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Cite as 309 Neb. 141

Richard McCaulley, individually and as 

Personal Representative of the Estate 

of Michelle McCaulley, appellant, v. 

C L Enterprises, Inc., a Nebraska 

corporation, et al., appellees.

___ N.W.2d ___

Filed May 7, 2021. No. S-20-075.

1. Summary Judgment: Appeal and Error. An appellate court will affirm 

a lower court’s grant of summary judgment if the pleadings and admitted evidence show that there is no genuine issue as to any material facts 

or as to the ultimate inferences that may be drawn from those facts and 

that the moving party is entitled to judgment as a matter of law. An 

appellate court reviews the district court’s grant of summary judgment 

de novo, viewing the record in the light most favorable to the nonmoving party and drawing all reasonable inferences in that party’s favor.

2. Pleadings: Judges: Words and Phrases: Appeal and Error. A district 

court’s denial of a motion for leave to amend a complaint is reviewed 

for an abuse of discretion. A judicial abuse of discretion exists if the 

reasons or rulings of a trial judge are clearly untenable, unfairly depriving a litigant of a substantial right and denying just results in matters 

submitted for disposition.

3. Limitations of Actions: Negligence: Breach of Warranty: Contractors 

and Subcontractors. The limitations period in Neb. Rev. Stat. § 25-223 

(Reissue 2016) applies to defective construction claims brought against 

contractors and builders, whether such claims are based on negligence 

or breach of warranty.

4. Limitations of Actions: Contractors and Subcontractors. When the 

basis of a claim against a builder or contractor is improper workmanship 

resulting in defective construction, the statute of limitations under Neb. 

Rev. Stat. § 25-223 (Reissue 2016) runs from the date of substantial 

completion of the project, not the date of any specific act which resulted 

in the defect.

Nebraska Supreme Court Online Library

www.nebraska.gov/apps-courts-epub/

06/25/2021 08:09 AM CDT
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5. ____: ____. Determining when a construction project is substantially 

complete for purposes of the limitations period under Neb. Rev. Stat. 

§ 25-223 (Reissue 2016) requires consideration of the nature and scope 

of the agreed-upon project.

6. Pleadings: Rules of the Supreme Court: Appeal and Error. When a 

party seeks leave to amend a pleading, appellate court rules generally 

require that leave shall be freely given when justice so requires. Denial 

of leave to amend pleadings is appropriate only in those limited circumstances in which undue delay, bad faith on the part of the moving party, 

futility of the amendment, or unfair prejudice to the nonmoving party 

can be demonstrated.

7. Pleadings: Summary Judgment: Evidence. Generally, it is not an 

abuse of discretion to deny leave to amend when a party seeks to add 

a new claim or defense after a motion for summary judgment has been 

heard and submitted, unless evidence or testimony exists in the record 

indicating the proposed claim or defense was newly discovered or that 

counsel was previously unaware of the claim.

Appeal from the District Court for Douglas County: W. 

Russell Bowie III, Judge. Affirmed.

Andrew M. Hollingsead and Michael J. Matukewicz, of 

Liakos & Matukewicz, L.L.C., for appellant.

Robert D. Mullin, Jr., of McGrath, North, Mullin & Kratz, 

P.C., L.L.O., for appellee Able Plumbing, Inc.

Robert M. Schartz and Julie M. Ryan, of Abrahams, Kaslow 

& Cassman, L.L.P., for appellee Timberland Hardwood Floors, 

Inc.

Danny C. Leavitt, of Salerno & Leavitt, for appellee Dan 

Becker.

Daniel J. Welch, Damien J. Wright, and Daniel McDowell, 

Senior Certified Law Student, of Welch Law Firm, P.C., for 

appellee Hardscape Contractors, LLC.

Heavican, C.J., Cassel, Stacy, Funke, Papik, and 

Freudenberg, JJ.
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Stacy, J.

In this construction defect case brought by homeowners 

against several contractors, the district court found the homeowners’ claims were time barred under Neb. Rev. Stat. § 25-223 

(Reissue 2016). The primary question on appeal is whether the 

4-year limitations period under § 25-223 began to run on the 

date each contractor substantially completed its project or on 

the date the entire home was completed. Because we agree 

with the district court that the limitations period against each 

contractor began to run upon the substantial completion of 

each contractor’s project, we affirm.

