Case Name: BEVERIDGE et ux, Appellants, v. KING, Respondent
Court: Oregon Court of Appeals
Jurisdiction: Oregon
Decision Date: 1981-02-18
Citations: 50 Or. App. 585
Docket Number: No. A 7812 20655, CA 16889
Parties: BEVERIDGE et ux, Appellants, v. KING, Respondent.
Judges: BUTTLER, J.
Reporter: Oregon Reports, Court of Appeals
Volume: 50
Pages: 585–593

Head Matter:
Argued and submitted September 3, 1980;
resubmitted in banc February 12,
reversed and remanded February 18,
reconsideration denied April 9,
petition for review allowed May 5, 1981 (291 Or 1)
BEVERIDGE et ux, Appellants, v. KING, Respondent.
(No. [ A XXXX XXXXX ], CA 16889)
623 P2d 1132
Cary A. Gluesenkamp, Hillsboro, argued the cause and filed the briefs for appellants.
James K. Belknap, Portland, argued the cause and filed the brief for respondent.
BUTTLER, J.
Richardson, J., dissenting.

Opinion:
BUTTLER, J.
Plaintiffs appeal from an order granting defendant's motion for summary judgment and dismissing plaintiff's complaint as being barred under the statute of limitations contained in ORS 12.135(1). They also appeal from an order denying their cross-motion for summary judgment in which they contended the action was governed by ORS 12.080(1), and was timely. We reverse.
Plaintiffs entered into an earnest money agreement with defendant, by the terms of which plaintiff agreed to buy and defendant agreed to sell a parcel of real property, together with the new house then under construction on the property. An implied term of the agreement was that the new house would be completed in a workmanlike manner. Newlee v. Heyting, 167 Or 288, 117 P2d 829 (1941). The house was completed, the sale was consummated and plaintiffs moved in. Shortly thereafter, it became apparent that the plaintiffs had not received what they bargained for because the house had not been constructed in a workmanlike manner. More than two years after they became aware of the construction defects, but with the six years permitted by ORS 12.080(1), plaintiffs brought this action against defendant for breach of the contract under which they bought the house.
In his motion, defendant contended only that the action was barred by ORS 12.135(1) as construed by this court in Securities-Intermountain v. Sunset Fuel, 40 Or App 291, 594 P2d 1307, (sec dissenting opinion), rev allowed 287 Or 149 (1979). On that basis, the trial court granted defendant's motion for summary judgment. Subsequently, however, the Supreme Court reversed our decision, Securities-Intermountain v. Sunset Fuel, 289 Or 243, 611 P2d 1158 (1980), and it is clear from that opinion that ORS 12.135(1) does not apply to this case. The Supreme Court stated its conclusion on the application of that section as follows:
"We conclude that the phrase 'injuries to persons or to property' was thought to encompass what is commonly meant by 'personal injuries,' i.e. bodily injuries including their psychic consequences, and physical damage to existing tangible property, but not financial losses such as a reduced value of the completed project due to the unsatisfactory performance of the work or the added cost of satisfactory completion or replacement. Actions to recover such financial losses remain within statutes of limitation other than ORS 12.135. [Footnote omitted.] " 289 Or at 251.
In this case, plaintiffs allege that as a result of unsatisfactory construction by defendant, they suffered financial losses incurred from undertaking necessary repairs to correct the defects. There are no claims for any personal injury or injury to tangible property, so ORS 12.135 has no application.
Plaintiffs contend that ORS 12.080(1) is controlling because it applies to "an action upon a contract or liability, express or implied Defendant now contends for the first time that, even though ORS 12.135(1) is not applicable; this action is barred by ORS .12.110(1), which governs "an action for assault, battery, false imprisonment, for criminal conversation, or for any injury to the person or rights of another, not arising on contract The classic definition of a tort is "a wrong independent of contract." Black's Law Dictionary, 4th Ed., 1951. It seems clear enough that the two statutes referred to make that classic distinction, and although life has become more sophisticated justifying some inroads on the clear delineation [ORS 12.135(1) and malpractice cases are examples], we see no purpose or justification in muddying the water further.
In contending that ORS 12.110(1) controls, defendant attempts to adapt the analysis used by the court in Securities — in determining whether claims based on contracts for the personal services of professionals — to this contract for the sale of real property. The issue here was not addressed by the Supreme Court in Securities or in any of its predecessors. We perceive no reason why any decision should have addressed it because it is clear that this action is a straight forward one for breach of contract for the sale of improved real property, and, as such, is governed by ORS 12.080(1). The analysis undertaken by the court in Securities simply does not fit this kind of action.
The dissent seems to conclude that the rationale of Securities requires that in order to assert a claim for breach of a contract for the sale of improved real property, the underlying contract must specify, and the buyer must allege, specific obligations of the seller, rather than rely on the recognized implied obligation that the house under construction will be completed in a workmanlike manner. Apparently, the dissent would require that the earnest money agreement here must specifically provide that upon completion of the house water will not flow continuously under it, it will be level, the roof will not blow off under normal conditions, etc. Such things are not done in the real world, and we do not understand the Supreme Court's opinion in Securities to impose such a requirement.
We conclude that ORS 12.080(1) controls this action and, therefore, reverse the judgment of the trial court.
Reversed and remanded.
ORS 12.135(1) provides:
"An action to recover damages for injuries to a person or to property arising from another person having performed the construction, alteration or repair of any improvement to real property or the supervision or inspection thereof, or from such other person having furnished the design, planning, surveying, architectural or engineering services for such improvement, shall be commenced within two years from the date of such injury to the person or property; provided that such action shall be commenced within 10 years from substantial completion of such construction, alteration or repair of the improvement to real property."
ORS 12.080 provides:
"(1) An action upon a contract or liability, express or implied, excepting those mentioned in ORS 12.070 and 12.110 and except as otherwise provided in ORS 72.7250;

"shall be commenced within six years."