Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca3-14-04738/USCOURTS-ca3-14-04738-0/pdf.json

Nature of Suit Code: 385
Nature of Suit: Property Damage - Product Liability
Cause of Action: 

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PRECEDENTIAL 

UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT 

______ 

No. 14-4738 

______ 

MRL DEVELOPMENT I, LLC; 

MICHAEL R. LUCHT, 

 Appellants 

v. 

WHITECAP INVESTMENT CORP. d/b/a Paradise Lumber; 

GREAT SOUTHERN WOOD PERSERVING, INC.; 

PUTNAM LUMBER AND EXPORT COMPANY; 

PUTNAM FAMILY PROPERTIES, INC. 

______ 

On Appeal from District Court 

of the Virgin Islands 

(D.C. No. 3-13-cv-00048) 

District Judge: Honorable Curtis V. Gomez 

______ 

Argued December 7, 2015 

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Before: FISHER, KRAUSE, ROTH, Circuit Judges. 

(Filed: May 17, 2016) 

Jared D. Bayer, Esq. 

Thomas G. Wilkinson, Jr., Esq. [ARGUED]

Cozen O'Connor 

1650 Market Street 

One Liberty Place, Suite 2800 

Philadelphia, PA 19103 

David A. Bornn, Esq. 

The Bornn Firm 

5079 Norre Gade, Suite 1 

Charlotte Amalie 

St. Thomas, VI 00802 

Counsel for Appellants 

Chad C. Messier, Esq. 

Alex M. Moskowitz, Esq. [ARGUED] 

Lisa M. Komives, Esq. 

Dudley Topper & Feuerzeig 

1000 Frederiksberg Gade 

P.O. Box 756 

St. Thomas, VI 00804 

John S. Baker, IV, Esq. 

Lee M. Hollis, Esq. 

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S. Andrew Kelly, Esq. [ARGUED]

Lightfoot Franklin & White 

400 20th Street North 

The Clark Building 

Birmingham, AL 35203 

Daryl C. Barnes, Esq. 

Sunshine S. Benoit, Esq. 

Bryant Barnes Blair & Benoit 

1134 King Street, 2nd Floor 

P.O. Box 224589 

Christiansted, St. Croix, VI 00820 

Robert A. Carlson, Esq. [ARGUED] 

Lana M. Naghshineh, Esq. 

Ryan M. Charlson, Esq. 

Lee Hernandez Landrum Garofalo & Blake 

100 North Biscayne Boulevard, Suite 605 

Miami, FL 33132 

Counsel for Appellees 

______ 

OPINION OF THE COURT 

______ 

FISHER, Circuit Judge. 

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 Michael Lucht (and his company, MRL Development 

I, LLC), purchased treated lumber for a deck on his vacation 

home in the Virgin Islands. The lumber allegedly decayed 

prematurely. After replacing rotten deck boards, Lucht 

brought suit against the retailer, wholesaler, and treatment 

company of the lumber. 

 Lucht purchased the lumber between 2002 and 2006. 

He began replacing deck boards in 2010, but he claims he did 

not discover the severity of the problem until the fall of 2011. 

Lucht and MRL filed suit in February 2013, alleging the 

following claims against the appellees: (1) a Uniform 

Commercial Code contract claim; (2) a common law contract 

claim; (3) a breach of warranty claim; (4) a negligence claim; 

(5) a strict liability claim; and (6) a deceptive trade practices 

claim under the Virgin Islands Deceptive Trade Practices Act 

(“DTPA”). The appellees are the retailer, Whitecap 

Investment Corporation, d/b/a Paradise Lumber (“Paradise”); 

the wholesaler, Putnam Lumber & Export Company and 

Putnam Family Properties, Inc. (“Putnam”); and the treatment 

company, Great Southern Wood Preserving, Inc. (“Great 

Southern”). 

 The District Court granted summary judgment against 

Lucht and MRL on the basis that all claims were time-barred. 

We agree, except that we will review the tort claims under the 

gist of the action doctrine, and will affirm on that basis. 

I. 

A. 

 The underlying product at the heart of this dispute, the 

lumber, was pressure treated by Great Southern. It offers 

various services, one of which is called Yellawood and one 

designated as “Treatment Services Only” (“TSO”). Under the 

TSO process, Great Southern does not purchase the lumber 

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itself, but rather treats lumber purchased by the customer to 

the customer’s requested treatment level. Great Southern does 

not test the lumber for retention or penetration levels when it 

fills a TSO lumber order. Yellawood is lumber that has been 

purchased and pressure treated by Great Southern. It is tested 

for retention and penetration levels and includes a warranty. 