BACKGROUND

In approximately November 2006, Richard McCaulley and 

Michelle McCaulley began construction on a home in Omaha, 

Nebraska. The McCaulleys acted as their own general contractor, and in that capacity, they hired a number of different 

contractors to perform specific work. As relevant to the issues 

on appeal, the McCaulleys hired Able Plumbing, Inc., to install 

sewer lines servicing the property; Affordable Exteriors, Inc., 

to install exterior masonry and brickwork; Stile Construction 

Services, LLC (Stile), to install the roof; Timberland Hardwood 

Floors to install hardwood floors; Dan Becker Construction to 

install the doors and windows; Senegal Specialty Contracting, 

LLC, to perform waterproofing and to install drain tile and 

sump pumps; and Hardscape Contractors, LLC, to construct a 

retaining wall.

The McCaulleys moved into the home sometime in late 

February or early March 2008. Approximately 4 years later, 

on February 7, 2012, they filed this construction defect action 

in the district court for Douglas County, naming as defendants 

12 of the contractors involved in the construction of the home, 

including the 7 contractors referenced above.

The McCaulleys alleged a separate negligence claim against 

each of the seven contractors. Specifically, they alleged that 

each such contractor owed a legal duty to install its “respective 
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improvements” to the property “in a good and workmanlike 

manner” and failed to do so. They also alleged a breach of 

warranty claim against four of the contractors: Able Plumbing, 

Affordable Exteriors, Stile, and Dan Becker Construction. 

Specifically, they alleged that each such contractor’s work 

carried with it a warranty the work “would be performed in 

a good and workmanlike manner, without latent defects, and 

reasonably fit for the ordinary purposes” for which the specific work was intended. It was alleged that each such contractor breached the warranty, because the McCaulleys discovered 

“numerous and substantial defects and deficiencies in the 

installation” work of each. There were no allegations that any 

of the contractors expressly warrantied their work.

While the case was pending, Michelle died. Her claims 

have been revived by Richard in his capacity as personal 

representative of her estate. For ease of reference, this opinion will continue to refer to the plaintiffs/appellants as “the 

McCaulleys.”

At different times during the litigation, each of the seven 

contractors referenced above filed a motion for summary judgment, arguing the claim against it was barred by the 4-year 

limitations period under § 25-223. Each of the seven contractors generally argued that the McCaulleys’ claim accrued, and 

the limitations period under § 25-223 began to run, on the 

date that each contractor substantially completed its work. The 

McCaulleys did not dispute the dates on which each contractor 

claimed to have completed its work, but instead argued that 

the 4-year limitations period did not start to run for any of the 

seven contractors until the entire home construction project 

was substantially completed.

In March 2014, the district court granted summary judgment 

in favor of Timberland Hardwood Floors, Senegal Specialty 

Contracting, and Hardscape Contractors, generally agreeing 

that the limitations period for the McCaulleys’ claims against 

these contractors began to run on the dates that each contractor substantially completed its work. After determining the 
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substantial completion date for each contractor, the district 

court found the McCaulleys’ suit had not been filed within 4 

years of such date. The district court also found the discovery 

rule did not extend the time to file against any of these contractors, and thus, it dismissed the claims against those contractors 

as time barred. In June 2015, the district court utilized identical reasoning to grant summary judgment in favor of Able 

Plumbing and Dan Becker Construction.

Similar summary judgment motions were filed by Affordable 

Exteriors and Stile, and those motions were pending when this 

court decided Adams v. Manchester Park.

 1 At the summary 

judgment hearing in November 2015, the McCaulleys made an 

oral motion for leave to file a fourth amended complaint, relying on language in the concurring opinion in Adams to argue

they should be allowed to amend their complaint to allege 

the breach of an express warranty to repair. Both Affordable 

Exteriors and Stile objected to the requested amendment, arguing that the McCaulleys had already filed three complaints and 

that none had alleged the existence, or breach, of an express 

warranty to repair material defects. The court took the oral 

motion to amend under advisement.

