A. Applicable Deadlines for Construction Defect Claims

• Library: SC Construction Law Desk Book (SCBar) (2013 Ed.)

A. Applicable Deadlines for Construction Defect Claims

Construction defect claims in South Carolina are subject to both statutes of repose and limitation. While these statutes may have similar preclusive effects in certain cases, they are based on different legal theories and have different commencement dates and durations (note: despite their differences, these statutes can run concurrently). The statute of repose creates a substantive right in those protected to be free from liability after a legislatively determined period of time.¹ It establishes an absolute time limit beyond which liability no longer exists and cannot be tolled for any reason because to do so would upset the economic balance struck by the legislative body.² South Carolina's statute of limitations, on the other hand, is a procedural device that operates as a defense to limit the remedy available from an existing cause of action.³ "A statute of repose differs from a statute of limitations . . . [T]he expiration of the time extinguishes not only the legal remedy but also all causes of action, including those which may later accrue, as well as those already accrued."⁴

1. Statute of Repose - S.C. Code Ann. § 15-3-640

In South Carolina, the repose period is eight years for projects that were certified for occupancy or final completion by a local building official after July 1, 2005, and thirteen years for projects completed prior to that date.⁵ As a general matter, the period of repose set forth in Section 15-3-640 begins running on the date upon which an improvement to real property, or a specified portion thereof, is substantially complete as determined by a local building official's issuance of a certificate of occupancy/completion or written agreement of the parties. The repose period provides an outside limit for bringing an action to recover damages based upon or arising out of the defective or unsafe condition of an improvement to real property. While the statute of repose establishes a cutoff date for most construction defect claims, it does not ensure plaintiffs a right of action for this full period of time. As described below, South Carolina's three year statute of limitations runs from the date of discovery and thus, in the case of a defect discovered soon after completion, can expire well before the statute of repose.

a. Running as To Specific Areas/Portions of a Project

Although the period of repose set forth in Section 15-3-640 is commonly thought to run from substantial completion of "an improvement to real property," Ocean Winds Corp. of Johns Island v. Lane⁶stands for the proposition that the statute of repose may begin to run as discrete portions of the work are finished. Ocean Winds involved a condominium association's claims against a window manufacturer. The window installation was held to have occurred no later than December 2, 1986; certificates of occupancy were issued for the various units between June of 1987 and May of 1991; and the case against the window manufacturer was commenced in February 2000. The South Carolina Supreme Court held that the thirteen year period of repose began running as to the windows upon completion of the window installation and ruled that the suit against the manufacturer was untimely. In reaching its holding, the South Carolina Court noted that S.C. Code Ann. § 15-3-630 defined substantial completion as "that degree of completion of...