 Great Southern supplied primarily TSO lumber to 

Putnam on a wholesale basis, order-by-order. The TSO 

lumber has a green tag. The appellees assert that the 

appellants purchased TSO lumber rather than Yellawood 

lumber, and Lucht stated on the record that he believes the 

tags on the lumber were green. 

 The lumber that the appellants purchased was for a 

home that MRL acquired in the Virgin Islands to serve as a 

vacation home for Lucht and a rental property for MRL. 

Lucht began renovating the home, a project which extended 

from 2002 to December 2006. As part of this project, Lucht 

added a deck which he constructed with pressure-treated 

lumber that was purchased from Paradise. 

 After finishing the deck, at the latest in December 

2006, Lucht visited the home every three months. Lucht 

alleges that, starting in 2010, each time he visited the home he 

had to replace a few boards in the deck. A year after he 

started replacing the boards, in the fall of 2011, he asserts that 

he had a meeting with a carpenter friend who informed Lucht 

that he had been replacing bad lumber all over the island. 

Lucht contends that he then realized that the problem with his 

deck was widespread and would likely continue. 

B. 

 The appellants filed their complaint in this action in 

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the Virgin Islands Superior Court in February 2013. They 

amended their complaint on March 7, 2013. The appellees 

thereafter removed the case to the District Court of the Virgin 

Islands based on diversity jurisdiction. In addition, the 

appellees asserted various cross-claims against each other. 

 Putnam filed the first dispositive motion (pertinent to 

this appeal), requesting that the District Court dismiss the 

appellants’ contract, breach of warranty, and DTPA claims. 

The District Court granted this motion.1

 Thereafter, Great 

Southern and Putnam filed motions for summary judgment, 

and Paradise joined in each motion. The appellees also filed 

motions for summary judgment on the cross-claims. The 

District Court granted the appellees’ motions for summary 

judgment against appellants, dismissed the motions regarding 

the cross-claims as moot, and entered judgment in favor of 

the appellees. 

 The District Court found that the appellants’ contract 

claims were time-barred because (1) they were subject to the 

U.C.C.’s four-year statute of limitations; (2) the discovery 

rule is inapplicable under the U.C.C.; and (3) the statute of 

limitations had thus expired in December 2010 prior to the 

filing of the complaint. Similarly, the District Court found the 

warranty claim was time-barred. As to the negligence and 

strict liability claims, the District Court found that although 

the applicable two-year statute of limitations is subject to the 

discovery rule, Lucht discovered the rotting lumber in 2010, 

his investigation of the issue was insufficient, and he was 

therefore ineligible for tolling of the limitations period. 

Finally, the District Court found that the DTPA claims were 

subject to the two-year statute of limitations in the version of 

the DTPA in place at the time of filing the complaint, rather 

 1

 The appellants have not appealed that decision. 

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than under the amended statute (which provided a six-year 

statute of limitations) because the claims accrued at or before 

the time of purchase in 2006. Accordingly, the District Court 

held that the DTPA claims were time-barred. 

 The appellants timely appealed the District Court’s 

dismissal. 

II. 

 The District Court had jurisdiction under 28 U.S.C. 

§ 1332(a) and 48 U.S.C. §§ 1612(a) and 1613 because the 

parties meet the requirements for diversity jurisdiction. This 

Court has appellate jurisdiction under 28 U.S.C. § 1291.2

 The 

appellants appealed only the District Court’s order granting 

summary judgment. We apply “a plenary standard in 

reviewing orders entered on motions for summary judgment, 

applying the same standard as the District Court.” Blunt v. 

Lower Merion Sch. Dist., 767 F.3d 247, 265 (3d Cir. 2014). 

We must therefore consider “whether there are any genuine 

issues of material fact such that a reasonable jury could return 

a verdict for the [appellants].” Banks v. Int’l Rental & 

 2

Although we recently determined that our jurisdiction 

over cases arising from the Virgin Islands District Court has 

been altered by the 1984 Revised Organic Act and the 1990 

amendment by the Virgin Islands legislature to 4 V.I. Code § 

76(a), we also indicated that there was “no reason not to 

incorporate the federalism principles applicable throughout 

the circuit into our relationship with the Virgin Islands 

courts” and to act otherwise would “subvert[] the dual aims of 

Erie [R.R. Co. v. Tompkins, 304 U.S. 64 (1938)].” Edwards v. 

