Opinion ID: 2581659
Heading Depth: 3
Heading Rank: 1

Heading: The Two-Year and Ninety-Day Provisions

Text: Section 13-80-104 is a statute of limitations provision applicable to suits against architects, contractors, builders or builder vendors, engineers, inspectors, and others involved in real property construction or improvements. It incorporates the two year statute of limitations contained in section 13-80-102(1). Section 13-80-104(1)(a), C.R.S. (2004) states as follows: Notwithstanding any statutory provision to the contrary, all actions against any architect, contractor, builder or builder vendor, engineer, or inspector performing or furnishing the design, planning, supervision, inspection, construction, or observation of construction of any improvement to real property shall be brought within the time provided in section 13-80-102 after the claim for relief arises, and not thereafter, but in no case shall such an action be brought more than six years after the substantial completion of the improvement to the real property, except as provided in subsection (2) of this section. (emphasis added). Section 13-80-102(1) states generically that the suit shall be commenced within two years after the cause of action accrues, and not thereafter. Section 13-80-104(1)(b)(I) provides that the claim for relief based on a construction defect arises under this section at the time the claimant or the claimant's predecessor in interest discovers or in the exercise of reasonable diligence should have discovered the physical manifestations of a defect in the improvement which ultimately causes the injury. Having provided a two year statute of limitations applicable to bringing a construction defect lawsuit claim from the time it arises, the statute then addresses indemnity and contribution claims that defendants in construction defect lawsuits might have against another person. Section 13-80-104(1)(b)(II) provides as follows: (II) Notwithstanding the provisions of paragraph (a) of this subsection (1), all claims, including, but not limited to indemnity or contribution, by a claimant against a person who is or may be liable to the claimant for all or part of the claimant's liability to a third person: (A) Arise at the time the third person's claim against the claimant is settled or at the time final judgment is entered on the third person's claim against the claimant, whichever comes first; and (B) Shall be brought within ninety days after the claims arise, and not thereafter. (emphasis added). If one reads the notwithstanding, claimant, third person, arise, brought within ninety days, and not thereafter language in isolation from the surrounding statutory provisions, one might conclude that the General Assembly has provided a separate and extraordinarily narrow statute of limitations for bringing an indemnification or contribution claim after a construction defect lawsuit terminates. Such a reading would bar operation of C.R.C.P. 13 and 14 in construction defect lawsuits, rendering a general contractor sued by a homeowner for a construction defect unable to resolve the liability of a subcontractor who caused the defect, except by filing a separate suit and thereby prolonging litigation. Depending on the outcome of this second litigation, a third lawsuit might be commenced by the person held responsible for the construction defect in the second lawsuit, and so on through a succession of lawsuits down the chain of architects, contractors, builders, engineers, and inspectors. If this were the General Assembly's intent, it would defy the axiom that time is money and produce an absurd result for the construction industry. The rules of civil procedure are designed to avoid extensive seasons of fractured litigation, such as this. They promote expeditious resolution of all disputes arising out of the same transaction in a single lawsuit. To avoid multiple, expensive, time-intensive, and time-delayed suits, C.R.C.P. 13(g) provides that a cross-claim may be brought against a party who is or may be liable to the cross claimant for all or part of a claim asserted in the action against the cross claimant. C.R.C.P. 14(a) provides that a defending party may have process served against a person not a party to the action who is or may be liable to him for all or part of the plaintiff's claim against him. These rules allow cross-party or third-party claims in order to avoid the necessity of separate actions. Packaging Corp. of America v. Indus. Comm'n, 173 Colo. 212, 477 P.2d 367, 368 (1970). They guard against circuity of action, save time and expense, and eliminate a serious handicap to the defendant consisting of the time difference between the judgment against her and a judgment in her favor against the cross-party or third-party defendant. Pioneer Mut. Comp. Co. v. Cosby, 125 Colo. 468, 244 P.2d 1089, 1091-92 (1952). Claims that may be pursued against a cross-party or third-party defendant are those that would result in a judgment against a [cross-party or] third party for all or some part of the judgment entered against a defendant on a plaintiff's claim.... Martinez v. Denver Transformer Sales & Serv., Inc., 780 P.2d 49, 51 (Colo.App.1989). Our statutory analysis concludes that the General Assembly did not intend to prevent the beneficial operation of C.R.C.P. 13 and 14 in construction defect litigation; accordingly, we reject the trial court's construction of section 13-80-104(1)(b)(II).