Byline: Barbara L. Jones
There was no safe harbor for a developer who tried to settle claims against it for defective construction of condominiums in Minneapolis using practices developed in case law known as the Two Harbors trilogy. That procedure allows a defendant such as a developer to settle a case and allow the plaintiff to pursue contribution or indemnification claims against other co-defendants.
The Court of Appeals said that the trial court did not err by saying a defendant developer couldn't settle without a summary judgment motion first. "The court is saying, 'I can't save my own skin through a Two Harbors agreement until I have lost my summary judgment motion,'" said Einar Hanson, the plaintiff's attorney.
The ruling leaves common settlement practices in construction litigation up in the air, he added.
The case is Village Lofts at St. Anthony Falls Association v. Housing Partners III-Lofts LLC, et al., which affirmed in part and reversed in part the Hennepin County District Court, and sent the case back down on remand. The opinion was written by Judge Matthew Johnson.
The case also addresses issues about the statute of repose for common law and breach of warranty claims in construction cases.
The Court of Appeals said that the statute of repose for breach of statutory warranty claims is different for different individual condominium units. But it also said that the statute of repose barred the plaintiff's common law claims.
The opinion complicates litigation over breach of warranty claims in condominium projects because each condominium owner owns an undivided interest in common elements, meaning that the repose period may not start to run until the warranty date passes for the latest-sold unit, Hanson said.
Certificate of Occupancy
Village Lofts at St. Anthony Falls consists of two buildings in northeast Minneapolis developed by defendant Housing Partners III-Lofts LLC. In the opinion, they are known as Building A and Building B. There are several co-defendants including the architect, Elness Swenson Graham Architects Inc. and the general contractor, Kraus-Anderson Construction Co.
The first certificate of occupancy for Building A was issued on Sept. 5, 2002. A certificate of occupancy for Building B was issued on Oct. 14, 2004.
On or about Jan. 30, 2014, a resident in Building A notified the property manager that the floor in her condo was discolored. The cause was found to be a broken joint on the water pipe connected to the...