Court Opinion

ID: 7125371
Source: CourtListenerOpinion
Date Created: 2022-07-24 13:05:52.827619+00
Date Added: 2024-06-11T12:48:35.290635
License: Public Domain

Green, J.,
dissenting: I would affirm the judgment for the reasons stated by the trial court. Accordingly, I dissent. In its decision, the trial court noted that Kirk’s Remodeling and Custom Homes, Inc. (Kirk’s) failed to “repair, replace, or pay the HOME-BUYER^) the reasonable cost of repairing or replacing the defective item.”
The trial court further noted that before Kirk’s would have been obligated to repair or fix any defects in the home, a breach of warranty would have had to occur. In holding that Kirk’s failed to deliver a home free of defects, the trial court properly concluded that Kirk’s breached the warranty at the outset. Thus, the trial court correctly held that Kirk’s breached the warranty on the date of delivery of the warranty or tire completion of the home, which both occurred on December 12, 2003, and that the 5-year statute of limitations under K.S.A. 60-511(1) began to run from that date. As a result, the trial court properly concluded that the Hewitts’ action was barred, since their action did not begin until Kirk’s was served on January 31, 2009, more than 5 years after the delivery of tire warranty or the completion of the home.
The narrow question in this case is when the statute of limitations began to run for the purposes of this action. The majority reaches this pivotal question by holding: “We hold, for purposes of K.S.A. 60-511(1), a cause of action based upon a builder’s express warranty to repair or replace construction defects in a newly built house must be brought within 5 years of the date the builder breached the warranty by refusing or failing to repair or replace the defects.” Slip op. at 20. Nevertheless, K.S.A. 60-511(1), which applies to contract-related actions, does not contain language regarding accrual upon a builder refusing or failing to repair or replace defects. In fact, our Supreme Court has held that “[a] cause of action for breach of contract accrues when a contract is breached . . . , irrespective of any knowledge on tire part of the plaintiff or of any actual injury it causes.” Pizel v. Zuspann, 247 Kan. 54, 74, 795 P.2d 42, modified on other grounds 247 Kan. 699, 803 P.2d 205 (1990).
*525Moreover, the majority’s holding hinges on its contention that Freeto Construction Co. v. American Hoist & Derrick Co., 203 Kan. 741, 746, 457 P.2d 1 (1969), is distinguishable from the facts of this case and, thus, Freeto does not control the outcome of this case. The majority is incorrect when it holds that Freeto is distinguishable from this case. In Freeto, our Supreme Court held that a cause of action for a breach of warranty, express or implied, accrues when the breach occurs, not as in a tort action, when tire first injury occurs. 203 Kan. at 746.
Like Freeto, the parties in this case dispute when the breach occurred. Nevertheless, the defects in the workmanship on the house were apparent when the Hewitts took possession of the house. Brant Jones, tire owner of Brant Jones Masonry, referred to repairs and problems with the brickwork of the Hewitts’ home in a letter dated November 15, 2003, to “Mr. Kirk and Mr. [a]nd Mrs. Hewitt.” In die opening paragraph of his letter, Jones stated the following: “I recently was employed by you and Mr. [a]nd Mrs. Hewitt to do some repair on die brick’ on their new home near Hillsdale. This letter will be a report of die various problems with the job that I discovered while repairing the brickwork.” In the closing paragraphs of Jones’ letter, he pointed out some major problems with the brickwork:
“My bid was some $8000 for the work that I performed, and I could have easily doubled the bid to tear out more work that did not appear to be professionally done. It appeared to me that both the contractor and die homeowner were trying to be as reasonable as possible in die repair of items that seemed major.
“My conclusion is diat this job doesn’t look too bad now, but some serious issues are still unanswered, diat of the lack of the vapor barrier and die absence of wall ties in the areas that I repaired. I told the contractor early on that removing all of the brick and relaying new bricks correctly would be the only totally reliable solution to diis problem job.”
Obviously, the home was defective when the construction was completed and the warranty delivered on December 12, 2003.
Turning to our Supreme Court decision in Freeto, I note that Freeto filed suit to recover damages from the breakdown of a truck crane sold to Freeto by American Hoist. Our Supreme Court specifically addressed when a cause of action accrues in a breach of *526contract claim. The Freeto court held that “whether it be for breach of an express or of an implied warranty the action accrues at the time of breach.” 203 Kan. at 746. In Freeto, the court held that die breach occurred when the crane was sold and delivered, because it was designed and assembled in an inadequate manner to sustain the warranted load capacity. 203 Kan. at 746.
In reaching this conclusion, the Freeto court relied on the holding in Crabb v. Swindler, Administratrix, 184 Kan. 501, 507, 337 P.2d 986 (1959). In Crabb, an action was brought against the estate of a deceased plumbing contractor to recover damages resulting from the negligent and unworkmanlike installation of plumbing fixtures. The Crabb court held that the warranty was breached when the plumbing was installed and the job completed. 184 Kan. at 507-08. The Crabb court further stated: “ ‘A cause of action in contract accrues at the time of the breach or failure to do the thing agreed to, irrespective of any knowledge on the part of the plaintiff or of an actual injury it has occasioned him.’ ” 184 Kan. at 507.
