Article Date: 04/26/2013

Experts Discuss Implied Obligations in Design and Construction Contracts

By Steve Rizer


An “implied duty to provide access” for certain key personnel in a construction project may seem “pretty obvious,” but “you’d be surprised how many times we’ve seen cases” in which admittance became an issue, Bryan Jackson, a partner in the California law firm of Allen Matkins, told professionals attending a webinar that WPL Publishing held last week. He reported that his firm, whose “mainstay” focus is in real estate, has encountered multiple instances “where a party is under contract to build something, and they can’t get to the project because they have to cross over somebody else’s green acre, and they don’t have the right to cross that green acre to get to [the] black acre to do the work.”


Jackson also reported problems involving access in which “clients are buying a site and they don’t quite own it yet, and yet they’re trying to get that construction … started immediately upon closing, and yet the contractor … want[s] to do some testing [and] site review…. Do they have that kind of access to do [those activities] if the owner of the property hasn’t sold it yet to the one who’s going to be the eventual owner to build?”


For the webinar, Jackson and fellow Allen Matkins partner Robert “Mike” Cathcart presented a list of more than a dozen implied obligations in design and construction contracts.


“What we’ve done with these implied [obligations] is to pick out what we think are principles that apply in virtually every contractual situation, certainly on a construction project,” Cathcart said. “Many, if not all, of [the listed implied obligations can serve] as guidelines for how [parties can] cooperate and act together in a spirit of consensus and conciliation so that you can get a project done on time [and] on budget with the desired quality and without paying lawyers.”


In listing the components of an implied duty to provide access, Cathcart and Jackson stated that “the owner must allow the contractor sufficient access to the site to accomplish work for site investigation and inspection.” Another component calls for contractors to provide owners, architects, and project engineers access to preparatory work and work in progress “wherever located.”


Cathcart further advised webinar attendees that “if you’re involved as an owner or contractor in construction on a very crowded site or one that’s difficult to access, the contract should address that issue. Otherwise, the owner might be susceptible, ultimately, to a contractor claim for extras, either extension of time or money, because there was insufficient site access that required the contractor, for instance, to rent other space for mobilization.”


During the interactive webinar, Jackson and Cathcart discussed implied obligations involving good faith and fair dealing; sharing of material information; coordination; standard of care; workmanship; and other areas. The program’s target audience included contractors, subcontractors, consultants, construction managers, attorneys, architects, engineers, and public and private owners.


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