Balfour Beatty Infrastructure, Inc. v. Rummel Klepper & Kahl, LLP

⁴²⁶ LEAHY, J. In this appeal we consider whether the economic loss doctrine applies to shield an engineering firm from tort claims brought by a contractor seeking damages for economic losses suffered in consequence of relying on the firm’s allegedly defective designs and projections. Our holding is framed by the fact that, while the engineering firm and the contractor each had separate contracts with the government to perform work on the same design-bid-build construction project, there was no contract between the parties. The City of Baltimore entered into a contract with Rummel Klepper & Kahl, LLP (“RK & K” or “Appellee”), a design engineering firm, to produce construction designs and associated documents for use by the successful bidder(s) on succeeding proposals for construction of the Patapsco Wastewater Treatment Plant. Fru-Con Construction Corporation, predecessor to Balfour Beatty Infrastructure, Inc. (“BBII” or “Appellant”), 1 was the successful bidder on the plant upgrade projects, and entered into Sanitary Contract 852R with the City in November 2009.

Just over four years later, BBII filed a complaint in the Circuit Court for Baltimore City against RK & K, claiming that, during construction, BBII ran into costly delays and complications in reliance on RK & K’s allegedly defective designs and negligent misrepresentations concerning project timeline projections. The complaint sounded in tort, supported by the theory that RK & K had a duty to BBII based on the “intimate nexus” between them, and asserted three causes of action: 1) professional negligence, 2) information negligently supplied for the guidance of others under Restatement (Second) of Torts § 552, and, 3) negligent misrepresentation. RK & K filed a motion to dismiss the complaint for failure to state a claim. RK & K’s central argument was that the ⁴²⁷ complaint sought recovery for purely economic losses, and, because there was no contractual privity or its equivalent between BBII and RK & K, the economic loss doctrine barred BBII’s tort claims.

The circuit court granted the motion to dismiss in an order entered on April 10, 2014. We affirm. We hold that BBII failed to state a claim because, as a matter of law, in the absence of privity, death, personal injury, property damage, or the risk of death or serious personal injury, no duty of care in tort runs from an engineer or architect to a contractor for purely economic losses on a public construction project. In reaching this holding, we determine that Maryland does not expand the “intimate nexus” test to include extra-contractual concepts of duty for the recovery of solely economic losses in public construction cases.

BACKGROUND Design-bid-build contracts Under the “design-bid-build” project delivery method utilized by the City in this case, the owner first enters into a contract with an architect and/or engineer (“A/E” or “design professional”) to design the project. Typically, the engineering and design is completed before the owner releases a request for proposals for a general contractor to perform the work. 2 1 Bruner & O’Connor Construction Law § 2:11 (2015). Under this method: (1) the design is fully developed and completed before the pricing of the work, thus, presumably resulting in lowest cost, and (2) selection among responsible and responsive bidders can be made on the basis of price alone ... the contractor is excluded from contributing to the design process ... ⁴²⁸ Id. The A/E and the contractor each have a contract with the owner, but they have no contractual relationship with each other.

In contrast, integrated delivery methods, such as “design-build,” create a single point of responsibility because the A/E and the contractor are bound under a single contract with the owner. Id. at § 2:12. Typically the contractor who is part of a design-build team is involved in aspects of the design of a project from the beginning, and the A/E remains involved— normally in an oversight and advisory role — during the construction phase. Id.; 5 Bruner & O’Connor Construction Law § 17:52 (2015) (explaining the modern trend to minimize the A/E’s previous “substantial involvement in the construction process” to a lesser obligation to “observe the work and determine in general if the work is being performed in accordance with the contract documents.”). 3 The traditional design-bid-build model often engenders tensions between the A/E and the construction contractor, as explained in one treatise on the subject: A fundamental difficulty in allocating liability under the design-bid-build model is the inherent tension between the ⁴²⁹ interests of the architect and contractor.

Some contractors believe they can increase profits through change orders that are based on ambiguities, errors, or omissions in the architect’s design. Architects have an interest in protecting their designs, and frequently serve as the owner’s representative during construction. In these situations, it benefits the architect to resist any suggestion that the design is flawed and deny change order requests based on defective plans and specifications. Because of these competing interests, it can be difficult for the owner to determine whether the architect or contractor is responsible for a delay....