In an order entered February 11, 2016, the district court 

granted summary judgment in favor of Affordable Exteriors 

and Stile, again reasoning that the 4-year limitations period 

under § 25-223 began to run on the dates each contractor 

substantially completed its respective work and that the completion dates were more than 4 years before the date on which 

the McCaulleys filed their lawsuit. The court also denied 

the McCaulleys’ request for leave to file a fourth amended 

complaint.

After all remaining claims were resolved, the district court 

entered final judgment, and the McCaulleys timely appealed. 

We moved the case to our docket on our own motion.

1 Adams v. Manchester Park, 291 Neb. 978, 871 N.W.2d 215 (2015).
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ASSIGNMENTS OF ERROR

The McCaulleys assign, restated, that the district court erred 

in (1) finding their claims against the seven contractors were 

time barred by § 25-223 and (2) denying their oral motion 

seeking leave to amend their complaint to add a new claim 

against Affordable Exteriors and Stile.

STANDARD OF REVIEW

[1] An appellate court will affirm a lower court’s grant of 

summary judgment if the pleadings and admitted evidence 

show that there is no genuine issue as to any material facts 

or as to the ultimate inferences that may be drawn from those 

facts and that the moving party is entitled to judgment as a 

matter of law. 2 An appellate court reviews the district court’s 

grant of summary judgment de novo, viewing the record in the 

light most favorable to the nonmoving party and drawing all 

reasonable inferences in that party’s favor. 3

[2] A district court’s denial of a motion for leave to amend 

a complaint is reviewed for an abuse of discretion. 4 A judicial 

abuse of discretion exists if the reasons or rulings of a trial 

judge are clearly untenable, unfairly depriving a litigant of a 

substantial right and denying just results in matters submitted 

for disposition. 5

ANALYSIS

Statute of Limitations

The primary issue on appeal is whether the contractors were 

entitled to summary judgment on statute of limitations grounds. 

Given the nature of the McCaulleys’ claims against the contractors, all parties agree the applicable statute of limitations is 

found in § 25-223. That statute provides:

2 Fuelberth v. Heartland Heating & Air Conditioning, 307 Neb. 1002, 951 

N.W.2d 758 (2020).

3 Id.

4 Eagle Partners v. Rook, 301 Neb. 947, 921 N.W.2d 98 (2018).

5 Grothen v. Grothen, 308 Neb. 28, 952 N.W.2d 650 (2020).
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Any action to recover damages based on any alleged 

breach of warranty on improvements to real property or 

based on any alleged deficiency in the design, planning, 

supervision, or observation of construction, or construction of an improvement to real property shall be commenced within four years after any alleged act or omission constituting such breach of warranty or deficiency.

If such cause of action is not discovered and could not 

be reasonably discovered within such four-year period, 

or within one year preceding the expiration of such fouryear period, then the cause of action may be commenced 

within two years from the date of such discovery or 

from the date of discovery of facts which would reasonably lead to such discovery, whichever is earlier. In no 

event may any action be commenced to recover damages for an alleged breach of warranty on improvements 

to real property or deficiency in the design, planning, 

supervision, or observation of construction, or construction of an improvement to real property more than ten 

years beyond the time of the act giving rise to the cause 

of action. 6

[3] We have long held that the limitations period in § 25-223 

applies to defective construction claims brought against contractors and builders, whether such claims are based on negligence or breach of warranty. 7 The dispute in this appeal 

centers on when the 4-year limitations period under § 25-223 

began to run as against the contractors.

[4] As a general rule, when the basis of a claim against a 

builder or contractor “is improper workmanship resulting in 

defective construction, the § 25-223 statute of limitations runs 

from the date of substantial completion of the project, not the 

6 § 25-223 (emphasis supplied).

7 See Fuelberth, supra note 2, citing Murphy v. Spelts-Schultz Lumber Co., 

240 Neb. 275, 481 N.W.2d 422 (1992). See, also, Adams, supra note 1; 

Witherspoon v. Sides Constr. Co., 219 Neb. 117, 362 N.W.2d 35 (1985).
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date of any specific act which resulted in the defect.” 8 In the 

instant case, the McCaulleys and the contractors disagree on 

how to characterize the construction project for purposes of 

applying this general rule.

