Title: Daidone v. Buterick Bulkheading
Citation: N/A
Docket Number: a-60-06
State: new-jersey
Issuer: new-jersey Supreme Court
Date: June 26, 2007

Commencing sometime prior to February 1993, plaintiffs John and Laura Daidone took steps to build their home in Lacey Township. Acting as their own general contractor, they hired defendants Scott Lepley, Lepley Design Group, and Lepley-McCorry Architects AIA, P.C. (collectively, Lepley) to provide the architectural design for the home. Lepley prepared and certified the architectural plans, which included a foundation piling system to support the house. The Lacey Township Construction Official approved the plans on June 23, 1993. Once the plans were approved, Lepley had no further role in the design or construction of the Daidone s home. The Daidones also contracted with defendant Buterick Bulkheading to install the foundation pilings. Buterick completed installation of the pilings and invoiced the Daidones for its work. On May 24, 1994, the Daidones paid Buterick s invoice in full. Once its piling services were completed, Buterick performed no further work on the Daidones home. Construction of the home was completed, and a certificate of occupancy was issued on June 14, 1994. The Daidones then moved in to their home. Beginning in 1999, the Daidones experienced many problems caused by the home settling on its foundations. For example, there was stress on the natural gas line and electrical panel, the hot water heater pipes ripped through the ceiling, and the sewerage waste pipe ripped out of the floor. The Daidones did not seek expert assistance until late 2001. They retained an expert to perform a subsurface investigation and geotechnical evaluation of their home. In a report dated January 2, 2002, the expert stated that the basement structure settled due to the underlying soft soils and that the length of the pilings may not be enough based on the information available from the soil borings. The report did not state that the design or installation of the pilings was deficient. Based on their expert s advice, the Daidones made repairs to their home that cost about $90,000. The repairs were completed by July 2002. The Daidones filed their complaint against Lepley and Buterick on June 2, 2004. That date was within ten years of the date they obtained a certificate of occupancy for their home, but it was over ten years after both Lepley and Buterick had completed their services. Lepley and Buterick filed a motion to dismiss, arguing that the Statute of Repose barred the complaint. The trial court granted the motion, finding that Lepley and Buterick completed their work more than ten years before the Daidones filed their complaint. In an unpublished opinion, the Appellate Division affirmed, holding that the ten-year statutory period begins when the architect or contractor completes its work relating to the property. The Supreme Court granted plaintiffs petition for certification. 188 N.J. 572 (2006). HELD: If design or construction services relating to an improvement to real property are completed before a certificate of occupancy is issued, and the designer or contractor has no further work to perform on that construction project, then the start date for purposes of the Statute of Repose, N.J.S.A. 2A:14-1.1(a), is the date on which the designer or contractor has completed his or her portion of the work. The complaint against Lepley and Buterick was properly dismissed because it was filed more than ten years after they completed their work. 1. The Statute of Repose, N.J.S.A. 2A:14-1.1(a), provides that no action to recover damages for any deficiency in the design or construction of an improvement to real property shall be brought more than 10 years after the performance or furnishing of such services and construction. As the Court explained in Rosenberg v. Town of North Bergen, 61 N.J. 190 (1972), the Statute of Repose is different than a statute of limitations. The Statute of Repose prevents what might be a cause of action from ever arising. For that reason, an injury that occurs more than ten years after the allegedly negligent act forms no basis for recovery. (pp. 8-9) 2. Because the language used in the Statute of Repose is clear, the Court does not look to outside evidence to decide its meaning. Ten years and one day after the designer or contractor has performed his or her services, a cause of action for design or construction defects ceases to exist. Thus, if the services are completed before a certificate of occupancy is issued and the designer or contractor has no further work on that construction project, then the start date for the Statute of Repose is the date when the designer or contractor completed his or her portion of the work. (pp. 10-11) 3. In this case, Lepley and Buterick completed their work more than ten years before the Daidones filed their complaint. Under the Statute of Repose, the Daidones causes of action are deemed to have never arisen. (pp. 11-12) 4. The Daidones argue that it would be too burdensome for a homeowner to determine the dates that each designer or contractor completed its services. They assert that a uniform date -- the date the certificate of occupancy is issued -- should be the start date under the Statute of Repose for all aspects of a construction project. The Court disagrees. The Statute of Repose reflects the Legislature s public policy preference for finality in construction-related claims. If a plaintiff wants to sue an individual subcontractor, the plaintiff will have to track when that subcontractor s services were completed and must file a complaint within ten years of that date. The Daidones acted as their own general contractor, assuming responsibility for the overall project. They chose to obtain services from subcontractors on a piecemeal basis. They became aware of the defects that are the subject of their complaint and corrected those defects well within the period of the Statute of Repose. Their unexplained delay in