the requirement to
conduct a pre-bid site visit?
Most solicitations include a mandatory requirement that offerors
conduct a pre-bid site investigation and attend at least one pre-bid
meeting with the designer. Whether or not they participate in prebid
activities, contractors are generally deemed to be on notice of
any conditions that a pre-bid site visit would have revealed if they
had attended. In one case, the court denied a small business contractor’s
claim for over $100,000 in extra sheet pile shoring costs
spent while installing an oil/water separator tank. Even though
the court found that the owner’s soil boring logs affirmatively represented
the soil conditions, the court denied recovery because
a “pre-bid site visit would have revealed geological features indicating
a likelihood of highly variable subsurface conditions, such
as the proximity of the construction site to the ocean and to the
nearby streams.”7 The lesson: always send a knowledgeable and
experienced representative to any pre-bid site visit, preferably
someone who is not afraid to ask questions and shift the burden
to the owner to clarify inconsistencies in the contract documents.
5. Owner disclaimers of information
in the contract documents
A great deal of litigation has stemmed from project owners and
designers attempting to deflect responsibility at the pre-bid phase
by, for example, couching drawings and specifications as “for information
purposes only.” Such language would, intuitively, defeat
the whole purpose of allowing the contractor to rely on the information
provided by the owner. Yet in several cases, courts have
denied claims under the differing site conditions clause on the
grounds that a “reasonable contractor” would not rely on drawings
that were clearly not intended to be a part of the “contract documents.”
8 Thus, contractors are well-advised to include clarifications
in any bid based on contract documents that include disclaimer
language, so as to preserve a potential claim down the road, in the
event that there are material differences between what is represented
by the owner and what actually lies beneath the surface. t
Anthony LaPlaca is an attorney with the Construction Litigation
and Government Contracts practice groups at Seyfarth Shaw LLP in
Washington, D.C. Any questions or comments regarding this article
may be directed to him at 202-828-5379 or alaplaca@seyfarth.com.
References
1. The Stuyvesant test comes from the 1987 decision of the U.S. Court
of Appeals for the Federal Circuit in Stuyvesant Dredging Co. v.
United States, 834 F.2d 1576 (Fed. Cir. 1987).
2. Stuyvesant, 834 F.2d at 1581; see also Trafalgar House Constr., Inc. v.
United States, 73 Fed. Cl. 675, 698 (2006); W.M Schultz Constr., Inc.
v. Vt. Agency of Trans., ___ A.3d___, 2018 WL 6427252 (Vt. 2018).
3. See Neal & Co. v. United States, 36 Fed. Cl. 600 (1996) (contractor
was required to factor geotechnical information into its pricing
where geotechnical reports were made available to it during
bid phase).
4. See id.; see also
5. Manuel Bros. v. United States, 55 Fed. Cl. 8, 43 (2002).
6. Id.
7. H.B. Mac, Inc. v. United States, 153 F.3d 1338, 1346 (Fed. Cir. 1998);
see Orlosky, Inc. v. United States, 64 Fed. Cl. 63 (2005) (electrical
contractor was not permitted to recover costs of installing polemounted
reclosers where contractor failed to attend pre-bid
meeting or ask for clarification from Navy contracting officer).
8. Old Veteran Constr., Inc. v. United States, 121 Fed. Cl. 346, 357
(2015) (plaintiff was not entitled to rely on report of geotechnical
investigation that was provided “only for information” and
which expressly noted seasonal changes to ground conditions
outside of summer months); P.J. Maffei Bldg. Wrecking Corp. v.
United States, 732 F.2d 913, 917 (Fed. Cir. 1984) (specifications
stated that drawings were “for information only” and that their
“quantity, quality, completeness, accuracy, and availability were
not guaranteed.”); but see Foster Constr. C. A. & Williams Bros.
Co. v. United States, 435 F.2d 873, 888 (Ct. Cl. 1970) (contractor
could maintain claim based on representations in drill hole data
logs, despite language purporting to disclaim responsibility by
the owner).
Certain repeat fact patterns
have cropped up in litigation
over the differing site
conditions clause. Good pile
drivers will be wary of these
pitfalls and take steps to
mitigate the relevant risks.
114 | ISSUE 1 2020 www.piledrivers.org
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