The McCaulleys generally contend the project was the 

construction of their home; as such, they argue the limitations period did not start to run against any contractor until 

the entire home was substantially completed in late February 

or early March 2008. The contractors define the project more 

narrowly. They contend the McCaulleys contracted for separate construction projects with each of the contractors; as such, 

they argue the limitations period began to run against each 

contractor on the date that contractor substantially completed 

its work.

The question presented in this case is one we have not 

directly considered before: When a homeowner has not contracted with a builder or general contractor to construct the 

entire home, and instead has entered into separate agreements 

with individual contractors to construct portions of the home, 

when does the limitations period under § 25-223 begin to run?

Before addressing that question, we note the McCaulleys 

do not contend the district court made any error in determining the dates on which each contractor substantially completed its own work, nor do they make any arguments related 

to the discovery rule, or the statute of repose, under § 25-223. 

We limit our analysis accordingly.

The plain language of § 25-223 requires that any action 

must be commenced “within four years after any alleged act 

or omission constituting such breach of warranty or deficiency.” Most of our prior cases applying this language have 

8 Adams, supra note 1, 291 Neb. at 983, 871 N.W.2d at 218-19. See, also, 

Durre v. Wilkinson Development, 285 Neb. 880, 830 N.W.2d 72 (2013); 

Board of Regents v. Lueder Constr. Co., 230 Neb. 686, 433 N.W.2d 485 

(1988); Board of Regents v. Wilscam Mullins Birge, 230 Neb. 675, 433 

N.W.2d 478 (1988).
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involved claims brought by a homeowner against the homebuilder or general contractor, and the alleged act or omission 

was the builder’s and/or general contractor’s failure to erect 

the home in a workmanlike manner. 9 Under those circumstances, we held that the wrongful act or omission of the 

builder and/or general contractor occurred on the date the 

home construction was substantially complete, not on the date 

the defective work was performed. 10 In other words, when 

a defective construction claim is brought against the homebuilder or the general contractor alleging failure to construct 

the home in a good and workmanlike manner, we generally 

view the project as the entire home.

More recently, in Fuelberth v. Heartland Heating & Air 

Conditioning,

 11 we addressed the application of § 25-223 in 

a case potentially involving more than one project. There, the 

property owner entered into an oral agreement with a contractor to design, construct, and install an interior geothermal 

system that would heat and cool a farm shop building and an 

exterior system that would melt ice on the building’s driveway. 

Several years later, the owner sued the contractor, alleging 

both systems had failed due to the contractor’s negligence and 

breach of the implied warranty of workmanlike performance. 

The contractor successfully moved for summary judgment, 

arguing the owner’s construction defect claims were time 

barred under § 25-223. On appeal, we considered how the 

“substantial completion” rule applied when there was evidence 

9 See, e.g., Adams, supra note 1 (holding when homeowner sues homebuilder 

alleging defective construction due to improper soil compaction, limitations period begins to run upon substantial completion of home, not 

upon completion of soil compaction); Witherspoon, supra note 7 (holding 

when homeowner sues general contractor for failure to construct home 

in workmanlike manner due to subcontractor’s installation of faulty pipe, 

limitations period begins to run upon substantial completion of home, not 

upon date pipe was installed or broke).

10 Id.

11 Fuelberth, supra note 2.
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that the interior and exterior systems were substantially completed at different points in time.

Fuelberth recited the general rule that “where the basis 

of a claim is improper workmanship resulting in defective 

construction, the statute of limitations period under § 25-223 

begins to run from the date of substantial completion of the 

project.” 12 But application of that general rule to the facts 

in Fuelberth required us to determine whether the agreement between the owner and the contractor was divisible. 