To complicate matters further, it may not be possible to join the architect and contractor in a single action[.] Robert F. Cushman et al., Proving & Pricing Construction Claims § 9.03[A][1] (3d ed.2015). As discussed further infra, under traditional design-bid-build contracts, especially in the public sector, the contractor normally has a contractual entitlement to recover against the owner for construction delays and other benefit-of-the-bargain damages caused by the A/E’s defective specifications and designs. RK & K’s Professional Engineering Services Contract According to the complaint, 4 sometime prior to October 2009, 5 the City entered into a contract with RK & K for the design of two interrelated projects to upgrade the plant, termed the “Enhanced Nutrient Removal Facilities.” According to BBII, the City’s contract with RK & K specified that RK & K was to produce accurate, complete, and correct ⁴³⁰ construction designs and drawings for use by the successful bidder(s) who would construct the plant upgrades. RK & K’s duties and responsibilities allegedly included, but were not limited to: • Development of the design for the two interrelated projects; • Development and preparation of drawings and specifications for use by prospective contractors for preparing and submitting bids and ultimately for use by the successful contractor for the construction of the projects; • Development of timelines for construction of the projects; • Development and preparation of responses to questions regarding the design raised by prospective contractors during the bid phase; • Review, evaluation, and comment on the proposals submitted by bidders/prospective contractors; • Review, evaluation, and approval of various submittals from the successful contractor during construction related to the Work and RK & K’s design; • Review, evaluation, and inspection of the successful contractor’s Work during construction to assure conformance with RK & K’s design intent and design; and • Review, evaluation, and acceptance of the successful contractor’s Work and certification to the City regarding the same.

Thus, in addition to its pre-construetion/design phase responsibilities, RK & K was allegedly assigned several construction-phase responsibilities, including: 1) evaluating and approving “various submittals” from the contractor related to the work and RK & K’s design; 2) inspecting the contractor’s work during construction to assure conformance with RK & K’s design intent and design; and, 3) review, evaluation, and, if acceptable, certification of the contractor’s work to the City. ⁴³¹ Sanitary Contract 852R Construction work for the projects under Sanitary Contract 852R (“SC 852”) and Sanitary Contract 845R (“SC 845”) 6 was to be completed at the same time, although SC 852 was let out for bid prior to SC 845. After it was pre-qualified by the City as capable of performing the work, Fru-Con Construction Corporation (predecessor in interest to BBII) bid on the SC 852 project, directly relying upon RK & K’s documents and designs. 7 On November 20, 2009, Fru-Con Construction Corporation and the City entered into a contract for the SC 852 project (“Contract”). Several years later, on January 1, 2014, the City agreed to an assignment of the Contract from Fru-Con Construction, LLC, to BBII. 8 Under the Contract, BBII was to, “among other things,” construct thirty-four “[d]enitrification filter cells (‘DNF cells’) adjacent to the existing wastewater facility.” DNF cells are “enormous, concrete tubs that hold massive amounts of wastewater to be treated.” The Contract also required BBII to construct pipes and pipe support systems for the SC 852 project. ⁴³² BBII’s Complaint In its complaint filed on January 6, 2014, BBII related that RK & K designed the DNF cells to expand or contract at keyed joints located in their concrete walls to accommodate fluctuating water pressure. BBII constructed the DNF cells in accordance with RK & K’s designs, but, when the water retention integrity of the DNF cells was tested, BBII learned that the cells were leaking due to cracks in the expansion and contraction joints.

BBII alleged that these cracks and the associated leaks were a direct result of deficiencies in RK & K’s design and that it cost BBII substantial additional time and expense to remediate the problems. BBII also claimed that, once construction was underway, it discovered RK & K’s design for the pipe support system was defective, and again, suffered substantial additional time and cost remedying RK & K’s allegedly defective pipe system design. Finally, BBII contended that RK & K delayed completion of its design of the companion project, SC 845, and that RK & K knew that any delays in the design of SC 845 would delay BBII’s ability to complete work on SC 852 and expose BBII to substantial costs and expenses. BBII alleged RK & K failed to properly establish a reasonable contract duration or project timeline for SC 852, and, instead, supplied false information to prospective contractors who were developing their estimates and competitive bids for the projects.

