Introduction
These companion appeals concern whether a subsequent purchaser of a completed apartment complex may pursue professional-negligence claims against the architect and structural engineer despite having no contract with either professional.
Sugarloaf Walk Apartments, L.P. retained Wakefield Beasley & Associates (“WBA”) to provide architectural services for a five-building mixed-use apartment project. WBA subcontracted structural engineering work to Hart Gaugler and Associates. The project was completed in 2019 and purchased by ICH 3 Atlanta Sugarloaf Apartments, L.P. (“ICH”) in 2020. After moisture intrusion was reported in 2021, an investigation identified water damage, structural defects, building-envelope problems, and other deficiencies.
ICH alleged that WBA and Hart Gaugler negligently prepared plans and specifications and failed to perform their professional duties according to industry standards. It also alleged that WBA negligently administered the construction phase. The trial court granted summary judgment to both firms, principally relying on lack of contractual privity, the economic-loss doctrine, asserted admissions in ICH’s pleadings, and release provisions in ICH’s purchase agreement.
The Court of Appeals reversed both judgments.
Analysis
1. Standard Governing Summary Judgment
Relying on Centurion Indus. v. Naville-Saeger, the court reviewed the summary judgments de novo and construed the evidence and reasonable inferences in ICH’s favor. Summary judgment was therefore improper if the record contained a genuine dispute over a material fact.
Under Cowart v. Widener, a defendant who will not bear the burden of proof at trial may obtain summary judgment by identifying an absence of evidence on an essential element. Once that showing is made, the plaintiff must identify specific evidence creating a triable issue. ICH met that obligation through expert opinions identifying allegedly defective designs, ambiguous plans, inadequate building-envelope details, and deficient construction administration.
2. Privity and Independent Professional Duties
OCGA § 51-1-11 (a) generally allows tort claims without privity, but confines a claim to contracting parties when the allegedly violated duty exists only because of a contract. An exception applies when the injured party possesses an independent right of action apart from the contract.
Dominic v. Eurocar Classics supplies this framework: where the parties lack privity, a viable tort claim must rest on a duty arising independently of the contract. Howard v. Dun & Bradstreet states the general rule that a professional ordinarily is not liable for professional negligence to a person outside contractual privity. But Driebe v. Cox recognizes that professionals may, under appropriate circumstances, owe reasonable-care duties to nonclients.
The decisive authority was Jai Ganesh Lodging, Inc. v. David M. Smith, Inc., which recognizes that a construction-professional claim may arise from a duty implied by law to perform work according to industry standards rather than solely from a contractual promise. ICH’s experts identified numerous departures from professional standards and connected those departures to physical defects and damage. That evidence created a factual issue concerning an independent professional duty.
The decision does not impose unlimited liability on architects and engineers to every remote party. A nonclient must still establish a legally cognizable duty, breach of the professional standard of care, causation, and recoverable damages. The holding is narrower: lack of privity alone does not justify summary judgment when evidence supports an independently imposed professional duty.
3. Hart Gaugler’s Structural Engineering Services
The trial court characterized ICH’s repair and remediation costs as purely economic losses and concluded that Hart Gaugler’s duties arose only from its subcontract with WBA. The Court of Appeals found that analysis incomplete.
ICH presented evidence that Hart Gaugler’s design allegedly failed to accommodate wood shrinkage and contributed to physical damage. Because the asserted standard of professional care could arise independently of the subcontract, the controlling question was not simply whether ICH had contractual privity. It was whether Hart Gaugler breached an independent professional duty and caused the claimed damage. Those questions remained disputed.
4. Earlier Pleadings as Judicial Admissions
The trial court treated ICH’s allegation that some construction was not performed according to the plans as a binding admission defeating its negligent-design claim. The appellate court rejected that treatment.
Richmond County v. Sibert establishes that withdrawal or amendment prevents an original allegation from continuing as a conclusive admission in judicio. Under Strozier v. Simmons U.S.A. Corp., an allegation from a superseded or stricken pleading may remain admissible evidence, but the party may explain it and create a factual dispute. Versico, Inc. v. Engineered Fabrics Corp. similarly explains that pleading admissions are conclusive only until withdrawn or amended.
ICH’s eighth amended complaint alleged that damage occurred in locations where contractors followed WBA’s plans. Consequently, the earlier allegation was no longer conclusively binding. At most, it was evidence for the factfinder to weigh against ICH’s amended allegations and other proof.
5. Compliance with Plans Must Be Assessed Defect by Defect
The trial court also reasoned that any departure from the plans defeated the negligent-design claim as a whole. The Court of Appeals held that this was too broad.
Under Covil v. Robert & Co. Associates, a plaintiff claiming negligent preparation of plans must prove that construction complied with the plans “with respect to that portion of the work claimed to be defective.” The rule requires a causal link between the challenged design and the particular defect; it does not require proof that every aspect of the entire project complied perfectly with every plan.
Thus, defective workmanship in one area does not automatically insulate an architect from liability for a design defect in another. ICH’s experts identified particular components allegedly built according to plans that were themselves defective or inadequately detailed. That evidence presented a jury question.
6. WBA’s Construction Administration and the Release
ICH’s purchase agreement accepted the property “as is” and released the seller, its affiliates, agents, and related parties from broadly defined claims. The trial court treated WBA as the seller’s agent and held that the release barred ICH’s construction-administration claim.
The Court of Appeals concluded that WBA’s status as an “agent” within the meaning of the release involved disputed facts. The mere existence of WBA’s professional relationship with the project owner did not permit the court to resolve the scope of the release as a matter of law. The court also stated that material factual disputes defeated the trial court’s other alternative grounds for summary judgment.
7. Treatment of the Economic-Loss Issue
The opinion rejects the use of the economic-loss doctrine as an automatic bar where the evidence supports physical property damage and breach of a duty implied by law. It does not, however, announce that every repair cost is recoverable in tort. Future plaintiffs must distinguish actual property damage and independent professional negligence from a claim seeking only the benefit of a commercial bargain.