When a client proceeds under both tort and contract causes of action, each theory of liability has its own distinct damages and its own distinct statute of limitations. First, damages recovered under a contract theory are measured differently than damages recovered under a tort theory. In certain jurisdictions, this difference may make the tort remedy more advantageous to the client. Thus, damages such as lost profits resulting from the interruption of use of a facility are only awarded when such damages were in the reasonable contemplation of the parties at the time they made the contract. By contrast, in an action in tort, the limitations of damages may only be tied to the idea of proximate causation and the general policy that denies recovery to certain types of interests.
Duties imposed by law are tort obligations.
With design professionals, conduct constituting a breach of contract also may constitute a tort. A design professional has the legal duty to perform the duties of the contract according to the standards of the profession. In a breach of contract situation, the law does not charge a breaching party with all the losses caused by its breach. Usually the breaching party is not chargeable with all consequential or less direct damages. For that reason, the design professional should seek to exclude this liability for consequential damages in the contract.