7.4 Damage Recovery

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Practice Statement:

State damage prevention laws and regulations recognize the right to recover damages and costs resulting from noncompliance.

A: Right of Recovery

Practice Description:

The statute recognizes an injured party’s right to recovery when damages and/or costs are incurred as the direct result of an entity’s failure to comply with the one call laws and regulations. For example, Arizona endorses an injured party’s right to recover damages when the other party has failed to comply with the one call law.


  • Arizona: “If an underground facility is damaged by any person as a result of failing to obtain information as to its location, failing to take measures for protection of the facilities, or failing to excavate in a careful and prudent manner as required by this article, the person is liable to the owner of the underground facility for the total cost of the repair of the facility.” Arizona Code, Article 6.3, § 40-360.26(A)
  • Arizona: “If the owner or operator fails to locate or incorrectly locates the underground facility, pursuant to this article, the owner or operator becomes liable for resulting damages, costs, and expenses to the injured party.” Arizona Code, Article 6.3, § 40-360.28(C)


B: Alternative Dispute Resolution

Practice Description:

Avenues for settlement of disputes include alternative dispute resolution. Minnesota endorses ADR through the state court system, New Jersey endorses ADR in construction contract documents, and the federal government endorses ADR through the federal courts.


  • Minnesota: “The Supreme Court shall establish a statewide alternative dispute resolution program for the resolution of civil cases filed with the courts. The Supreme Court shall adopt rules governing practice, procedure, and jurisdiction for alternative dispute resolution programs established under this section. Except for matters involving family law, the rules shall require the use of nonbinding alternative dispute resolution processes in all civil cases, except for good cause shown by the presiding judge, and must provide an equitable means for the payment of fees and expenses for the use of alternative dispute resolution processes.” Minnesota Code, Chapter Title: District Courts, § 484.76
  • New Jersey: “All construction contract documents entered into in accordance with the provisions of P.L. 1971, c. 198 (C.40A:11-1 et seq.) after the effective date of P.L. 1997, c.371 (C.40A:11-50) shall provide that disputes arising under the contract shall be submitted to a process of resolution pursuant to alternative dispute resolution practices, such as mediation, binding arbitration, or non-binding arbitration pursuant to industry standards, prior to being submitted to a court for adjudication. Nothing in this section shall prevent the contracting unit from seeking injunctive or declaratory relief in court at any time. The alternative dispute resolution practices required by this section shall not apply to disputes concerning the bid solicitation or award process, or to the formation of contracts or subcontracts to be entered into pursuant to P.L. 1971, c. 198 (C.40A:11-1 et seq.).” New Jersey Code, Title 40A, § 40A-11-50
  • Federal: “Congress finds that (1) alternative dispute resolution, when supported by the bench and bar, and utilizing properly trained neutrals in a program adequately administered by the court, has the potential to provide a variety of benefits, including greater satisfaction of the parties, innovative methods of resolving disputes, and greater efficiency in achieving settlements; (2) certain forms of alternative dispute resolution, including mediation, early neutral evaluation, minitrials, and voluntary arbitration, may have potential to reduce the large backlog of cases now pending in some federal courts throughout the United States, thereby allowing the courts to process their remaining cases more efficiently; and (3) the continued growth of Federal appellate court-annexed mediation programs suggests that this form of alternative dispute resolution can be equally effective in resolving disputes in the federal trial courts; therefore, the district courts should consider including mediation in their local alternative dispute resolution programs...Each United States district court shall authorize, by local rule adopted under section 2071(b) 2071(a), the use of alternative dispute resolution processes in all civil actions, including adversary proceedings in bankruptcy, in accordance with this chapter, except that the use of arbitration may be authorized only as provided in section 654 [(1) the action is based on an alleged violation of a right secured by the Constitution of the United States; (2) jurisdiction is based in whole or in part on section 1343 of this title; or (3) the relief sought consists of money damages in an amount greater than $150,000.].” Alternative Dispute Resolution Act of 1998, enacted October 1998.


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