LEGALLY SPEAKING Type 2 Differing Site Conditions A n i s sue cent ral to any project incorporating deep foundations is how to address the risks of unanticipated subsurface materials and conditions. To avoid bids inf lated by contractor contingencies for these risks, most construction contracts for public projects, and many contracts on private projects, include what is commonly referred to as a “differing site condition” or “changed conditions” clause. While the precise language of differing site conditions clauses vary by version, common to most is an adjustment to the contract for: (1) subsurface or concealed conditions that differ materially from those indicated in contract documents (Type 1); and (2) unknown physical conditions of an unusual nature that differ materially from those ordinarily found to exist and generally recognized as inherent in the work (Type 2). The vast majority of differing site condition claims are based upon the discovery of Type 1 differing site condi- tions. That is, a contractor or subcontractor contends that what it discovered differs from what was indicated in the geotechnical information (borings, generalized profiles, narrative descriptions, etc.) furnished by the project owner. In many instances, however, the nature of the work does not readily allow for the exposure or examination of subsurface materials to prove that they differ from those previously indicated. Even if the materials can be exposed, sampling may miss a localized condition or disturb the materials to the point of misrepresenting their in-situ condition. In these situations, a contractor may be able to show that the conditions are unusual and differ from those ordinarily encountered; that is, a Type 2 differing site condition. For a deep foundations contractor, this might include claims that rock is unexpectedly pinnacled, groundwater inflow is excessive, cohesive soils ravel or rock is unusually karstic. A contractor seeking to establish a Type 2 differing site condition, however, faces a high burden of proof. Generally, the contractor must prove that (1) it did not know about the condition; (2) it could not have anticipated the condition from inspection or general experience; and (3) the condition varies from the norm in similar contracting work. In Skanska USA Building, Inc. v. U.S., 2013 WL 1179528 (Fed. Cl. March 21, 2013), the contractor successfully met this burden by showing that (1) the contract documents did not disclose, and a site inspection did not reveal, lead in the soil, and that none of the contractor’s personnel knew about the condition prior to bid; (2) an estimator from a local contractor with 41 years of experience in the area found lead contamina- tion to be unusual; and (3) the requirements and costs of disposal of contaminated soils are materially greater and different than the dis- posal of “clean” soils. Anothe r way to establish a Type 2 differing site condition is to prove that anticipated materials behaved or reacted in an unanticipated way. A good example of this approach is Paccon, Inc., ASBCA No. 7643, B.C.A. ¶ 3546 (1962). There, the Armed Services Board of Contract Appeals distinguished between subsurface “materials” and subsurface “conditions,” pointing out that, while the presence of a certain material (clay) had been indicated and expected, “there is no evidence that it had ever previously caused the difficulties which [contractor] encountered” Brian Wood Attorney Of Counsel Smith, Currie and Hancock (clay unable to hold a cut). Likewise, in Servidone Constr. Corp. v. U.S., 19 Cl. Ct. 346 (1990), a contractor proved a Type 2 condition by showing that clays indicated in the contract documents, and which the contractor understood to have high liquid limits, behaved in a much tougher/harder way than a reasonable contractor could have expected. A recent case, however, has made clear “Establishing ‘unknown’ and ‘unusual’ subsurface conditions is difficult, but possible.” that merely showing the inconsistency in the behavior of subsurface materials is not sufficient to prove a Type 2 differing site condition. In R. Pittman Construction, ASBCA No. 57387, 15-1 BCA ¶ 35881, the contractor claimed a Type 2 differing site condition when many temporary sheet piles it installed could not be removed using conven- tional means (vibratory hammer). The contrac- tor argued that, because all variables remained constant in the equipment, materials, and methods used to drive and extract the sheet piles, but the piles could not be removed in some locations, there must be a differing subsurface condition. The board rejected this argument as circular, noting that the contractor did not provide sufficient evidence to prove that subsurface conditions were unusual. The takeaway: damages for Type 2 differing site conditions can be recovered, but the argument needs to be crafted and supported carefully. DEEP FOUNDATIONS • MAR/APR 2016 • 107