filing suit undermines their attempt to avoid the consequences of the Statute of Repose. (pp. 12-15) The judgment of the Appellate Division is AFFIRMED. CHIEF JUSTICE ZAZZALI and JUSTICES LONG , LaVECCHIA, ALBIN, WALLACE, and HOENS join in JUSTICE RIVERA-SOTO s opinion. SUPREME COURT OF NEW JERSEY A- 60 September Term 2006 JOHN DAIDONE and LAURA DAIDONE, his wife, Plaintiffs-Appellants, v. BUTERICK BULKHEADING, SCOTT LEPLEY, LEPLEY DESIGN GROUP and LEPLEY-MCCORRY ARCHITECTS AIA, P.C., Defendants-Respondents, and JOHN DOE, A Fictitious Name Representing A Licensed Professional Engineer Responsible For Reviewing And Certifying Construction And Certain Records, Defendant. Argued March 5, 2007 Decided June 26, 2007 On certification to the Superior Court, Appellate Division. Richard J. Allen, Jr., argued the cause for appellants (Kipp &amp; Allen, L.L.P., attorneys). Richard J. Shackleton argued the cause for respondent Buterick Bulkheading (Shackleton &amp; Hazeltine, attorneys). Daniel J. Cogan argued the cause for respondents Scott Lepley, Lepley Design Group, and Lepley-McCorry Architects AIA, P.C. (Hoagland, Longo, Moran, Dunst &amp; Doukas, L.L.P., attorneys; Mr. Cogan and Richard W. Gaeckle, on the brief). JUSTICE RIVERA-SOTO delivered the opinion of the Court. This appeal addresses a discrete issue: whether, under the circumstances present in this matter, the Statute of Repose, N.J.S.A. 2A:14-1.1, should not commence until the issuance of a certificate of occupancy notwithstanding the completion of work by subcontractors at an earlier date. In this case, plaintiffs John and Laura Daidone acted as their own general contractor and sub-contracted with several contractors to perform specific portions of the work in respect of the design and construction of their home. Among those, defendants Scott Lepley, Lepley Design Group, and Lepley-McCorry Architects AIA, P.C. (collectively, Lepley) designed plaintiffs home, and defendant Buterick Bulkheading, Inc. installed the pilings for the home s foundation. More than ten years after both Lepley and Buterick completed their respective portions of the work, but less than ten years after a certificate of occupancy was issued for plaintiffs home, plaintiffs sued Lepley and Buterick alleging negligence and other claims. Plaintiffs claim that the relevant start date for Statute of Repose purposes must be the date on which the certificate of occupancy issues; Lepley and Buterick assert that the start date must be when they completed their work. The plain language of N.J.S.A. 2A:14-1.1(a) is clear: no action for deficient design or construction of an improvement to real property may be brought more than 10 years after the performance or furnishing of such services and construction. (Emphasis supplied). If the design or construction services provided continue up to and including the date the certificate of occupancy is issued for the improvements made, then the start date for Statute of Repose purposes is the date of the certificate of occupancy. However, if the design or construction services are completed before a certificate of occupancy is issued and the designer or contractor has no further functions to perform in respect of that construction project, then the start date for Statute of Repose purposes is the date on which the designer or contractor has completed his or her portion of the work. Q. What do you mean slabs should not settle as they settled? A. . . . . Because the utilities, the boiler and the hot water heater are on a platform that sits on the slab. . . . . But what s happening, as the slab was settling all the pipes and everything else are ripping out of the ceiling. The natural gas pipe coming in from the meter was being stressed. You could still see the marks in the ceiling. . . . . We had to shim up basically the platform two inches to relieve that stress, all right. The sewerage waste pipe which goes through the floor out, that was ripping through. That was just coming down too because of the settlement. So we had to cut that and put a rubber gasket. The rubber gasket is still there. We had to do that in two places. The electrical panel had to be lifted up because it was being stressed. Q. . . . . You said if you didn t take these precautions that you could not live in the house. The house would have been uninhabitable? A. Yeah, cause the furnace wouldn t have worked, the boiler, the hot water, everything was ripping out of the ceilings, the pipe, the heating. It s all hot water baseboard. They were all ripping out of the ceiling and bending. Q. You said natural gas was pulling too? A. The natural gas pipe. You could see it till today. When it was put in it was horizontal. Now it s pitched down because it was being dragged down. Although plaintiffs noticed these changes as early as 1999, they did not seek any expert assistance until late 2001, when they retained an expert to perform a subsurface investigation and geotechnical evaluation of their home. In a report dated January 2, 2002, the expert opined that the basement structure has settled due to the underlying soft soils and organics present. Significantly, after describing the length of the pilings installed, plaintiffs expert did not conclude that the design or installation of the pilings was deficient. The most the expert would say is that [t]he length of these timber pilings below the ground surface may not be enough based on the information available from the soil borings. (Emphasis supplied). Based on their expert s advice, plaintiffs undertook repairs to their home, which repairs cost approximately $90,000 and were completed by July 2002. Plaintiffs, however, did not file their complaint against either Lepley or Buterick until June 2, 2004. Although that date was within ten years after plaintiffs secured a certificate of occupancy for their home, it was more than ten years after both Lepley and Buterick had performed and completed their services. Lepley and Buterick moved to dismiss plaintiffs complaint