Chapter 8 - § 8.4 • DEFENSES
| Jurisdiction | Colorado |
In decades past, one of the most frequently asserted defenses by A/Es was lack of privity. With the general demise of the privity requirement, additional defenses have been asserted with increased frequency. In Colorado, these defenses include: standard of care, no duty, approval of others/acceptance by owner, non-compliance with design, statute of limitations/statute of repose, Construction Defect Action Reform Act, privilege, indemnification limitations/requirements, selected contractual risk-allocation clauses, owner first costs/betterment, economic loss rule, contributory negligence/comparative fault, state of the art, certificate of review, disclaimers, and immunity.
§ 8.4.1-Standard of Care
Much has already been said about the yardstick utilized in measuring the work and professional services of the A/E. It logically follows, then, that the applicable standard of care may often create a defense for the A/E. More specifically, the A/E may assert that, despite a failure to achieve a desired result, his or her performance was within the range expected of other reasonably careful and diligent A/Es practicing under the same or similar circumstances. In other words, the A/E does not guarantee or promise success368 or that his or her plans and specifications will receive the approval of the governing building department.369 Nor does the A/E guarantee or promise that his or her construction observation or contract administration services will uncover every defect or problem.370 Thus, in many instances, the A/E's first line of defense will be that he or she complied with the applicable standard of care which, again, is not perfection.371
Practice Pointer
Almost all A/E agreements identify the professional standard of care. The A/E, however, may agree to an elevated or more subjective standard of care;372 it may also agree to a lower standard of care provided the lower standard does not fall below what is required by the applicable building codes.373
To the extent the circumstances suggest that a standard form A/E agreement is not appropriate or will not be used, a professional standard-of-care clause should still be included within whatever A/E agreement is ultimately employed.374
§ 8.4.2-No Duty
As previously noted (§ 8.2.1), a failure to meet the applicable standard of care is only actionable by a party to which or whom the A/E owes a duty. Where the A/E owes no duty of care, there can be no negligence.
For example, in Glacier Tennis Club at the Summit, LLC v. Treweek Construction Co., the Supreme Court of Montana affirmed summary judgment in favor of the A/E, who prepared schematic bid documents and who approved pay applications submitted by the project's design-builder. The court found the A/E did not owe a duty of care to the design-builder with respect to the review and approval of its payment applications.375
In Howe v. Bishop,376 the Alabama Supreme Court ruled the A/E owed no duty of care to subsequent purchasers of an apartment building. The court affirmed the trial court's ruling that the purchasers were not foreseeable parties to whom the A/E - the building's designer - owed a duty of care.377
Conti v. Pettibone Cos. involved a claim against an A/E by an injured construction worker. The Supreme Court of New York held the A/E had no duty to provide for the injured worker's safety absent a clear contractual provision creating such duty.378 Colorado law is similar.379
In Ramey Construction Co. v. Apache Tribe of Mescalero Reservation,380 the Tenth Circuit found the A/E did not owe the contractor a duty to properly manage the project. The Court of Appeals of Texas also arrived at that same result in a different case.381 There, the plaintiff brought suit against the A/E, alleging that its negligent administration caused it to suffer extensive delays and to incur increased construction costs. The court noted that some jurisdictions have adopted the rule that the A/E owes a duty of care to contractors whose economic interests could foreseeably be affected by the A/E's performance.382 However, the court rejected that rule, instead finding the A/E's duty is to protect the interests of the owner - its client - not those of the contractor.383
In County of Westchester v. Welton Becket Associates,384 the A/E apprised his client of certain potential problems with the project bid documents, but did not disclose those problems to the project bidders. One of the bidders asserted a fraud claim against the A/E.385 The Supreme Court of New York court ruled the A/E did not owe a duty of care to disclose the potential problems to the project bidders; that duty was owed only to his or her client. Colorado law is also similar.386
Practice Pointer
All A/E agreements should provide as much detail as practicable regarding the agreed-upon scope of work and professional services. For purposes of clarity, an A/E agreement should also include an affirmative representation or disclaimer that no other work or professional services will be provided, and that no other party is an intended beneficiary of the A/E's work and professional services.387 This attention to detail should help later in the event claims against the A/E are asserted by third parties or by the A/E's client, alleging a responsibility for certain additional work or professional services on the part of the A/E.388
§ 8.4.3-Approval of Others/Acceptance by Owner
As a professional, it is difficult for the A/E to escape liability by asserting that deficiencies in his or her plans and specifications are excused by the approval of third parties. However, the expertise of the approving party and the extent to which the A/E has advised the approving party of the risks inherent in a particular design may control the viability of this defense.
