Statute of Limitations

Aquatherm, LLC v. CentiMark Corp, 2019 BL 13240 (D. Utah Apr. 12, 2019)

Stag II Lindon LLC and Stag Industrial Inc. (collectively “Stag”) owned a building in Lindon, Utah.  Stag contracted with CentiMark Corp. (“CentiMark”) to perform work on the building’s roof.  CentiMark’s work required it to manipulate, move, and reinstall existing heating cables on the roof.  Shortly after completion of the work, in March of 2014, a fire occurred on the roof which was traced to the location of heat tape, which CentiMark had removed and replaced.

Continue Reading District Court in Utah Grants Summary Judgment for Contractor Against Insurance Subrogation Claim Based on Contractual Waiver Provision and Statute of Limitations

Dep’t of Transp. v. Seattle Tunnel Partners, 2019 BL 36988, 2 (Wash. App. Div. 2 Feb. 05, 2019)

On January 8, 2019, the Court of Appeals for the State of Washington reversed and remanded in part a trial court’s grant of summary judgment in a tunnel-boring construction case.  Specifically, the Court clarified that the three-year statute of limitations for negligence claims begins to run as soon as the aggrieved party becomes aware of the factual elements of the claims.  It does not matter whether the underlying cause of the claims remains disputed.

Continue Reading The Washington Court of Appeals Clarifies When the Statute of Limitations for a Negligence Claim Begins to Run Under the Discovery Rule

Strickland v. Arch Ins. Co., No. 17-10610, 2018 U.S. App. LEXIS 504 (11th Cir. Jan. 9, 2018)

Strickland provided sand to a paving company (“Douglas”) for a Georgia Department of Transportation (“GDOT”) road improvement project (the “Project”).  Arch Insurance Company (“Arch”) issued payment and performance bonds on Douglas’s behalf.  In 2007, GDOT declared Douglas in default and removed it from the Project.  In accordance with the performance bond, Arch arranged for a third-party contractor to complete Douglas’s work on the Project. Strickland did not supply sand after Douglas’s removal.
In August 2010, GDOT determined that the Project was substantially complete, and in September 2010, performed final inspection and generated a punch list.  Arch’s contractor completed the punch list by September 2011.  In March 2012, GDOT accepted Project maintenance responsibilities because the Project had been satisfactorily completed as of September 2011.  GDOT made semi-final payment to Arch in July 2012.

In September 2012, Strickland sent a demand for payment on Arch’s payment bond.  Arch acknowledged the claim and asked for additional documentation.  Strickland did not respond.  In 2014, Strickland learned that GDOT was preparing to close out the Project and filed a lawsuit against Arch.

Continue Reading Eleventh Circuit Holds That the Statute of Limitations on Payment Bond Claim Under Georgia Law Commences at Substantial Completion Rather Than Final Acceptance

Broomfield Senior Living Owner, LLC v. R.G. Brinkmann Co., 2017 Colo. App. Lexis 261 (March 9, 2017)

R.G. Brinkmann Company, as general contractor, was retained by Sunrise Development, Inc., a major national developer, for the construction of a senior assisted and independent living facility in Broomfield, Colorado. The project was owned by Broomfield Senior Living Owner, LLC.

Section 13.7 of the contract between Brinkmann and Sunrise provided that all claims arising from defects in Brinkmann’s work would be deemed to accrue no later than final completion of the project. On May 15, 2009, the project achieved final completion when a certificate of occupancy was issued.  No defects in the project were noted at that time.  In the Fall of 2012, however, Broomfield discovered broken sewer pipes at the project.  Further investigation revealed a number of defects that Broomfield attributed to Brinkmann’s poor construction.

On July 21, 2014, Broomfield filed a lawsuit asserting various defective workmanship claims against Brinkmann. Brinkmann responded by moving for summary judgment, arguing that under Section 13.7 of its contract with Sunrise, all defective work claims accrued no later than final completion on May 15, 2009 and that Colorado’s two year statute of limitations for civil claims therefore expired on May 15, 2011.  The trial court granted Brinkmann’s motion and dismissed Broomfield’s claims.

Continue Reading Colorado Appellate Court Holds that Commercial Entity that Owns a Senior Living Facility Is a “Residential Property Owner” Within the Meaning of the Homeowner Protection Act and Is Therefore Entitled to More Lenient Statute of Limitations

Hartford Fire Insurance Co. v. City of Mont Belvieu
2010 U.S. App. Lexis 14277 (5th Cir. July 13, 2010)

The Court of Appeals for the Fifth Circuit recently held that a Texas City’s bond claim was time barred under the statute of limitations and equitable remedies based on estoppel were unavailable to revive claims on the bond.

Hartford Fire Insurance Company issued a performance bond for a contractor constructing a public recreational facility for the City of Mont Belvieu, Texas. The bond was a requirement under Texas public work contracts. By statute, the bond was subject to a one-year limitations period commencing from project final completion. The project progressed with numerous delays and changes. However, the City issued a certificate of occupancy in mid-2001, taking possession and operating the facility by July 2002.

