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Construction Reform Legislation: How Chapter 193 of the Acts of 2004 Impacts Design and Construction Management Professionals

By David J. Hatem, PC

The enactment of Chapter 193 of the Acts of 2004 (the “Legislation”) on July 19, 2004 marks the most significant reform to public construction law in nearly a quarter century. The Legislation, which only affects public projects, not only changes the scope of construction law, but creates new opportunities for design and construction management professionals. And with new opportunities come new risks of which professionals should be cognizant. This article highlights the major changes set forth in the Legislation while describing how these changes affect design and construction management professionals.

Court Finds Proper Impleading of Architect by General Contractor

The U.S. District Court for the Eastern District of Louisiana recently held that even if two parties completed different tasks on a Project, if found to be liable for the same damages, then one party can assert claims against the other party.

Court Holds that Use of Fictitious Party Practice and Relation Back in Actions for Statute of Repose was Inapplicable

In a recent decision, Greczyn v. Colgate-Palmolive, 842 A.2d 895 (N.J. Super. March 10, 2004), a New Jersey appellate court was faced with determining whether a defendant architectural firm was subject to suit beyond the ten-year statute of repose under the principles of fictitious party practice and relation back.

State Court in Idaho Rules that Breach of Contract Action Against Engineer is Governed by Malpractice Statute of Limitations

In Nerco Minerals Co. v. Morrison Knudsen Corp., 90 P.3d 894 (Idaho April 12, 2004), the Supreme Court of Idaho (“Supreme Court”) affirmed the district court’s grant of summary judgment in favor of the defendant engineer on grounds that plaintiff company’s actions were barred by the statute of limitations. The Plaintiff company alleged breach of contract, fraudulent misrepresentation, and fraudulent concealment by the defendant engineer in the initial phases of designing a heap leach pad. Heap leaching is a method used to salvage precious metals from low-grade ore. The Plaintiff company argued that the breach of contract action was governed by the five-year statute of limitations; however, the appellate court found that the claim should be characterized as a professional malpractice claim thereby governed by the two-year statute of limitations provided by Idaho law.

Owner’s Architect has No Duty to Identify Contractor’s Design Errors

A recent decision from the Supreme Court of Montana held that an architect retained by an owner to provide a preliminary design and to periodically review the contractor’s progress did not owe a duty of care to the contractor. In Glacier Tennis Club v. Treweek Constr. Co., Inc. v. Jim Thompson d/b/a Arquitectnos, et al., 2000 MT 70 (2004), the Supreme Court of Montana specifically held that absent evidence that the architect communicated professional information with the intention or knowledge that such information would be relied upon by a contractor, no duty of care existed.
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