Sheetz, Aiken & Aiken, Inc. v. Spann, Hall, Ritchie, Inc.

• Decision Date: 24 July 1987
• Parties: SHEETZ, AIKEN & AIKEN, INC., et al. v. SPANN, HALL, RITCHIE, INC. 86-410.
• Court: Alabama Supreme Court

Page 99

512 So.2d 99

SHEETZ, AIKEN & AIKEN, INC., et al. v. SPANN, HALL, RITCHIE, INC.

86-410.

Supreme Court of Alabama.

July 24, 1987.

John E. Byrd, Dothan, for appellants.

E.L. McCafferty III and Dennis McKenna, of Inge, Twitty, Duffy, Prince & McKenna, Mobile, for appellee.

SHORES, Justice.

This is an appeal from a summary judgment in favor of a third-party defendant, Spann, Hall, Ritchie, Inc. We affirm.

On October 1, 1980, the Dothan Assisted Housing Corporation, hereinafter referred to as DAHC, entered into a development contract with the Atlanta-based architectural firm of Sheetz, Aiken & Aiken, Inc., hereinafter referred to as "Sheetz." In the contract, Sheetz, as developer and architect, agreed to design and oversee the construction of a subsidized housing project in Dothan, Alabama, as well as to act as the inspecting architect, making weekly inspections and reports to DAHC of observed defects or deficiencies. Sheetz also agreed to verify and certify that the project, upon completion, complied with the plans and specifications as originally drafted by Sheetz, and that final payment was appropriate.

Prior to execution of the development contract, Sheetz contacted Spann, Hall, Ritchie, Inc., hereinafter referred to as "Spann," with the intention of hiring it to serve as the inspecting architect designated in the development contract. Spann refused, but in a contract entered into with DAHC on August 8, 1980, Spann agreed to provide the limited architectural service of verifying monthly payments to the contractor under the contract. The contract between DAHC and Spann more particularly described Spann's duties and liabilities as architect as follows:

"[The architect shall make] periodic visits to the site to familiarize himself generally with the progress of the work observed and to determine in general if the work is proceeding in accordance with the contract documents. The ARCHITECT shall not be required to make any exhaustive or continuous onsite inspections to check the quality and quantity of the work. The ARCHITECT shall not be responsible for construction means, methods, techniques, sequences, or procedures or for safety precautions and programs in connection with the work, and shall not be responsible for the contractor's failure to carry out the work in accordance with the contract documents.

"....

"1.1.2 Based upon the observations at the site on the contractor's application for payment, the ARCHITECT shall determine the amount owing to the contract [sic] for 'direct construction costs' and shall approve applications for payments in such amounts. The approval of applications for payment shall constitute a representation by the ARCHITECT to the OWNER and other authorized agencies, based on the ARCHITECT'S observations at the site as provided in subparagraph 1.1.1 and the data comprising the application for payment, that the work has progressed to the point indicated; to the best of ARCHITECT'S knowledge, information and belief. By signing an application for payment, the ARCHITECT shall not be deemed to represent that he has made assertions or that he has made any examinations to ascertain how and for what purpose a contract [sic] has used the monies paid on account of the contract sum.

"....

"1.1.4 The ARCHITECT shall not be responsible for the acts or omission of the contractor, or any subcontractors, or any other contractor or subcontractors, agents or employees, or any person performing any work."

DAHC filed suit against two defendants, Sheetz and Albert G. Smith, Inc., the firm hired by Sheetz to do the actual construction on the housing project. The complaint alleges that Sheetz breached its contract with DAHC by failing to deliver a building free of defect and constructed in accordance with the plans and specifications set forth in the contract. The complaint also contains allegations that both defendants breached implied warranties of habitability, that Sheetz fraudulently failed to comply with the plans and specifications of the contract, and that Sheetz fraudulently misrepresented the quality of the materials and workmanship used on the project.

After service of the complaint, Sheetz filed a third-party complaint against a number of defendants, including Spann. In the third-party complaint, Sheetz incorrectly designated Spann by the corporate name of Phillip Spann and Associates, Inc., a corporation formed by Phillip Spann after the dissolution of Spann, Hall, Ritchie, Inc., on October 25, 1983. In January of 1986, on motion of Sheetz, Spann was substituted as the correct party.

Sheetz alleged liability on the part of Spann as follows:

"157. On January 15, 1980, Sheetz entered into a contract with Smith for the construction of the Vaughn Towers Project in Dothan, Alabama.

"158. The third-party defendant, Spann, on August 8, 1980, entered into an agreement with the Housing Corporation to provide professional services and to be compensated for the services performed in the...