Differing site conditions, also commonly known as changed conditions or concealed conditions, occur when conditions at a construction site differ materially from those that existed at the time of contracting or as represented in the contract documents. Some of the more common types of claims involve subsurface conditions, such as unforeseen underground obstructions or unforeseen rock or water conditions.
Common Issues Encountered Relative to this Type of Claim
A variety of issues on a construction project could lead to a claim for differing site conditions. Therefore, it is important to first review the contract to ascertain if certain parties assumed the risk of differing site conditions. In addition, construction contracts may provide entitlement to an equitable adjustment for certain unforeseeable site conditions. Claims for differing site conditions typically consider the following:
- The condition existed prior to executing the contract.
- The condition is physical and is at the construction site.
- The condition differed materially from the conditions in the contract documents.
- The contractor’s interpretation of the contract documents was reasonable.
- The contractor relied upon the contract documents and the conditions encountered at the site were unforeseeable.
- The contract suffered damages due to the differing site conditions.
Typically, construction contract documents require contractors to inspect the project site prior to bidding to ensure an understanding of the existing site conditions. However, the site visit often occurs while the facility is operating; therefore, access for detailed measurements or inspections may not be permitted or possible for safety and security reasons. In such cases, the site visit is general in nature. Additionally, there are often conditions which cannot be determined by an initial site inspection, such as when the owner provides a geological/soil survey which turns out to be incorrect or a situation where there was no reasonable way for either party to know what hidden conditions existed.
Analyzing Differing Site Conditions Claims
Analyzing a differing site conditions claim typically involves reviewing the conditions as represented in the bid and contract documents and comparing them to conditions actually encountered at the site. In addition, a successful claim should consider the contract language regarding differing site conditions as well as the six (6) conditions listed above.
Belmont’s construction claims consultants provide the following services relative to differing site conditions:
- Site inspection and investigation
- Drawing and survey analysis
- Damage quantification
- Delay and disruption analysis