as barred by the Statute of Repose, which the trial court granted. After noting that plaintiffs acted as the general contractor for their home, the trial court found that plaintiff[s] also slumbered on [their] rights. [They] had an engineering report that was dated 1/2/02 showing the footing defects, but [they] never brought a suit until 6/24/04. I think for purposes of this case the bulkheader [Buterick] was substantially complete when he did his work as a sub[-contractor], got out, and was paid. It was done, and I think the designer [Lepley] similarly completed his work when this plan was approved by the Construction Official. So that s my interpretation of substantial completion for purposes of this case. The trial court concluded that the bulkheader [and the] designers are entitled to the protection of the Statute of Repose and that the claimed defects constitute defective and unsafe conditions covered by the Statute. It underscored that [t]here was no diligence in bringing the suit and the Complaint was outside of the ten-year Statute[.] Plaintiffs appealed, and the Appellate Division affirmed the judgment of the trial court. In an unpublished opinion, the panel explained that [t]he purpose of the statute [of repose] is to protect architects and contractors from never-ending liability for their work on construction projects. Concluding that the Statute of Repose is an affirmative defense, imposing the burden of proving it on defendants[,] the Appellate Division held that the ten-year Statute of Repose commences when the architect or contractor completes its task with respect to the property involved in the claim (quoting Hopkins v. Fox &amp; Lazo Realtors, 242 N.J. Super. 320, 328 (App. Div. 1990)). Referring to language we too have cited with approval, the panel quoted Hopkins for the proposition that when an architect . . . completes the work for which he was commissioned, he should be able to look back ten years and one day after the completed performance of his work and know there is repose from liability (Quoting id. at 327; see Newark Beth Israel Med. Ctr. v. Gruzen &amp; Partners, 124 N.J. 357, 366 (1991) (same)). Affirming the trial court s entry of judgment in favor of Lepley and Buterick, the Appellate Division concluded as follows: We see no reason for extending the commencement date for the Statute of Repose to the issuance of the certificate of occupancy under the circumstances here, where the architect and the bulkheader completed their work more than a year before the certificate of occupancy was issued and plaintiffs failed to file a timely complaint when they had notice of their injury five years after the certificate of occupancy was issued. We granted plaintiffs petition for certification, Daidone v. Buterick Bulkheading, 188 N.J. 572 (2006), and now affirm the judgment of the Appellate Division. [N.J.S.A. 2A:14-1.1(a).] We have explained that [i]n an important respect, [a statute of repose] is unlike the typical statute of limitations [because t]he time within which suit may be brought under [the statute of repose] is entirely unrelated to the accrual of any cause of action. Rosenberg v. Town of N. Bergen, 61 N.J. 190, 199 (1972). Unlike a statute of limitations, the Statute of Repose does not bar a cause of action; its effect, rather, is to prevent what might otherwise be a cause of action[] from ever arising. Ibid. For that reason, injury occurring more than ten years after the negligent act allegedly responsible for the harm[] forms no basis for recovery. Ibid. The starkness of its application is intended: The injured party literally has no cause of action. The harm that has been done is damnum absque injuria a wrong for which the law affords no redress. The function of the statute [of repose] is thus rather to define substantive rights than to alter or modify a remedy. The Legislature is entirely at liberty to create new rights or abolish old ones as long as no vested right is disturbed. [Id. at 199-200.] See Greczyn v. Colgate-Palmolive, 183 N.J. 5, 14 (2005) (explaining that statute of repose, by its very terms -- no action . . . shall be brought . . . more than ten years after . . . construction -- bars [] claims [older than ten years] ). With those principles as our guide, we address the certified issue in this appeal, that is, whether the start of the time period under the Statute of Repose should be delayed until the issuance of a certificate of occupancy even though the designer or contractor completed his or her work at an earlier date. SUPREME COURT OF NEW JERSEY NO. A-60 SEPTEMBER TERM 2006 ON CERTIFICATION TO Appellate Division, Superior Court JOHN DAIDONE and LAURA DAIDONE, his wife, Plaintiffs-Appellants, v. BUTERICK BULKHEADING, SCOTT LEPLEY, LEPLEY DESIGN GROUP and LEPLEY-MCCORRY ARCHITECTS AIA, P.C., Defendants-Respondents. DECIDED June 26, 2007 Chief Justice Zazzali PRESIDING OPINION BY Justice Rivera-Soto CONCURRING/DISSENTING OPINIONS BY DISSENTING OPINION BY The trial court found that [t]he facts show that plaintiff was the contractor for his own house. The trial court rejected plaintiffs claim that plaintiff John Daidone is only a computer expert, not a builder[,] finding that plaintiff John Daidone built this house. He took out the construction permit and he apparently had a construction company . . . and his wife [plaintiff Laura Daidone] is the one that paid Buterick on that building company[ s] check. Although, in this summary judgment context, we view the facts in the light most favorable to [] plaintiff[s, ] Soto v. Scaringelli, 189 N.J. 558, 564 (2007), we see no reason to disturb those findings. Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 484 (1974) (holding that we do not disturb the factual findings and legal conclusions of the trial judge unless we are convinced that they are so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice (quoting Fagliarone v. Twp. of N. Bergen, 78 N.J. Super. 154, 155 (App. Div.), certif. denied, 40 N.J. 221 (1963))).