COE sues Architectural-Engineering firm for expansive clay damage to utilities

[This case was described in Civil Engineering Magazine in 2013, article written by Michael C. Loulakis.  I have condensed it.]

BPLW Architects and Engineers, Inc. provided the MEP design for two student dorm bldgs at Lackland Air Force Base in San Antonio.  Soon after construction was completed, water leaks occurred that even flooded several rooms.  The US Army Corps of Engineers (COE) repaired the broken pipes and replaced the sanitary sewer pipe system.  The COE billed the MEP firm $7,600,000 for the damages and repair work (negligence or omission claim against the MEP firm).  BPLW appealed to the US Court of Federal Claims.  Heaving clay soils and poor surface drainage design were suspected of having led to the pipe damage and flooding damage.

The "standard of care" requires that the MEP firm consider the geotechnical report ("soils report") when designing underground utilities.  The geotechnical report actually warned that the clay soils at this site could heave 9 inches (i.e. worst case scenario).  The construction contract documents, however, included a mechanical connections section and the MEP firm did abide by the requirements of that section, which apparently included language about tolerating 1 inch of differential movement at horizontal to vertical transitions and possibly 4 inches as the horizontal moves away from a vertical run.  The MEP firm was also accused of producing poor drainage plans (grading and drainage).

The Court determined that the MEP firm's design, as well as its grading plans, failed to comply with the contract and the applicable "standard of care".  But there was also testimony that the GC did not install some of the piping system correctly and that the GC had installed a bent and broken piping component under the slab.  There was uncertainty as to whether the GC had graded the site properly for drainage design (no as-built data).

The Court determined that the COE FAILED TO PROVE CAUSATION.  i.e. the COE did not demonstrate that the design, in contrast to other factors, caused the damage directly.  The COE also did not show that the negligent surface drainage design led to the improper grading and ponding of water.  Poor pipe installation by the GC was the potential intervening cause of damage that allowed the MEP firm to escape this claim.

In addition to failing to prove causation, the COE was also determined by the court to have failed in proving a reasonable damage assessment.  The COE witnesses were not experts and provided insufficient testimony on whether the scope of repair work was reasonable or necessary.  i.e. was that $7,600,000 work all necessary and was that cost reasonable.

The court awarded the COE a small amount of $ for certain modifications it had to make to the MEP's design, but most of the other money was not awarded.  As the prevailing party, the MEP was able to recover money from the COE for legal costs, to make matters worse for the COE.

Lesson learned for geotechs: In cases of negligence claims, the Owner or other suing party has to PROVE CAUSATION.  Even if found having breached the "standard of care", the engineering firm's error has to also be found to have actually directly caused the damage and losses.  If the engineering firm can show that construction errors could have caused soil movement or damage, then causation cannot be linked directly to the design.  Now if the GC performed their duties correctly and installed everything per plans and specs, then your error may indeed be the cause and you simply just need to have your insurance company handle the claim.  Another lesson: geotech should address buried utility construction.  I dont know what was in the geotech report for this site but i am surprised the COE did not sue them for omissions (i.e. lack of recs addressing buried utility construction and connections).  Some will argue the opposite: the less you say, the better.