A Synopsis of the AIA Trust white paper: Contractor Termination Lawsuits: The Architect’s Risks and How to Manage Them.
When the terminator shows up, you must be ready. Termination of the contractor on a project almost always guarantees a lawsuit, and the architect is often among the casualties. The white paper, Contractor Termination Lawsuits: The Architect’s Risks and How to Manage Them, addresses why the architect is often sued when a project goes wrong, and it examines related legal theories such as breach of contract and tort claims and the affect they can potentially have on the litigation.
The issue of “foreseeability” is examined using pivotal case law and legal treatises and how they have been used to hold design professionals responsible for the contractor’s work through allegations of negligent misrepresentation.
Common claims that owners bring against architects are examined in the areas of certifications, site observations, failure to report construction defects, and deficient design documents. An emerging area of risk, subsequent property owners, is addressed, including recent adverse case law where the architects did not build the project or exercise control over the construction, yet were found responsible to future owners.
Common claims that contractors bring against architects are explored in the areas of third-party beneficiary and tort theories based on tortious interference in the bidding process, deficient design documents, and negligence during construction contract administration. Third-party complaints by subcontractors and sureties are also discussed.
Opportunities for risk-averse actions on the part of the design professional are addressed in the areas of contract drafting, with emphasis on scope definition, observation of the work, and the potential perils of warranties, certifications, and guarantees. A case illustration is used to bring the issues to real-time relevance.
This comprehensive paper cuts to the chase on the potential perils of contractor terminations, and you should not miss this important message and valuable information. Add this white paper to your reading file to help prepare yourself for the terminator, should his intimidating silhouette darken your door and you hear his ominous words, “I told you, I’ll be back.”
For more detailed definitions and explanations please refer to the entire white paper, Contractor Termination Lawsuits: The Architect’s Risks and How to Manage Them.