Who Pays When Unmarked Utilities Are Hit by Bernard S. Kamine ECA Legal Counsel Beneath every modern city is a complex web of water, sewer, storm drain, gas, oil, steam, electric, telephone, fiber optic and cable lines that are laid alongside, across, over and under each other. Whenever the surface is scratched a line can be hit. When hit, a line can be damaged and produce hazards. Containing those hazards and repairing the line often shuts down adjacent construction activity, causing delay damages (e.g., labor and equipment standby, extended field overhead, need to accelerate to get back on schedule). Several California statutes, in different codes, address these issues; common law doctrines can also be involved. Some of the statutes affect parties to the construction contract; others affect the contractor and third parties. Anyone who breaks the ground surface must understand both the statutory duties and when damages can be recovered under either the statutes or common law doctrines. One statute, Government Code § 4215, requires public agencies to "assume the responsibility, between the parties to the contract, for the timely removal, relocation, or protection of existing main or trunkline utility facilities located on the [project] site . . . if such utilities are not identified . . . in the plans and specifications made a part of the invitation for bids." The contractor must be compensated for relocation and repair costs, and "for equipment on the project necessarily idled during such work." Also no liquidated damages can be assessed for delays resulting from hitting, repairing and relocating a main or trunkline not shown on the plans.
	Another statute is the Regional Notification Center System (Gov. Code § 4216 et seq.), often referred to as the Underground Service Alert (USA) or Digalert statute. It uses the term "operator" to cover any person, business, public agency or other entity "which owns, operates, or maintains a subsurface installation." The only exception is installations on private property that serve only that property and are operated and controlled by the property owner. If strictly complied with, the USA statute gives contractors a shield. When not followed, it can become a sword for operators. Its violation can also expose both contractors and operators to civil penalties. "Every operator of a subsurface installation," except Caltrans, is required to join - and help finance - a regional notification center (Gov. Code § 4216.1). An operator who fails to do so forfeits any claim for damage to its installations (Gov. Code § 4216.7). There are two regional notification centers: Underground Service Alert of Southern California (www.digalert.org) and Underground Service Alert of Northern California (www.usanorth.org). Both use the same call-in number: (800) 227-2600. The 19-person governing board of USA-South has representatives from 16 operators, one contractor, one locating firm and one public member. About 30% of the funding comes from Sempra Energy and its subsidiaries, like Southern California Gas Company. Most of the call-ins it receives are from operators or contractors working for operators.
	Except in an emergency, every person planning to conduct any excavation (i.e., using any tools or equipment to break the surface - even just the removal of sod, a sidewalk or pavement) must contact the regional USA center at least 2 working days, but not more than 14 calendar days, before starting work. Further, "if practical," the excavation area should be delineated in white paint; otherwise, it must be sufficiently identified in the call-in to tell the operators where to mark their lines (Gov. Code § 4216.2). The USA center assigns an "inquiry identification number" to the call, and notifies the operators. Each operator must "field mark the approximate location" of any lines that may be affected by the excavation and are shown on its records or can be located using "standard locating techniques," (Gov. Code § 4216.3). "Approximate location" means within 24", horizontally, of the line (Gov. Code § 4216). The contractor must determine the exact location "with hand tools," except for the removal of pavement when no subsurface installations are contained in the pavement (Gov. Code § 4216.4). The contractor's shield: If a contractor calls-in to the USA center, excavates between 2 working days and 14 calendar days after the call, yet hits an unmarked utility line that should have been marked, the operator forfeits any claim for damages caused by its failure to mark the line. However, the USA statute does not shield the contractor from 3d party claims (e.g., someone injured by flying debris from an explosion when an unmarked gas line is hit, or property flooded when an unmarked water line is hit) (Gov. Code § 4216.7). Nor does the USA statute give the contractor a sword to recover its damages from the operator, but other statutes and common law doctrines discussed below may do so. To preserve the shield, when excavations continue beyond 14 calendar days from the call-in date, the contractor must "revalidate" the inquiry identification number by calling-in again on or before the 14th day after the initial call-in, and again on or before the 14th day after the 2d call-in, etc. until the excavation work is finished (Gov. Code § 4216.2). Otherwise, the shield lapses on the 14th day after the last call-in, and the contractor must start the process anew, obtaining a new inquiry identification number and waiting two working days before excavating. In other words, to preserve the shield on any job over 14 calendar days, the contractor must make the initial USA call and then assure that a revalidation call is made not later than every 14 calendar days thereafter until the work is finished. The operator's sword: If a contractor fails to call the USA center at least 2 working days before commencing excavations, it is liable for any damage to utility lines that would have been marked if the contractor had called or waited the 2 working days after the call. Also, if the contractor uses machines, instead of hand tools, to determine the exact location of a marked line, it is liable for any damage to that line caused by the use of machines. (Gov. Code § 4216.7)