HOVENSA, LLC, 497 F.3d 355, 360–61 (3d Cir. 2007). Thus, 

jurisdiction is proper in this action as the parties are diverse. 

Id. 

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Leasing Corp., 680 F.3d 296, 297 n.1 (3d Cir. 2012). In doing 

so, we must apply the substantive laws of the Virgin Islands, 

including its statutes of limitations. HOVENSA, 497 F.3d at 

360 (“The fact that the District Court of the Virgin Islands is 

an Article IV court rather than an Article III court does not 

preclude the application of Erie.”). 

 The appellees have advanced some arguments that 

were not relied upon by the District Court in granting 

summary judgment. The appellants argue that this Court 

should not consider any grounds other than those considered 

by the District Court. New Castle Cty. v. Nat’l Union Fire Ins. 

Co. of Pittsburgh, 174 F.3d 338, 342 (3d Cir. 1999) (“[A]s a 

general rule, we will consider only issues passed upon by the 

court below.”). However, “[i]nasmuch as our review is 

plenary, ‘we may affirm the District Court on any grounds 

supported by the record,’ even if the court did not rely on 

those grounds.” Blunt, 767 F.3d at 265 (quoting Nicini v. 

Morra, 212 F.3d 798, 805 (3d Cir. 2000)). Accordingly, this 

Court may consider the other arguments that have been 

advanced by the appellees. 

III. 

 We will undertake a review of the appellants’ claims in 

the order they appear in the appellants’ amended complaint, 

starting with the breach of contract and warranty claims, 

moving next to the tort claims, and ending with the DTPA 

claims. 

A. 

 The appellants asserted two breach of contract 

claims—one against Putnam and one against Paradise—

pursuant to the U.C.C. and common law; and a breach of 

warranty claim against all of the appellees. Common law 

contract and warranty claims have a six-year statute of 

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limitations under the Virgin Islands Code. V.I. Code tit. 5, § 

31(3)(A). The parties agree that the discovery rule3

 is 

applicable to common law claims. The parties disagree, 

however, about whether the U.C.C. supplants the common 

law claims in this action and precludes the application of the 

discovery rule, which would in turn bar the appellants’ 

claims. V.I. Code tit. 11A, § 2-725. 

 In order to apply the correct statute of limitations, we 

must first determine whether the appellants’ common law 

claims may stand or are supplanted by the U.C.C. This will 

allow us to then determine the applicability of the discovery 

rule and apply the correct statute of limitations. 

1. 

 In assessing whether the U.C.C. displaces a common 

law claim, this Court begins with two basic principles. First, 

the U.C.C. “must be liberally construed and applied to 

promote its underlying purposes and policies.” V.I. Code tit. 

11A, § 1-103(a); N.J. Bank, N.A. v. Bradford Sec. Operations, 

Inc., 690 F.2d 339, 345 (3d Cir. 1982). Second, “[u]nless 

displaced by the particular provisions of [the U.C.C.], the 

principles of law and equity . . . supplement its provisions.” 

V.I. Code tit. 11, § 1-103(b). Thus, the U.C.C. displaces the 

common law only “insofar as reliance on the common law 

would thwart the purposes of the Code.” N.J. Bank, 690 F.2d 

at 346. Where the U.C.C. supplants common law contract 

claims, the common law action will be barred. Id.

 3

We have, at various times, described the discovery 

rule as postponing the accrual date of a cause of action or, 

more precisely, as tolling the running of the limitations period 

once the action has accrued. See G.L. v. Ligonier Valley Sch. 

Dist. Auth., 802 F.3d 601, 613 n.10 (3d Cir. 2015). 

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 We must decide whether the Virgin Islands U.C.C. 

supplants the appellants’ common law claims. The Virgin 

Islands Supreme Court has not spoken on this issue. Where 

this occurs, we are “required to predict how the Supreme 

Court of the Virgin Islands would decide an issue of 

territorial law, and should seek guidance from Superior Court 

decisions in undertaking this endeavor.” HOVENSA, 497 F.3d 

at 361 n.3. The Superior Court of the Virgin Islands, 

however, “is not the highest court of the Territory [or] even 

an intermediate appellate court, but rather a trial court.” Id. at 

361. Accordingly, we are not bound by Superior Court 

decisions. Id.; see also Commissioner of Internal Revenue v. 