Where the A/E prepares deficient plans and specifications, the failure of a building official to discover the deficiencies rarely provides a defense; by the same token, a building official's approval is not conclusive proof that the requirements of the applicable building code were, in fact, satisfied.389 Likewise, prior governmental approval of the A/E's plans and specifications is not an affirmative defense against a claim of negligence.390
Under most circumstances, the approval and acceptance of the A/E's plans and specifications by his or her client will also not relieve the A/E of liability for deficient design.391 Nor does the fact that the owner paid the contractor in full upon project completion absolve the A/E of responsibility for negligent construction observation or administration services.392 However, where the owner is aware of the governing code requirements and specifically requests the A/E to prepare plans and specifications that are in violation of those requirements, the A/E is not liable to the owner.393
Practice Pointer
A rational argument exists that where a governmental entity with authority to grant building code variances is both the approving authority and the project owner, approval by that authority should constitute a valid defense in the nature of waiver394 or estoppel.395
§ 8.4.4-Non-compliance with Design
For the A/E to be held liable for negligent design, it must first be shown that the defective construction was completed in accordance with his or her plans and specifications. If the contractor deviated from the A/E's design, the A/E may have a defense to liability. Indeed, when construction is not in accordance with the A/E's design, there is no causal relation between that design and the defect causing damages, even if there are deficiencies in the design itself.396
The editors of American Jurisprudence state the law as follows:
An [A/E] is not liable if the employer has failed to follow the plans in an important particular and damages result which may have been due to such departure.397
In Corpus Juris Secundum, it is stated:
Where the negligence of the [A/E] consists of the furnishing of defective plans, specifications, and drawings, it is essential to prove that the builder substantially complied with such plans and specifications . . . .398
In Colorado, this rule of law was recognized in Balcom Industries, Inc. v. Nelson.399 There, the trial court ruled a condition precedent to liability for negligent design was a showing that construction was accomplished in accordance with the design. Because the condition precedent had not been shown by the owner, the A/E was held not liable.
The Balcom Industries, Inc. court relied upon Covil v. Robert & Co. Associates,400 in which the Court of Appeals of Georgia held that
[w]hen a case is based upon negligence of an architect or engineer in preparing plans, it is essential that the plaintiff prove that construction of the project designed was accomplished in compliance with the plans and specifications furnished by the defendant . . . . Likewise, it is necessary that a plaintiff allege this element as an ultimate fact . . . , for without it there would appear . . . no causational link between the alleged negligence and the injuries complained of.401
This rule of law has also been recognized nationally for many years. For instance, in Bayne v. Everham,402 the plaintiff's intestate was killed by the collapse of a concrete garage designed by an A/E. One of several concrete panels used to construct the garage was formed six inches too long, with no corresponding increase in steel reinforcing. The panel later failed. In other panels, certain specified steel was omitted in some beams. In one beam calling for three reinforcing bars, only two were placed, and in another, the steel was omitted entirely. According to expert testimony, these omissions "'materially decreased the efficiency'" of the beams.403
The A/E argued that, before liability could attach, the plaintiff must show not only a deficiency within his plans and specifications, but also that the deficient design was built and caused the garage to collapse. He further...
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