We framed the question as whether the contractor was hired 

to complete one construction project involving two systems 

(such that the limitations period did not begin to run until the 

entire project was substantially complete) or two construction projects involving separate systems (such that a separate 

limitations period would begin to run when the construction of 

each system was substantially complete). Fuelberth noted that 

whether the construction agreement between the owner and 

the contractor was “divisible or indivisible” was a question of 

fact, and because the evidence on that question was in dispute, 

summary judgment was not appropriate. 13 We explained:

Whether the [owner] could institute and maintain suit 

as soon as one system was substantially complete or 

[was] required to wait until the substantial completion of 

the work as a whole depends on whether the agreement 

[between the owner and the contractor] was divisible or 

indivisible. If a contract is divisible, breaches of its severable parts give rise to separate causes of action, [and] 

the statute of limitations will generally begin to run at 

the time of each breach. . . . If, however, a contract is 

indivisible, an action can be maintained on it only when a 

breach occurs or the contract is in some way terminated, 

12 Id. at 1007, 951 N.W.2d at 762.

13 Id. at 1008, 951 N.W.2d at 762.
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and the statute of limitations will begin to run from that 

time only. 14

[5] Our opinions illustrate that when applying the general 

rule that the limitations period under § 25-223 “begins to run 

from the date of substantial completion of the project,” 15 consideration must be given to the nature and scope of the agreedupon project. 16

Here, the evidence was undisputed that the McCaulleys 

acted as their own general contractor when constructing their 

home, and they entered into separate agreements with each of 

the seven contractors to perform a specific project. There was 

no homebuilder or general contractor responsible for erecting 

the entire home. And we have been directed to no evidence in 

the record suggesting that the completion of any contractor’s 

project was necessarily tied to or contingent upon the completion of another contractor’s work. Nor is there any genuine 

dispute over the dates on which any contractor substantially 

completed its agreed-upon work.

On this record, we conclude the district court correctly 

found that under § 25-223, the statute of limitations for each 

of the McCaulleys’ claims against the contractors began running on the dates that each contractor substantially completed 

its respective project. Because it is undisputed that all of those 

dates were more than 4 years before the date the McCaulleys 

filed this action, the contractors’ motions for summary judgment were properly granted.

Amendment of Complaint

In their second assignment of error, the McCaulleys argue 

the district court abused its discretion in denying their oral 

14 Id. (internal quotation marks and citations omitted).

15 Id. at 1007, 951 N.W.2d at 762.

16 See, Fuelberth, supra note 2; Adams, supra note 1; Witherspoon, supra

note 7.
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motion for leave to file a fourth amended complaint to add 

a claim of breach of warranty to repair. Their request to amend 

the complaint was made during the hearing on the motions for 

summary judgment filed by Affordable Exteriors and Stile. 

We review the district court’s denial of leave to amend for an 

abuse of discretion. 17

[6] Generally, when a party seeks leave to amend a pleading, our rules require that “‘leave shall be freely given when 

justice so requires.’” 18 In applying this rule, we have explained 

that the denial of leave to amend pleadings is appropriate only 

in those limited circumstances in which undue delay, bad 

faith on the part of the moving party, futility of the amendment, or unfair prejudice to the nonmoving party can be 

demonstrated. 19

Here, the district court denied leave to amend after finding the proposed amendment would be futile and would cause 

unfair prejudice to the nonmoving parties. Because the proposed fourth amended complaint considered by the court in its 

ruling is not in our record, we express no opinion on the futility of the proposed amendment. Instead, we focus on whether 

the record supports denying leave to amend on grounds of 

undue delay or unfair prejudice, 20 and we conclude it does.

The McCaulleys filed their original complaint in February 

2012. They amended their complaint in April 2012 and again 

in June 2015. All three complaints alleged the seven contractors failed to complete their project in a good and workmanlike manner and were therefore negligent. The third amended 

complaint added breach of implied warranty claims against 

17 Eagle Partners, supra note 4.

18 InterCall, Inc. v. Egenera, Inc., 284 Neb. 801, 811, 824 N.W.2d 12, 21 

(2012), quoting Neb. Ct. R. Pldg. § 6-1115(a).