At that time, numerous punch list items remained and several subcontractors owed payment by contractor filed claims on a payment bond. Hartford advised the City to be cautious when releasing further payment to contractor. Thereafter, in July 2002, City paid contractor almost $675,000 as an equitable adjustment via a change order. Critically, the change order stated that the project’s completion date was July 19, 2001.

Continue Reading U.S. Court of Appeals for the Fifth Circuit Holds Performance Bond Claim Time Barred – Estoppel Excuse Not Available to City

James J. Gory Mechanical Contracting Inc. v. Travelers Casualty & Surety Co.
2010 Phila. Ct. Com. Pl. Lexis 20 (Phila. CCP Feb. 8, 2010)

In February 2005, Surety issued payment bond of over $45 million on behalf of the general contractor for construction of student housing project at Temple University. Under terms of the payment bond, any claim, suit or action had to be brought within two years of bond’s issuance. General contractor entered into plumbing subcontract with Plaintiff, who certified that its work was 100% complete in October 2006. However, general contractor only paid Subcontractor for 95% of the work it completed.

Continue Reading Pennsylvania Common Pleas Court Upholds Payment Bond Contractual Limitation Period

Steadfast Insurance Co v. Brodie Contractors, Inc.
2008 U.S. Dist. LEXIS 88448 (October 31, 2008 W.D. Va.)
Steadfast Insurance Co., as subrogee of Skanska USA Building Co., the general contractor, alleged claims for breach of contract and breach of warranty against Brodie Contractors, Inc., a masonry subcontractor, concerning replacement of brick veneer on the Danville Regional Medical Center. Brodie moved for summary judgment alleging that the lawsuit was barred by Virginia’s statute of limitations.
Continue Reading United States District Court in Virginia Holds That Prime Contract Provision Concerning Accrual of Statute of Limitations “Flowed Down” to Afford Subcontractor Defense to Defective Work Claim

Waynesborough Country Club of Chester County v. Diedrich Niles Bolton Architects, Inc.
2008 U.S. Dist. LEXIS 45980 (E.D. Pa. July 21, 2008)
The case arose out of the design and construction of a new clubhouse for Waynesborough. Diedrich Niles Bolton Architects (“DNB”) provided professional architectural services to Waynesborough for the project and Ehret Construction served as the project’s general contractor and construction manager. Structural problems arose after the clubhouse was complete, and Waynesborough sued DNB alleging, as a result of DNB’s professional negligence and breach of contract, significant water leaks developed at various places throughout the interior of the clubhouse. DNB joined Ehret as a third party defendant. Ehret, in turn, filed a counterclaim against DNB for negligent misrepresentation, claiming that DNB’s architectural work was deficient and that Ehret’s work was delayed, disrupted and inefficient as a result of having relied upon inaccurate drawings and other architectural documents supplied by DNB during construction.
Continue Reading U.S. District Court in Pennsylvania Holds Bilt Rite Claim Subject to Discovery Rule for Limitations Purposes

Regent Ins. Co. v. Storm King Contr., Inc.
2008 U.S. Dist. LEXIS 16513 (S.D.N.Y. Feb. 26, 2008)
In June 1999, the owner of The Emerson Inn hired Storm King to act as its general contractor in the remodeling and rebuilding of the Inn. Under their agreement, Storm King was not responsible for the design of the project or for compliance with applicable law, building codes, or regulations, and it was agreed that the remedy for any defective work would be limited to correction of the defects. Storm King entered into a subcontract with Sullivan Fire Protection for the installation of a fire sprinkler system. The subcontract incorporated the terms of the agreement between the owner and Storm King. Its scope of work section provided that Sullivan’s work was to be performed in accordance with the plans and specifications prepared by the design professional.
Continue Reading U.S. District Court in New York Draws Distinction Between Damages Recoverable for Defective Work in Tort and for Breach of Contract – Where Tort Claim Barred By Statute of Limitations, Owner Could Not Recover for Cost of Replacement of Structure Destroyed By Fire Allegedly Resulting From Defective Work of Renovation Contractor

La Liberte, LLC v. Keating Building Corp. v. Roman Mosaic and Tile Co.
Civ. A. No. 07-1397, 2007 U.S. Dist. LEXIS 90878 (E.D. Pa., Dec. 11, 2007)
The United States District Court for the Eastern District of Pennsylvania dismissed the third-party complaint of the defendant holding that the statute of limitations had expired on the defendant’s performance bond claims against surety companies.
Plaintiff La Liberte LLC sued Defendant Keating Building Corporation for breach of contract, breach of implied warranty, and breach of express warranty in connection with the work Keating performed on a hotel owned by La Liberte. Under the contract between La Liberte and Keating, Keating was to make renovations and construct an addition to La Liberte’s hotel. Keating, in turn, entered into several subcontracts. Among them, Keating contracted with Voegele Mechanical Inc. and Shannon Plastering and Drywall Corporation. Both subcontracts contained warranty provisions which ran one year from acceptance by La Liberte. Voegele and Shannon obtained performance bonds for the benefit of Keating. The performance bonds contained the following identical provisions:
Continue Reading US District Court in Pennsylvania Holds Time for Suit Prescribed in Performance Bond Is Not Tolled By "Discovery Rule"