A statute of limitations does not start to run until damage is, or reasonably should be, discovered. For those who design or construct improvements to real property, this creates a very long liability tail. The response has been state enactment of statutes of repose. The time period of these statutes commences upon a stipulated date – typically substantial completion of the project. When the time period expires, actual or prospective claims are extinguished. Even claims for losses that have not yet occurred are extinguished.
The Ohio Supreme Court was recently asked to interpret the state’s statute of repose regarding claims against architects and engineers; specifically, whether the statute applies only to claims based in negligence or extends to breach of contract allegations as well. In a split decision, the court decided the latter.
The other case in this issue involves subcontractor mechanic’s liens. The North Dakota Supreme Court ruled that unpaid subcontractors were not required to exhaust their contractual payment rights against the prime contractor before exercising their lien rights against the project owner.
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