Reference no: EM133211954

Geddy Construction (GC) has a written contract with Owner, an Oklahoma municipality, to build a sewer treatment plant with three lagoons. The prime contract is governed by the 2017 Edition of AIA Document A201. Owner hired YYZ Design (YYZ) to prepare the plans and specifications. YYZ, in turn, hired an independent lab to perform a comprehensive soils test. Based on the results of the soils test, the plans and specifications prepared by YYZ called for the installation of bentonite-treated clay liners in the three lagoons. The specified mix ratio was 3%. Significant leaks appeared shortly after the lagoons were constructed and filled with water. The project was shut down for 3 months while the source of the leaks and a possible solution were investigated. GC, Owner, and YYZ subsequently determine that the specified bentonite mix ratio of 3% was inadequate to properly seal the floor of the lagoons. At the Owner's request, GC prepares a cost estimate to rework the clay liners with additional bentonite. After receiving GC's cost estimate, the Owner and YYZ decide that GC should have recognized the error in the specifications and reported the problem before the clay liners were first installed. The Owner and YYZ issue a change directive requiring GC to proceed with the remedial work at GC's own expense. In total, the project takes 6 months longer than expected and GC spends $150,000 on the lagoon repairs. YYZ is also the designated Initial Decision Maker (IDM).

Would GC have the right to sue YYZ for its economic losses incurred in repairing the lagoon?

Group of answer choices

Yes

No