By:  Benjamin J. McDonnell

     Division II of the Washington State Court of Appeals recently addressed whether a construction defect case was timely commenced. In Dania, Inc. v. Skanska USA Building Inc., the appeals court reversed the trial court’s dismissal of a construction defect claim, finding that the lower court erred in ruling the claim was barred under the statute of repose because factual issues existed that required resolution at the trial court.

        In this case, Dania, Inc. (“Dania”) contracted with Skanska USA Building Inc. (“Skanska”) for the construction of a warehouse in Dupont, Washington.  Skanska subcontracted with McDonald & Wetle, Inc. (“M&W”) to perform work on the Warehouse roof system.  Substantial completion occurred in January of 2006.  However, M&W completed installation of a mineral cap sheet on the roof in June of 2006.  After Dania discovered that the roof was leaking, on April 4, 2012, it sued Skanska and M&W and alleged to have suffered damages of nearly $400,000.

      Skanska filed for summary judgment dismissal. It argued that the statute of repose, RCW 4.16.310, barred Dania’s claim. Under this statute, a construction defect action is barred if it fails to accrue within six years of the later of substantial completion of construction or termination of services. The trial court granted Skanska’s motion for summary judgment.  It reasoned that the statute of repose began to run from the date of substantial completion, not the later date of installation of the mineral cap sheet because, it explained, there was insufficient evidence that the cap sheet installation was related to the leaks that gave rise to the action.

      On appeal, the court refocused the inquiry from the statute of repose to RCW 4.16.326(1)(g).  This statute creates an affirmative defense in construction contract cases.  Specifically, it terminates a construction contract claim on the later of six years after substantial completion or termination of services such that any claim must both accrue and be filed within this time frame or be subject to dismissal.

      Thus, the issue on appeal was whether Dania timely filed its lawsuit. Dania argued that the critical date was June 2006, when Skanska finished installing the mineral cap sheet on the roof. Skanska argued, however, that the critical date was January 2006, the date of substantial completion. Skanska contended further that the June 2006 date was inapplicable because, it argued, there was no evidence of any nexus between the services performed after substantial completion, installation of the mineral cap sheet, and the leaking giving rise to Dania’s construction defect claim.

     The appeals court disagreed with Skanska and ruled that a factual dispute existed as to whether there was a nexus between the final mineral cap installation work performed and the leak that gave rise to the lawsuit.  The appeals court, therefore, concluded that the trial court’s summary dismissal of Dania’s claim was improper and remanded back to the trial court for further proceedings.

     If you are in need of professional legal services regarding a construction defect claim or defense, contact the attorneys at Piskel Yahne Kovarik, PLLC.