Predicated on these factual allegations, BBII asserted a claim for Professional Negligence (Count I), Restatement (Second) of Torts § 552 (Count II), and Negligent Misrepresentation (Count III). In Count I, BBII claimed that it was a foreseeable party that would directly rely upon RK & K’s professional services and designs, and, that “based upon the intimate nexus between [RK & K’s] design and [BBII’s] work as well as the contractual privity equivalent that exists between [RK & K] and [BBII], [RK & K] owed [BBII] a duty to act with a reasonable degree of care, knowledge, diligence and skill ordinarily possessed and exercised by similarly situated design professionals.” BBII demanded an estimated $10 mil ⁴³³ lion in damages for “increased and additional labor, materials, equipment and subcontractor costs, investigative costs, consultant fees, remediation costs, and delay costs.” In Count II (Restatement § 552 for “Information Negligently Supplied for the Guidance of Others”), BBII contended that it suffered damages “[a]s a direct and proximate result of [RK & K’s] failure to exercise reasonable care in preparing, supplying and communicating the design, including plans and specifications, for the Project.” Finally, in its third count for negligent misrepresentation, BBII posited that, as a result of the overlapping responsibilities of RK & K in both the design and construction phases of the project, and, because RK & K knew that BBII would rely on RK & K’s design and project duration schedule, “an intimate nexus and contractual privity equivalent exists between [RK & K] and [BBII].” According to BBII, RK & K knew that the design of SC 845 was not sufficiently complete so as to allow SC 582 to be constructed within the contract schedule, and RK & K faded to warn BBII that the prices and ultimate costs of completing SC 852 would far exceed estimates. Motions Before the Circuit Court After it was served with a copy of the complaint, on January 29, 2014, RK & K filed a motion to dismiss for failure to state a claim in the circuit court. In its memorandum of points and authorities, RK & K argued that BBII failed to plead any facts that would support finding the existence of a legally cognizable duty in tort running from RK & K to BBII.

Invoking the “economic loss rule,” RK & K argued that, in the construction industry, in the absence of privity or death, injury or a genuine risk of death or serious personal injury or property damage, no duty is owed by an architect or engineer to a contractor where the loss or damage alleged is economic in nature. RK & K asserted that there was no contract between the parties, and argued that the “intimate nexus” and Restatement (Second) of Torts § 522 concepts of extra-contractual duty have never been applied in Maryland to design ⁴³⁴ professionals in the construction field. Nonetheless, RK & K contended that BBII failed to allege facts that would allow a court to find the parties shared an “intimate nexus” or “professional/client relationship.” RK & K asserted that, for example, there were no allegations in the complaint regarding any specific communications between RK & K and BBII before or during construction, or consultations between BBII and RK & K on BBII’s bid or schedule assumptions. RK & K advanced the principles that support the economic loss rule as applied in the construction industry; namely, that common variables and “unknowns” — such as hidden site conditions, owner-directed changes, material and labor shortages, price escalations, defective materials, change orders and errors — are addressed through contracts that allocate risks and provide mechanisms for the assertion of claims and resolution of disputes.

