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December 23, 2008

Failure To Inspect Project Site Precludes Claim For Additional Costs

Rapid Demolition Company, Inc. v. State of New York, 856 N.Y.S.2d 921 (App. Div. 2nd Dep't, September 23, 2008)

This case addresses claims made by public contractors for additional costs arising from differing site conditions. The demolition contractor sought to recover costs for extra work because the concrete deck overlay on a particular bridge was significantly thicker than was represented in the bid documents.

The contract stated that the contractor relied on information secured by personal investigation and research, and not from the estimates or records of the public owner; and that the contractor would not make any claim against the State based on the estimates, tests, or other representations by any officer or agent of the State, except as contained in the contract specifications.

The demolition contractor admitted it had failed to investigate the thickness of the concrete deck overlay prior to signing the contract. At trial, evidence was presented that simple visual inspection would have revealed the true thickness of the deck.

Not surprisingly, the demolition contractor's claim for allegedly unanticipated costs related to the deck thickness was denied. The court did mention, however, that a showing of fraud or misrepresentation as to existing conditions could be enough to overcome a contractor's reliance upon its own inspection.

Comment

This case does not represent a new development in the law, but rather highlights the importance of exercising proper diligence when bidding on projects, whether public or private. All standard contract forms impose an obligation to perform pre-construction inspections of the project site. Contractors who enter into those contracts having failed to inspect do so at their own peril, and will face a difficult challenge explaining why their failure should entitle them to additional costs.

If you require further information regarding the information presented in this Legal Alert and its impact on your organization, please contact any of the members of the Practice Area.

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