Estate of Bosch, 387 U.S. 456, 465 (1967) (“[D]ecrees of 

lower state courts should be attributed some weight [but] the 

decision is not controlling where the highest court of the State 

has not spoken on the point.” (internal quotation marks 

omitted)).

 The parties have cited two Territorial Court decisions 

for their separate positions regarding the applicability of the 

U.C.C.’s statute of limitations. The Superior Court has 

subsumed the role of the Territorial Court and we will review 

those decisions as if they were decided by the Superior Court. 

 The Virgin Islands Territorial Court in White v. S&E 

Bakery, Inc., 26 V.I. 87 (Terr. Ct. 1991), found that the 

plaintiff in that action could go forward with claims under 

both the U.C.C. and the common law statutes of limitation. 

White, 26 V.I. at 90. However, White has never been cited by 

any other Virgin Islands court, and the opinion did not 

address the purview of the U.C.C. Additionally, the plaintiff 

in White had filed his action within the four-year statute of 

limitations that is provided by the U.C.C., and thus the 

finding that the claim qualified under both statute of 

limitations was unnecessary. Id. 

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 Six years earlier in Fombrun v. Controlled Concrete 

Prods., Inc., 21 V.I. 578 (Terr. Ct. 1985), the Territorial Court 

addressed the purview of the U.C.C. and found that a contract 

for the sale of goods was supplanted by the U.C.C. Id. at 581–

82. Although earlier, Fombrun provides a clearer analysis and 

the White court failed to cite it or discuss the prior holding in 

Fombrun. 

 Despite Fombrun’s persuasive qualities, these cases do 

not provide a clear picture of what the current law is on this 

issue as we would be forced to pick between two 

contradictory holdings—one of which failed to recognize that 

it was creating such a division. Thus, given that the Territorial 

Court decisions are not controlling on this Court because the 

Virgin Islands Supreme Court has not spoken on the subject, 

Estate of Bosch, 387 U.S. at 465, and no other Virgin Islands 

courts have cited either case (other than the District Court in 

citing Fombrun), we will have to look elsewhere to make our 

prediction. 

 Consequently, we will analyze the application of the 

U.C.C. by applying a plain meaning interpretation of whether 

lumber qualifies as a “good” to determine whether the 

appellants’ common law contract and warranty claims should 

be supplanted by the U.C.C. See In re Am. Home Mortg. 

Holdings, Inc., 637 F.3d 246, 254–55 (3d Cir. 2011). 

“Goods” are “all things (including specially manufactured 

goods) which are movable at the time of identification to the 

contract for sale.” V.I. Code tit. 11A, § 2-105(1). The 

contracts at issue in this case are clearly governed by the 

U.C.C. The appellants allege that they had oral contracts, 

memorialized by invoices, with Putnam and Paradise, for the 

purchase of lumber. Lumber is a thing that is movable at the 

time of identification to the alleged contract for sale. Under a 

plain reading of the definition of “goods,” lumber is included 

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and the appellants’ claims fall within the purview of the 

U.C.C.4

 

 This conclusion is bolstered by the purpose of the 

U.C.C. “[t]o introduce a uniform statute of limitations for 

sales contracts, thus eliminating jurisdictional variations and 

providing needed relief for concerns doing business on a 

nationwide scale.” V.I. Code tit. 11A, § 2-725 cmt. As such, 

failure to apply the U.C.C. in this situation would thwart the 

U.C.C.’s purpose to provide uniform limitations periods for 

claims involving contracts for the sale of goods, including 

lumber. 

2.

 Because the U.C.C. applies, we will now address the 

appellants’ argument that the discovery rule applies to the 

U.C.C. 

 The Virgin Islands Code provides a six-year statute of 

limitations for actions involving a contract “except when, in 

special cases, a different limitation is prescribed by statute.” 

V.I. Code tit. 5, § 31. The Virgin Islands U.C.C., on the other 

hand, provides that an action for breach of contract is subject 

 4

 The District Court similarly concluded that the 

U.C.C. statute of limitations governed the claims against all 

appellees for breach of warranty. The appellants do not argue 

on appeal that, because the bulk of the lumber shipped from 

Great Southern to Putnam was TSO lumber, the alleged 

contracts at issue were for services and not goods; instead, 

they argue that U.C.C. and common law contract claims may 

be asserted simultaneously. The argument that these contracts 

were for services is therefore waived, and we need not 

address it. See, e.g., In re Surrick, 338 F.3d 224, 237 (3d Cir. 