RK & K asserted that “[w]hen considered in the construction industry context,” BBII’s “pitch to apply tort principles in order to bypass its bargained-for rights ... [is] a disruptive tactic that only can undermine public confidence in public procurement.” In its response filed February 20, 2014, BBII argued that RK & K misconstrued Maryland case law because the “economic loss rule” applies to products liability claims and was not meant to be a shield for professional malpractice. BBII defended its failure to allege facts detailing the provisions of BBII’s contract(s) with the City because the causes of action alleged in the complaint were separate from any claims BBII may have had against the City. BBII challenged RK & K’s assertion that the complaint failed to allege facts showing a relationship between RK & K and BBII on the ground that the complaint alleged that BBII was one of a limited group of pre-qualified, prospective contractors and that RK & K knew the City’s prospective contractors would directly rely upon RK & K’s design in preparing their bids. Finally, BBII argued that under Maryland law, a plaintiff seeking purely economic losses is not foreclosed from bringing an action for negligent misrepresentation. ⁴³⁵ RK & K replied, adding that tort liability should not be extended in this case because the “Spearin Doctrine” should have sheltered BBII from the risk of suffering the benefit-of-the-bargain type economic damages alleged in the complaint. 9 The doctrine, as enunciated in United States v. Spearin, applies specifically to construction projects and provides that “if the contractor is bound to build according to plans and specifications prepared by the owner, the contractor will not be responsible for the consequences of defects in the plans and specifications.” 248 U.S. 132, 136 , 54 Ct.Cl. 187 , 39 S.Ct. 59 , 63 L.Ed. 166 (1918) (citations omitted); see also Dewey Jordan, Inc. v. Maryland-Nat’l Capital Park & Planning Comm’n, 258 Md. 490, 498 , 265 A.2d 892 (1970) (“the contracting authority impliedly warrants that the plans and specifications are adequate and sufficient for the purpose intended and that the contractor is entitled to be compensated for delays in work occasioned by faulty plans and specifications.”).

Thus, RK & K argued, that if its designs were indeed defective, and if BBII had a right to rely on them (as BBII alleged in the complaint), then BBII would have been entitled to reimbursement from the City for any extra costs incurred under its ⁴³⁶ contract with the City under the Spearin doctrine. On the other hand, if BBII could not establish that RK & K’s designs were defective, or if it was determined that BBII failed to follow or properly interpret the designs, then BBII’s tort claims would fail as well. On March 14, 2014, BBII filed a motion for leave to file a sur-reply. BBII argued that RK & K misapplied the Spearin Doctrine because, although courts have held that the contracting authority impliedly warrants that plans and specifications supplied under the contract are adequate, and that the contractor is entitled to be compensated for certain costs and delays, those courts have never held that the implied warranty was a “limitation on a contractor’s ability to pursue another, viable cause of action.” On April 2, 2014, the Circuit Court for Baltimore City heard argument from counsel on the pending motion to dismiss.

At the close of the hearing, the circuit court orally granted RK & K’s motion, finding that there was no privity between the parties giving rise to a tort duty under the current law in Maryland. BBII filed a motion to reconsider on April 7, 2014, along with a memorandum of law, arguing (1) that privity is not a requirement for a claim under Restatement (Second) Torts § 552, or negligent misrepresentation, and (2) the circuit court did not consider the “equivalent of privity” between BBII and RK & K to support BBII’s professional negligence claim. On May 6, 2014, the circuit court denied BBII’s motion for reconsideration, and, on May 15, 2014, BBII noticed a timely appeal. BBII presents three questions: I. Does an engineer owe a duty to a contractor when the engineer is aware that the contractor will rely upon the engineer’s services to the contractor’s detriment if the engineer’s services are negligently performed, even though no contract exists between the engineer and contractor? ⁴³⁷ II.

Does a contractor have a cause of action under Restatement of Torts (Second) § 552 against an engineer for negligently supplied information when the design professional knew the contractor would rely upon the information supplied and be harmed by the engineer’s negligence?

III

Does a contractor have an action for negligent misrepresentation against an engineer when the engineer: (a) intended the contractor to rely upon the representations (i.e., design); (b) knew that the contractor would rely upon the design; and (c) knew that the contractor would be harmed if the design was negligently performed? DISCUSSION Standard of Review Appellate courts “review [ ] the grant of a motion to dismiss for legal correctness.” Rounds v. Maryland-Nat. Capital Park and Planning Comm’n, 441 Md. 621, 635 , 109 A.3d 639 (2015) (citing Patton v. Wells Fargo Financial Maryland, Inc., 437 Md. 83, 95 , 85 A.3d 167 (2014); Heavenly Days Crematorium, LLC v. Harris, Smariga & Assocs., Inc., 433 Md. 558, 568 , 72 A.3d 199 (2013)). The circuit court, when considering a motion to dismiss a complaint for failure to state a claim upon which relief can be granted, must view all well-pleaded facts and allegations in the complaint as true.

