Reference no: EM132184983

CHANGES PROBLEM

Review this case carefully and answer the question at the end of the case in detail.

ABC was awarded a contract to replace steam lines at a major installation. The government did not show all necessary valves on the drawings attached to the contract. Upon beginning work, ABC found that there were more valves than were shown on the drawings. The site visit consisted of looking down manholes, because lines that were to be replaced were leaky, and safety concerns dictated that no one could enter the area: service requirements on the other hand dictated that the steam only be unavailable for a short time, so the system could not be shut down.

Although drawings did not show all valves, the solicitation required "replacement of all valves." While installing the replacement pipe. a government inspector directed some of the contractor's workers to add a line to feed a separate area of the building; the inspector thought that this work was included in the contract, and that he was simply clarifying what the workers needed to be doing. It was not included in the contract.

ABC's superintendent discovered this new line when it was half completed, told the workers to discontinue work, and asked the government for direction. He was told to work on other areas pending further guidance. ABC had its workers do what work could be done, and then asked for further direction, and, after two weeks, was given a change order to add the line, increasing the amount of needed pipe by 20 sections. The original contract required 100 sections.

QUESTION:

1. Discuss the government's liability, indicating the various theories of recovery available to the contractor.