Court of Claims Referee Finds State and its Agents Mismanaged Deaf and Blind Schools Project
Kegler Brown Construction Alert September 21, 2015
After three (3) weeks of trial and admitting well over 500 exhibits, Referee Wampler of the Court of Claims, in a 140-page decision, has ruled:
- The State has a duty to provide full and accurate plans sufficient for construction.
- The Architect and the Construction Manager were authorized agents of the State with respect to planning, design and construction.
- “The design was in such a state of confusion and disarray that the Architect itself was never able to issue a comprehensible set of construction drawings” … “so they could be issued to the contractors.”
- The Construction Manager “manipulated the schedule by accelerating some activities which resulted in stacking of trades which in turn led to inefficiencies.”
The Court found that the contractor “had become a scapegoat” for “mismanagement” and “poor design” and concluded that problems arose from:
- an inadequate budget;
- political forces;
- Ohio School Facilities Commission’s lack of experience with residential-type projects;
- a poorly developed, unrealistic and manipulated schedule;
- confusing, incomplete and unapproved design documents;
- slow and sometimes confusing or inadequate responses to RFIs;
- the architect putting an unlicensed person in charge of contract administration;
- inability to coordinate construction phases; and
- heavy-handed and sometimes misleading conduct of the construction manager and the architect.
As a result, the Court ruled that the State, through its agents, “did not act in good faith in the performance of its obligations,” and breached the contract.
This dispute arose from the efforts of the Ohio State School Facilities Commission (OSFC) to build dorms for the Ohio School for the Blind (OSSB) and Ohio School for the Deaf (OSD) when our client, TransAmerica (TA), was hired as the general trades contractor.
As the Court summarized: “At the end of the day, it is clear the OSFC tried to build a project that OSD and OSSB could not afford within the funding provided through the Capital Bill, and it forced its contractors to achieve this task, at least with respect to the Dorm Project, without approved or adequate construction documents.”
“OSD and OSSB ended up with a compromised design and reduced capacity for their new facilities and they were delayed in putting them into service for their students. This was not the fault of TA. It was the fault of OSFC in its efforts to build facilities that OSD and OSSB could not afford, and in trusting its agents to carry out the task-agents who often acted in their own interest and not in the interest of the OSFC, or fairly and honestly in their dealings with TA.”
The Court also found that the “Article 8 process was a road to nowhere” as it was ignored or disregarded by the OSFC. It also found that the OSFC and its agents prevented the contractor from strictly “complying with the conditions precedent under Article 8 of the General Conditions.”
Contractors who are unfairly blamed for additional costs or delays caused by incomplete plans or flawed schedules will find helpful language in the Decision. Further objections and appeals from the State are expected.