Court Opinion

ID: 3192255
Source: CourtListenerOpinion
Date Created: 2016-04-07 17:03:47.226107+00
Date Added: 2024-06-11T12:24:07.803083
License: Public Domain

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

326 ASSOCIATES, L.P.,             )
                                  )
           Plaintiff,             )
                                  )
     v.                           )     C.A. No.: N15C-09-228 ALR
                                  )
PROGRESSIVE SERVICES, INC.,       )
                                  )
           Defendant.             )

                        Submitted: February 23, 2016
                          Decided: March 29, 2016

                        MEMORANDUM OPINION

     Upon Consideration of Defendant’s Motion for Summary Judgment
                               GRANTED

R. Karl Hill, Esq., Seitz, Van Ogtrop & Green, P.A., Wilmington, Delaware,
Attorney for Plaintiff 326 Associates, L.P.

Colin M. Shalk, Esq., Casarino Christman Shalk Ransom & Doss, P.A.,
Wilmington, Delaware, Attorney for Defendant Progressive Services, Inc.

ROCANELLI, J.
                               Factual Background

      Plaintiff 326 Associates, L.P. (“326 Associates”) owns and operates the New

Castle Farmer’s Market located at 110 N. DuPont Highway, New Castle, Delaware

19720 (“Farmer’s Market”). Defendant Progressive Services, Inc. (“Progressive”)

is an electrical construction services business that provides electrical services for

commercial, industrial, and residential projects.    On or about May 22, 2008,

Progressive issued a proposal to Builders & Managers, Inc. (“B&M”) for electrical

work at the Farmer’s Market. At some time between May 22, 2008 and July 23,

2008, Progressive and B&M entered into a contract that provided, inter alia, that

Progressive would extend and connect four existing sets of conductors and add two

new sets of conductors to upgrade the electrical equipment at the Farmer’s Market

(“Contract”).   Progressive extended and connected the four existing sets of

conductors; however, Progressive failed to install the two new sets of conductors.

Nevertheless, Progressive was paid in full for the work no later than July 2009.

      On October 20, 2013, a fire started in the Farmer’s Market, causing a power

outage and destruction of two of the conductors that Progressive installed. 326

Associates hired and paid Shure-Line Electrical to replace the two damaged

conductors and to install a new set of conductors. 326 Associates contends that

Progressive breached the Contract with B&M by not completing the contracted

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electrical work and as a result of this breach, 326 Associates—as an intended

beneficiary of the Contract—suffered damages.

                                   Procedural Background

         326 Associates filed its original complaint on September 25, 2015, asserting

that Progressive breached the Contact with B&M by failing to install two of the six

conductors at the Farmer’s Market. On October 16, 2015, 326 Associates filed an

amended complaint, specifying that it was an intended beneficiary of the Contract

and as a result of Progressive’s breach, 326 Associates incurred damages including

but not limited to the loss of rent during the power outage, the cost to fix the

incomplete work, the cost to supply two new conductors, deprivation of the use

and occupancy of the property, as well as other unspecified property damage.

         Progressive filed a motion to dismiss on December 7, 2015, arguing that 326

Associates is barred from maintaining an action against Progressive due to a six

year statute of repose under 10 Del. C. § 8127 (“Section 8127”).1 326 Associates

responded to Progressive’s motion to dismiss, asserting that Progressive effectively

converted its motion to dismiss into a motion for summary judgment by attaching

an affidavit and arguing that the statute of repose has not run because Progressive

never completed the work under the Contract. Because the parties’ pleadings

attached various materials outside of the pleadings, the Court converted

1
    See 10 Del. C. § 8127(b)(6).
                                             2
 Progressive’s motion to dismiss into a motion for summary judgment by letter

 dated February 11, 2016.2

                                     Standard of Review

        The Court may grant summary judgment only where the moving party can

 “show that there is no genuine issue as to any material fact and that the moving

 party is entitled to a judgment as a matter of law.” 3 The moving party bears the

 initial burden of proof and, once that is met, the burden shifts to the non-moving

 party to show that a material issue of fact exists. 4 At the motion for summary

 judgment phase, the Court must view the facts “in the light most favorable to the

