R.M. Kliment & Frances Halsband, Architects v. McKinsey & Company, Inc., 3 N.Y.3d 538 (2004)
When a claim against an architect arises from their failure to exercise due care in performing professional services, the claim is governed by the three-year statute of limitations for malpractice, regardless of whether the claim is framed as a breach of contract based on an express contractual provision mirroring the architect’s professional obligations.
Summary
McKinsey & Company hired R.M. Kliment & Frances Halsband, Architects (K&H) for office design. After the project’s completion, McKinsey alleged K&H failed to comply with fire protection requirements mandated by the Connecticut Building Code, breaching an express contractual clause. McKinsey demanded arbitration more than three years after project completion. K&H sought a stay, arguing the three-year malpractice statute of limitations barred the claim. The New York Court of Appeals held that because the claim fundamentally alleged professional negligence, the three-year statute applied, even with an express contract term mirroring professional obligations, thus barring the claim.
Facts
In January 1998, McKinsey & Company, Inc. contracted with R.M. Kliment & Frances Halsband, Architects (K&H) for architectural and interior design services. A clause in the contract required K&H to ensure all plans complied with applicable building codes. The Stamford Building Department issued a certificate of occupancy in November 1998. In April 2002, McKinsey claimed K&H failed to provide code-compliant fire protection, necessitating McKinsey to incur costs to remedy the defect. McKinsey then sought arbitration.
Procedural History
K&H initiated a special proceeding to stay arbitration, arguing the claim was time-barred under the three-year malpractice statute of limitations. The Supreme Court denied the petition, characterizing the claim as a breach of contract and subject to a six-year statute of limitations. The Appellate Division reversed, holding that the claim was subject to the three-year malpractice statute of limitations, irrespective of being framed as a contract breach. The New York Court of Appeals granted leave to appeal and affirmed the Appellate Division’s decision.
Issue(s)
Whether a claim against an architect for failing to comply with building codes, based on an express contractual provision requiring such compliance, is governed by the three-year statute of limitations for malpractice, or the six-year statute of limitations for breach of contract.
Holding
No, because the essence of the claim is that the architect failed to perform services in a professional, non-negligent manner, which falls under the definition of malpractice, and is therefore subject to the three-year statute of limitations regardless of whether the claim is based on an express contractual provision.
Court’s Reasoning
The Court of Appeals emphasized that CPLR 214(6) was amended to ensure that malpractice claims are governed by a three-year statute of limitations, irrespective of whether the underlying theory is contract or tort. The legislative intent was to prevent plaintiffs from circumventing the malpractice statute by framing malpractice claims as contract breaches. The Court noted that while McKinsey argued the case differed due to an express contractual provision, compliance with building codes is inherent in an architect’s professional obligations. The Court reasoned that “Making such ordinary obligations express terms of an agreement does not remove the issue from the realm of negligence…nor can it convert a malpractice action into a breach of contract action.” Allowing the claim would undermine the legislative purpose of the amendment to CPLR 214(6). The pertinent inquiry is whether the claim is essentially a malpractice claim. Because K&H did not guarantee a particular result beyond its professional obligations, the claim remained a malpractice action and was time-barred. As the court stated, “where the underlying complaint is one which essentially claims that there was a failure to utilize reasonable care or where acts of omission or negligence are alleged or claimed, the statute of limitations shall be three years if the case comes within the purview of CPLR Section 214 (6), regardless of whether the theory is based in tort or in a breach of contract”.