19 InterCall, Inc., supra note 18.

20 See Davis v. State, 297 Neb. 955, 902 N.W.2d 165 (2017) (holding 

appellate court may affirm lower court ruling on different reasoning).
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four of the contractors. Each of the seven contractors, after 

conducting discovery and preparing its case, moved for summary judgment, asserting the McCaulleys’ claim was barred by 

the § 25-223 statute of limitations.

By October 2015, the district court had granted the motions 

for summary judgment filed by five of the seven contractors, 

and only the motions filed by Affordable Exteriors and Stile 

remained pending. Those defendants appeared at the November 

2, 2015, evidentiary hearing on their motions and offered evidence showing why the claims in the operative third amended 

complaint were time barred. At that hearing, the McCaulleys, 

for the first time, asked for leave to amend their complaint 

to add a new claim that the contractors breached an express 

warranty to repair. While the McCaulleys argue on appeal that 

they were seeking amendment only with respect to the claims 

against Affordable Exteriors and Stiles, and not with respect to 

the five contractors already dismissed, their oral motion was 

unclear on that issue.

[7] Generally, it is not an abuse of discretion to deny leave to 

amend when a party seeks leave to amend to add a new claim 

or defense after a motion for summary judgment has been 

heard and submitted, unless evidence or testimony exists in the 

record indicating the proposed claim or defense was newly discovered or that counsel was previously unaware of the claim. 21

Absent such evidence, a request to amend an operative pleading while summary judgment is pending is often just a belated 

effort to inject issues of material fact into a proceeding where 

previously the pleadings revealed none. 22

21 See, Parnell v. Madonna Rehab. Hosp., 258 Neb. 125, 602 N.W.2d 461 

(1999); Darrah v. Bryan Memorial Hosp., 253 Neb. 710, 571 N.W.2d 783 

(1998). See, also, John P. Lenich, Nebraska Civil Procedure § 15:4 at 701 

(2021) (“[a]n explanation for the party’s failure to raise the new matter 

earlier becomes especially important if leave to amend is sought while the 

court is considering a motion for summary judgment”).

22 See id.
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The McCaulleys claim the impetus for seeking leave to 

amend was the concurring opinion in Adams.

 23 But that 

concurrence did not recognize any new construction defect 

claim. Instead, it suggested there may be certain claims, such 

as a claim for breach of an express warranty to repair, that 

would not accrue until after the project was complete and the 

promised repairs had not been made. But since the homeowners in Adams had not alleged such a claim, the concurring justice agreed the majority had correctly applied the general rule 

that the limitations period in § 25-223 begins to run from the 

date the project is substantially completed. Thus, the Adams

concurrence did not recognize a new claim or defense of 

which the McCaulleys would previously have been unaware. 

Moreover, while the McCaulleys argue they wanted to amend 

their operative complaint to add the type of claim described 

by the concurring justice in Adams, our appellate record 

does not contain the proposed amendment, and thus does 

not permit us to confirm or deny this characterization of the 

proposed claim.

The record does, however, support the conclusion that the 

McCaulleys’ request for leave to add a new claim was the 

result of undue delay and would unfairly prejudice the defendant contractors. By the time the McCaulleys sought leave to 

amend their complaint a fourth time, the litigation had been 

pending for several years, and five of the contractors had 

already been granted summary judgment on statute of limitations grounds. Affordable Exteriors and Stile had moved for 

summary judgment on the same basis and objected to the 

McCaulleys’ request to add a new warranty claim. Further, 

Affordable Exteriors and Stile were present in court and prepared to offer evidence showing they were entitled to summary 

judgment based on the allegations in the McCaulleys’ operative complaint. This record supports a finding of both undue 

23 Adams, supra note 1.
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delay and unfair prejudice, and we cannot find the district court 

abused its discretion in refusing to allow the McCaulleys to 

amend their complaint to add a new claim.

CONCLUSION

For the foregoing reasons, the district court did not err in 

finding the McCaulleys’ claims against the seven contractors 

involved in this appeal were time barred as a matter of law 

under § 25-223. Nor, on this record, did the district court abuse 

its discretion in denying the McCaulleys leave to amend their 

complaint to add a new claim. The judgment of the district 

court is affirmed.

Affirmed.

Miller-Lerman, J., not participating.