Court Focuses on Biakanja Factors in Deciding Homeowner Can Sue Principal Architect for Negligence
July 7, 2014
A Forum on Key Legal Issues for Design Professionals, Contractors, and Developers
July 7, 2014
The Supreme Court of California issued its ruling in Beacon Residential Community Assn. v. Skidmore, Owings & Merrill LLP on July 3. Gordon & Rees’s Greg Hanson discussed the Supreme Court hearing on this case in his June 5 blog post. Greg’s prediction as to the court’s decision turned out to be true. Certain architects can be sued by a homeowner for defects in a residence.
The court focused on the Biakanja factors in determining that a “principal architect” can be sued in negligence by a homeowner despite the absence of privity. Interestingly, the court preserved the ruling in the Weseloh matter, which held that a retaining wall designer retained by a second-tier subcontractor could not be sued by the homeowner for a collapse of a retaining wall.
In his blog post, Greg observed that the court suggested it was foreseeable that a defective design would affect eventual purchasers of units; that the Beacon architects were intimately involved with the project; and that the payment of $5 million to the Beacon architects in comparison to the $2,000 payment to the designers in the Weseloh case was significant. In its ruling, the court used these factors as a major part of its analysis in finding that the Biakanja factors support a finding that the Beacon architects could be sued by the homeowners association in negligence without a contractual relationship.
The following is the court’s summary of its analysis of the Biakanja factors:
While the ruling itself is not surprising to most observers, an in-depth reading of the opinion creates an open question as to when a designer’s connection to the project is enough to create liability in negligence. Where does the line ultimately get drawn between the architects in Beacon and the designers in Weseloh?
It should also be noted that we can expect to hear more from the appellate court regarding Beacon as the court is presently deciding whether the HOA has standing to bring a class action on behalf of the unit owners.
For a more detailed discussion of the case, click here.