2003). 

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to a four-year statute of limitations. V.I. Code tit. 11A, § 2-

725(1). This statute of limitations is restricted by the 

subsection that follows, subsection two, which provides that 

“[a] cause of action accrues when the breach occurs, 

regardless of the aggrieved party’s lack of knowledge of the 

breach. V.I. Code tit. 11A, § 2-725(2) (hereinafter referred to 

as “subsection two”). Subsection four of that provision, 

however, states that “[t]his section does not alter the law on 

tolling of the statute of limitations nor does it apply to causes 

of actions which have accrued before this title becomes 

effective.” V.I. Code tit. 11A, § 2-275(4) (hereinafter referred 

to as “subsection four”). 

 The appellants argue that, despite subsection two’s 

instruction that the aggrieved party’s knowledge is not to be 

considered, subsection four’s pronouncement allows for the 

application of the discovery rule to U.C.C. claims. The 

appellees argue, and the District Court found, that subsection 

two prohibits the application of the discovery rule and 

subsection four refers to equitable tolling. 

 One Virgin Islands court has found that the discovery 

rule does not apply to the U.C.C. Fombrun, 21 V.I. at 582–

83. This case is a Territorial Court case, however, and the 

court did not undergo a review of subsection two in 

conjunction with subsection four. The Fombrun court did not 

undertake a review of what comprises “the law on tolling.” 

This Court must therefore interpret the statute to determine 

whether the discovery rule is applicable because neither the 

Virgin Islands legislature nor the Virgin Islands Supreme 

Court has provided the parameters for what constitutes “the 

law on tolling.” 

 When interpreting a statute, this Court must give effect 

to the legislature’s intent. In re Am. Home Mortg., 637 F.3d at 

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254. This determination begins with the statute and if the text 

is plain, this Court need not inquire further. Id. at 255. If the 

legislature’s intent is made plain, “it is unnecessary for us to 

refer to other canons of statutory construction, and indeed we 

should not do so.” Id. at 254–55. Moreover, just because 

party opponents may “proffer different interpretations of the 

statutory language does not make the language ambiguous. It 

just makes the court’s role difficult in deciding which 

interpretation is persuasive.” Id. at 256. 

Given the parties’ differing interpretations, this Court 

must determine which interpretation of the two subsections is 

correct. We have indicated that both the discovery rule and 

equitable tolling require diligence on the part of the plaintiff 

with the potential consequence of losing the benefit of either 

doctrine.5

 The two doctrines differ, however, as to their 

purposes in application. G.L., 802 F.3d at 613 n.10, 614 n.12 

(citing William A. Graham Co. v. Haughey, 646 F.3d 138, 

150 (3d Cir. 2011); Oshiver, 38 F.3d at 1390). 

 The discovery rule focuses on the plaintiff’s 

knowledge of injury, whereas equitable tolling focuses on the 

time to bring an action despite discovery of the injury. Id. at 

614 n.2. Given the difference between the two doctrines, the 

two § 2-725 subsections each stand alone, subsection two 

referring to the discovery rule and subsection four referring to 

equitable estoppel. Such a reading is consistent with this 

 5 Oshiver v. Levin, Fishbein, Sedran & Berman, 38 

F.3d 1380, 1390 (3d Cir. 1994) (citing Keystone Ins. Co. v. 

Houghton, 863 F.2d 1125, 1127 (3d. Cir. 1988), abrogated on 

other grounds by Klehr v. A.O. Smith Corp., 521 U.S. 179 

(1997) (for the discovery rule); Reeb v. Econ. Opportunity 

Atlanta, Inc., 516 F.2d 924, 930 (5th Cir. 1975) (for equitable 

tolling)). 

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Court’s preference to construe a statute in a way that gives 

meaning to all provisions. Kendall v. Russell, 572 F.3d 126, 

143 (3d Cir. 2009) (“It is a well known canon of statutory 

construction that courts should construe statutory language to 

avoid interpretations that would render any phrase 

superfluous.”). 

