Architect Prevails on Personal Injury Claim under Completed-and-Accepted Doctrine (Neiman v. Leo A. Daly Company)

On May 30, 2008, Ellen Neiman went to the Main Stage Theatre of Santa Monica College to watch a show. While walking down the stairs to find a seat at the Main Stage she fell and was seriously injured.

In investigating the cause of her accident she discovered that the theater, designed by Leo A. Daly Company (Architect) and owned by Santa Monica Community College District (College) had been constructed in 2006 lacking the contrast marking stripes on the stairs specified by the Architect in its plans. The stripes were designed to be seen by someone walking down the stairs and the purpose of such striping is to ensure that “the location of each tread is readily apparent when viewed in descent.” Neiman learned that the Architect, the College, the contractor and a representative from the Division of the State Architect failed to notice the lack of contrast marking stripes on a walk-through of the project on June 15, 2006. However, at the end of the walk-through, or “job walk,” the project was deemed substantially complete, meaning the Main Stage could be utilized for its intended use.

Neiman sued the Architect and the College for a dangerous condition of public property under Gov’t Code §835, alleging that the theater stairs were improperly marked and delineated; that the College had notice of the condition under §835.2; and that the Architect negligently failed to notify the College during construction that the theater stairs did not have the contrast marking stripes that were specified in the Architect’s plans.

The Architect moved for summary judgment, arguing that it was not liable for Neiman’s injury because the work at the theater had been completed and had been accepted by the College. The trial court granted the motion, finding that the Architect established the affirmative defense of the completed-and-accepted doctrine. Neiman appealed.

The completed-and-accepted doctrine provides that “[W]hen a contractor completes work that is accepted by the owner, the contractor is not liable to third parties injured as a result of the condition of the work, even if the contractor was negligent in performing the contract, unless the defect in the work was latent or concealed. The rationale for this doctrine is that an owner has a duty to inspect the work and ascertain its safety, and thus the owner’s acceptance of the work shifts liability for its safety to the owner, provided that a reasonable inspection would disclose the defect. Stated another way, “when the owner has accepted a structure from the contractor, the owner’s failure to attempt to remedy an obviously dangerous defect is an intervening cause for which the contractor is not liable.” (Sanchez, supra, 47 Cal.App.4th at p. 1467.) The doctrine applies to patent defects, but not latent defects. “If an owner, fulfilling the duty of inspection, cannot discover the defect, then the owner cannot effectively represent to the world that the construction is sufficient; he lacks adequate information to do so.” (Sanchez, supra, 47 Cal.App.4th at p. 1467.)

The Court of Appeal affirmed, holding that the Architect was not liable for Neiman’s injury under the completed-and-accepted doctrine because 1) the evidence established that the work on the stairs was completed and accepted by the College, and the theatre was opened to the public long before Neiman’s injury; 2) the lack of contrast marking stripes was a patent defect, not a latent defect. The Architect’s plans and specifications called for contrast marking stripes to be placed on the stairs at the theater, and if the College had conducted a reasonable inspection to ensure the project complied with the plans and specifications, it would have noticed the contrast marking stripes called for in the plans and specifications were missing; and 3) the Architect, as an architect engaged in the supervision of construction was entitled to the protection of the completed-and-accepted doctrine.

The completed-and-accepted doctrine is a blessing for contractors, and for construction managers and design professionals responsible for supervision of construction work. It insulates these parties from damages to third persons that are injured as a result of defectively performed work that was apparent upon reasonable inspection when accepted by the owner. The doctrine also likely insulates these parties from equitable indemnity claims by owners who must pay the injured party as a consequence of the defective work. See Prince v Pacific Gas & Electric Co. (2009) 45 Cal. 4th 1151. On the other hand, owners beware — , when you accept a job following construction you may be accepting responsibility for open and obvious conditions that are dangerous to the public. The lesson of the Neiman and Sanchez cases for owners is to diligently adhere to a belt and suspenders approach to risk management and risk transfer. This includes: 1) carefully maintain your own liability coverages; 2) insist on properly drafted indemnity agreements when retaining contractors or design professionals to perform construction or repair work; and 3) require that contractors name you—the owner—as an insured on their policies for ongoing and completed operations for injuries arising out of their work.

Neiman v. Leo A. Daly Company
(11/1/2012) 2012 Cal. App. LEXIS 1134

By Ralph R. Rhoades
Parton | Sell | Rhoades,

For questions or more information about this topic, please contact Ralph Rhoades at rrhoades@partonsell.com

On May 30, 2008, Ellen Neiman went to the Main Stage Theatre of Santa Monica College to watch a show. While walking down the stairs to find a seat at the Main Stage she fell and was seriously injured. In investigating the cause of her accident she discovered that the theater, designed by Leo A. […]