Builders and Contractors Exchange
Weekly Bulletin: 05 Jul 2004
Submittals: Are They Really "Approved"?
By: Neil Lowenstein
Most submittals evoke little, if any, discussions. The contractor provides the drawing, sample, data, or other information; the submittal is reviewed and returned, sometimes with notes; and the contractor proceeds to furnish the work or materials in accordance with the submittal either as submitted or in conformance with returned notes. The submittal process, however, often become the focus of later dispute; strangely enough with both sides arguing the process - and either what did or did not occur during it - supports their dispute position.
From the contractor side, the position is typically "I gave you what was submitted." From the owner's side, the position is typically "You gave me what was submitted, but that doesn't mean you were entitled to use it instead of what was originally specified." Most contracts try and avoid this issue by stating something to the effect that submittal approval is not approval to deviate, unless the deviation is clearly and expressly called out. Even if not, though, owners typically argue - and the law in certain instances allows - avoidance of their submittal approval because they were somehow mislead by the submittal. But this type of analysis still begs several questions such as: What is a deviation? Was there a deviation? Was the deviation significant or material? And so on.
More recently, we have observed instances where owners subsequently attempt to disclaim any "approval" altogether, arguing instead they merely "reviewed" the submittal. So what's a contractor to do? First, always read the contract requirements for submittals, and follow them. Second, regardless of a contractual requirement to expressly delineate a deviation, call out deviations expressly and clearly so there is no question they have been brought to the owner's attention. Third, log the submittals in and out so you have a record of them (and as an aside this tracking will help you with scheduling analysis, and in particular delays related to the submittal process). And, fourth, require express owner approval - not just review - of every submittal, and do not order any material or perform any work without that approval.
Submittals will, by their nature, always be an integral part of the claims dispute process, and there is no "silver bullet" to avoid related disputes. However, consideration of and following the above processes can help alleviate many potential disputes by insuring the submittal process is used for that it is intended - contractor specifics of how and what is going to be furnished or provided, and owner input - positive or negative - to those specifics. For more information, please contact this author, Neil Lowenstein, or anyone else on the Vandeventer Black Construction and Public Contracts Law Team.
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This article is meant to bring awareness to this topic and is not intended to be used as legal advice.