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Symbols, Contract Ambiguity, and the Duty to Ask Questions

To most, it may seem obvious that a subcontractor would have the obligation to seek an explanation when there is an unknown symbol on the architectural design drawings to be used for a new construction project. The truth is, however, such obligation really depends on the specific situation. Seemingly small mistakes in this area may leave all parties involved in the project exposed to financial loss or legal action.

In the case Goodrich Quality Theaters, Inc. v. Fostcorp Heating and Cooling, Inc., 16 N.E.3d. 426 (Ind. Ct. App. 2014), a structural steel subcontractor installed joist girders (a type of support beam) for a Goodrich movie theater in Portage, Indiana. The installation was not in absolute compliance with the design drawings provided by the architectural firm hired by Goodrich, and this mistake resulted in significant additional expenses and delay for Goodrich and its general contractor, including costly litigation.

Although the symbol may have been apparent to the architectural firm and other professionals, the Court held it was meaningless to the structural steel subcontractor. More importantly, the symbol used was not sufficient to have required the subcontractor to question the possible work plans of other trades (e.g. plumbing subcontractor, carpet subcontractor, etc.) also included in the design drawings, of which the steel subcontractor had no specialized knowledge.

The Court also held that there was no ambiguity in the design drawings because the architectural firm used a non-industry-standard symbol to indicate openings in the building’s joist girders where the ductwork was to run through. The symbol used (a dashed line in the shape of an hourglass on top of the joist girder with the word “opening” and a dimension to indicate where the ductwork would pass through) was not described in any of the other contract documents, the design drawing’s legend, or the designated steel manual used by the general contractor and subcontractor.

When drafting business contracts, the proper use of symbols, defined terms, and industry standard language can often be complex and very nuanced, yet is often overlooked as not as important as the contract’s subject matter. As shown in Goodrich, such small details may determine the course of a project and the outcome of litigation, which in turn may determine the success or failure of a business venture.

For additional information, please contact KDDK attorney Matt Malcolm at (812) 423-3183 or mmalcolm@KDDK.com, or contact any member of the KDDK business law or construction law practice teams.

About the Author

Matthew D. Malcolm

Matthew D. Malcolm, an attorney at Kahn, Dees, Donovan & Kahn, LLP, in Evansville, Indiana, practices business law, economic development law, real estate law, and creditors’ rights and collections law in the State of Indiana. Focusing on results, he is interested in meeting each client’s needs and providing quality counsel.