The line between a differing site condition claim and a defective specification claim is not always clear. It’s difficult to tell whether the problem is with the physical condition of the worksite or the methods the contract specifies for the site. Here, the protester alleged differing site conditions and defective specifications. The court, however, found that the defective specification claims were predicated on a differing site condition. The problem was not with the method specified by the contract but that the method failed due to the alleged differing site condition. The court found that the claims were all one claim for differing site conditions, which the court denied.
Nova Group/Tutor-Saliba v. United States, COFC Nos. 15-885C, 16-925C
Background
The Navy issued a solicitation seeking a contractor to design and build replacement structures on a pier in Washington state. The solicitation included a geotechnical engineering report, which assessed the soil conditions at the worksite. The report also made recommendations about the types of piles for the project and the depth to which those piles could be driven into the soil.
The Navy awarded the contract to Nova Group/Tutor-Saliba. Nova spent several months working on designs for the project, which the Navy approved. But when Nova began work, it experienced problems with the piles; it could not drive the piles as deep as expected. Nova had to use a crane to cut off the excess pile length sticking up out of the ground.
In addition to pile depth, the Navy’s construction consultant questioned the stability of two of the piles Nova installed. Nova stopped working on critical construction activities and, through its subcontractor, engaged a company to perform an independent review of the piles. Ultimately, the Navy directed Noval to redesign the pier substructure.
Nova submitted requests for equitable adjustment seeking costs incurred in having to drive the piles in differing soil conditions and for the work stoppage to address the pile stability issue. The Navy issued a final decision denying the REAs. Nova filed suit with Court of Federal Claims
Legal Analysis
Differing Site Condition
- No Type 1 Differing Condition – Type I differing site conditions are subsurfaces of latent physical conditions at the site that differ materially from those indicated in the contract. Nova alleged that it encountered undisclosed obstructions in the soil that resulted in excessive pile cutoff. The court rejected Nova’s claim. The geotechnical report included with the solicitation had indicated uncertain soil conditions, and that some of the soil deposits were very dense, which would make pile driving difficult.
- No Type II Differing Site Condition – A type II differing site condition occurs when there is an unknown condition at the site of an unusual nature. A type II condition is more difficult to prove than a type I condition. The court found that Nova had not established a type II condition. Encounting boulders or dense soil conditions was not unusual for the area and should’ve been anticipated.
Defective Specifications
As an alternative argument, Nova claimed that the contract contained defective specifications as to the site conditions encountered and the method by which piles could be installed. The court, however, found that the defective specifications were merely a recasting of the differing site condition claims. Although defective specifications and differing site conditions are distinct in theory, they collapse into a single claim when the claims are intertwined. Here, the court determined that the specifications and conditions claims were intertwined. The alleged defective specifications were only defective due to the purported differing site conditions. In other words, the predicate for each defective specification was that the soil was not as expected. The court denied the defective specification clam as redundant of the differing site condition claims.
Constructive Change
Nova sought compensation for a constructive change, alleging that it had performed work beyond the contract when the Navy required it to redesign to address the stability of the stability of the piles. The court agreed with Nova. The Navy had approved Nova’s designs and then told Nova to redesign the piles. Nova was entitled to compensation for the change, including the costs of accelerated work and of idle equipment stemming from the delay.
Nova is represented by Gerald Scott Walters, Brain S. Wood, and Sarah K. Carpenter of Smith Currie & Hancock, LLP. The government is represented by Joseph H. Hunt, Robert E. Kirschman, Jr, Steven J. Gillingham, Adam E. Lyons, Melissa L. Baker, Andrew J. Hunter, and Kristin B. McGroryh of the Department of Justice as well as by David M. Marquez of the Navy.
