Willis v. DeWitt

2015 UT App 123_________________________________________________________
THE UTAH COURT OF APPEALS
WILLIAM D. WILLIS AND PAULA A. WILLIS,
Plaintiffs and Appellants,
v.
RAYMOND C. DEWITT AND RC DEWITT CONSTRUCTION, INC.,
Defendants and Appellees.
Opinion
No. 20130867-CA
Filed May 14, 2015
Fifth District Court, St. George Department
The Honorable James L. Shumate
No. 120500368
Darwin C. Fisher, Attorney for Appellants
Peter H. Barlow, Sadé A. Turner, Heinz J. Mahler,
and Andrew R. Hale, Attorneys for Appellees
JUDGE MICHELE M. CHRISTIANSEN authored this Opinion, in
which JUDGES J. FREDERIC VOROS JR. and STEPHEN L. ROTH
concurred.
CHRISTIANSEN, Judge:
¶1 William D. and Paula A. Willis appeal from the district
court’s grant of summary judgment in favor of Raymond C. DeWitt
and RC DeWitt Construction, Inc. (collectively, DeWitt). We affirm.
BACKGROUND
¶2 In 2005, the Willises contracted with DeWitt for the
construction of a new house in a residential development. Before
constructing any houses in the development, DeWitt discovered
Willis v. DeWitt
that expansive soil was present in multiple lots in the
development.1 As a result, DeWitt had the top sixteen feet of soil
removed from the affected areas and replaced with compacted fill.
DeWitt was aware that the fill mixture included some amount of
expansive soil but believed that the fill would not be expansive and
that the fill provided “a very safe condition to build upon.”
¶3 DeWitt commenced construction on the Willises’ house, and
the Willises took possession of the completed home on December
27, 2005. Within a few months, the Willises began to notice defects
in the home that appeared to be related to earth movement or
settlement, such as cracking of their driveway, garage ceiling, and
exterior walls. In 2008, the Willises received a letter from a
neighbor claiming that damage to neighborhood homes was caused
by expansive soil.
¶4 The Willises filed suit against DeWitt in June 2012, asserting
claims of fraudulent misrepresentation, fraudulent nondisclosure,
negligent misrepresentation, breach of contract, breach of the
covenant of good faith and fair dealing, and breach of implied
warranty for DeWitt’s failure to disclose the presence of expansive
soil in the development. DeWitt moved for summary judgment,
arguing that the Willises’ claims were time-barred by the relevant
statutes of limitations. The district court granted summary
judgment in favor of DeWitt on the Willises’ fraud and breach-of-
implied-warranty claims. The district court initially denied
DeWitt’s motion for summary judgment on the Willises’ claims for
breach of contract and breach of the covenant of good faith and fair
dealing. The court explained that “there is a question of fact as to
whether or not any ‘fraudulent concealment’ took place,” which
the court believed could allow the Willises to “invoke the discovery
rule and thereby toll the statute of limitations” with respect to
those claims.
1. Expansive soil can damage building foundations by swelling as
it absorbs water and contracting as it dries.
20130867-CA 2 2015 UT App 123Willis v. DeWitt
¶5 DeWitt filed a new motion for summary judgment
addressing the fraudulent-concealment issue, and the district court
concluded that the undisputed evidence showed that the Willises
had knowledge of their claims on February 28, 2006. The district
court therefore concluded that the Willises’ contract-based claims
brought on June 15, 2012, were time-barred under the six-year
limitations period for contract actions against a builder. The
Willises appeal.
ISSUE AND STANDARD OF REVIEW
¶6 The Willises challenge the district court’s grant of summary
judgment dismissing their claims for breach of contract and breach
of the covenant of good faith and fair dealing.2 “[W]e review a
district court’s grant of summary judgment for correctness,
considering only whether the trial court correctly applied the law
and correctly concluded that no disputed issues of material fact
existed.” Francis v. State, 2013 UT 65, ¶ 19, 321 P.3d 1089 (citation
and internal quotation marks omitted).
