Don’t Get Buried in Unexpected Costs: Understanding EPC Site Condition Exclusions
Imagine this: you’ve signed an EPC contract for a new building, excited to get started. Then, halfway through construction, you encounter unexpected soil contamination or buried utilities. Who’s responsible for the extra time and cost?
In EPC contracts, it’s common for contractors to exclude or limit liability for certain site conditions they can’t control.This protects both parties:
- Below-Ground Surprises:
Unless a site survey clearly identifies issues, contractors may not be responsible for unforeseen problems with the soil. They typically aren’t involved in the initial investigation. - Pre-existing Contamination: The contractor isn’t liable for historical soil contamination unless they caused it.
- Hidden Utilities:
Discovering buried pipes or cables during construction can be disruptive. The contract may limit the contractor’s responsibility unless the utilities were documented beforehand. - Mother Nature’s Wrath: Extreme weather or other unforeseen environmental factors can impact construction timelines. The contract might exclude contractor liability for these unless specifically anticipated.
- Environmental Issues:
Similar to contamination, the contractor may not be responsible for existing environmental hazards unless they’re directly responsible. - Unforeseen Delays: Changes in local regulations, strikes, or natural disasters can all disrupt a project. The contract might outline how these unforeseen events are handled.
Key Takeaway:
Carefully reviewing these exclusions with your contractor is crucial. A thorough site survey and clear documentation can help minimize surprises and ensure a smooth (and budget-friendly) construction process.
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