Lloyd, supra, 397 Md. at 121, 916 A.2d 257 (citing Morris, supra, 340 Md. at 531, 667 A.2d 624 ; Sharrow v. State Farm Mutual Ins. Co., 306 Md. 754, 768 , 511 A.2d 492 (1986)). The court may grant the motion only if the allegations and inferences, assumed to be true, do not state a cause of action. State Center, LLC v. Lexington Charles Ltd. P’ship, 438 Md. 451, 496-97 , 92 A.3d 400 (2014) (quoting RRC Ne., LLC v. BAA Maryland, Inc., 413 Md. 638, 643-44 , 994 A.2d 430 (2010)).

When the claim at issue is in tort, the court “merely determines [the plaintiffs] right to bring the action,” and does not decide whether the claims are meritorious. Figueiredo-Torres v. ⁴³⁸ Nickel, 321 Md. 642, 647 , 584 A.2d 69 (1991). We apply the same standards and determine only whether the circuit court’s decision was legally correct, according no special deference to the circuit court’s legal conclusions. Heavenly Days Crematorium, 433 Md. at 568 , 72 A.3d 199 (citations omitted).

I. Professional Negligence BBII asserts that RK & K is liable under a professional negligence theory for the economic losses BBII sustained performing construction work under BBII’s contract with the City in reliance upon RK & K’s allegedly defective designs. According to BBII, RK & K breached a duty to BBII to act with the reasonable care of a design professional in creating designs for the SC 852 project, and in “failing to establish a reasonable duration” for the construction of the project. The elements required to establish a cause of action for professional negligence are equivalent to the elements required in a standard negligence action; the professional, however, is held to the standard of care that prevails in his or her profession. See Crockett v. Crothers, 264 Md. 222, 224-25 , 285 A.2d 612 (1972). “[O]ne who undertakes to render services in the practice of a profession or trade is required to exercise the skill and knowledge normally possessed by members of that profession or trade in good standing in similar communities.” Restatement (Second) of Torts § 299A (1965).

To sustain a cause of action for negligence, a complaint must allege facts sufficient to support a finding of: 1) a duty to the plaintiff (or to a class of which the plaintiff is a part), 2) a breach of that duty, and 3) a causal relationship between the breach and the harm, and 4) damages suffered. See Walpert, Smullian & Blumenthal, P.A. v. Katz, 361 Md. 645, 655 , 762 A.2d 582 (2000) (citing Jacques v. First Nat’l Bank, 307 Md. 527, 531 , 515 A.2d 756 (1986); Cramer v. Hous. Opportunities Comm’n, 304 Md. 705, 712 , 501 A.2d 35 (1985); Scott v. Watson, 278 Md. 160, 165 , 359 A.2d 548 (1976); Peroti v. Williams, 258 Md. 663, 669 , 267 A.2d 114 (1970)). “Absent a ⁴³⁹ duty of care, there can be no liability in negligence.” Id. (citing W.Va.

Cent. v. Fuller, 96 Md. 652, 666 , 54 A. 669 (1903)). The Walpert Court further clarified: “[T]here can be no negligence where there is no duty that is due; for negligence is the breach of some duty that one person owes to another.... As the duty owed varies with circumstances and with the relation to each other of the individuals concerned, so the alleged negligence varies, and the act complained of never amounts to negligence in law or fact, if there has been no breach of duty.” Walpert, 361 Md. at 655 , 762 A.2d 582 (quoting W.Va. Cent., 96 Md. at 666 , 54 A. 669 ).

In Jacques , the Court of Appeals instructed that two major considerations in determining whether a tort duty should be recognized in a particular context are “the nature of the harm likely to result from a failure to exercise due care, and the relationship that exists between the parties.” 307 Md. at 534 , 515 A.2d 756 . A. The Economic Loss Doctrine Most states recognize that lack of privity between the parties is not, alone, a bar to a negligence claim. See Council of Co-Owners Atlantis Condo., Inc. v. Whiting-Turner Contracting Co., 308 Md. 18, 32 , 517 A.2d 336 (1986) (“In following the modern trend, we hold that privity is not an absolute prerequisite to the existence of a tort duty.”); Adams v. Buffalo Forge Co., 443 A.2d 932, 939 (Me.1982) (“We hold, therefore, that lack of privity does not constitute a bar to an action alleging negligence on the part of the manufacturer”); Barni v. Kutner, 76 A.2d 801, 803 (Del.Super.Ct.1950) (stating that “lack of privity is no defense in a negligence case under certain conditions.”) (citation omitted). But in cases such as the one presented here, in which a contractor sustains higher than anticipated costs based on the allegedly defective designs of an engineering firm with which it has no contract, states are divided over whether and in what circumstances a negligence claim to recover the costs is barred by the “economic loss doctrine.” ⁴⁴⁰ The general rule is that a party cannot recover against another in tort where the resulting harm is purely economic loss and the parties have no contract between them.