ANALYSIS
¶7 The Willises argue that the district court erred both in
concluding that there was no genuine dispute as to when the
Willises had knowledge of their claims and in concluding that “the
discovery rule does not apply to toll the statute of limitations.” We
do not directly reach the issues raised by the Willises, because we
affirm the district court’s grant of summary judgment on the
alternative ground that Utah Code section 78B-2-225(3)(a) is a
statute of repose not subject to equitable tolling and there are no
2. The Willises do not appeal the district court’s grant of summary
judgment on their fraud or breach-of-warranty claims.
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disputed facts regarding when that statute began to run or when
it expired.
I. Utah Code Section 78B-2-225(3)(a) Is a Statute of Repose.
¶8 “A statute of limitations requires a lawsuit to be filed within
a specified period of time after a legal right has been violated or the
remedy for the wrong committed is deemed waived.” Berry ex rel.
Berry v. Beech Aircraft Corp., 717 P.2d 670, 672 (Utah 1985). “A
statute of repose bars all actions after a specified period of time has
run from the occurrence of some event other than the occurrence
of an injury that gives rise to a cause of action.” Id. Once the
statutory period set by a statute of repose expires, “any cause of
action is barred regardless of usual reasons for tolling the statute.”
Perry v. Pioneer Wholesale Supply Co., 681 P.2d 214, 219 (Utah 1984)
(internal quotation marks omitted). Thus, a party’s ignorance of the
injury, which is generally a ground for equitable tolling of a statute
of limitations, does not toll a statute of repose. See id.
¶9 Utah Code section 78B-2-225 governs actions against
providers of construction services for work done on a building site.
Utah Code Ann. § 78B-2-225(1)(f), (3)(a) (LexisNexis 2008).3 A
homebuilder such as DeWitt is a provider as defined by the statute,
see id. § 78B-2-225(1)(f), and section 78B-2-225(3)(a) therefore
governs the Willises’ claims here. That subsection states, “An action
by or against a provider based in contract or warranty shall be
commenced within six years of the date of completion of the
improvement or abandonment of construction.” Id. § 78B-2-
225(3)(a). By its plain language, this statute “bars all actions after a
specified period of time has run from the occurrence of some event
3. Although the Willises’ house was completed in December 2005,
we cite the 2008 codification of the statute at Utah Code section
78B-2-225 because our legislature has directed that section 78B-2-
225 “applies to all causes of action that accrue after May 3, 2003.”
Utah Code Ann. § 78B-2-225(11) (LexisNexis 2008).
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other than the occurrence of an injury.” See Berry, 717 P.2d at 672.
Utah Code section 78B-2-225(3)(a) is therefore a statute of repose.4
¶10 This conclusion is bolstered by our supreme court’s
interpretation of Utah Code section 78-12-25.5 in Craftsman Builder’s
Supply, Inc. v. Butler Manufacturing Co., 1999 UT 18, 974 P.2d 1194.
There, the court concluded that section 78-12-25.5, a predecessor to
section 78B-2-225, was a statute of repose. Id. In Craftsman, the
statute at issue stated that “no action for breach of contract or
warranty may be commenced against a provider more than six
years after completion of the improvement or abandonment of
construction” and established a twelve-year limitations period for
all other actions. Id. ¶ 24 (quoting Utah Code Ann. § 78-12-25.5(4)
(Michie 1996)); see also Utah Code Ann. § 78-12-25.5(5). The
supreme court held that “[b]ecause these periods start to run on the
date of completion or abandonment of the improvement without
regard to the ‘occurrence of an injury that gives rise to a cause of
action,’ they are statutes of repose.” Craftsman, 1999 UT 18, ¶ 26
(quoting Berry, 717 P.2d at 672). The court then concluded that “the
statute of repose provisions are not subject to a discovery rule” and
barred the plaintiff’s claims. Id. ¶ 27. Given that the language of
section 78B-2-225(3)(a) is functionally identical to the language
4. The Willises assert that “[t]he issue of whether Utah Code Ann.
§ 78B-2-225(3)(a) is a statute of repose or a statute of limitations was
never presented to the court or decided by the trial court, and is
raised by [DeWitt] for the first time on [the] Willises’ appeal.” The
Willises therefore argue that we should “refuse to consider” this
issue. However, even if we were to conclude that DeWitt failed to
raise this issue in the district court, that conclusion would not bar
our consideration of the issue, because “[w]e may affirm a
judgment on an unpreserved alternate ground where the alternate
ground is apparent on the record.” Angel Investors, LLC v. Garrity,
2009 UT 40, ¶ 38, 216 P.3d 944 (citation and internal quotation
marks omitted). Because the record is adequate for us to affirm on
this alternative ground, we exercise our discretion to do so here.
