ACPA Quarter 1 2019

Concrete Pavement Progress www.acpa.org 26 A B O U T T H E L A W The following is a list of disclaimers we have seen routinely utilized in the contract documents to accomplish this: 1. “Subsurface conditions may vary which may not become evident until construction.” 2. “Subsurface conditions may vary from those shown on the logs.” 3. “Subsurface conditions identified in this report are based on infor- mation gained from a limited number of borings and may vary significantly between borings.” 4. “Because the soils are primarily alluvial, the material characteristics may vary significantly within a distance of only a few feet.” 5. “Additionally, unknown fill areas, that may be encountered while performing excavations, may create exceptions to the recommen- dations provided herein.” 6. The soils report “should be made available to the prospective contrac- tors for information on factual data only and not as a warranty of subsurface bid conditions.” 7. “ Any conclusions by a construction contractor or bidder relating to the construction means, methods, techniques, sequences, or costs based upon the information provided in this report are not the responsibility of the Engineer or Owner. B. Courts’ Refusal to Enforce Contract Disclaimers and the Basis for Such Refusal Many courts throughout the country have refused to enforce such contract provisions. Courts have reached this conclusion in consideration of three important policy considerations. 1) Soil borings provide the most reliable information on subsurface conditions. Boring logs are “considered the most reliable reflection of subsurface conditions.” United Contractors v. U.S., 368 F.2d 585, 597 (Ct. Cl. 1966). That is why “[p]articular protection is given by the courts to the right of bidders to rely upon drill hole data in the contract data.” Foster Const. C.A. & Williams Bros. Co. v. U.S., 435 F.2d 873, 888 (Ct. Cl. 1970). In determining what will probably be found beneath the surface of the area to be excavated the information available from the borings made in the same general area is to be considered . . . . In the absence of any persuasive contrary evidence we conclude that a reasonable bidder could infer from the pattern of the test holes that they were reasonably representative of the subsurface conditions throughout the construction site generally. Appeal of Alps Construction Corporation, 73-2 BCA ¶ 10309, ASBCA No. 16966, 1973 WL 1894. Moreover, “[e]xperience teaches that soil condi- tions within a reasonable area surrounding the bore are likely to possess characteristics substantially like the sample within the bore.” Mandel, Inc. v. U.S., 424 F.2d 1252, 1255 (8th Cir. 1970), citing, Morrison-Knudsen Co. v. U.S., 170 Ct. Cl. 712, 345 F.2d 535, 541 (1965). Further, it has been recognized that the purpose of the soils information is to assist the contractor in the preparation of an accurate bid: The information was given Appellant by the Government. It had a purpose—to aid the Appellant in formulating its offer. Appellant had a right to rely on such information. If the Government did not want the information to be used and relied upon then it should not have taken the borings, prepared boring logs and given them to the contractor for use as an aid in preparing its offer. Appeal of Jack Crawford Construction Corp., 75-2 BCA ¶ 11387, GSBCANos. 4090, 4089, 4120, 1975 WL 1414 (1975) (refusing to enforce disclaimers which stated that boring logs were “furnished for information only,” “not part of the contract,” and “accuracy is not guaranteed”). 2) Enforcement of site disclaimers would render differing site condition clauses meaningless. Courts have refused to enforce site data disclaimers because to do so “would render meaningless the language of sections like [the differing site conditions clause] and negate their salutary purpose.” Asphalt Roads & Materials Co., Inc. v. Virginia Department of Transportation, 257 Va. 452, 512 S.E.2d 804, 807 (1999). “The Government may not by means of a broad disclaimer leave without remedy an otherwise valid contractor grievance under the Differing Site Conditions clause.” Appeal of Jack Crawford Construction Corp., 75-2 BCA ¶ 11387, GSBCA Nos. 4090, 4089, 4120, 1975 WL 1414 (1975). 3) Differing site condition clauses protect owners as well as contractors. Protecting the right of contractors to rely upon soil borings, and to have protection under the differing site conditions clause, protects both the contractor and the owner financially. As explained in PT & L Const. v. Dept. of Transportation: The starting point of the policy expressed in the changed condi- tions clause is the great risk, for bidders on construction projects, of adverse subsurface conditions: “no one can ever know with certainty what will be found during subsurface operations.” Kai- ser Industries Corp. v. United States, 340 F.2d 322, 329 (Ct. Cl. 1965). Whenever dependable information on the subsurface is unavailable, bidders will make their own borings or, more likely, include in their bids a contingency element to cover the risk. Either alternative inflates the costs to the Government. The Government therefore often makes such borings and provides them for the use of the bidders, as part of a contract containing the standard changed conditions clause. Bidders are thereby given informa- tion on which they may rely in making their bids, and are at the same time promised an equitable adjustment under the changed conditions clause, if subsurface conditions turn out to be materially different than those indicated in the logs. The two elements work together; the presence of the changed conditions clause works to reassure the bidder that they may confidently rely on the logs and » continued from page 25 continues on page 28 »