	Although the USA statute provides no sword for the contractor to use to recover its damages, the statute does impose a duty on operators to mark their lines upon notice of a call-in to the USA center. A call-in by any contractor is sufficient to invoke the duty (in other words, the duty can flow to a prime contractor based on a subcontractor's call-in or vice versa). The duty flows to any owner representative, design professional or contractor that the operator knows or should know will be on the project (contrast the contractor's shield which only protects contractors who timely called-in to the USA center). The duty should exist for as long as the marks would have given notice of the subsurface installations if they had been properly placed when requested. In other words, the duty can exist for days or weeks after a 14 day shield period has elapsed, if the marks would have given notice of the line that was hit had the line been properly marked when the last USA call-in was made. The duty also requires marking the lines in the customary manner; a line not so marked may, for practical purposes, be unmarked. The industry marking standards are described in "Suggested Guidelines for Prospective Excavation Site Delineation and Facility Owner Markout," which can be found on the USA-South web site, and explains, for example, "Marks in the appropriate color should be approximately twelve (12) to eighteen (18) inches in length, spaced no more than fifty (50) feet apart. The marks should be placed over the approximate center of the facility."
	If an operator breaches its duty to properly mark lines upon notice of a USA call-in, then the contractor who hit the unmarked line, and any other contractor the operator could have foreseen on that project, should be able to recover damages under one of several legal theories. For example, if an operator undertook the marking of lines in response to a USA notice, but missed the one that was hit, and the hit line was either in the operator's records or could have been located using standard locating techniques, then the operator was negligent. It is liable to every contractor who could have reasonably been anticipated to suffer damages from the unmarked line being hit. As Schwartz v. Helms Bakery Limited (1967) 67 C2d 232, 238, 60 CR 510, 430 P2d 68, explains: "Firmly rooted in the common law lies the concept that . . . 'He who undertakes to do an act must do it with . . . care.' [citations, including Rest. 2d, Torts § 324A] '[I]f the defendant enters upon an affirmative course of conduct affecting the interests of another, he is regarded as assuming a duty to act, and will thereafter be liable for negligent acts or omissions . . . .' [citations]." Restatement 2d, Torts § 324A provides: "One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of a third person or his things, is subject to liability to the third person for physical harm resulting from his failure to exercise reasonable care to protect his undertaking, if (a) his failure to exercise reasonable care increases the risk of such harm, or . . . (c) the harm is suffered because of reliance of the other or the third person upon the undertaking." This well-established common law doctrine has been employed against public utilities in California (Lurye v. So. Cal. Edison Co. (1999) 71 CA4th 1167, 84 CR2d 225 [rejecting utility's arguments that its status as a utility made it immune from this doctrine].
	Another legal theory: Since one purpose of the USA statute is to protect anyone who might be injured or damaged by the disruption of an underground utility line, including contractors working near the line, a operator's breach of its statutory duty to mark the line is negligence (Ev. Code § 669). The contractor need only prove that the failure to mark the line was the cause of the line being hit and the nature and extent of the damages suffered from hitting the line. To the extent that the owner of the unmarked line is a public utility, this common law negligence theory is augmented by Public Utilities Code § 2106, which provides: "Any public utility . . . which omits to do any act . . . required to be done . . . [by] any law . . . shall be liable to the persons or corporations affected thereby for all loss, damages, or injury caused thereby or resulting therefrom." Government Code § 4216.3 is a law that requires an operator, when properly notified by the regional notification center, to mark all subsurface installations on its records or that can be located by standard locating techniques. If an operator fails to do that act, it is liable to everyone damaged as a result of an unmarked line being hit, whether or not the victims are protected by the contractor's shield under Gov. Code 4216.7. What about those civil penalties? Under Government Code § 4216.6, any contractor or operator who negligently violates the USA statute can be sued by the Attorney General or a district attorney or the local or state agency that issued the building permit for the project for a civil penalty of up to $10,000. The penalty for knowingly and willfully violating the statute can be as high as $50,000. There is no record of any such lawsuit being brought. However, if a death results from hitting an unmarked line, the local district attorney may decide to seek those civil penalties.