In a January decision, the Oklahoma Supreme Court significantly
expanded the potential liability of architects involved in
supervising public construction projects. In doing so, it may have
expanded the potential liability of other professionals.
Boren v. Thompson & Associates arose out of the construction of a
library by the Tyrone, Okla., school district. The case was brought
by a subcontractor that had not been paid by the general contractor.
The general contractor's liability to its subcontractor was
apparently undisputed, but the case focused not on the general
contractor's liability but on the liability of the school district's
Normally, unpaid subcontractors may file mechanic's and
materialmen's liens against property on which they perform work.
However, public property is not subject to liens, thereby leaving
unpaid subcontractors with no claim against the property. To protect
subcontractors working on public projects, Oklahoma law provides
alternative security. It requires that the general contractor post a
Through the payment bond, the bonding company commits to pay
subcontractors whose bills are not paid by the general contractor.
The Tyrone school district had employed an architect to oversee
the construction project. The architect's responsibilities included
"certifying" payments to the general contractor -- that is,
certifying that the contractor was entitled to payment under its
construction contract. To qualify for payment, the general
contractor had to satisfy the obligations of its contract, which
included the posting of the payment bond required by law.
In this case, however, the architect overlooked the fact that the
general contractor had failed to post the required bond and
proceeded to certify payments under the contract. The unpaid
subcontractor sued the architect, claiming the architect's failure
to withhold certification facilitated unauthorized payments to the
general contractor, thereby depleting funds which should have been
reserved to pay subcontractors' claims.
The court took the opportunity to revisit a 1979 Oklahoma Supreme
Court case that considered a similar issue. In that case, a
subcontractor had sought recovery against the Edmond Public School
District for amounts not paid by the general contractor. In this
case, the general contractor had failed to post the required
statutory bond, but the district had nonetheless made payments to
the general contractor. The court held that a subcontractor who
furnishes labor or materials without satisfying itself that the bond
is in place does so at its own peril. Therefore, the court held that
no claim could be made against the school board or the board
In the Boren case, the Supreme Court considered the potential
liability of a for-profit company (as opposed to the public agency
involved in the 1979 decision).
The court held that under the facts of the case subcontractors
could assert claims of negligence against the school district's
architect and, if such claims are substantiated, presumably recover
unpaid amounts from the architect. The court held that an architect
under such circumstances "ought to labor under a duty to
subcontractors" to avoid action that may result in the
subcontractors not being paid. …