797 Broadway Group, LLC v. Stracher Roth Gilmore Architects ( 2014 )

State of New York
Supreme Court, Appellate Division
Third Judicial Department
Decided and Entered: December 11, 2014 517903
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797 BROADWAY GROUP, LLC,
Appellant,
v MEMORANDUM AND ORDER
STRACHER ROTH GILMORE
ARCHITECTS,
Respondent.
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Calendar Date: October 8, 2014
Before: Peters, P.J., Lahtinen, Garry, Rose and Lynch, JJ.
__________
Tomaselli Law Offices, Poestenkill (Patrick J. Tomaselli of
counsel), for appellant.
Sugarman Law Firm, LLP, Syracuse (Matthew D. Gumaer of
counsel), for respondent.
__________
Peters, P.J.
Appeal from an order of the Supreme Court (Kramer, J.),
entered August 9, 2013 in Schenectady County, which granted
defendant's motion to dismiss the complaint.
Plaintiff owns an office building in the City of
Schenectady, Schenectady County. In response to a 2006 request
for proposals by the County of Schenectady to provide newly
constructed or renovated office space to house its Department of
Social Services and Job Training Agency, defendant, a
professional partnership that provides architecture services,
submitted a proposal to plaintiff to redevelop the premises.
Plaintiff accepted the proposal and also entered into a separate
agreement with the general contractor, BCI Construction, Inc.,
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for construction administration and management services.
Following substantial completion of the work, the County assumed
use and occupation of the building in early 2009. Approximately
three years later, the stucco facade of the building began to
crack and fail, with delamination allegedly occurring over most
of the building's exterior vertical surfaces.
In December 2012, plaintiff commenced this action,
asserting claims sounding in strict liability, breach of implied
warranty of fitness for a particular purpose, breach of implied
warranty of merchantability, negligent design or review, breach
of contract and negligent misrepresentation. In lieu of
answering, defendant moved to dismiss all six causes of action in
the complaint. As relevant here, defendant argued that the
claims either failed to state a cause of action or that they were
time-barred under the three-year statute of limitations
applicable to claims of professional malpractice. Supreme Court
granted defendant's motion, prompting this appeal.
Plaintiff argues that Supreme Court erred in determining
that the contract at issue was not a turnkey or design-build
agreement pursuant to which defendant was responsible for all
aspects of designing and building the project, as opposed to only
professional services. In "turnkey" or "design-build"
construction projects, "an owner contracts with one entity to
both design and build the project [and t]he turnkey builder is
responsible for every phase of the construction from final design
through subcontracting, construction, finishing and testing"
(Robert A. Rubin, Sarah B. Biser & Catherine M.K. Brown, New York
Construction Law Manual § 1:23 [33 West's New York Practice
Series 2013]; see Richard K. Allen, Stanley A. Martin & Leah A.
Rochwarg, Construction Law Handbook § 6.03 [A], at 134-135 [2d ed
2013]; see also Charlebois v Weller Assoc., 72 NY2d 587, 590-592
[1988]). The design-builder generally cannot shift liability and
is the "single point [of] responsibility" under a design-build
contract, because it is "the [d]esign-[b]uilder [who] has the
responsibility of the preliminary and construction design, the
responsibility of submitting a fixed sum for the construction of
the project and the responsibility for holding the contracts with
its trade contractors" (Richard K. Allen, Stanley A. Martin &
Leah A. Rochwarg, Construction Law Handbook § 6.03 [A], at 134
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[2d ed 2013] [emphasis added]). As plaintiff asserts, it follows
that nearly every design-build project involves the existence of
two or more contracts – at least one among the members of the
design-build team and one between the design-builder and the
owner. Here, however, it was not defendant, the purported
design-builder, who held the separate contract with the general
contractor, but plaintiff as the owner. Hence, Supreme Court
correctly determined that the parties had not entered into a
design-build agreement, despite their mislabeling the agreement
as such, because the critical factor in a design-build
arrangement – that the owner has only a single contract with the
design-builder – is absent.