See Robins Dry Dock & Repair Co. v. Flint, 275 U.S. 303 , 48 S.Ct. 134 , 72 L.Ed. 290 (1927); see also U.S. Gypsum Co. v. Mayor and City Council of Baltimore, 336 Md. 145, 156 , 647 A.2d 405 (1994). The recovery of purely economic, benefit-of-the-bargain-type damages has long been limited in the United States. In Robins, Justice Holmes addressed the issue in a suit brought by the charterers of a steamship against a dry dock for damages for loss of the use of the vessel. Id. at 307, 48 S.Ct. 134 .

The dry dock company was contractually responsible to the vessel owner to perform periodic servicing. Id. When the dry dock company negligently broke a propeller, the Supreme Court held that the charterers could not recover their economic damages from the dry dock, either as third-party beneficiaries to the owner’s service contract, nor for the dry dock company’s negligence. Id. at 308-09 , 48 S.Ct. 134 .

Justice Holmes explained: [The charterer’s] loss arose only through their contract with the owners — and while intentionally to bring about a breach of contract may give rise to a cause of action, no authority need be cited to show that, as a general rule, at least, a tort to the person or property of one man does not make the tort-feasor liable to another merely because the injured person was under a contract with that other unknown to the doer of the wrong. The law does not spread its protection so far. Id. at 308-09 , 48 S.Ct. 134 (internal citations omitted). In Maryland, we acknowledge that “ ‘the first obstacle which arises [to imposition of a duty] is the fact that there has been no direct transaction between the plaintiff and the defendant, which usually is expressed by saying that they are not in ‘privity’ of contract.’” Whiting-Turner, 308 Md. at 26 , 517 A.2d 336 (quoting Prosser and Keeton on the Law of Torts § 18.5, at 708-10 (2d ed.1986)).

The rationale supporting the requirement of privity (or, as we shall explain infra, a “privity equivalent”) as a condition to the recovery of economic dam ⁴⁴¹ ages for negligent conduct is “to avoid ‘liability in an indeterminate amount for an indeterminate time to an indeterminate class.’ ” Walpert, 361 Md. at 671 , 762 A.2d 582 (quoting Chief Judge Cardozo in Ultramares Corp. v. Touche, 255 N.Y. 170 , 174 N.E. 441, 444 (1931)). Still, Maryland courts have established that the economic loss doctrine does not always apply to bar recovery of economic damages. See, e.g., Lloyd, 397 Md. at 121 , 916 A.2d 257 (stating that the economic loss doctrine will not bar a claim for products liability where the product at issue [defective car seats that collapse rearward in rear-impact collisions] creates a dangerous condition that “gives rise to a clear danger of death or personal injury.” (citation omitted)); A.J. Decoster Co. v. Westinghouse Elec. Corp., 333 Md. 245, 254-60 , 634 A.2d 1330 (1994) (stating that economic loss can be recovered for property damage through strict products liability claims where the damage is caused by “unreasonably dangerous products.”); Cash & Carry America, Inc. v. Roof Solutions, Inc., 223 Md.App. 451, 468-470 , 117 A.3d 52 (2015) (holding that the economic loss doctrine did not bar a negligence claim against a contractor by a third party where the risk of harm was personal injury and property damage). 10 In construction matters, the law in Maryland contours more narrow circumstances under which the economic loss doctrine does not bar tort claims for purely economic loss.

