Malfunctioning Treatment Works: Liability and Legal Remedies

A significant fraction of publicly owned treatment works (POTW) constructed with federal grants did not perform to the design specifications. Municipalities had 5 potential legal remedies to establish responsibility for damages: breach of contract (against the engineer or the construction contractor); action against the equipment supplier; and negligence (action against the engineer or the contractor). Other bases for claims were breach of warranty, misrepresentation and fraud, the Racketeer Influenced and Corrupt Organizations Act, the False Claims Act. Defendants in a POTW lawsuit had various defences: inspection and acceptance by owner, cross claims against others; statutues of limitation, and improper or inadequate operation and maintenance by the owner. Types and measures of damages are discussed.