Opinion ID: 500164
Heading Depth: 2
Heading Rank: 1

Heading: Applicability of the Architects and Engineers Statute of Repose

Text: 16 This question is clearly the lynchpin of this entire case. To date, no Ohio court has interpreted that portion of the statute dealing with persons entitled to benefit thereby. A federal court sitting in diversity is bound to apply the substantive law of the forum state, and if that state's highest court has not spoken to the question in controversy, our task is to discern how the state courts would respond if confronted with the question. Erie Railroad Co. v. Tompkins, 304 U.S. 64 (1938); see Clutter v. Johns-Manville Sales Corp., 646 F.2d 1151, 1153 (6th Cir.1981). 17 Basically, the statute requires a twofold inquiry: first, does the party claiming its protection qualify as one which the statute was intended to benefit, and second, did the injury arise out of the defective condition of an improvement to real property. Failure to satisfy either prong will preclude application of the statute's ten-year limit on all tort-based claims. Because we find the answer to the first inquiry to be dispositive of this case, we do not address the issue of whether the Zuber Creek bridge constitutes an improvement to real property. 6 18 In determining the interpretation the Ohio courts would give to the phrase any person performing services for or furnishing the design, planning, supervision of construction, or construction of an integrated structure, a review of the general history of such statutes, which have been enacted by the majority of states, is instructive. In the mid-1960's, faced with what they considered to be an intolerable situation arising from judicial decisions abrogating the privity requirement in defective design cases, architects, engineers, and builders, through their respective professional associations, began a drive to alleviate the effects of this development. See Smith, Recent Statutory Developments Concerning the Limitations of Actions Against Architects, Engineers and Builders, 60 Ky.L.J. 462, 464 (1972). The American Institute of Architects, along with the National Society of Professional Engineers and the Associated General Contractors, began to push for model legislation which would substantially curtail the limitless duration of liability potentially imposed upon its members. Id. As originally enacted in 1963, Sec. 2305.131 protected only licensed architects and engineers. The statute was amended in 1971 to expand its protection to all persons providing services in connection with the design and construction of an improvement to real property. 19 In passing on the validity of architects' and engineers' statutes of repose, courts have generally ruled that mere suppliers of products, or materialmen, are not protected by these statutes, and that such distinction is rationally related to the purposes underlying such statutes: 20 Suppliers, who typically produce items by the thousands, can easily maintain high quality-control standards in the controlled environment of the factory. A builder, on the other hand, can pretest his designs and construction only in limited ways--actual use in the years following construction is their only real test. Further, every building is unique and far more complex than any of its component parts.... The Legislature can rationally conclude that the conditions under which builders work are sufficiently difficult that limitations should be placed on their liabilities, but not on the liabilities of suppliers. 21 Freezer Storage, Inc. v. Armstrong Cork Co., 476 Pa. 270, 277, 382 A.2d 715, 719 (Pa.1978). See also Cinnaminson Township Board of Education v. U.S. Gypsum Co., 552 F.Supp. 855 (D.N.J.1982) (concluding that state's ten-year statute of repose did not bar claim against supplier of acoustical plaster containing asbestos). 22 Defendants urge us to include them under the statute's umbrella by tacitly admitting that they designed the particular culvert utilized as a component of the Zuber Creek bridge and then furnished this design to the county. We find this argument unpersuasive. Several courts have ruled that, considering the purpose and intent of such statutes, the design of a standardized product is not equivalent to the design of an improvement to real property within the meaning of the statute. A New Jersey court has explained, [t]he problem as we perceive it is the ambiguity lurking in the word 'design' in this context.... This statute was not intended to benefit manufacturers and sellers of products who are uninvolved in the design, planning and construction of improvements to real estate. Product-design alone is not enough to trigger the applicability of [the statute of repose] .... Wayne Township Board of Education v. Strand Century, inc., 172 N.J.Super. 296, 302, 411 A.2d 1161, 1163 (N.J.1980). The courts of Tennessee have similarly ruled that the word design within its statute of repose for architects and builders refers to the design of the improvement and not to the design of the manufactured products which go into the improvement: 23 We do not interpret design as used in the statute to mean the general design of a manufactured product which might be used in improvements of real estate. The meaning of the word is limited to the architectural or engineering design of a particular building or the particular parts thereof. 24 Pridemark Custom Plating, Inc. v. Upjohn Company, Inc., 702 S.W.2d 566, 570 (Tenn.App.1985). See also In Re Beverly Hills Fire Litigation, 672 S.W.2d 922 (Ky.1984) (manufacturer of aluminum wire used as component in construction project not included within protected class under Kentucky's architect's statute of repose). Cf. Adcor Realty Corp. v. Mellon-Stuart Co., 450 F.Supp. 769 (N.D.Ohio 1978) (under Ohio law, suit for damages regarding defective bricks incorporated into a building was properly characterized as products liability claim); Lonzrick v. Republic Steel Corp., 6 Ohio St.2d 227, N.E.2d 185 (1966) (steel roof joists were products subject to products liability law despite their incorporation into an improvement to real property). 25 This court has also upheld the exclusion of materialmen from the statute's protection in Hartford Fire Ins. v. Lawrence, Dykes, Goodenberger, 740 F.2d 1362, 1371-72 (6th Cir.1984). In Hartford, we pointed out that Sec. 2305.131 affects suits maintainable against three specific groups, two of which are persons performing services for or furnishing the design, planning, supervision of construction, or construction of an improvement to real property and persons who supply products used in construction of the improvement. Id. at 1371. We held that, [o]nly the first group, the designers and builders, is covered by these statutes. Id. In so doing, we implicitly held that the design of the component product was distinguishable from the design of the improvement itself. 7 26 The district court cited two Ohio cases in support of its conclusion that defendants qualified as persons included within the statute's ambit. The court noted that in Elizabeth Gamble Deaconess Home Ass'n v. Turner Construction Co., 14 Ohio App.3d 281, 470 N.E.2d 950 (1984), the appellate court stated that Sec. 2305.131 set forth a ten-year bar to actions against architects, engineers, builders and others. (Emphasis in district court opinion only.) Review of that case reveals that it concerned an action against the architect and construction company involved in building the allegedly defective parking garage. The only question presented in that case was whether the statute barred both contract as well as tort claims. The court ruled that only tort claims were barred, with no discussion whatsoever as to the conceded applicability of the statute to the defendant parties. 27 The second Ohio case, Jones v. Ohio Bldg. Co., 40 Ohio Misc.2d 10, 447 N.E.2d 776 (Lucas Co. 1982), involved a suit against the installer of an allegedly defective service elevator. In granting summary judgment to the defendant, the court began by inquiring whether defendant fell within the protected class. In ruling in defendant's favor on this question, the court specifically noted that it was undisputed that the defendant designed, constructed, and installed the elevator specifically for use in the Ohio Building in 1954 and serviced the elevator via contract for several years thereafter. The court's holding was predicated upon these factual findings. 8 28 It is apparent that these cases cannot support the broad proposition for which they were cited by the district judge. Based on the foregoing, which we believe to comport with the manner in which the Ohio courts would analyze this question, we conclude that U.S.S. and American Culvert, as suppliers of a standard product wholly unconnected with any specialized design or services in connection with the Zuber Creek structure as a unit, are not persons within the meaning of Sec. 2305.131.