Opinion ID: 2549816
Heading Depth: 1
Heading Rank: 12

Heading: risk of mislocated utilities

Text: The county argues that MMJ assumed all risk of delay and other potential problems due to utilities at the site. MMJ claims the county breached its implied warranty to furnish the contractor with accurate plans, and the delay was thus owner-caused. As [b]etween the owner and the contractor, the owner is responsible for the design and any losses due to defects in design. This responsibility is often stated in terms of the owner's implied warranty of the adequacy of the plans and specifications. Bramble & Callahan, supra, § 3.02(D). There is evidence submitted by MMJ that plans associated with change order number three were inaccurate. According to its standard practice, prior to soliciting bids from contractors, the county requested input from all utility companies regarding the presence of equipment within the boundaries of the Apple Valley and Wolfland projects. MMJ provided evidence through the affidavit of an expert witness in construction management that the standard in the trade is that the owner is responsible for confirming the location of utilities. However, the county failed to solicit input from utility companies after it expanded the scope of the project. The change order was presented to MMJ on June 4, 1998 and MMJ was required to start work immediately, prior to approval by the utility director. The drawings the county provided to MMJ indicating utility line placement were in error. MMJ contends, and the evidence suggests, that the error was the result of the county failing to follow its standard procedures and failing to fulfill its duty to provide adequate plans. MMJ was entitled to rely on the standard practice of the county to involve utilities in the design process. This is an unresolved factual issue that is material to the outcome of the case. The county says it disclaimed the implied warranty in its contract document. Standard specification 1-07.17 allocates to the contractor all costs associated with relocation of utilities. Therefore, according to the county, MMJ's reliance on the contract plans and specifications was unreasonable. Whether the reliance was reasonable is a question of fact, making summary judgment inappropriate in this case. This is not a novel question of law. For example, in Clevco, Inc. v. Mun. of Metro. Seattle, 59 Wash.App. 536, 799 P.2d 1183 (1990), Clevco won a bid to install sewers in east King County. The contracts purported to allocate all risk of underground utilities to Clevco, the contractor. Like the case at bar, Metro failed to indicate utilities on its plans and Clevco submitted a bill for additional compensation. Metro moved for summary judgment, arguing the contract clearly placed the risk of utilities on the contractor. The appellate court disagreed stating the general rule is that the contractor's recovery is determined by the question of whether the contractor's reliance on contractual representations was reasonable. Id. at 543, 799 P.2d 1183 (emphasis added). Where the plans or specifications lead a public contractor reasonably to believe that conditions represented on the plans do exist and may be relied upon, he is entitled to compensation for extra expense incurred as a result of the inaccuracy of those representations. Id. at 542, 799 P.2d 1183 (citing Dravo Corp. v. Mun. of Metro. Seattle, 79 Wash.2d 214, 484 P.2d 399 (1971)); see also Scoccolo Constr., Inc. v. City of Renton, 102 Wash.App. 611, 9 P.3d 886 (2000) (contract language stating contractor bears risk of delays due to utilities does not necessarily preclude contractor's recovery but what parties intended contract language to mean is a factual issue which prevents summary judgment).