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ConstructionPro Week, Volume: 4 - Issue: 38 - 10/02/2015

Does the Owner Warrant the Design on Non-Traditional Projects?

By Bruce Jervis

 

As new methods of procuring construction services have evolved in recent decades, the public bidding statutes have been slow to keep up. Now, however, most state procurement laws have been amended to accommodate multiple prime contracts, design/build agreements, construction manager at risk, and other non-traditional contracting arrangements. But the judicial case law interpreting public construction contracts was developed in the context of the traditional design-bid-build model.

 

The Massachusetts Supreme Court was recently presented with a novel question: Does a public owner on a “construction manager at risk” (CMAR) project warrant the accuracy and sufficiency of the plans and specifications? On a traditional project, the answer is clearly in the affirmative. But on a CMAR project, the contractor has participated in the final stages of the design.

 

The court ruled that there is an implied warranty of the design documents. But the scope of that warranty is narrower than on a traditional project, reflecting the participation of the CMAR in the design process. The CMAR has the burden of showing that its reliance on the allegedly defective documents was reasonable in light of its prior participation.

 

Have you seen other situations where the traditional “rules” and “practices” don’t fit non-traditional construction procurement methods? Your comments are welcomed.

 

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