More recently, in Law v. Law Company Building Assocs., 295 Kan. 551, 289 P.3d 1066 (2012), our Supreme Court again considered when a cause of action accrues in a breach of contract claim. In Law, our Supreme Court interpreted K.S.A. 60-511(1) and determined that the Kansas Legislature had not provided a discovery exception in K.S.A. 60-511; therefore, contract actions accrue on breach, not when the breach is discovered. 295 Kan. at 576. The issue in Law involved a claim to reform an executory contract because of a mutual mistake. The parties disputed whether the statute of limitations began to run on discovery of the mutual mistake or whether it began to run on execution of the agreement, which was when the mutual mistake was actually made. Our Supreme Court discussed a long line of cases that support the general rule that contract actions accrue on breach, not when the breach is discovered. See 295 Kan. at 566-75. This “accrual-upon-execution rule” has been around for over a century and “derives from a long-standing rule that contract actions accrue as soon as the right to maintain a legal action arises.” 295 Kan. at 574.
The Law court ultimately held that “a cause of action for breach of contract accrues on the date of breach, not the date of discovery, *527and, likewise, a cause of action for reformation of a contract based on mutual mistake accrues on the date of mistake, not the date of discovery of the mistake.” 295 Kan. at 574. Our Supreme Court further held that whether the contract is executed or executoiy does not make a difference in determining the date when a statute of limitations begins to accrue. 295 Kan. at 574-75.
The Hewitts’ cause of action accrued on December 12, 2003, when their home was completed and when they signed the warranty. It is readily apparent that the breach occurred on the date of delivery of the December 12, 2003, warranty because the Hew-itts’ letter to Kirk’s, dated December 11, 2004, still referred to the defects that existed in the brickwork before delivery of the warranty and the completion of the home on December 12, 2003:
“1. Unsightly and Problematic Brickwork. The leaks in the basement have been repaired on the North and South side of our home by removing brick; and flashing and sealing around the support beam pockets. This was a matter of neglect by your first Subcontractor, The Brick Doctor. We still need the brick problem taken care of near the front' door causing leaks in the basement. When removing a small section of the brick on die North and South side of our home, your second brick Subcontractor, Brant Jones, mentioned that he saw brick ties and felt paper. However as Mr. Jones indicated in the conclusion of his letter of November 15, 2003, removing all of the brick and relaying new bricks correctly would be the only totally reliable solution to this problem job. Since Mr. Jones discovered that no felt or other waterproofing material was used above the garage door when removing a 50 to 60 foot section of brick, we are still not certain that felt or waterproofing was used completely around our home.”
The majority supports its holding based on caselaw from foreign jurisdictions. For example, tire majority relies on Feinour v. Ricker Co., 255 Ga. App. 651, 566 S.E.2d 396 (2002). As stated earlier, the Freeto court held that a cause of action for a breach of warranty, express or implied, accrues when the breach occurs, not as in a tort action, when the first injury occurs. 203 Kan. at 746. To the contrary, the Feinour court treats the statute of limitations start 'date for a breach of an express warranty claim differently from the statute of limitations start date for a breach of an implied warranty. Unlike Freeto, the Feinour court held that a breach of an express warranty “does not arise until the landowner notifies the contractor of the alleged defects.” 255 Ga. App. at 653. In explaining the *528statute of limitations start date for a breach of an express warranty to repair and replace, the Feinour court stated: “Since an express warranty to repair is not breached until the warrantor refuses to repair or inadequately repairs the defect, the statute of limitation[s] on that claim does not commence to run until that obligation is breached.” 255 Ga. App. at 655.
Nevertheless, the Feinour court affirmed the trial court’s holding that the applicable 6-year statute of limitations barred Feinour’s claims for breach of die construction contract and breach of the implied warranty. 255 Ga. App. at 655. As a result, except for the statute of limitations start date for a breach of an express warranty, Georgia’s statute of limitations start date for a breach of contract or breach of an implied warranty is similar to Kansas caselaw. For example, in Feinour, the record showed that the certificate of occupancy on Feinour’s house was issued on September 23, 1993. The Feinour court stated that unless the applicable 6-year statute of limitations was tolled by actual fraud, the “breach of implied warranty and breach of the sale/construction contract claims brought by Feinour are all barred, since suit was not filed until 2000, more than six years after the certificate of occupancy issued in 1993.” 255 Ga. App. at 653.
The Feinour court along with many of the cases cited by the majority treats a breach of an express warranty to repair and replace as an executory contract. An executory contract is a contract whose conditions or promises have not been fully performed; that is, one party or both have something yet to perform. Here, the contract seemed to be executed as to the Hewitts but partially executory as to Kirk’s. Kirk’s still had an obligation to perform under the written warranty. Nevertheless, as stated earlier, the Law court held that whether the contract is executed or executory does not make a difference in determining the date when a statute of limitations begins to accrue. 295 Kan. at 574-75.
In summary, defects existed in the quality of the workmanship in assembling the brick work on tire Hewitts’ home. The Hewitts’ knew about the problems. Moreover, the defects in the brick work were observable when the Hewitts’ took possession of the house and received the written warranty from Kirk’s on December 12, *5292003. In the warranty, Kirk’s warranted that the home was free of defects. Because the Hewitts’ knew that Kirk’s written assertion was untrue, their cause of action would have accrued when they received the warranty or accepted possession of the house on December 12, 2003.
Since the Hewitts’ action did not begin until Kirk’s was served on January 31, 2009, their petition was filed outside the applicable 5-year statute of limitations. As a result, the trial court properly granted summary judgment in favor of Kirk’s.