WWW.ACPA.ORG 19 FALL // 2022 continues on page 20 » NEARLY EVERY PUBLIC CONSTRUCTION PROJECT has a differing site condition clause. The purpose is two-fold: to allow contractors the confidence to submit accurate bids and allow government owners to benefit from not having large contingencies unnecessarily inflating costs. This principle has been expressed around the country in various ways, but we think it is nicely summed up in PT & L Const. v. Dept. of Transportation: The purpose of the changed conditions clause is thus to take at least some of the gamble on subsurface conditions out of bidding. Bidders need not weigh the cost and ease of making their own borings against the risk of encountering an adverse subsurface, and they need not consider how large a contingency should be added to the bid to cover the risk. The Government benefits from more accurate bidding, without inflation for risks which may not eventuate. 108 N.J. 539, 531 A.2d 1330 (1987), quoting Foster Constr. C.A. & Williams Bros. Co. v. U.S., 193 Ct. Cl. 587, 435 F.2d 873, 887 (1970). Nearly all contractors approach the DSC by looking to the borings or other geotechnical data included with the bid documents. For example, the borings may indicate some gravel and maybe cobbles, but when the contractor begins excavation work in an area they discover a boulder field. This is known as a “Type I” DSC, or a condition that is differing materially from the conditions “indicated” in the project documents (including the geotechnical information, plans, specs., etc.). But what happens when the borings don’t necessarily contradict the materials encountered, or there are not any borings to begin with? This is where the “other DSC” comes into play. A “Type II” DSC is an “unknown physical condition of an unusual nature, differing materially from those ordinarily encountered and generally recognized as inherent in the work provided for in the contract.” 48 CFR 52.236-2. Unfortunately, many contractors either forget or do not understand that they have rights beyond the “typical” Type I DSC claim. Furthermore, The Other Differing Site Condition By Thomas R. Olson & Rielly J. Lund when contractors do submit a Type II DSC claim, they are often denied by the project engineer because “the contract documents do not contradict the on-site materials.” Or, as nearly every DSC denial states, the engineer believes “the contractor should have anticipated” the material despite zero actual evidence in the contract. (A personal favorite was an engineer pointing to the IDOT Standard Specifications, which contained a standard rock excavation clause for why the contractor should have anticipated potential rock excavation.) Fortunately, contractors do not need to plan for the worst in order to “reasonably anticipate” what the conditions will be on-site. One area where we have been successful with this in the past, is when the soil classifications are the same as indicated in the contract documents, but they react in an unanticipated manner. For example, let’s say on a road you need to excavate a portion beyond the existing roadbed, for whatever reason. There are soil borings provided, that indicate clays and gravel, and also the “N” values, plasticity, water content, etc. Now you get out there and find that the excavation is much more difficult than anticipated. In fact, the soils are so hard that it is taking nearly twice as long to excavate before you are able to move the project along. This is a prime example of when a Type II DSC could be applicable. It has long been held that a Type II DSC exists when an anticipated soil reacts in an unanticipated manner. “[T]he proof in this case is that the material encountered did not react as anticipated.” Appeal of T & B Builders, Inc., ENG BCA No. 3664, 77-2 BCA ¶ 12663 at 6 (emphasis added). See also Appeal of Ballenger Corp., DOTCAB No. 7432, 84-1 BCA ¶ 16973 at 44 (“reaction of the soil to the excessively moist environment was both unusual, unknown and materially different from what either party expected”). One case that goes into substantial detail regarding this is Servidone Const. Corp. v. U.S., 19 Cl. Ct. 346 (Ct. Cl. 1990): There are certainly no affirmative indicators that the soil would not be tough, and the court declines to hold that the absence of an indication of toughness is an implied assurance that the soil was not tough. Servidone is essentially asking the court to compare the actual conditions to what they argue were the normal or average conditions typically encountered in similar projects. Such a comparison, however, is more appropriately advanced in a Type II, rather than a Type I analysis. [360] ■ ■ ■ Servidone alleges that the fill materials at the Joe Pool Lake site were of a highly unusual character; that they were extremely tough in a way that Servidone could not have anticipated; and that this toughness added dramatically to the cost of completion. It also asserts that part of the cause of the toughness of the soils is that they contain poorly crystallized or non-crystalline montmorillonite and calcium carbonate, which, when wet, form a highly unusual inorganic jelly-like substance. [360] Numerous Board1 decisions also support the above proposition. See, e.g., Appeal of MC Co., ASBCA No. 21403, 78-2 BCA ¶ 13,313 (June 21, 1978) (Water could have been anticipated in the project and contract documents, but not to the extent that it came in and caused such issues: sloppy, soupy, could not place pipe or machinery on without sinking, had to change means and method); In Re Appeal of Fed. Ins. Co.¸IBCA No. 3236, 96-2 BCA (CCH) ¶ 28415 (July 2, 1996) (Although conditions may have been anticipated to a degree, this will not preclude recovery when actual conditions were in a higher proportion than anticipated. A reasonable contractor is not held to knowledge that a geologist may have, and uncharacteristic hardness warranted a Type II DSC); Appeal of Paccon, Inc., ASBCA No. 7643, 1962 BCA (CCH) ¶ 3546 (Oct. 17, 1962) (Although the type of material—Shimajuri clay—was known to be in the area, the condition and reaction of this particular clay was not); Appeal of Warren Painting Co., Inc., ASBCA No. 18456, 74-2BCA (CCH) ¶ 10834 (Sept. 13, 1974) (Although contractor was experienced in L E G A L M A T T E R S
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