Differing Site Conditions – Who Really Owns The Risk?

Schedule Wednesday, May 19, 2021 || 10:00 AM PDT | 01:00 PM EDT
Duration 90 Mins
Level Basic & Intermediate & Advanced
Webinar ID IQW21E0529

  • This webinar discusses the definition of a differing site condition and why there is a need for a Differing Site Conditions clause in a construction contract
  • The webinar sets forth the history and purpose of the clause and examines the modern Differing Site Conditions clauses
  • Discussion of the terms “indications” and “material difference” as well as an overview of the impact of contract disclaimers related to differing site conditions are covered  
  • The webinar explores what conditions are generally not covered by the clause and conditions that are sometimes included within the scope of the clause  
  • This webinar goes on to list the six-part test for a successful differing site condition claim and five additional contractual requirements contractors must comply with in order to prevail.  The contractor’s duty to continue work is also examined
  • A brief discussion of the “reverse differing site condition claim” – an owner claim that may be asserted against the contractor seeking recovery of funds from the contractor when they encounter conditions “materially better than anticipated”
  • An alternative use for the Differing Site Condition clause is also presented
  • The webinar explores several Court and Board of Contract Appeal decisions which appear to be slowly eroding the traditional risk allocation commonly accepted under the Differing Site Conditions clause, along with lessons learned from each case
  • Finally, this webinar provides a list of practical recommendations for both owners and contractors dealing with the risks of differing site conditions

Overview of the webinar

The Differing Site Conditions clause is one of the oldest clauses used in construction contracts, having been created by the U.S. federal government in 1926. It is generally accepted that the object of the clause is to transfer the risk of latent site conditions to the owner, thus enticing contractors to reduce their contingency cost at the time of the bid. The promise of the clause is that if the contractor encounters a “materially different” condition during the execution of the work, the owner will compensate the contractor for the resulting cost and/or time.For more than 90 years this standard clause has been used widely in both public and private contracts.Most practitioners in the construction industry think they know what the clause means and how it operates.But, in the words of one of the mid-20th century “deans” of construction law, Max E. Greenberg, “It ain’t necessarily so!”Over the years, the Courts and Boards of Contract Appeals have been slowly changing the interpretation of risk allocation under the clause.A series of Court and Board cases have increased the contractor’s risk concerning differing site conditions.This webinar will explore the changes in risk allocation.

Who should attend?

  • Owner & Contractor Project Managers
  • Resident Engineers & Architects
  • Agency Construction Managers
  • Construction Managers@Risk
  • Design Managers
  • Legal Counsel representing project participants

Why should you attend?

  • Learn about the intent of the Differing Site Conditions clause and how it operates
  • Learn what conditions are and are not covered by the Differing Site Conditions clause
  • Understand what must be demonstrated to prevail on a differing site condition claim and what contractual requirements must be complied with in full
  • Become familiar with several Court and Board of Contract Appeal decisions that are changing the “traditional” allocation of risk under the Differing Site Conditions clause

Faculty - Mr.James G. Zack

Jim is the Senior Advisor, Ankura Construction Forum™. The Forum strives to be the construction industry’s resource for thought leadership and best practices on avoidance and resolution of construction project disputes globally. Jim was eh founder and Executive Director of the Navigant Construction Forum™.  Formerly he was the Executive Director, Corporate Claims Management Group, Fluor Corporation, one of the world’s largest EPCM contractors. Mr. Zack was previously Vice President of PinnacleOne and the Executive Director of the PinnacleOne Institute and a Senior Construction Claims Consultant for CH2M HILL, Inc. Mr. Zack has, for 47 years, worked on both private and public projects throughout the U.S. and in 28 countries abroad. Mr. Zack is a Fellow of AACE International, the Royal Institution of Chartered Surveyors, and the Guild of Project Controls.  In the construction claims field, he is a recognized and published expert in mitigation, analysis and resolution or defense of construction claims and disputes.  Mr. Zack is a Certified Construction Manager (CCM), a Certified Forensic Claims Consultant (CFCC) and a Project Management Professional (PMP).  Mr. Zack is an internationally recognized author and speaker in the construction claims and disputes arena.

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