This is the third in a series of articles that will examine issues that can arise in the
relationship between the architect in a construction project and the property owner, the contractor, subcontractors and others who may be involved.
Whenever an architect enters into an agreement, it is a good idea to know something about what can go wrong, and the liabilities that may be created should that happen. For that reason, it may be wise to have a basic fear factor that is always in the back of the architect’s mind. Fear of the worst thing that can happen should be motivation for thinking things through carefully. What better way to do that than to learn the ways an architect can be sued an how damages may be calculated.
There are two legal theories under which an architect can be sued: under the terms of the contract or in tort (negligence). Of course, the world being such a “simple place”, a law suit can be filed with one or more counts based on contract rights and one or more other counts based on tort law.
A suit brought under a contract theory is rather obviously one alleging a violation of one or more terms of a contract. A tort theory is based on the alleged breach of a duty owed by one party to another. Each theory has certain elements that must be proved and remedies that are available, although in the case of a contract that does not define the standard of care required, they can be the same.
In a contract case, the plaintiff must prove that that the architect did not provide the required level of professional services. Architects are generally subject to a professional standard of care like that imposed on doctors, lawyers, and other professionals. An architect can be held liable where he fails to exercise the care, skill, and diligence as would the ordinary architect under like circumstances and in a similar time frame. If the contract for services does not define the required standard of care, the standard is the same for both contract and tort liability.
“Tort” is the legal term that refers to a wrong suffered by someone due some form of negligence or the intentional act of another. Architects can be held liable for torts. To prevail on a tort claim, four elements must be proved:
A duty must have existed on the part of the architect to the claimant,
The architect must have breached that duty,
The claimant must have suffered an injury, and
The injury must have been caused by the breach.
Damages in contract cases fall into two categories: compensatory and special.
Compensatory damages represent the amount of money necessary to put the Plaintiff in the same position as he would have been if the architect had not breached the contract and which naturally results from the breach.
Special damages represent the amount of money which will compensate the Plaintiff for those damages which do not normally result from the breach of contract. To recover special damages, Plaintiff must prove that when the parties made the contract, the architect knew or reasonably should have known of the special circumstances leading to such damages.
Damages relating to property damages in negligence cases can fall into classes as well.
If the claim does not contend that the damages should include unreasonable economic waste, damages should equal the reasonable cost to Plaintiff of completing the work in accordance with the contract, less the balance due under the contract.
If there is a claim for unreasonable economic waste, the damages should equal the difference between the fair market value of Plaintiff’s real property as improved and its fair market value if the architect had constructed the improvements in accordance with the contract, measured at the time of the breach.
There are many variations on the foregoing themes. This article is not intended to be an exhaustive study of this topic. It should be a reminder that there is no substitute for guidance from a reputable attorney experienced this these matters.