Moreover, a review of the scope of services in the parties'
agreement indicates that plaintiff contracted with defendant
solely for professional services relating to the design of the
renovations to be performed on plaintiff's building. Indeed,
plaintiff does not dispute that the duties set forth in the
agreement were "[]consistent with an architect's ordinary
professional obligations" (Matter of R.M. Klimet & Frances
Halsband, Architects [McKinsey & Co., Inc.], 3 NY3d 538, 542
[2004]), and the complaint characterizes the parties' agreement
as one for "professional services." In contrast, the complaint
describes plaintiff's separate agreement with BCI as one for
nonprofessional construction administration and management
services, including the provision of all labor, materials,
equipment and services necessary to perform the redevelopment
work.
In light of the foregoing, we conclude that plaintiff's
fourth and fifth causes of action – alleging that defendant was
negligent and breached the parties' contract by failing to use
reasonable care in rendering its professional services –
essentially allege professional malpractice (see id. at 542-543;
City of Binghamton v Hawk Eng'g P.C., 85 AD3d 1417, 1418 [2011],
lv denied 17 NY3d 713 [2011]). Such claims "'come[] within the
purview of CPLR 214 (6),'" which sets forth a three-year statute
of limitations for nonmedical malpractice, "'regardless of
whether the theory is based in tort or breach of contract'" (City
of Binghamton v Hawk Eng'g P.C., 85 AD3d at 1418, quoting Rev
Assembly Mem in Support, Bill Jacket, L 1996, ch 623, at 6;
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accord Matter of R.M. Klimet & Frances Halsband, Architects
[McKinsey & Co, Inc.], 3 NY3d at 542). We note that "'a claim
for professional malpractice against an engineer or architect
accrues upon the completion of performance under the contract and
the consequent termination of the parties' professional
relationship'" (City of Binghamton v Hawk Eng'g P.C., 85 AD3d at
1418, quoting Town of Wawarsing v Camp, Dresser & McKee, Inc., 49
AD3d 1100, 1101-1102 [2008]). Defendant provided both invoices
indicating that it last rendered services to plaintiff in early
January 2009, and a certificate of substantial completion that
was signed by plaintiff's representative that acknowledged that
the work was "sufficiently complete in accordance with the
[c]ontract [d]ocuments so that [plaintiff could] occupy" the
premises as of December 19, 2008. Plaintiff signed the
certificate of substantial completion in March 2009; defendant
signed it in April 2009. Accordingly, in the absence of any
contractual obligations extending beyond issuance of the
certification of substantial completion, the running of the
statute of limitations commenced in April 2009, at the latest
(see State of New York v Lundin, 60 NY2d 987, 989 [1983]; City of
Binghamton v Hawk Eng'g P.C., 85 AD3d at 1419; cf. Town of
Wawarsing v Camp, Dresser & McKee, Inc., 49 AD3d at 1102-1104).
Inasmuch as plaintiff did not commence this action until December
2012, plaintiff's fourth and fifth causes of action are time-
barred (see CPLR 214 [6]).
Plaintiff's remaining arguments do not require extended
discussion. With respect to plaintiff's causes of action for
strict liability, breach of implied warranty of fitness for a
particular purpose and breach of implied warranty of
merchantability, it is settled that "no action lies for breach of
implied warranty, or what is now known as strict product
liability, on behalf of an owner against the architect with whom
he [or she] has [a] contract" (Sears, Roebuck & Co. v Enco
Assoc., 43 NY2d 389, 398 [1977] [superseded by statute on other
grounds]; see Queensbury Union Free School Dist. v Walter Corp.,
91 Misc. 2d 804, 806-809 [Sup Ct, Warren County 1977]; see also
Barnett v City of Yonkers, 731 F Supp 594, 601 [SD NY 1990]).
Thus, plaintiff's claims in that regard were properly dismissed
for failure to state a cause of action (see CPLR 3211 [a] [7]).
Finally, plaintiff's claim for negligent misrepresentation was
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also properly dismissed pursuant to CPLR 3211 (a) (7) because it
"arise[s] from the same facts as the [architectural] malpractice
cause[s] of action alleged in the complaint, and do[es] not
allege distinct damages" (Iannucci v Kucker & Bruh, LLP, 42 AD3d
436, 437 [2007]; see Rochester Fund Muns. v Amsterdam Mun.
Leasing Corp., 296 AD2d 785, 788 [2002]).
Plaintiff's remaining arguments have been considered and
found to be lacking in merit.
Lahtinen, Garry, Rose and Lynch, JJ., concur.
ORDERED that order is affirmed, with costs.
ENTER:
Robert D. Mayberger
Clerk of the Court