The Two-year Construction Statute of Limitations
| Publication year | 1986 |
| Pages | 402 |
| Citation | Vol. 15 No. 3 Pg. 402 |
1986, March, Pg. 402. The Two-Year Construction Statute of Limitations
CRS § 13-80-127 is the statute of limitations governing actions against architects, contractors, builders, builder-vendors, engineers, inspectors and others. The statute dictates that such actions must be brought within two years after the claim for relief arises. The statute has generated considerable argument since its enactment in 1969. However, most of the controversy stems from the 1979 amendment to the statute.
This article discusses this important amendment to the statute and generally identifies the past, existing and foreseeable problems which surround it. This article is intended as a brief review of the statute and some of the applicable case law.
The 1979 amendment to the statute was a legislative response to the Colorado Supreme Court opinions of Duncan v. Schuster-Graham Homes and Tamblyn v. Mickey & Fox, Inc.(fn1) These cases held that the 1969 original statute did not apply to any suit seeking damages for correction of deficiencies in the design or construction of an improvement to the property itself. However, it did apply to an action for personal injury or injury to other property caused by defective design or construction of the improvement. The 1979 amendment to the statute expressly includes actions for damages for deficiencies in the improvement itself.(fn2)
Subsection (1)(c) of the amended statute is designed to protect the construction industry by including actions in "tort, contract, indemnity, or contribution or other actions for the recovery of damages. . . ." One claim for recovery invariably asserted in actions involving residential construction is that of implied warranty of habitability. This cause of action is not specifally mentioned in the statute. The sweep ing language of the statute seems to make clear that the legislature intended that suits based upon any theory should be subject to the statute, including those premised on the theory of an implied warranty.
In Cosmopolitan Homes, Inc. v. Weller,(fn3) the Colorado Supreme Court held that an implied warranty of habitability arises from the contractual relationship between the builder and the purchaser. Thus, an action grounded on the theory of an implied warranty probably falls within the "contract" and "other actions" provisions of the statute.
The most difficult issues involving the statute revolve around commencement of the running of the two-year limitation period. The period begins to run when the claim for relief arises.(fn4) In determining when the claim for relief arises, at first reading the language of the statute is clear: the claim arises when one discovers or with "reasonable diligence" should have discovered the defect which causes the injury when such defect is of a substantial or significant nature.(fn5)
Arguably then, for limitation purposes, the construction industry in Colorado is subject to a "discovery rule," similar to the medical profession.(fn6) The three reasons most frequently advanced in support of the discovery rule approach are as follows: (1) the duty owed to a client by a construction professional is similar to the duty owed by other professionals; (2) the untrained eye of most people precludes them from being able to recognize design deficiencies; and (3) many construction deficiencies are latent in nature.(fn7)
However, applying the discovery rule and the language of the statute to various fact patterns is a much more difficult task than the language of the statute alone would suggest. The recent Colorado Supreme Court decision in Criswell v. M.J. Brock & Sons, Inc.(fn8) illustrates the problem. In Criswell, the homeowners purchased a residence in September 1976. By late 1978, significant basement slab cracking occurred. By March 1979, "structural" problems became "unbearable." On October 12, 1979, an engineer hired by Defendant Homeowners...
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