It is not unusual for project owners to furnish equipment or material for the contractor to use in a project. The motivation is usually financial. There is nothing improper about this practice so long as the use of the owner-furnished property is stipulated in the contract. However, if the equipment or material proves unsuitable for the project, the owner cannot hold the contractor responsible.
A federal appeals court addressed a situation in which an owner mandated the use of gravel stockpiled at the project site as the base for a paved parking lot. The owner designated a third-party materials testing company to evaluate the gravel. The company reported the gravel was suitable, and the contractor used the gravel. However, the pavement started to heave and crack as a result of inadequate drainage in the base, and the project owner sought to hold the contractor liable for breach of the contractual warranty.
The other case in this issue involves an equipment manufacturer that employed multiple licensed professional engineers at its production facility. A claimant alleged the manufacturer was practicing engineering.
