Murtha Cullina: Architect can be sued by contractor for contractual interference - by Sara Bryant and Andrew Wailgum

Sara Bryant, Murtha Cullina

Andrew Wailgum, Murtha Cullina

A lawsuit brought by a contractor – and a court decision to allow the case to continue to trial over the architect’s effort to dismiss it – is a reminder to architects of their duty to act objectively and in good faith when performing their duties as initial decision maker under the standard AIA contract provisions.

A contractor was terminated by the project owner and brought suit against the architect alleging that the architect had falsely certified grounds for termination.  The architect certified, in essence, that the contractor had breached its contract with the owner by “repeatedly refusing or failing to supply enough properly skilled workers or proper materials.” In its suit, the contractor alleged that the architect knew this was not true and colluded with the owner to fabricate grounds for terminating the contractor. The contractor pointed to project correspondence and meeting minutes to establish that the project delays were not attributable to the contractor.

The contractor’s suit alleged that the architect tortiously interfered with its contractual relations (Count I) and with its advantageous relations (Count II). The elements of both counts require the contractor to demonstrate that the architect acted with an improper motive or means.

The architect filed a motion to dismiss these two counts asserting that the contractor failed to allege that the architect acted with actual malice, which is more stringent than “improper motive.” The court disagreed and held that no showing of malice was required to prove the two intentional interference torts. Instead, the contractor need only make a showing of improper conduct by the architect. The court found that the contractor’s allegations in the complaint – primarily that the architect knowingly certified false reasons to induce the owner to terminate its contract with the contractor – met the elements of the intentional interference torts. In doing so, the court allowed the contractor’s case against the architect to continue toward trial.

Take Away In this case, the architect was the “Initial Decision Maker” under the standard AIA contract provisions and per the contract was required to review claims. The contract also provided that the owner could not terminate the contractor for cause without the architect’s certification of the grounds for termination. Here, the contractor alleged facts which the court held was sufficient to establish a claim that the architect was not carrying out its contractual duties objectively and in good faith.

This decision is a reminder that although an architect is employed by the project owner, it still must act objectively and in good faith when performing its duties under the contract documents, including its review of contractor claims.

Sara Bryant and Andrew Wailgum are partners at Murtha Cullina LLP, Boston, Mass.