#43:  See No Evil: The Design Professional’s Liability for Construction Defects

When an Architect or Engineer wears her “Contract Administrator” hat, her duties to the Owner are set out in her contract of hire, typically including such roles as approving pay requisitions and change orders, shop drawing review, scheduling changes, certifying substantial completion – and rejecting deficient work. Suppose she fails to catch the contractor’s poor workmanship. Will she liable to the Owner?
A typical contract of hire for a design professional is the AIA Document B141 (2007). Section provides:
“The Architect shall not have control over, charge of, or responsibility for the construction means, methods, techniques, sequences or procedures, or for safety precautions and programs in connection with the Work, nor shall the Architect be responsible for the Contractor’s failure to perform the Work in accordance with the requirements of the Contract Documents. The Architect shall be responsible for the Architect’s negligent acts or omissions, but shall not have control over or charge of, and shall not be responsible for, acts or omissions of the Contractor or of any other persons or entities performing portions of the Work.”
Section provides:
“The Architect shall visit the site at intervals appropriate to the stage of construction, or as otherwise required in Section 4.3.3, to become generally familiar with the progress and quality of the portion of the Work completed, and to determine, in general, if the Work observed is being performed in a manner indicating that the Work, when fully completed, will be in accordance with the Contract Documents. However, the Architect shall not be required to make exhaustive or continuous on-site inspections to check the quality or quantity of the Work. On the basis of the site visits, the Architect shall keep the Owner reasonably informed about the progress and quality of the portion of the Work completed, and report to the Owner (1) known deviations from the Contract Documents and from the most recent construction schedule submitted by the Contractor, and (2) defects and deficiencies observed in the Work.”
Design professionals like to think that these two clauses amount to this: “Owner, you’re paying me to visit the site from time to time and look for problems, but I can’t see everything. If my trained eye happens to spot a construction defect, I’ll report it, and reject it. If I don’t happen to spot it, though, I’m not on the hook for it.” Actually, matters are not quite that harsh. The Owner is, after all, hiring a trained eye, and is entitled to the fruits of that training. If a reasonably careful design professional would have spotted a defect, failure to catch it is negligence.
Proving that a design professional should reasonably have noticed a defect – typically through expert testimony – is only the first step to recovery. The next step is proving proximate cause, i.e., that “that the injury would not have occurred but for the negligent conduct,” and “that the negligent conduct was a substantial factor in bringing about the harm,” Carignan v. New Hampshire Intern. Speedway, Inc., 151 N.H. 409, 414 (2009). If the “harm” in negligent inspection cases were the poor construction itself, this would be impossible to prove. But if the "harm" is the loss of an owner's bargained-for opportunity to catch and correct that poor construction before it comes home to roost, proof gets easier.
And that is indeed the case. In Corson v. Liberty Mutual Insurance Co., 110 N.H. 210 (1970), a factory employee who was injured by malfunctioning machinery sued the insurance carrier that had undertaken to inspect it, claiming that “proper inspection would have prevented the malfunction.” Our Supreme Court quoted “the language of Cardozo, Ch. J., in Marks v. Nambil Realty Co., Inc., 245 N.Y. 256, 259, 157 N.E. 129, 130: ‘His case is made out when it appears that by reason of such negligence what was wrong is still wrong, though prudence would have made it right. . . The inference is permissible that the (defendant’s conduct) cloaked the defect, dulled the call to vigilance, and so aggravated the danger.’” That is enough to impose liability.Original Article