In Venema v. Moser Builders, Inc., 2370 EDA 2021 (Pa. Super. Ct. Aug. 29, 2022), the Superior Court held that the Statute of Repose was not tolled by repairs made several years after the certificate of occupancy was issued. Homeowners are not entitled to unilaterally dictate an extended window to file suit because a builder complies with the agreement in good faith and makes repairs years after the original purchase date.
Factual Background
In 2003, Moser Builders, Inc. built the subject home which was located in Chester Springs, Pennsylvania. A Certificate of Occupancy was issued on August 13, 2003 and in October 2004, the house was purchased by Appellants from the original third party owners.
In August 2019, Appellants filed a Complaint against Moser alleging construction defects and that despite several inspections and repairs by Moser during the period from 2004 to 2008, the defects were never properly remedied. Due to this ongoing failure to remedy the defective conditions, Appellants claimed that there was substantial water intrusion into the home, which caused significant damage.
Moser argued that Appellants' case was barred by the Statute of Repose because in excess of twelve years had passed from the construction completion date. 42 Pa. C.A. §5536(a) states, "A civil action or proceeding brought against any person lawfully performing or furnishing the design, planning, supervision, or observation of construction, or construction of any improvement to real property must be commenced within twelve years after completion of construction." Thus, Moser filed a Motion for Judgment on the Pleadings, seeking dismissal of the action. Appellants responded by asserting that as ongoing repairs took place from 2004 to 2008, these repairs should effectively suspend the running of the clock on the Statute of Repose and that the claim was therefore filed in a timely fashion.
Moser took the position that, as a matter of law, the Statute of Repose began to run on the date the Certificate of Occupancy was issued. The trial court agreed with Moser and granted Moser's Motion for Judgment on the Pleadings. The trial court determined that the construction of the house was completed in 2003 and that the Appellants had failed to raise a genuine issue of material fact as to the validity of that completion date.
When is it Appropriate to Bar a Claim Based on a Statute of Repose?
When a party attempts to utilize the Statute of Repose as a bar to litigation, that party has the burden of proof to demonstrate:
- What is supplied by the defendant is an improvement to real property;
- More than 12 years have elapsed between the completion of the improvements to the real estate and the injury; and
- The activity of the moving party must be within the class which is protected by the statute.
McConnaughey v. Building Components, Inc., 637 A.2d 1331 (Pa. 1994).
In Venema, the controversy centered around whether twelve years had passed since the construction was completed. Although Appellants argued that the Statute of Repose did not begin to run until after the last repairs were made by Moser in 2008, the Certificate of Occupancy was issued in 2003. By statute, the Certificate of Occupancy is only issued after a final inspection is completed and the licensing agency signs off on the property as complying with all building codes and requirements. Pennsylvania Uniform Construction Code, 34 Pa. Code §403.65(a)-(b).
Appellants’ assertion that the Statute of Repose was effectively tolled by the repairs that took place between the years from 2004 to 2008 was not supported by any legal authority. Appellants could not provide the Superior Court with any statutory or case law to support their theory. In fact, the Supreme Court of Pennsylvania has held that, "A statute of repose generally may not be tolled, even in extraordinary circumstances beyond a plaintiff's control." Dubose v. Quinlan, 173 A.3d 634, 644-45 (Pa. 2017). In addition, precedent clearly dictates that "completion of the construction of such improvement marks the commencement of the repose period at the point when third parties are first exposed to defects in design, planning, or construction." Catanzaro v. Wasco Prod., Inc., 489 A.2d 262, 266 (Pa. Super. 1985). Here, the original owners of the home would have been exposed to potential defects starting in 2003 when they purchased it (and in 2004 for Appellants) when they purchased the home from the original owners. As such, the Superior Court ruled that the Statute of Repose ran from 2003 on and was not tolled or interrupted by any other circumstance.
The Superior Court affirmed the trial court’s determination that the Appellants' claims were barred by the running of the Statute of Repose and that their window for bringing a claim has closed.
Take-Aways
Given the Superior Court’s ruling in Venema, the Statute of Repose continues to provide a strong foundation upon which to build a defense to claims arising out of the construction of a home, even when repairs to address the same are undertaken over a period of years. This defense should be first and foremost in the minds of litigators when defending defective construction claims.