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Legal Issues Related to Large-Scale Airport Construction Projects Copyright National Academy of Sciences. All rights reserved. 24 ACRP LRD 38 The FAA generally requires an environmental due diligence audit (EDDA) to ensure that the property is free from hazard- ous materials and other environmental liabilities. This audit is a process in which airports collect data and conduct site visits to assess the environmental conditions of land and assets in order to avoid the risks of environmental liability due to prop- erty acquisition (FAA 2007). Changes in time and cost due to work stoppage and any required cleanup of hazardous materials may be reimbursed to the contractor by issuing a change order. According to 49 C.F.R. Part 24 (Uniform Relocation Assistance and Real Property) and FAA Advisory Circular 150/5100-17, it is mandatory for airport sponsors seeking federal funding for land acquisition under the AIP to prepare EDDAs. This includes completion of an EDDA before acquiring any land for airport purposes. Typically, owners are required to indemnify and hold con- tractors harmless for any claims, damages, losses, or expenses resulting from the contractorâs performance of required haz- ardous materials remediation work for the project. However, it should also be noted that the ownerâs ability to indemnify may be subject to limitations of sovereign or local government im- munity. Consequently, without specific waivers or authorization to waive such limitations, applicable law could limit or preclude such contractually required indemnification. In addition, if a contractor brings hazardous material onto the worksite, the owner is not responsible for any resulting remediation costs, unless the contract requires the contractor to bring the materi- als onto the site. Furthermore, the contractorâs entitlement to relief may be rejected or otherwise limited depending on sev- eral other factors, including whether the contractor exacerbated the release of hazardous materials or released the materials, was negligent in handling the hazardous materials, or failed to prop- erly inform the architect or owner regarding the presence of the hazardous materials in a timely manner. The contractor is typically required to indemnify the owner for the cost and expense the owner incurs for remediation of hazardous materials brought onto the site or released by or other wise negligently handled by the contractor. In addition, the contractor typically indemnifies the owner for the cost that the owner incurs when the contractor fails to properly reme- diate preexisting hazardous materials identified in the contract documents (AIA 2017). While the procedures set forth above are typical for airport construction projects, they are not mandatory, and owners have instituted different procedures based on the needs of in- dividual projects. For example, an airport owner on a current PPP project has elected to require the developer to keep one or more on-call consultants ready to assess any potential hazard- ous materials identified on the project site, with the goal of expediting the assessment and potential remediation of such substances. The contractor is entitled to reimbursement for the hazardous materials consultantâs costs. However, on this project, the contractor is not entitled to any delay of the proj- ect schedule associated with the time period it takes for the consultant to analyze the materials and produce a remediation because they did not meaningfully use this clause of the contract during construction. The third participant mentioned that the airport used a dis- pute ladder instead of a DRB for its CMAR project, and that the airport found that the dispute ladder worked very well. Typi- cally, dispute ladders require the parties to attempt to address disputes at the project level (e.g., a meeting between the project managers), and then proceed up the management ladder if the dispute remains unresolved, eventually leading to a meeting between the chief executive officer and head of the airport. In this case study project, the contractor was required to exhaust the dispute ladder process before proceeding with more formal dispute-resolution processes (e.g., arbitration, or litigation). B. Progressive DB and Lump-Sum DB Case Study Results The dispute review processes for both the progressive DB and lump-sum DB project case studies mirrored one another. Both airports used nonbinding dispute ladders first in order to address any disputes that arose. Unless otherwise agreed, the designerâbuilders were required to exhaust this process before seeking relief through other means. For both projects, the dispute ladder was followed by a DRB. Similar to the dis- pute ladder, the DRBâs recommendations were nonbinding on the parties unless otherwise agreed; however, the parties were required to exhaust both the dispute ladder and DRB process before one of the parties could file suit on an unresolved claim. The DRBs for these projects were not heavily used. For the two progressive DB contracts related to the terminal expansion project, one of the DRBs was never formed, while the other was formed and met quarterly, but the parties never used the DRB to help resolve a dispute. XI. REMEDIATION OF HAZARDOUS MATERIALS Generally, airports follow a standard hazardous material clause consistent with the guidelines of Article 10.3 of AIA 201- 2007: General Conditions of the Construction Contracts (AIA 2007). According to this clause, the contractor is responsible for removing all preexisting hazardous materials identified in the contract. If any other hazardous materials are encountered dur- ing construction that were not identified in the contract, then the contractor must take precautions by stopping work in the af- fected areas and report, in writing, the condition to the architect or owner. The owner then selects a licensed laboratory to verify the presence or absence of hazardous materials or substances at the site. The owner also informs the architect and contractor of the names and qualifications of the persons or entities involved in performing the test. If the architect or contractors have any objections regarding the people or entities used to perform the tests, the owner submits the names of other persons or entities that the architect and contractor can agree upon. If the materials are found to be safe, then the contractor resumes work.
