A Pennsylvania court has voided a multi-million dollar residential construction contract, ruling that the builder's failure to explicitly name the project's architectural firm in the agreement violated state law. The decision stems from a dispute in Bucks County where a home project's budget escalated from an initial $2 million to nearly $7 million.
The ruling highlights a critical legal requirement for design-build firms in the state and serves as a significant warning to the construction industry. Even though an architect was involved in the project, the court found that not naming the firm in the contract was a fatal flaw, rendering the entire agreement unenforceable.
Key Takeaways
- A Bucks County court voided a home construction contract initially budgeted at $2 million that grew to nearly $7 million.
- The contract was deemed illegal because it failed to name the architectural firm, a violation of Pennsylvania's Architects Licensure Law.
- The builder, Marco Polo Real Estate Inc., argued an architect was involved, but the court ruled the contract's omission was the deciding factor.
- The case is ongoing, with claims for monetary damages still pending, preventing an immediate appeal of the contract ruling.
The Dispute Over a Bucks County Home
The case began when homeowners William and Lynda Sinclair hired Marco Polo Real Estate Inc. to design and build a new residence. The initial agreement set the project budget at $2 million. However, over the course of a year, the costs climbed dramatically, approaching $7 million.
The Sinclairs alleged that during this period, the builder failed to provide clear updates on the project's status and did not follow the contract's requirements for executing change orders. They also claimed that attempts to secure permits without proper documentation led to further delays and increased expenses.
Court documents show the homeowners had paid Marco Polo $248,598. They filed a lawsuit with three main claims: one for breach of contract to recover expenses and costs from delays, a request for a full accounting of payments, and a crucial third claim for a declaratory judgment.
A Contract Undone by a Single Omission
The request for a declaratory judgment became the central issue. The Sinclairs' legal team argued that the entire contract should be voided because it violated a specific provision of the Pennsylvania Architects Licensure Law.
Understanding the Architects Licensure Law
The relevant statute, 63 P.S. § 34.508(9)(iv), mandates that a contract between a design-build company and a client "shall set forth the name of the architectural firm which will be contractually responsible to the design-build entity for providing architectural services." This requirement is designed to ensure clarity and accountability, guaranteeing that a licensed and identified firm is overseeing the architectural integrity of a project.
The homeowners contended that their contract with Marco Polo Real Estate never explicitly named a licensed architect or architectural firm responsible for the project. Under Pennsylvania law, a contract that violates a statute is considered illegal and, therefore, unenforceable.
Marco Polo Real Estate countered this argument, stating that they had, in fact, engaged an architect. They noted that this architect met with the Sinclairs multiple times to review the plans and that the architectural firm had properly signed and sealed all documents submitted to the local township for approval. In their view, this fulfilled the spirit of the law.
The Court's Decisive Ruling
The court was not persuaded by the builder's defense. Following oral arguments in April 2025, a Bucks County trial court judge issued a one-page order siding with the Sinclairs. The judge granted their motion for declaratory judgment, stating the contract was void specifically because it failed to name the architectural firm.
A Costly Oversight
The project's budget ballooned by approximately 250%, from an agreed-upon $2 million to nearly $7 million. This escalation formed the backdrop of the legal dispute that ultimately led to the contract's invalidation.
Marco Polo Real Estate requested that the court reconsider its decision, but the motion was denied. The company then attempted to appeal the ruling to the Pennsylvania Superior Court, the state's intermediate appellate court.
However, the appeal was quashed. The Superior Court determined that the trial court's order was not a final judgment because two other claims—the breach of contract claim for monetary damages and the request for an accounting of invoices—were still unresolved. Under state procedural rules, an appeal can typically only proceed after all claims involving all parties have been fully decided at the trial court level.
Implications for the Design-Build Industry
This case serves as a stark reminder for all design-build companies in Pennsylvania. The court's strict interpretation of the Architects Licensure Law means that simply hiring an architect is not enough; the firm's name must be explicitly written into the client contract from the outset.
"This ruling emphasizes strict compliance. The court's message is clear: the letter of the law matters, and procedural shortcuts can have catastrophic consequences for a contract's validity," remarked a legal expert familiar with Pennsylvania construction law.
For construction and design-build firms, the path to compliance involves several key steps outlined in the statute:
- Independently contract with a licensed architectural firm for the project.
- Provide the client with a written disclosure confirming that a licensed architect is engaged and contractually responsible for the architectural work.
- Ensure the architect has direct supervision over all architectural aspects of the project.
- Crucially, expressly state the name of that architectural firm within the client contract.
As of late October, the case remains pending in the Bucks County Court of Common Pleas, where the remaining financial claims will be addressed. The final outcome will determine the financial repercussions for both the homeowners and the builder in a project defined by soaring costs and a critical contractual error.
