Public project owners have the authority—and the obligation—to define the project they want constructed. Construction companies bidding on these contracts are dependent on the documentation provided by the owners. A great deal of capital is at stake. It was therefore disappointing when a Minnesota appeals court read a geotechnical report out of the contract, essentially absolving the project owner of responsibility for the information it had provided.
The contract itself listed the “Contract Documents,” including the Bid Packet. Attached to the Bid Packet was a 283-page geotechnical report. However, the construction contract did not expressly identify the attachments to the stipulated documents as “Contract Documents.” As a result, the court said the project owner was not bound by the report. The contractor, having experienced a costly differing site condition, was left with no recourse.
The second case in this issue involves a recently completed apartment complex with water intrusion problems. Engineering reports placed some of the responsibility with the structural engineer, a subcontractor to the design architect. The engineer, however, argued it had no contract with the property owner. A Georgia appellate court said the engineer had extra-contractual duties that extended to third parties. Responsibility was not limited to contractual obligations to the architect.
The third case addresses the scope of a bilateral contract modification. While the change order granted additional time for the performance of extra work, it did not waive the contractor’s right to an extension for the government’s administrative delay in issuing the modification.