As explored further below, a construction contractor’s ability to recover for economic losses against a design professional where there is no contractual privity is generally limited to situations involving death, personal injury, property damage, ⁴⁴² or the risk of death or serious personal injury. See Whiting-Turner, 308 Md. at 35 , 517 A.2d 336 . i. Privity, Property Damage, Death, Injury, or the Risk of Death or Serious Personal Injury In Whiting-Turner , the Court of Appeals held that builders and architects have a duty, even where no privity exists between the parties, to use due care in the design, inspection, and construction of a project that extends to “persons foresee-ably subjected to the risk of personal injury because of a latent and unreasonably dangerous condition resulting from that negligence.” 308 Md. at 22 , 517 A.2d 336 . In Whiting-Turner , a condominium owners’ association brought a negligence action against the general contractor, developer, and architects of a building, alleging that their negligence had resulted in the deficient construction of the building and created a fire hazard that “present[ed] a threat to the safety and welfare of the owners and occupants.... ” Id. at 22-23 , 517 A.2d 336 .

The unit owners also alleged, inter alia, that, in advertising and selling the units, the developer negligently misrepresented “the building’s suitability for occupancy.” Id. at 23, 517 A.2d 336 . The builder and certifying architects filed motions to dismiss, contending that the complaint failed to allege facts sufficient to show they owed a duty of care to the unit owners. Id. The defendants argued that a duty should not be recognized because the unit owners had only suffered economic loss, not personal injury or property damage.

Id. at 23-24, 517 A.2d 336 . The trial court concluded it was bound by the Court of Appeals’ statement in Marlboro Shirt, that “ ‘a contractor owes no duty to the general public for which it may be made responsible in an action in tort for negligence if it does not perform its contract.’ ” Id. at 29, 517 A.2d 336 (quoting Marlboro Shirt Co. v. Am. Dist. Tel.

Co., 196 Md. 565, 571-72 , 77 A.2d 776 (1951)). The Court of Appeals distinguished Marlboro Shirt because it involved an action solely for injury to personal property and ⁴⁴³ the plaintiffs did not allege the contractor created any risk of personal injury. Id. The Court then turned to the question of whether a negligence action may be maintained against a builder or architect in a situation in which the risk of personal injury existed but no personal injury occurred.

Id. at 30-31, 517 A.2d 336 . The Court concluded that the determination of whether a duty will be imposed in this type of case should depend upon the risk generated by the negligent conduct, rather than upon the fortuitous circumstance of the nature of the resultant damage. Where the risk is of death or personal injury the action will lie for recovery of the reasonable cost of correcting the dangerous condition.[ 11 ] Id. at 35, 517 A.2d 336 (footnote omitted). Eight years later in Chambco, Div. of Chamberlin Waterproofing & Roofing System, Inc. v. Urban Masonry Corporation, 101 Md.App. 664 , 647 A.2d 1284 (1994), vacated on other grounds, 338 Md. 417 , 659 A.2d 297 (1995), this Court reviewed the development and application of Whiting-Turner since its publication.

Chambeo addressed a claim of negligence asserted by a roofing subcontractor against a masonry subcontractor, both of whom had contracts with the general contractor but not each other. 101 Md.App. at 667-68 , 647 A.2d 1284 . The Court held that Whiting-Turner was a “narrowly drawn opinion,” concluding that, “in Maryland, there have been no substantive expansions of the Whiting-Turner theory of negligence actions in building construction cases.” Id. at 672, 680, 647 A.2d 1284 . Because the appellant only suffered economic losses, was not in privity of contract with the appellee, and did not allege that the negligence created a risk of death or personal injury, this Court deter ⁴⁴⁴ mined in Chambeo that the cause of action did not fit within Whiting-Turner and there was no cause of action absent privity of contract. Id. at 680-81, 647 A.2d 1284 .

In Heritage Harbour, L.L.C. v. John J. Reynolds, Inc., developers brought an action seeking indemnification and contribution from the original developers, contractors, and architects of a condominium in relation to an underlying action brought against the developer by the owners of the condominium for “numerous structural and non-structural defects in the buildings....” 143 Md.App. 698, 702-03 , 795 A.2d 806 (2002). This Court clarified that the appellees must have had an original duty to the condominium owners in the underlying suit in order to be liable to appellants for contribution and/or indemnity. Id. at 706 , 795 A.2d 806 . The appellants needed to “plead clear facts that would support a finding of extreme danger and an imminent risk of severe personal injury,” to circumvent the economic loss doctrine in order to find tort liability.

