Case Study:
Dimwit has refused to issue Change Orders for other work, claimed to be “extra” by Wackinsmack. Included in the pile of refused change orders, are two “Field Directives” issued by Dimwit’s Engineer (Ithinkican Engineering Consultants, Inc.) which the Owner feels are not changes; a claim for Differing Site Conditions, which Dimit says Wackinsmack should have known about; and, the discovery of hazardous “contamination” in the excess excavated soil materials which had to be trucked off the site and disposed of (which Dimwit feels is Wackinsmack’s contractual responsibility).
The accumulation of changes, including those for which Dimwit has not agreed, has resulted in delays to the project. Wackinsmack failed to achieve Substantial Completion of the work by the Contract End Date (as adjusted by approved change orders). As a result Dimwit has assessed liquidated damages against Wackinsmack for late completion. Wackinsmack has, in turn, assessed Acme for 56% of the liquidated damages based on Acme’s proportionate share of the prime contract price.
One of the disputed Work Orders involves the direction by Ithinkican to relocate some of the process piping (work performed by Acme) to avoid conflicts with other aspects of the design. Ithinkican has advised Dimwit that this work was part of the contractor’s “methods and means” responsibility and is not an extra. Acme performed the work and claims $350,000 in extra costs.
The DSC condition involved conflicts with existing underground utility lines (sanitary and storm sewer lines, and the main power feeds to the site, provided by Detroit Edison) which were not shown in their actual locations on the contract drawings. In the case of the Edison lines, they weren’t shown at all on the contract documents. Ithinkican and Dimwit defends against the claim by arguing that Wackinsmack failed in its duty to visit and inspect the site prior to the bid, and if there were irregularities in the drawings then Wackinsmack should have notified the Engineer and Owner of the problems.
As to the hazardous materials contaminating the site soils (the contamination was not disclosed by the contract documents) Ithinkican and Dimwit defend on the basis that ownership of excess materials on the site “is the contractor’s” and that the contractor is obligated remove and dispose of the excess material in a legal manner. Accordingly, Dimwit has refused to issue a change order for disposal of the contaminated soils because Wackinsmack is obligated to remove and dispose of it in a legal manner. Thus, Wackinsmack should have made provisions in its bid price to dispose of the hazardous materials at a Class II landfill as part of its bid. It is noted that the contamination was caused by Dimwit’s disposal, on site, of contaminated ash from the incinerator before construction started. It is further noted that the incinerated ash looks like fine grained brown sand and was intermixed with existing “clean” site soils.
Q1. As to the Differing Site Conditions presented regarding the utilities at the site which were shown in the wrong locations,
a. Does Wackinsmack’s claim fail if it hit and broke the utilities while excavating, and before notifying Dimwit of the condition? Why or why not?
b. Does Wackinsmack’s claim fail if it provided notice to Ithinkican’s inspector (instead of Dimwit) who was inspecting from the side of the trench and witnessed the excavator breaking the sewer lines? Why or not?
c. Does Wackinsmack’s claim fail if manholes, indicating the presence of the sewers, were observable during the mandatory pre-bid site inspection which was attended by Wackinsmack. Why or why not?
d. Does Wackinsmack’s claim fail if, during the subsequent litigation, a note was discovered in Wackinsmack’s bid preparation file that said: “site utilities – correctly shown on dwgs?”
e. If Ithinkican’s inspector directed Wackinsmack to repair the damaged sewer lines and to construct “protection” over them by encasing the sewers at the point of conflict with concrete, is Wackinsmack entitled to the costs for the work? Why or why not?
f. If Wackinsmack was driving piling in the locations shown on the drawings, as opposed to excavating, at the time the sewers were hit and damaged, does this change any of your answers to the Questions a – d, above? Why or why not?
Q2. As to the Detroit Edison lines which were not shown on the contract drawings
a. If Wackinsmack called for a MISSDIG utility location prior to commencing excavation, and the Edison facilities were flagged by the locator, does Wackinsmack’s claim fail if it did not provide notice to Dimwit prior to starting excavation in the area of the Edison facilities? Why or why not?
b. If Ithinkican made inquiry of Detroit Edison during the design phase of the project, and Edison provided Ithinkican with copies of drawings showing Edison’s facilities at the project site, does this enhance Wackinsmack’s claim? Why or why not?
c. If it turns out that the Edison facilities didn’t actually “conflict” with Wackinsmack’s excavation activities, but ran parallel to and close enough to the excavation, where they had to be continually located and in some instances, supported, would Wackinsmack be entitled to a cost or time adjustment? If so, under what circumstances?
d. If the reason that the Edison facilities had to be “supported” during excavation was because the trench was wet and the sides were “caving” does that change your answer to Question 2.c? Why or why not?
Your answer must be typed, double-spaced, Times New Roman font (size 12), one-inch margins on all sides, APA format and also include references.