 Subsection two encompasses the discovery rule 

because it relies on the plaintiff’s knowledge or imputed 

knowledge, coinciding with subsection two’s prohibition on 

considering the “aggrieved party’s lack of knowledge of the 

breach.” V.I. Code tit. 11A, § 2-725(2). This leaves 

subsection four, which refers to “tolling”, to be applied where 

equitable tolling is at issue. In contrast, reading the two 

subsections together as the appellants request would 

essentially read subsection two out of the statute, rendering 

the “phrase superfluous.” See Kendall, 572 F.3d at 143; see 

also Hull v. Eaton Corp., 825 F.2d 448, 456–57 (D.C. Cir. 

1987) (finding that identical language of a statute was clear 

and weighed against the application of the discovery rule). 

Such a result is consistent with our prior holdings. 

 We have previously found the discovery rule 

inapplicable to conversion actions under Pennsylvania’s 

U.C.C. Menichini v. Grant, 995 F.2d 1224, 1229–31 (3d Cir. 

1993). In making that finding, our focus centered on the 

U.C.C.’s “objectives of negotiability, finality, and uniformity 

in commercial transactions.” Id. at 1230. Similar objectives 

are found in the Virgin Islands U.C.C.’s official comment 

regarding the statute of limitations: 

[the purpose of this section is] [t]o introduce a 

uniform statute of limitations for sales 

contracts, thus eliminating jurisdictional 

variations and providing needed relief for 

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16 

concerns doing business on a nationwide scale 

whose contracts have heretofore been governed 

by several different periods of limitation 

depending upon the state in which the 

transaction occurred. 

V.I. Code tit. 11A, § 2-725 cmt. In accordance with this 

focus, we find that the discovery rule does not apply to 

contract claims covered by the Virgin Islands U.C.C. 

3.

 Under the applicable four-year statute of limitations, 

the appellants’ contract claims are time-barred. A claim for 

breach of contract accrues when the breach occurs. This 

precludes the consideration of the plaintiff’s knowledge of the 

breach. Id. § 2-725(1). The appellants’ contract claim is 

clearly time-barred as the breach of the contract occurred in 

December 2006, at the latest, when the last of the lumber was 

purchased from Paradise. As the appellants did not file this 

action until February 2013, the two contract claims fall 

outside of the four-year limitations period. 

 The breach of warranty claims are also time-barred. 

Where the underlying contract falls within the U.C.C., the 

warranty claim will also be subject to the U.C.C.’s 

application. Id. §§ 2-313, 2-314, 2-315 (referencing 

warranties in relation to the contract for the sale of goods to 

which they attach). A breach of warranty claim starts to 

accrue “when tender of delivery is made, except that where a 

warranty explicitly extends to future performance of the 

goods and discovery of the breach must await the time of 

such performance the cause of action accrues when the breach 

is or should have been discovered.” Id.; § 2-725. 

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 The final tender of delivery of the lumber was made in 

December 2006, when the last lumber was bought for the 

renovation of the home. Thus, the warranty claim is timebarred if there is no explicit warranty extending to future 

performance of the lumber. 

 The term “explicit” under the U.C.C. is defined as “not 

implied merely or conveyed by implication; distinctly stated; 

plain in language; clear; not ambiguous; express; 

unequivocal” or “that which is so clearly or distinctly set 

forth that there is no doubt as to its meaning.” Jones & 

Laughlin Steel Corp. v Johns-Manville Sales Corp., 626 F.2d 

280, 291 n.25 (3d Cir. 1980) (internal quotation marks and 

citation omitted). Moreover, the defendant’s knowledge of the 

plaintiff’s expectations or the possible reliance by the plaintiff 

on the defendant’s expertise does not transform 

“representations regarding the performance of existing 

products . . . into explicit warranties of future performance.” 

Id. 

 No reasonable jury could find, based on Lucht’s 

statements during his deposition, that an explicit warranty of 

future performance was made. Lucht stated that he: (1) never 

had contact with or heard of Putnam or Great Southern prior 

to this suit, (2) was not told by any Paradise employee that the 

lumber was treated a certain way or that it would last for a 

certain amount of time, (3) did not request a specific type of 

treatment of the lumber and purportedly relied on the 

representation that the lumber was pressure treated, (4) could 

not recall exactly what the tags on the end of the individual 

pieces of lumber stated but remembered that the tags were 

green, and (5) did not receive a warranty or any other 

representations from Putnam. Great Southern also provided 

evidence that the Yellawood tags, which provide a limited 

warranty, are not green and that the majority of the lumber 

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18 

sold to Putnam is TSO lumber, which has no warranty and 

has green tags. Additionally, the invoices from Paradise to 

Lucht do not state that Lucht received a warranty. 

