Liability for Damage to Underground Steel Pipe
Arizona Revised Statutes Annotated section 40-360.22 (Supp. 1999) provides in relevant part as follows:
A. a person shall not make or begin any excavation in any public street, alley, right-of-way dedicated to the public use or utility easement . . . without first determining whether underground facilities will be encountered, and if so where they are located from each and every public utility, municipal corporation or other person having the right to bury such underground facilities . . . .
B. Upon receipt of inquiry or notice from the excavator, the owner of the facility shall respond as promptly as practical, but in no event later than two working days, by marking such facility with stakes, paint or in some customary manner. No person shall begin excavating before the location and marking are complete or the excavator is notified that marking is unnecessary.
I. the owner of an underground facility shall notify the excavator whether the facility is active or abandoned. for an underground facility abandoned after December 31, 1988 . . . the owner of the facility may not advise . . . the excavator that a facility or portion of a facility is abandoned unless the owner has verified . . . that the facility or portion is actually abandoned and not merely inactive.
For all other abandoned or apparently abandoned underground facilities, each one-call notification center shall establish a method of providing personnel from a facility owner qualified to safely inspect and verify that the facility is abandoned or active and a method for reimbursing the verifying facility owner for the costs incurred. . . . for all purposes under this article, an . . . excavator or other person subject to this article may not . . . treat an underground facility as abandoned, unless the facility has been verified as abandoned pursuant to this subsection.
Section 40-360.23 (1996) provides:
A. Obtaining information as required by this article does not excuse any person making any excavation from doing so in a careful and prudent manner . . . .
B. After markings have been made pursuant to 40- 360.22, an excavator shall notify either the owner of an underground facility or an organization designated by the owner if the excavator encounters an underground facility that has not been located and marked or has been marked in the wrong location.
Section 40-360.26 (1996) addresses liability for damage to underground facilities as follows:
A. If any 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.
Section 40-360.28 (Supp. 1999) provides:
B. If a violation of this article results in physical contact with an underground facility, the violator is liable to the owner of the facility for all damages to the facilities and costs, expenses and damages to third parties incurred by the owner of the facility as a result of the contact.
C. 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.
Finally, the statute provides that the prevailing party in actions brought to impose liability under the Act is entitled to recover reasonable attorneys' fees. A.R.S. 40-360.27 (1996).
Section 40-360.28(B) provides that a person who violates the statute is liable to the owner for damages to the underground facility and for any damages the owner must pay to third parties injured by contact with the underground facility.
Section 40-360.28(C) provides that if the owner fails to locate an underground facility, the owner "becomes liable for resulting damages, costs and expenses to the injured party." Section 40-360.28(B) provides that a person whose violation of the statute results in contact with an underground facility is liable to the owner for damages to the facility, as well as for damages to third parties.
Thus, we read the statute as a whole to mean that if an owner fails to properly mark a facility, the owner becomes liable to the injured party for damages resulting from such failure.
If an excavator has complied with the statute in all respects, but has nevertheless been damaged because of an encounter with an unmarked underground facility, section 40-360.28(C) entitles the excavator to collect from the owner for any damages incurred due to the owner's failure to properly mark the underground facility.
However, when the excavator has encountered an underground facility without injury, but thereafter violates section 40-360.28(A) or (B), the excavator is liable to the owner both for any resulting damage to the facility and for any resulting damages the owner must pay to injured parties under section 40-360.28(C).