The risk of differing site conditions is, arguably, the single most impactful risk which must be allocated on subsurface construction projects. To accomplish this, contracts often include a series of terms which effect the transfer or sharing of risk amongst the parties. On tunnels, and increasingly on other horizontal construction projects, Geotechnical Baseline Reports (GBR) plays a critical role. A GBR, ideally, sets forth the expected subsurface conditions. To be effective, it should aim to identify a range of objective, measurable conditions the contractor is assumed to have accounted for in its construction plan and price. The intent is that if the contractor encounters conditions which deviate outside of the range identified in the GBR, the contractor receives an adjustment in the contract price or time. The underlying goal is to ensure that the contractor enters into the contract with a set of assumptions to prevent, for example, the contractor from including large contingencies to cover conditions which the parties never expect the contractor to encounter. Such contingencies simply drive up the cost without providing any value to the owner.
In the real world, it's never that simple. Often GBRs fail to account for conditions, do not include measurable conditions, or are laced with exculpatory language which purports to undermine the purpose of the document. Sometimes, this is a result of inexperienced drafters, layers of bureaucracy, or simple incompetence. Other times, the facts are simply that subsurface conditions are by their very nature sometimes unknowable until encountered during construction. And sometimes, a poorly-written GBR is a result of good intentions gone bad—for example, the inclusion of vague conditions to cover rare and unexpected conditions.
The use of a GBR does not negate a differing site condition claim. In fact, increasingly GBRs are critical components of differing site condition claims. Unfortunately, many differing site condition claims on projects with GBRs are not publicly known because of private dispute resolution procedures often required on large underground construction projects. This limitation makes it difficult to predict outcomes because those prior claims cannot be presented to a future judge, arbitrator, or dispute resolution board as authority for how the case should be decided.
This webinar by our expert speaker, Zach Jones, addresses how contractors, engineers, and owners on projects with a GBR should determine if a differing site condition claim exists, if the claim is valid, and how it should be handled.
Who should attend?
Contractor, Engineers, Owners, CEOs, Business Unit Managers, Project Managers, Engineers, Superintendents, Estimators, Business Development Professionals, CFOs, Controllers, and Consultants who work with Contractors and Manufacturers
Zach Jones is a construction attorney in Louisville, Kentucky, with the firm of Stites & Harbison who represents contractors across the country and around the world. Prior to becoming an attorney, Zach was a project engineer and estimator for W.L. Hailey & Company (now Layne, ENR Top 400 #53). Havin... More info