Montgomery County's chief architect, upset over a transfer that he initially charged was retaliatory, resigned this week to take a job in private business.

Frederick Kranz, the architect who oversaw construction of the county's new $34 million executive office building and courthouse complex, will take a job with MCI Communications Corp.

Since March, Kranz had been assigned to the county attorney's office to help prepare for the county's costly and complex legal dispute with Blake Construction Co., which built the complex after a year's delay.

When Kranz first was transferred, he filed a complaint with the county Merit System Protection Board, calling the move retaliation by county officials, said Kranz's attorney, Daniel J. Cassidy.

Since 1980, Kranz had been the lone voice in county government advocating in a series of inter-office memos, copies of which were obtained by The Washington Post, that the county not make its contract-required monthly payments to Blake because of the firm's alleged delays and cost overruns.

The office building opened in May 1981, and the courthouse opened last October.

Blake and the county are embroiled in the legal dispute because the company claims the county owes it $15 million for causing delays and making changes.

The county has paid Blake $32.1 million on the original $33 million construction contract, according to County Attorney Paul McGuckian, and the county still is holding more than $1 million, pending the outcome of the dispute.

"They haven't been paid a nickle over what the contract price called for," McGuckian said.

Under the contract, the county was required to make 36 "progress payments" to Blake as various phases of the project were completed. Outside architects verified the work had been done before the payments were made.

Even when the work was completed, Kranz argued vigorously in his memos that the payments should be held up to protest delays in the construction. But he consistently was overruled by county legal advisors, who said holding up the payments would be illegal under the contract and would end up costing the county more than $6 million in default penalties.

In a confidential memo dated July 13, 1981, Kranz argued that payment number 34 be held up--although the work's completion had been verified--because "it is not the architects' but the county's money and rights that are at stake. . . . My conscience and my professional judgment simply do not permit me to put my XXXXXXX on a payment authorization."

Kranz, in that same memo, called Blake's work on the cafeteria, "for lack of a more fitting term, . . . a farce." Kranz wrote then that "work in the kitchen/cafeteria occurs in uncoordinated spurts of activity" and "the quality of workmanship is substandard in many cases."

McGuckian said Kranz's objections at that time amounted to only one viewpoint in the county administration, an architect's viewpoint, and did not consider the legal ramifications of withholding the payments to Blake.

To hold up the payments, McGuckian said, would have put the county in default according to the contract, and Blake could have stopped work legally within 15 days with the building still incomplete. With daily penalties, the county could have been liable for more than $6 million, he said.

The memos show Kranz becoming increasingly frustrated, until he was finally transferred to the county attorney's office last March. After the transfer, Kranz continued to work out of his architect's office on the fourth floor of the judicial center until March 29, when he came to work to find his office door's lock had been changed.

Kranz fired off an angry March 30 memo to County Executive Charles W. Gilchrist. In the memo, Kranz wrote: "Being locked out for doing something good for the county government is indeed an amazing experience."

Kranz, in the memo, also detailed a meeting he held with his former boss, Thomas Abraham, director of facilities and services, demanding to know why he had been locked out. Kranz also objected to Gilchrist that Abraham accused him of making "a smart a--" comment.

Abraham responded to the accusations in an April 9 memo, stamped confidential, in which he defended changing the lock on Kranz's door. "I did not at the time feel that Fred needed to have two offices," he said. Nevertheless, Abraham wrote, he did give Kranz a new key.