THE STATUTE OF REPOSE FOR CONSTRUCTION PROJECTS
By Attorney Randall J. Andersen
July, 2012
By Attorney Randall J. Andersen
July, 2012
Disclaimer: The information contained on this page is not legal advice. The information provided on this website is for general informational purposes and is not necessarily updated to account for changes in the law. You should consult with an attorney for legal advice regarding your individual circumstances.
Wisconsin’s statute of repose for construction projects generally provides that a lawsuit cannot be brought against persons or contractors involved in the improvement of real estate more than ten years from the date of substantial completion of the project. This rule is set forth in §893.89, Wisconsin Statutes.
However, many claims involving construction projects are barred long before the ten-year time limit passes. Claims may be barred by one or more of Wisconsin’s statutes of limitation. A statute of limitation is different from a statute of repose. A statute of repose starts to run from a specified time when the defendant acted (i.e., the date of substantial completion of a building by a contractor). A statute of limitation, on the other hand, starts to run when the plaintiff’s cause of action accrues (for example, in a personal injury claim, on the date that the accident occurred).
In February of 2012, the Wisconsin Court of Appeals ruled in Kalahari Development, LLC v. Iconica, Inc. that when both a statute of repose and a statute of limitation are applicable, the shorter of the two periods will be applied to determine whether the claim is barred.
The Kalahari case involved a $26.2 million design and construction project at the Kalahari Resort & Conference Center in Wisconsin Dells. The design-build contractor, Iconica, completed the project in May of 2000. Just before the ten-year anniversary, Kalahari Development, LLC brought breach of contract and professional negligence claims against Iconica. Kalahari Development sought recovery of costs for the inspection and repair of walls for damage caused by moisture, which it claimed were caused by defectively designed and installed vapor barriers. Kalahari Development argued that its claim was timely because it was brought within the ten-year statute of repose. However, the Court of Appeals ruled that the claim was barred because it was not brought within Wisconsin’s six-year statute of limitations for breach of contract actions. The Court rejected the plaintiff’s claims for professional negligence, concluding that the “predominant purpose” of the design-build contract was for the purchase of a product (the building), not architectural and engineering services.
The rules regarding statutes of limitation and statutes of repose in Wisconsin are quite complex. There are many rules and deadlines for when an action must be brought, which vary depending upon the type of claim and the types of parties involved (i.e., private individuals, government entities, minors, etc.). The State Bar of Wisconsin publishes a treatise which is over 500 pages long devoted just to listing the statutes of limitation and other time limits which appear in the Wisconsin Statutes.
The lesson to be learned from the Kalahari case is that if you or your business are a potential party to a claim or lawsuit, be mindful that there are a variety of different statutes of limitation and statutes of repose which may apply, and both the plaintiff and the defendant will need to analyze and take into account the applicable deadlines.
However, many claims involving construction projects are barred long before the ten-year time limit passes. Claims may be barred by one or more of Wisconsin’s statutes of limitation. A statute of limitation is different from a statute of repose. A statute of repose starts to run from a specified time when the defendant acted (i.e., the date of substantial completion of a building by a contractor). A statute of limitation, on the other hand, starts to run when the plaintiff’s cause of action accrues (for example, in a personal injury claim, on the date that the accident occurred).
In February of 2012, the Wisconsin Court of Appeals ruled in Kalahari Development, LLC v. Iconica, Inc. that when both a statute of repose and a statute of limitation are applicable, the shorter of the two periods will be applied to determine whether the claim is barred.
The Kalahari case involved a $26.2 million design and construction project at the Kalahari Resort & Conference Center in Wisconsin Dells. The design-build contractor, Iconica, completed the project in May of 2000. Just before the ten-year anniversary, Kalahari Development, LLC brought breach of contract and professional negligence claims against Iconica. Kalahari Development sought recovery of costs for the inspection and repair of walls for damage caused by moisture, which it claimed were caused by defectively designed and installed vapor barriers. Kalahari Development argued that its claim was timely because it was brought within the ten-year statute of repose. However, the Court of Appeals ruled that the claim was barred because it was not brought within Wisconsin’s six-year statute of limitations for breach of contract actions. The Court rejected the plaintiff’s claims for professional negligence, concluding that the “predominant purpose” of the design-build contract was for the purchase of a product (the building), not architectural and engineering services.
The rules regarding statutes of limitation and statutes of repose in Wisconsin are quite complex. There are many rules and deadlines for when an action must be brought, which vary depending upon the type of claim and the types of parties involved (i.e., private individuals, government entities, minors, etc.). The State Bar of Wisconsin publishes a treatise which is over 500 pages long devoted just to listing the statutes of limitation and other time limits which appear in the Wisconsin Statutes.
The lesson to be learned from the Kalahari case is that if you or your business are a potential party to a claim or lawsuit, be mindful that there are a variety of different statutes of limitation and statutes of repose which may apply, and both the plaintiff and the defendant will need to analyze and take into account the applicable deadlines.