A case in Massachusetts concerned a flawed design from the DOT

Oct. 6, 2020

This column published as "Finger-pointing" in October 2020 issue

Although traditional design-bid-build (DBB) is still used more often in the public sector, the number of public entities using design-build (DB) has doubled over the last decade.

Historically, public entities have spent most of their DB dollars on education and transportation projects. Since 2012, DB education spending has remained relatively steady, while DB transportation spending has increased, according to the Design-Build Institute of America. 

From my unscientific perspective, it seems disputes arise just as often in DB projects as they do in DBB projects, and DB transportation projects include more disputes than education projects. Such disputes are typically related to the design, not the construction, and can be sourced either: (1) between the owner and design-builder over changes due to an inadequate or unadvanced conceptual design provided with the RFP, or (2) within the DB team itself pointing fingers at each other. (I wonder to what extent the owner’s absence in the second scenario affects the novelty and intensity of the disputes, but that is for another article.)

The second scenario arose over the construction of the Kenneth F. Burns Memorial Bridge over Lake Quinsigamond in Massachusetts. The project included the replacement of an existing bridge and all approach structures. Construction began in 2012 and was completed ahead of schedule in 2015 for nearly 10% less than the Massachusetts DOT’s (MDOT) own estimate, even after $18 million of changes above the initial $90 million contract award.

The DB marriage was planned in two, traditional phases. First, under a Teaming Agreement, the partners agreed to each do their part to prepare the bid package. For a maximum fee of $300,000, the designer advanced MDOT’s conceptual design by providing “professional services required for additional preliminary design sufficient to enable [builder] to prepare the overall Project and construction cost estimates.” The second phase of the marriage was performed under a separate $8.9 million subcontract, breaches of which were not at issue in the bench trial of this matter.

The opinion of the Massachusetts Superior Court carefully lays out a very detailed story of how and when the designer and builder interacted under the Teaming Agreement from RFP issuance through bid submission and soon after contract award. The following summary of events should suffice:

During preparation of the preliminary design, the designer determined MDOT’s concept was unworkable without significant changes (i.e., the conceptual steel arches were too flat and could not provide adequate structural support without additional drag brackets). The designer did not inform the builder of this problem. The builder directed the designer to cease its work on the preliminary design, and the designer transmitted the pre-final preliminary design (without fixing the problem) to the builder.

Subsequently, one of MDOT’s bid addenda significantly increased the bridge loads. To address the bid addendum, the designer changed the preliminary design and, at the same time, incorporated a solution to fix MDOT’s unworkable concept. The designer transmitted the final preliminary design to the builder, but the designer did not advise the builder of the changes to fix the concept. The bid package included the final preliminary design, which fixed the conceptual design. Only after award did the builder learn of the differences between the pre-final and final preliminary designs. Despite this knowledge, the builder provided the pre-final preliminary design to the steel subcontractor for pricing. (Remember that the pre-final preliminary design did not include the additional steel to accommodate the increased loads, nor did it include the additional drag brackets.) When the steel quantity increased to meet the final design, the builder blamed the designer.

In the case of Middlesex Corporation, Inc. v. Fay, Spofford & Thorndike, Inc., Mass. Sup. Ct., No. 2015-02592 (June 28, 2019), the court held the designer was not liable for the costs of the additional steel to address the bid addendum. However, the designer breached its standard of care by not informing the builder of the changes to fix MDOT’s unworkable concept. Nevertheless, the builder did not prove it was damaged, because the builder carried $20 million in its cost estimate for steel but spent only $19 million. Curiously, the court focused more on the builder’s cost estimate than the fact that the builder provided the pre-final preliminary design to the steel sub, when the builder knew the final preliminary design included more steel. 

About The Author: Straw is a partner with Kraftson Caudle, PLC, a law firm in McLean, Va., specializing in heavy-highway and transportation construction. Straw can be contacted via e-mail at [email protected].

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