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considered in Craftsman, we conclude that section 78B-2-225(3)(a)
is likewise a statute of repose.
¶11 The Willises argue that section 78B-2-225(3)(a) is not a
statute of repose because this court, in Moore v. Smith, 2007 UT App
101, 158 P.3d 562, affirmed a district court’s equitable tolling of the
limitations period set forth in Utah Code section 78-12-21.5(3)(a).
Section 78-12-21.5 was recodified in 2008 as section 78B-2-225, and
the relevant provision of section 78B-2-225 is identical to the
provision analyzed in Moore. Compare Utah Code Ann. § 78-12-
21.5(3)(a) (Lexis Supp. 1999), with Utah Code Ann. § 78B-2-225(3)(a)
(LexisNexis 2008). However, the issue before this court in Moore
was whether a trial court may apply an equitable discovery rule to
a statutory limitations period that does not include an “internal,”
or statutory, discovery rule. 2007 UT App 101, ¶¶ 26–29. The
question of whether section 78-12-21.5(3)(a) was a statute of
repose—and thus whether the trial court erred in tolling the
limitations period on that basis—was never addressed in Moore and
does not appear to have been raised by the appellant as a ground
for reversal.5 Id. Moore therefore did not decide whether section
78-12-21.5(3)(a) was a statute of repose, and its holding is not
inconsistent with our conclusion that section 78B-2-225(3)(a) is a
statute of repose.
II. The Willises’ Contract-Based Claims Are Barred by Utah Code
Section 78B-2-225(3)(a).
¶12 Having concluded that Utah Code section 78B-2-225(3)(a) is
a statute of repose, we next consider whether the Willises’ contract
5. The appellants in Moore v. Smith did argue that “the legislature
intended to hold contract claims related to property improvements
outside of the application of any discovery rule.” 2007 UT App 101,
¶ 28, 158 P.3d 562. However, this court held that the appellants
“provide[d] no authority for this legislative intent argument,” and
we rejected the argument without addressing its merits. Id.
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claims are time-barred under that statute. “An action by or against
a provider based in contract or warranty shall be commenced
within six years of the date of completion of the improvement or
abandonment of construction.” Utah Code Ann. § 78B-2-225(3)(a)
(LexisNexis 2008). It is undisputed that DeWitt completed
construction and the Willises took possession of the house on
December 27, 2005. The Willises therefore needed to commence any
contract or warranty action against DeWitt within six years of that
date. The Willises did not file suit until June 15, 2012. As a result,
their contract claims are time-barred under the statute.6 We
therefore affirm the district court’s summary judgment dismissing
the Willises’ claims.
CONCLUSION
¶13 Utah Code section 78B-2-225(3)(a) is a statute of repose and
therefore may not be tolled by application of a discovery rule. The
Willises’ contract claims were not brought within six years of the
completion of construction as required by statute, and are thus
time-barred. We affirm the district court’s summary judgment.
6. The Willises’ fraudulent-concealment argument is premised on
a variation of the discovery rule that is applicable in cases
involving statutes of limitations. See Berenda v. Langford, 914 P.2d
45, 51–52 (Utah 1996). Because Utah Code section 78B-2-225(3)(a)
is a statute of repose, “the discovery rule cannot operate to toll” the
six-year limit. See Kunz v. Kunz (In re Marriage of Kunz), 2006 UT
App 151, ¶ 21, 136 P.3d 1278. The Willises have raised no argument
that the circumstances of this case justify an exception to this rule.
20130867-CA 7 2015 UT App 123