Financial Associates, Ltd. v. G.E. Johnson Construction Co.

VOLLACK, Justice,

dissenting:

I disagree with the majority’s conclusion that the district court erred in entering summary judgment against the petitioner. Accordingly, I respectfully dissent.

The statute of limitations involved here, section 13-80-127, 6 C.R.S. (1973 and 1985 Supp.), provides in subsection (l)(b) that a “claim for relief arises under this section at the time the damaged party discovers or in the exercise of reasonable diligence should have discovered the defect in the improvement which ultimately causes the injury, when such defect is of a substantial or significant nature.” The majority correctly notes that discovery of the injury is not necessarily concurrent in time with discovery of the defect which causes the injury. Criswell v. M.J. Brock and Sons, Inc., 681 P.2d 495, 498-99 (Colo.1984). The majority further holds that the statute of limitations only begins to run when the plaintiff discovers or should have discovered that the defect causes the injury. In so ruling, the majority seems to require that the exact defect be determined before the statute of limitations begins to run.

In this case, the plaintiff knew of the injury in 1978. Subsequently, the plaintiff received five different reports which were prepared in an effort to determine the cause of the injury. Different theories were propounded by different experts, and the correct conclusion remains a matter of expert opinion. As early as January 11, *1411979, plaintiff received a report attributing the cause of the injury to the expansion of porous soils beneath the building and plaintiffs construction of partition walls in the basement. By the November 27, 1979, report, plaintiff was alerted that “some slight foundation movements may be attributed to approximately 20% of the observed distress.” Surely, these reports imparted an awareness to plaintiff that possible defects existed in the building. Plaintiff contends it was not until the receipt of the last report, which was prepared within the two year limitations period, that it discovered the “defect” in the building, even though the report reiterated a possible cause of the injury which was mentioned in previous reports.

If knowledge of the specific cause of an injury is the standard, a party could wait to bring an action far beyond a reasonable time when sufficient notice has been received of a possible invasion of one’s legally protected interests. Knox College v. Celotex Corp., 88 Ill.2d 407, 58 Ill.Dec. 725, 430 N.E.2d 976, 980 (1981). Based upon the first four reports received by plaintiff in this case, I would conclude the plaintiff had sufficient information to cause a reasonable person to inquire further as to the existence of a claim for relief. The accrual of a claim for relief does not await the awareness by the injured party that an injury was negligently inflicted, nor does it await the acquisition of knowledge of facts which would alert a reasonable person to suspect that a legal duty to him had been breached. United States v. Kubrick, 444 U.S. 111, 100 S.Ct. 352, 62 L.Ed.2d 259 (1979). I dissent from the majority’s conclusions because I do not believe it is necessary that the injured party be fully aware of the exact defect or its seriousness before a claim for relief arises. Tamblyn v. Mickey & Fox, Inc., 39 Colo.App. 319, 568 P.2d 491, 493 (1977), rev. on other grounds, 195 Colo. 354, 578 P.2d 641 (1978).

Normally, the issue of whether the statute of limitations bars a particular claim is a factual question. Owens v. Brochner, 172 Colo. 525, 474 P.2d 603 (1970); Davis v. Bonebrake, 135 Colo. 506, 313 P.2d 982 (1957). However, based upon the undisputed evidence contained in the reports prepared for plaintiff, I would conclude as a matter of law that the claim for relief arose no later than the receipt of the second Lincoln-DeVore report in November of 1980. Despite plaintiff's contention that it did not know of the specific defect until the August 1982 Summerlee report, based on the four previous reports, I would conclude that at least in the exercise of reasonable diligence the plaintiff should have discovered the defect in the building. Instead, plaintiff waited over two years to have the fifth report prepared. The law aids the vigilant, and not those who slumber on their rights.

In effect, the majority’s conclusion that the statute of limitations does not begin to run until the plaintiff discovers or should have discovered the specific defect that causes the injury may preclude the commencement of the limitations period in any actions of this kind. To defeat the statute of limitations defense, the majority concludes that a plaintiff needs only to raise the issue of when the specific defect which caused the injury was discovered. Even where the evidence is undisputed, the mere existence of possible “offsetting inferences” would defeat a summary judgment motion based on the statute of limitations defense. Undoubtedly, such an argument could be made in most cases.

I conclude the two year statute of limitations bars the maintenance of this action, and further conclude there is no genuine issue of fact involved in such a determination. I would affirm the conclusions of both the trial court and the court of appeals.

I am authorized to say that Justice ERICKSON and Justice ROVIRA join in this dissent.