 Lucht also stated in his deposition that he had no 

knowledge of whether his contractor informed Paradise that 

he needed a certain type of treated lumber or that he indicated 

at any time what type of lumber he needed when he picked up 

orders from Paradise. Lucht did state that he relied on 

Paradise to furnish the correct lumber, but he provided no 

evidence that suggests that his reliance was justified or that 

Paradise had reason to know of such reliance. Lucht indicated 

that he relied only on his architect to specify, and his 

contractor to pick, the correct type of lumber. 

 The appellees made no warranties. Given the record, 

there is no genuine issue of material fact that Lucht was given 

any type of explicit warranty of future performance. 

 The only other available avenue of recovery for the 

appellants would be equitable tolling under subsection four of 

the U.C.C.’s statute of limitations provision. The appellants, 

however, have failed to assert this argument in this appeal. 

Rather, the appellants focus on the discovery rule in their 

briefs and the only parties to address such an argument, 

interestingly, are the appellees. Accordingly, this Court will 

not consider this argument as it has been waived by the 

appellants. In re Surrick, 338 F.3d at 237 (“Failure to identify 

or argue [an] issue in [the] opening brief constitutes waiver of 

[an] argument on appeal.”). 

B. 

Three issues arose in the District Court regarding the 

appellants’ tort claims, whether the claims were: (1) 

Case: 14-4738 Document: 003112297227 Page: 18 Date Filed: 05/17/2016
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precluded by the gist of the action doctrine, (2) timely filed, 

or (3) precluded by the economic loss doctrine. Because the 

appellants’ tort claims are barred by the gist of the action 

doctrine, we will not undertake a review of the other two 

issues. 

This Court has found that the gist of the action 

doctrine applies in Virgin Islands actions. Addie v. Kjaer, 737 

F.3d 854, 868–69 (3d Cir. 2013). “[T]he ‘gist of the action 

doctrine’ bars plaintiffs from bringing a tort claim that merely 

replicates a claim for breach of an underlying contract.” 

Werwinski v. Ford Motor Co., 286 F.3d 661, 680 n.8 (3d Cir. 

2002) (applying Pennsylvania law). “[W]hile the existence of 

a contractual relationship between two parties does not 

prevent one party from bringing a tort claim against another, 

the gist of the action doctrine precludes tort suits for the mere 

breach of contractual duties”; the plaintiff must instead point 

to “independent events giving rise to the tort.” Addie, 737 

F.3d at 865–66. “[T]he important difference between contract 

and tort actions is that the latter lie from the breach of duties 

imposed as a matter of social policy while the former lie for 

the breach of duties imposed by mutual consensus.” Bohler–

Uddeholm Am., Inc. v Ellwood Grp. Inc., 247 F.3d 79, 103 

(3d Cir. 2001) (quotation marks and citation omitted). 

A claim arises from contract, rather than social policy, 

when it is one: 

(1) arising solely from a contract between the 

parties; (2) where the duties allegedly breached 

were created and grounded in the contract itself; 

(3) where liability stems from a contract; or (4) 

where the tort claim essentially duplicates a 

breach of contract claim or the success of which 

is wholly dependent on the terms of a contract. 

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Id. at 866 (quoting eToll, Inc. v. Elias/Savion Advertising, 

Inc., 811 A.2d 10, 19 (Pa. Super. Ct. 2002)). 

The appellants assert that their tort claims are 

supported by the public policy that sellers have a duty not to 

distribute defective and unreasonably dangerous construction 

products. This public policy argument, however, runs counter 

to the gist of the action doctrine. The appellants’ negligence 

and strict liability claims and alleged injuries arise solely 

from the allegation that the purchased lumber was not 

appropriately treated for use as building material in the Virgin 

Islands: a breach of a duty established, if at all, from a 

contract or warranty rather than a tort. The appellants have 

not asserted any other injury to themselves or to renters of the 

home. The appellants’ tort claims “essentially duplicate [the] 

breach of contract claim[s].” Jefferson v. Bay Isles Assoc., 

L.L.L.P., Civil No. ST-09-CV-186, 2011 WL 3853332, 59 

V.I. 31 at *10 (Super. Ct. Feb. 1, 2011) (quoting eToll, 811 

A.2d at 19). As a result, the appellants’ tort claims are barred 

by the gist of the action doctrine. 