 non-moving party.”5

                                           Discussion

I.   Progressive is covered under Section 8127.

        Section 8127 has been described as a statute of repose, preventing a cause of

 action from arising after six years. 6 Unlike a statute of limitation which is a

 2
   The Court gave the parties an opportunity to expand the record; however, neither party filed
 additional submissions. See Super. Ct. Civ. R. 12(b) (“If, on a motion asserting the defense . . .
 of the pleading to state a claim upon which relief can be granted, matters outside the pleading are
 presented to and not excluded by the Court, the motion shall be treated as one for summary
 judgment and disposed of as provided in Rule 56, and all parties shall be given reasonable
 opportunity to present all material made pertinent to such a motion by Rule 56.”); see also
 Furman v. Delaware Dep’t of Transp., 30 A.3d 771 (Del. 2011).
 3
   Super. Ct. Civ. R. 56.
 4
   Moore v. Sizemore, 405 A.2d 679, 680–81 (Del. 1979).
 5
   Brzoska v. Olson, 668 A.2d 1355, 1364 (Del. 1995).
 6
   Cheswold Volunteer Fire Co. v. Lambertson Const. Co., 462 A.2d 416, 419 (Del. Super. 1983)
 aff’d, 489 A.2d 413 (Del. 1984).
                                                 3
procedural bar, a statute of repose is a substantive provision and “any failure to

commence the action within the applicable time period extinguishes the right itself

and divests the . . . court of any subject matter jurisdiction which it might

otherwise have.”7

       Under Section 8127, a party is precluded from maintaining any action to

recover damages for alleged deficiencies in the construction of improvements to

real property if six years has passed from a list of various events.8 Specifically,

Section 8127 provides that the date on which the statute of repose begins to run is

the earliest of when payment in full was made or when construction was

substantially completed.9

       Section 8127 affords protection to those performing or furnishing

construction of an improvement as well as those performing or furnishing any

design, plan, supervision, or observation of such improvement.10 326 Associates

argues that Progressive did not furnish construction of an improvement as required

under Section 8127 because Progressive did not complete the construction under

the Contract and, therefore, Progressive is precluded from the protection of the

statute of repose.      Progressive furnished construction through extending and

7
  Cheswold Volunteer Fire Co. v. Lambertson Const. Co., 489 A.2d 413, 421 (Del. 1984).
8
  See 10 Del. C. § 8127(b)(6)(a)-(h).
9
  10 Del. C. § 8127(b)(6)(d),(f) (emphasis added). The Court need not address the issue of
substantial completion because 326 Associates concedes that it paid Progressive in full in July
2009.
10
   10 Del. C. § 8127(b)(6).
                                              4
  connecting four sets of electrical conductors at the Farmer’s Market.11 Therefore,

  there is no genuine issue of material fact that Progressive can utilize the protection

  of the six year statue of repose under Section 8127.

II.    326 Associates paid Progressive in full no later than July 2009.

          Progressive argues that Section 8127 precludes 326 Associates from

  maintaining its action because 326 Associates did not file its original complaint

  until more than six years after 326 Associates paid Progressive in full for the

  completed electrical work. In response, 326 Associates contends that there are

  issues of material fact as to whether Progressive completed construction.

          Under Section 8127, a party is precluded from maintaining an action if six

  years have passed from the date when payment in full has been received by the

  person against whom the action is brought. 12 326 Associates concedes that it

  furnished payment in full in July 2009.13 Accordingly, 326 Associates had until

  July 2015 to file its complaint against Progressive. Accordingly, 326 Associates is

  barred from maintaining its action against Progressive because 326 Associates

  11
     Contra Kirkwood Dodge, Inc. v. Frederic G. Krapf, Jr., Inc., 1989 WL 48639, at *3 (Del.
  Super. May 9, 1989) (denying defendant’s motion for summary judgment because defendant
  merely supplied a product that was incorporated into an electrical system and did not furnish
  construction within the meaning under Section 8127).
  12
     10 Del. C. § 8127(b)(6).
  13
     See Plaintiff’s Response to Defendant’s Mot. to Dismiss, Ex. 1, para. 2 (Richard Stat, sole
  owner and sole officer of B&M, explicitly states: “By oversight, I authorized payment in full in
  July, 2009. . . .”).
                                                 5
   waited until September 25, 2015 to file its Complaint – after the statute of repose

   under Section 8127 had run.

III.   Progressive is entitled to summary judgment.

         It is undisputed that Progressive extended and connected four electrical

   conductors as required by the Contract. It is undisputed that 326 Associates paid

   Progressive in full for the electrical work no later than July 2009. Therefore, there

   is no genuine issue of material fact that Progressive should be afforded the

   protections of the six year statute of repose under Section 8127. Accordingly,

   judgment is entered in favor of Progressive and against 326 Associates.

                                       Conclusion

         NOW, THEREFORE, this 29th day of March, 2016, Defendant

   Progressive’s Motion for Summary Judgment is hereby GRANTED, and

   JUDGMENT is entered in favor of Defendant Progressive Services, Inc. and

   against Plaintiff 326 Associates, L.P.

         IT IS SO ORDERED.

                                          Andrea L. Rocanelli
                                          ____________________________________
                                          The Honorable Andrea L. Rocanelli

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