Section 5.9.2.3 Time Limitations on Recovery; The Statute of Repose

• Library: Construction Law Practice Manual 3rd Edition 2016

§ 5.9.2.3 Time Limitations on Recovery; The Statute of Repose

The Statute of Limitations for a negligence claim is 2 years.⁷⁰ The Statute of Limitation for a breach of express contract claim is 6 years⁷¹. The Statute of Limitations for breach of an oral promise is 3 years.⁷² However, the Arizona Legislature has significantly broadened the time limitation available for construction defect cases by enacting the Statute of Repose.⁷³ The purpose of doing so is clear. Construction defect claims often involve latent defects?those that do not manifest themselves for years after completion of the home. However, the legislature also recognized the need to put a limitation within a reasonable period of time because evidence and documents used by contractors to defend themselves from lawsuits will not be kept indefinitely.

By way of A.R.S. § 12-552, the Arizona Legislature enacted the longest statute of limitations that could apply to a construction defect case. It reads as follows:

A. Notwithstanding any other statute, no action or arbitration based in contract may be instituted or maintained against a person who develops or develops and sells real property, or performs or furnishes the design, specifications, surveying, planning, supervision, testing, construction or observation of construction of an improvement to real property more than eight years after the substantial completion of the improvement to real property.

B. Notwithstanding subsection A of this section, in...