Recreational Design & Construction, Inc. v. Wiss, Janney, Elstner Associates, Inc.
820 F. Supp. 2d 1293
S.D. Fla.2011Background
- Plaintiff Recreational Design & Construction, Inc. contracted with the City of North Miami Beach in Feb. 2006 to perform design and construction for the Victory Pool Renovations project.
- Independent engineering firms (Defendants) evaluated the project after completion and issued reports alleging a defective water slide, advising immediate replacement.
- Plaintiff, aware of Defendants' involvement, rebuilt the water slide as directed by the City based on those reports.
- Plaintiff sued the Defendants in state court for professional malpractice and negligent misrepresentation; the case was removed to federal court and Defendants moved to dismiss under Rule 12(b)(6).
- The court sua sponte addressed subject matter jurisdiction and granted the motion to dismiss without prejudice, allowing an amended complaint.
- The City was not a party to the action, and the court analyzed Florida-law professional negligence and misrepresentation claims, including economic loss rule considerations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Economic loss rule applicability | Moransais permits claims absent privity; Plaintiff argues rule should not bar professional negligence. | Economic loss rule bars tort recovery when only contractual economic damages exist. | Economic loss rule not a bar to professional negligence here; Moransais controls. |
| Duty in professional malpractice | Allegations show Defendants knew Plaintiff was contractor and could foresee harm. | No close nexus or duty to Plaintiff; duty owed to City, not Plaintiff. | No duty owed to Plaintiff; insufficient factual nexus. |
| Breach of duty | Allegations show Defendants failed to exercise care and properly evaluate the water slide. | Complaint lacks factual specifics showing breach. | Breach not adequately pleaded; dismissed. |
| Causation | City relied on Defendants' reports, causing Plaintiff's damages. | Damages flow from City’s decisions, not Defendants' conduct; no proximate cause. | No causation linking Defendants to Plaintiff's damages. |
| Negligent misrepresentation | Defendants provided false information causing pecuniary loss to Plaintiff. | No special relationship; misrepresentation not pleaded with particularity; Rule 9(b) applies. | Misrepresentation claim failed; dismissed. |
Key Cases Cited
- Moransais v. Heathman, 744 So.2d 973 (Fla. 1999) (economic loss rule not broad in professional negligence against engineers; duty limits)
- Indemnity Ins. Co. of N. Am. v. Am. Aviation, Inc., 891 So.2d 532 (Fla. 2004) (economic loss rule generally governs contractual economic damages)
- AFM Corp. v. S. Bell Tel. Co., 515 So.2d 180 (Fla. 1987) (foreseeability as touchstone for duty in some contexts)
- McElvy, Jennewein, Stefany, Howard, Inc. v. Arlington Elec., Inc., 582 So.2d 47 (Fla. 2d DCA 1991) (architects/engineers may owe no duty to contractors without close nexus)
- E.C. Goldman, Inc. v. A/R/C Assoc., Inc., 543 So.2d 1268 (Fla. 5th DCA 1989) (consultant outside the chain of construction; no duty to subcontractor)
- First Fla. Bank v. Max Mitchell & Co., 558 So.2d 9 (Fla. 1990) (Restatement §552 negligent misrepresentation standard applied to professionals)
- Souran v. Travelers Ins. Co., 982 F.2d 1497 (11th Cir. 1993) (Rule 9(b) pleading heightened standard for negligent misrepresentation)