Id. at 708 , 795 A.2d 806 (citing Morris, supra, 340 Md. at 536 , 667 A.2d 624 ). Because the appellants “failed to allege the existence of any substantial risk to persons or property,” this Court, relying on Whiting-Turner , concluded that “their claims are precluded by the Economic Loss Doctrine.” Id. We recently held that the economic loss doctrine did not apply to bar a third party’s negligence claim against a contractor for damage to property where the risk of harm (personal injury and property damage from misuse of a torch and resulting fire) was not solely economic in Cash & Carry America, 223 Md.App. at 468-470 , 117 A.3d 52 . After reviewing established principles governing application of the doctrine, we explained that “the economic loss doctrine serves as a boundary between contract law, the purpose of which is to enforce the expectations of the parties to an agreement, and tort law, the purpose of which is to protect people and property from foreseeable risks of harm by imposing upon others a duty of reasonable care.” Id. at 466 , 117 A.3d 52 (citing East River S.S. Corp. v. Transamerica Delaval, Inc., 476 U.S. 858, 866 , 106 S.Ct. 2295 , 90 L.Ed.2d 865 (1986)). ⁴⁴⁵ Here, BBII’s complaint does not allege any facts that would support a finding that there was any risk of serious injury or death, nor does BBII argue that the alleged negligent actions of RK & K created such a risk.

BBII also made no claim of damage to property. Therefore, the economic loss doctrine bars BBII’s claim of professional negligence against RK & K for purely economic losses. See Whiting-Turner, 308 Md. at 35 , 517 A.2d 336 ; Chambco, 101 Md.App. at 680-81 , 647 A.2d 1284 ; Heritage Harbour, 143 Md.App. at 708 , 795 A.2d 806 . ii. The “Privity Equivalent” Analysis Does Not Apply BBII asks this Court to hold for the first time, that where there is no contract between a construction contractor and a design professional in a negligence action for the recovery of purely economic losses, an intimate nexus, and therefore a duty in tort, can be established by demonstrating a “privity equivalent” between the parties.

BBII argues that, as stated in the complaint, its relationship with RK & K satisfies the intimate nexus test because BBII was not a member of an “indeterminate class,” but, rather, as bidder on the contract with the City, was known to RK & K as an entity that would rely on RK & K’s schematics after winning the bid for the contract. Thus, RK & K owed a duty to BBII to act with reasonable care. In riposte, RK & K states that no Maryland appellate court has recognized a tort claim by a contractor against a not-in-privity design professional for the type of damages allegedly suffered by BBII. RK & K’s principal argument relies on policy — that Maryland contract law allows government contractors to recover against the owner in negligent design cases under the Spearin Doctrine, and that many state supreme courts have expressly denied recovery for contractors against architects, engineers, and designers.

RK & K contends that the intimate nexus analysis does not apply to this case at all, but that even if it did, RK & K owed no duty to BBII because the circumstances alleged in the complaint do not rise to the level of privity or its equivalent. RK & K maintains that no ⁴⁴⁶ facts were alleged in BBII’s complaint concerning “any design-phase interactions” between RK & K and BBII. As we next explain, although we agree that the law does not impose a duty of care that would sustain an action for professional negligence against RK & K on the complaint filed in this case, we do not adopt RK & K’s blanket contention that the intimate nexus analysis does not apply in construction contract cases. Rather, we hold that in government construction matters such as the case on appeal, 12 the intimate nexus analysis is not expanded to include “privity equivalent” concepts of extra-contractual duty for the recovery of solely economic losses.

Generally, “when the failure to exercise due care creates a risk of economic loss only, and not the risk of personal injury, we have required an ‘intimate nexus’ between the parties as a condition to the imposition of tort liability.” Swinson v. Lords Landing Vill. Condo., 360 Md. 462, 477 , 758 A.2d 1008 (2000) (citing Jacques, supra, 307 Md. at 534 , 515 A.2d 756 ; Village of Cross Keys v. U.S. Gypsum Co., 315 Md. 741, 753 , 556 A.2d 1126 (1989)). 13 We trace the term to Chief Judge