APRIL 2026 | 35 THE OKLAHOMA BAR JOURNAL the engineer. On the other hand, the engineer has an interest in defending their design and denying any change order or request for modified plans submitted by the contractor. Because of the lack of a contractual relationship, the contractor may be inclined to assert tort claims against the engineer. However, permitting tort liability against a design professional in the absence of a contractual relationship, personal injury or property damage may cause the design professional’s typically neutral position to shift to a position in which it considers tort liability in executing its design plans.53 This is similar to the idea of a doctor practicing defensive medicine. Further, exposing the engineer to tort liability for purely economic damages would prevent parties from negotiating and defining their economic risks via contract. Consequently, applying the doctrine could protect the design engineer’s neutrality and prevent a chilling effect that could occur if tort liability extended to the design engineer.54 On appeal, the Balfour court examined whether to extend a duty in tort to persons not in privity for the recovery of purely economic losses. There, the court held, “The economic loss doctrine represents a judicial refusal to extend tort liability to negligence that causes purely economic harm in the absence of privity, physical injury, or risk of physical injury.”55 This holding aligns with Oklahoma’s recognition and requirement of privity of contract to bring a cognizable claim in the construction defect context.56 While the economic loss doctrine has been applied in other jurisdictions to construction defect and design professional cases, other jurisdictions have imposed limits and exceptions to the doctrine. For example, in 2023, the Tennessee Supreme Court held that the doctrine applies only in products liability cases and does not extend to service contracts.57 This is all to say that despite the simplicity of the underlying principles, historical precedence and expansion in other districts, we do not yet know whether the doctrine will be extended beyond manufacturers’ products liability by the Oklahoma Supreme Court. In the meantime, it is imperative for practitioners and businesses to pay attention to the evolving case law and prepare accordingly. TURN YOUR ECONOMIC LOSS INTO ECONOMIC GAIN AND AVOID LITIGATION HEADACHES With the stage set by Mills and Proe, businesses and corporations should arm themselves with the doctrine any time a contract dispute arises with purely economic damages at issue. This is particularly important in disputes involving commercial transactions, especially when statutory provisions, like those found in the UCC, may apply. As it currently stands, Oklahoma district courts are being presented with, examining and adjudicating arguments involving the economic loss doctrine in construction defect cases. In practice, contract language and terms, along with warranty disclaimers and limitations of liability clauses, should receive close attention in drafting and particularly when litigation is initiated. Indeed, Oklahoma law provides that contracts may exclude claims for “indirect or consequential damages” and may limit tort liability as long as the contract language is clear and unambiguous as to the parties’ intent to restrict tort liability.58 Businesses and their lawyers should work to allocate their risks to explicit contractual terms – including “no tort liability” clauses. Statements or opinions expressed in the Oklahoma Bar Journal are those of the authors and do not necessarily reflect those of the Oklahoma Bar Association, its officers, Board of Governors, Board of Editors or staff.
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