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Don't be Late with Miss Dig

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Cole M. Young
Foster Swift Construction Law News
February 2008

Contractors and subcontractors must always remain cautious of every single detail of a project. Whether a general contractor or subcontractor, it is equally important to be aware of the activities and liabilities of the other contractors on a project. This can be a difficult task when there are multiple parties involved. Regardless, it is an important task that will save you time and money in the long run.

A recent example of the interconnectedness of general contractors and subcontractors involved underground transmission lines. The Michigan Court of Appeals in SBC v Crawford, Inc1 made several important decisions regarding the Protection of Underground Facilities Act (MCL 460.701, et seq., also known as the "MISS DIG" Act). In Crawford, Consumers Energy hired a general contractor, Henkels & McCoy, to repair several underground gas transmission lines. Henkels then subcontracted with Crawford to do the necessary pile-driving. Before work began, Henkels contacted MISS DIG for the location of underground utility lines; Crawford did not contact MISS DIG. While pile-driving, Crawford transected several SBC cables. Consequently, SBC sued Crawford for damages.

Crawford argued that pile-driving is not a covered activity under the MISS DIG Act because it is not explicitly mentioned in the Act. The Court disagreed, however, and held that pile-driving is included under the Act because it is implicitly part of "excavation," a regulated activity under the Act. Therefore, the Court held that pile-driving activities require compliance with MISS DIG.

Next, Crawford argued that Henkels, not Crawford, was responsible for contacting MISS DIG. The Court agreed with this argument, holding that under the Act, the excavator hired to perform the work is responsible for contacting MISS DIG and obtaining a project ticket. Consumers Energy hired Henkels to perform the excavation services, and accordingly, Henkels was in the best position to provide the necessary information to MISS DIG. The Court held that Crawford, the subcontractor, was not required to contact MISS DIG. Rather, Crawford could rely on Henkels’ notice to MISS DIG.

Finally, Crawford was dealt a serious blow when the Court held that because Crawford began the pile-driving one day after the expiration the MISS DIG project ticket, Crawford could be held responsible for the resulting damage to SBC. Even though Crawford could rely on Henkels’ request to MISS DIG, the ticket issued by MISS DIG had expired by the time excavation work actually began. The MISS DIG Act requires that notice of intent to excavate must be given no more than 21 days before commencing the excavation. The Court held that excavation work "commences" when machinery or equipment intended for such work breaks the ground. The Act provides an action for liability if underground utilities are damaged and the damaging party failed to give the required notice. Here, Crawford was just one day late. Crawford commenced pile-driving 22 days after notice was given to MISS DIG, and accordingly, had violated the 21-day notice requirement. This seemingly insignificant mistake subjected Crawford to costly liability under the Act.

The holding of this case serves as an important reminder to contractors and subcontractors. "Excavation" under the MISS DIG Act includes pile-driving, and therefore, requires compliance with the Act. Where a general contractor is hired to perform excavation, it is that contractor’s responsibility to contact MISS DIG. A subcontractor can rely on the general contractor’s notice given to MISS DIG, but must make sure that a ticket issued by MISS DIG has not expired. As demonstrated above, courts strictly interpret the MISS DIG Act’s 21-day requirement. Thus, all contractors must be aware that if they commence work after the expiration of a MISS DIG project ticket, they may be subjected to liability. A single day may make all the difference.

1 SBC v Crawford, Inc, unpublished opinion of the court of Appeals, entered November 27, 2007 (Docket No. 275334)