A recent appellate decision underscores the importance of due diligence in construction projects. The dispute arose from a construction contract between Maric Mechanical, Inc. (“Maric”) and the New York City Housing Authority (“NYCHA”). The contract involved the replacement of boilers at the Ravenswood Houses in Queens. According to the contract documents, the project required the construction of 40 temporary shoring towers. However, Maric later discovered that 206 shoring towers were necessary, significantly increasing the project’s cost.
Maric sought compensation for this “extra work,” arguing that the additional towers were not included in the original contract. NYCHA moved to dismiss the complaint, citing Maric’s failure to perform a pre-bid site inspection and the explicit disclaimers in the contract documents regarding the accuracy of the provided information.
The Supreme Court, New York County, granted NYCHA’s motion to dismiss the complaint. The decision was unanimously affirmed by the Appellate Division, First Department.
The appellate court’s decision was based on several factors. First, Maric admitted that it did not conduct a pre-bid project work site inspection, as required by the contract. This acknowledgment meant Maric could not claim that the need for additional shoring towers was unforeseeable. Second, the contract documents explicitly warned that NYCHA did not assume responsibility for the accuracy or completeness of the information regarding existing conditions. This disclaimer placed the responsibility on Maric to independently verify the site conditions. Lastly, Maric’s argument that its engineer’s post-contract determination of the need for extra work could not have been made based on a pre-bid inspection was deemed conclusory and insufficient to support its claim.
The decision in Maric Mechanical, Inc. v. New York City Housing Authority serves as an important reminder for contractors and legal professionals alike. It highlights the importance of pre-bid inspections and the need for documentation and verification of site conditions. Contractors must conduct pre-bid inspections to inspect and document all site conditions before submitting a bid. Additionally, contractors should pay close attention to disclaimers in contract documents, recognizing the limitations of the provided information.
The lower court’s decision can be found here, and the appellate decision here.
Jose A. Aquino (@JoseAquinoEsq on X) is a special counsel in the New York office of Duane Morris LLP, where he is a member of the Construction Group and of the Cuba Business Group. Mr. Aquino focuses his practice on construction law, lien law and government procurement law. This blog is prepared and published for informational purposes only and should not be construed as legal advice. The views expressed in this blog are those of the author and do not necessarily reflect the views of the author’s law firm or its individual attorneys.