C. 

 The appellants’ DTPA claim against Putnam was 

previously dismissed and was not appealed. The only DTPA 

claims pending on appeal are those against Great Southern 

and Paradise. Those claims are time-barred. 

 The appellants assert that the DTPA’s six-year statute 

of limitations, which went into effect in October 2013, rather 

than the two-year statute of limitations that was in place at the 

time their complaint was filed in February 2013, applies. The 

appellants’ assertion is incorrect. 

 The appellants argue that the six-year statute of 

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limitations applies because the Virgin Islands legislature 

voiced social policy concerns in the amendment’s bill. The 

text of the bill indicates that the legislature was concerned 

that other states “provide greater protection to their citizens 

and businesses while the laws of the Virgin Islands fail to 

give the same strong protections and remedies.” Bill No. 30-

0123, 30th Leg., Reg. Sess. (V.I. 2013). 

 There is a presumption against applying legislation 

that would revive otherwise untimely claims. This 

presumption is based on the principle “that the legal effect of 

conduct should ordinarily be assessed under the law that 

existed when the conduct took place.” Kaiser Aluminum & 

Chem. Corp. v. Bonjorno, 494 U.S. 827, 855 (1990) (Scalia, 

J., concurring); see also Vartelas v. Holder, 132 S. Ct. 1479, 

1486 (2012); In re Exxon Mobil Corp. Sec. Litig., 500 F.3d 

189, 196 (3d Cir. 2007), as amended (Nov. 20, 2007). In 

applying this presumption, we are guided by: 

a two-part test for determining whether a 

particular statute applies retroactively. At the 

first stage, a court must determine if Congress 

has expressly prescribed the statute’s intended 

reach. If Congress has done so, the inquiry ends 

. . . If the statute is ambiguous or contains no 

express command, a court must examine 

whether the statute would have an adverse 

effect if it were held to be retroactive; that is to 

say, “whether it would . . . increase a party’s 

liability for past conduct . . . .” 

Lieberman v. Cambridge Partners, LLC, 432 F.3d 482, 488–

89 (citation omitted) (quoting Landgraf v. USI Film Prods., 

511 U.S. 244, 280 (1994)). 

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The language used by the Virgin Islands legislature 

and cited by the appellants does not meet the first step of the 

Lieberman test. A social policy concern that consumers be 

protected does not meet the specificity requirement that a 

legislature enunciate an express and unambiguous intent that 

expired claims should be revived. Thus, the appellants’ 

DTPA claims are subject to the two-year statute of limitations 

unless the second Lieberman step is met. 

 The DTPA statute of limitations began “running from 

the date the violation of the statute occurred, not the date the 

violation was discovered.” Island Insteel Sys., Inc. v. Waters, 

296 F.3d 200, 214 (3d Cir. 2002). Each DTPA claim that the 

appellants have asserted and the applicable DTPA 

enumerated prohibited activities—misrepresentation of the 

quality or standard of the goods, or misrepresentation of a 

material fact or failing to state a material fact “if such use 

deceives or tends to deceive”—involve pre-sale conduct. See

V.I. Code tit. 12A, § 102; App. at 122–23 (appellants’ DTPA 

claims only allege pre-sale conduct). Any DTPA violation 

therefore occurred at the latest in December 2006 when the 

last of the allegedly defective lumber was purchased. 

 Consequently, retroactively applying the six-year 

statute of limitations period would impermissibly increase the 

appellees’ liability. See Lieberman, 432 F.3d at 492 

(explaining that “resurrection of previously time-barred 

claims ‘increases a party’s liability’ by abolishing complete 

defense to a suit” (quoting In re Enter. Mrtg. Acceptance Co., 

LLC Sec. Litig., 391 F.3d 401, 409-10 (2d Cir. 2005)). 

Because the Lieberman test is not met, the appellants had to 

file by December 2008 under the two-year statute of 

limitations. They failed to do so and their DTPA claims are 

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time-barred.6 

IV. 

 For the reasons set forth above, we will affirm the 

order of the District Court. 

 6

 Moreover, even if we were to apply the six-year 

statute of limitations, which we have found does not apply, 

the appellants’ DTPA claims are time-barred. 

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