Condominium boards embroiled in construction defect lawsuits against developers (sponsors) often see a further complication arise: the sponsor bringing in the project architects as third-party defendants. Sometimes the condo can sue the project architect directly but many times the focus is on the developer and its members and they point the finger at the architect. This tactic can introduce additional complexities into the condo board’s case against the sponsor. A recent New York case sheds light on this dynamic.

In the case of Board of Managers of the 15 Union Square West Condominium v. BCRE 15 Union Square West LLC, the condo board sued the building’s sponsor. The sponsor, in turn, filed claims against various third-party defendants, including the project architects, Perkins Eastman Architects P.C. Perkins Eastman argued that the sponsor’s claims against them were time-barred under their contract and that certain claims were duplicative and should be dismissed.

Key Points for Condo Boards

• Shifting Focus: When the sponsor brings the architects into the lawsuit, it can divert attention from their own potential liability for construction defects. Condo boards need to maintain a strong focus on the primary case against the sponsor. If there are additional pockets to pay for damages sought by the condo, great. But, stay focused on moving the condo’s case against the sponsor and its members forward.
• Statutes of Limitations: There is a limited window of opportunity to file claims against architects based on design flaws or oversight errors. Expired statutes of limitations can protect architects and prohibit claims against the if too much time goes by.
• Breach of Contract vs. Professional Negligence: Sponsors may attempt to pursue architects on both breach of contract and professional negligence grounds. However, demonstrating professional negligence requires proving a violation of broader industry standards that goes beyond the contract itself.
• Contractual Indemnification: Contractual indemnification clauses, by which sponsors might seek to shift liability to architects, often have time limits that diminish their usefulness.

In view of this, condo boards should be aware that sponsors may try to deflect blame and responsibility by bringing architects into the lawsuit. This additional layer of complexity can delay the condo’s suit and make it more complicated because of the additional parties and issues involved, but in the end, if there are more parties available to pay for the damages sought. However, it could end up being a good thing provided experienced counsel is leading the charge and stays focused on pushing the condo’s claims full speed ahead.

Here’s the case.