When an owner provides design plans and specifications for building a project, there is an implied warranty that if the contractor follows those plans and specifications, a satisfactory result will be produced. This principle is called the Spearin doctrine, which comes from the United States Supreme Court case United States v. Spearin.
Under the Spearin doctrine, if a contractor incurs additional costs due to the defective design of a project, the contractor may assert a defective specification claim, which may also be called a claim for breach of the implied warranty of design.
Generally, proving such a defective specification claim requires the contractor to show that the defective specification:
- was a design specification, not a performance specification;
- contained a latent (not obvious) error; and
- caused the contractor’s damages (e.g., additional construction costs).
Although it can be difficult to satisfy all three requirements, a recent Armed Services Board of Contract Appeals case–Appeal of KiewitPhelps–shows that it can be done.