By Stephen W. Smith

CHANGES IN LAW BODE WELL FOR ARCHITECTS AND ENGINEER

by

Stephen W. Smith, Esq.

Architects and engineers may be seeing an emerging trend in Michigan law in their favor.  In July of last year, the Michigan Court of Appeals announced a reversal of its tendency to allow negligence actions against architects and engineers which are brought by contractors with whom they had no contract.  Also in 2008, the State Senate approved a measure which would effectively reduce the timeframe in which lawsuits could be brought against architects and engineers, and the bill has been reintroduced in the new session of the Legislature.

In the case of Keller Construction, Inc. v. U.P. Engineers & Architects, Inc., a contractor brought suit against the project engineer for negligence and malpractice on a public water treatment project in the village of Ontonagon.  The trial court dismissed the contractor’s claim because it failed to allege breaches of professional duty separate from the engineer’s contractual obligations to the village.  On appeal, the Court of Appeals acknowledged that it had ruled in the recent past that tort claims could be brought for negligent performance of a contract even if the plaintiff was not a party to the contract.  However, the Michigan Supreme Court ruled in 2004 that such tort claims can only be maintained if the defendant owed a duty to the plaintiff that is separate and distinct from the defendant’s contractual obligations.  Under that rule, the Court of Appeals concluded that the contractor could not maintain its negligence and malpractice claims against the engineer because the claims ultimately arose from the engineer’s contractual duties to the village, and the engineer owed no separate duty to the contractor.

In the previous session of the State Legislature (2007-08), Senator Alan Sanborn of Macomb County introduced a bill to amend the statutes which establish time limits for bringing a lawsuit against architects and engineers.  Currently, Section 5805 of the Revised Judicature Act provides that actions for malpractice or negligence have statutes of limitations of (i.e., must be brought within) 2 and 3 years, respectively.  However, Section 5839 of the Act provides that, when such claims are against designing or supervising architects and engineers based on a defective or unsafe construction condition, the statute of limitations for a lawsuit is as late as 6 years after the time of occupancy of the project, or 1 year after a defect resulting from the architect’s or engineer’s gross negligence is or should have been discovered.  Section 5839 also establishes a “statute of repose,” an outer time limit which provides that no claim can be maintained against architects and engineers more than 10 years after the time of occupancy, regardless of whether any applicable statutes of limitation have not yet run out.

Senator Sanborn’s bill seeks to amend Sections 5805 and 5839 so that architects and engineers are, like all other defendants, only subject to the 2- and 3-year statutes of limitations for malpractice and negligence, and the previously-applicable 6- and 1-year statutes of limitations are transformed into statutes of repose which shorten the outer time limit for claims against architects and engineers.  The bill was passed by the State Senate in February, 2008, and went to the House of Representatives, where the Committee on the Judiciary recommended it without amendment in November.  However, the 2007-08 session of the Legislature ended before the bill was voted on by the House.  Undeterred, Senator Sanborn reintroduced the bill in the Senate in January, 2009 at the start of the new legislative session.  Whether it will be re-approved by the Senate, passed by the House, and signed by the governor during the 2009-2010 session remains to be seen.