What happens if a consultant overestimates how much a public project will cost?
Granted, the situation is usually the opposite: The projects usually project ends up costsing more than consultants told you it would. While courts have held Aarchitects and engineers liable in such instances, a recent appellate court decision shows that’s not necessarily what happens when infrastructure costs less than expected.
Here’s what happened
In both the first and renewal agreements, a consulting engineer and municipality agreed that a professional service order must be issued to trigger actual work, noting the basis and specifics of the tasks to be accomplished.
The first agreement included this language: “The (Municipality) hereby acknowledges that estimates of probable construction costs cannot be guaranteed, and such estimates are not to be construed as a promise to design facilities within the cost limitation.”
The renewal agreement asked the engineer to provide “statements of probable cost” for a road improvement project and included this language: “(Municipality) hereby acknowledges that (Engineer) cannot warrant that statements of possible construction or operating costs provided by (Engineer) will not vary from actual costs incurred by the (Municipality).”
This particular project had long been under consideration. In fact, the engineer provided cost information three times using the scope and pricing available at the time and incorporating known conditions.
Next page: Bonds issued too soon?