Blueridge Homes v. Method Air

2019 UT App 149THE UTAH COURT OF APPEALS
BLUERIDGE HOMES INC., JARED OESER, RYAN CLARK,
AND JULIANNE OESER,
Appellants,
v.
METHOD AIR HEATING AND AIR CONDITIONING, K&K STUCCO
& STONE LLC, HILL & MEHR HEATING & COOLING, CURTIS MINER
ARCHITECTS, PARRISH CONSTRUCTION COMPANY, DAVE’S CUSTOM
SIDING, AND HERCULES CONSTRUCTION INC.
Appellees.
Opinion
No. 20180310-CA
Filed September 6, 2019
Fourth District Court, Provo Department
The Honorable Samuel D. McVey
The Honorable Kraig Powell
No. 140401785
Richard K. Glauser and Richard Bissell, Attorneys
for Appellants
Joseph E. Minnock, Attorney for Appellee Method
Air Heating and Air Conditioning
Scott C. Powers and Erik R. Hamblin, Attorneys
for Appellee K&K Stucco & Stone LLC
Vincent J. Velardo and Thomas J. Rollins, Attorneys
for Appellee Hill & Mehr Heating & Cooling
Craig R. Mariger, Brad M. Liddell, and C. Michael
Judd, Attorneys for Appellee Curtis Miner Architects
Peter H. Barlow and Andrew D. Day, Attorneys
for Appellee Parrish Construction Company
Stephen F. Edwards, Attorney for Appellees
Dave’s Custom Siding
Blueridge Homes v. Method Air
Joseph J. Joyce and Jeremy G. Knight, Attorneys for
Appellee Hercules Construction Inc.
JUDGE DAVID N. MORTENSEN authored this Opinion, in which
JUDGES GREGORY K. ORME and KATE APPLEBY concurred.
MORTENSEN, Judge:
¶1 In this appeal, third-party plaintiffs in a construction
defect case seek to avoid a statute of repose but fail in that effort.
Plaintiff filed suit against its general contractor, Blueridge
Homes Inc. (Blueridge), in December 2014, alleging construction
defects in a condominium development project. In July 2015,
Blueridge filed a third-party complaint against its various
subcontractors, alleging that if Blueridge was liable to Plaintiff,
then subcontractors were liable to Blueridge. Although Plaintiff’s
claims against Blueridge survived a motion to dismiss, the
district court dismissed Blueridge’s third-party claims as time-
barred under Utah Code section 78B-2-225 (Builders’ Statute of
Repose). Blueridge argues that the district court erred by
(1) dismissing its third-party complaint because it should have
related back to Plaintiff’s December 2014 filing and (2) denying
its post-trial motions. We affirm the district court on both points.
BACKGROUND
¶2 Plaintiff entered into a contract with Blueridge as the
general contractor for a condominium development in Saratoga
Springs, Utah (Project). The Project consisted of nine buildings.
Upon substantial completion of each building, certificates of
occupancy were issued between May 2, 2007, and June 9, 2009.
¶3 On December 22, 2014, Plaintiff filed a complaint naming
Blueridge as defendant and raising various claims related to
alleged construction defects on the Project. Blueridge was first
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notified of the suit when the complaint was served on February
13, 2015. Over five months later on July 15, 2015, Blueridge filed
a third-party complaint against subcontractors Method Air
Heating and Air Conditioning, K&K Stucco & Stone LLC, Hill
& Mehr Heating & Cooling, Curtis Miner Architects, Parrish
Construction Company, Dave’s Custom Siding, and Hercules
Construction Inc. (collectively, Appellees), alleging that
Appellees were ultimately responsible for the construction
defects raised in the initial complaint.
¶4 On November 30, 2015, Miner filed a motion to dismiss,
arguing that the Builders’ Statute of Repose barred Blueridge’s
third-party claims. See Utah Code Ann. § 78B-2-225(3)(a)
(LexisNexis 2018) 1 (“An action . . . based in contract or warranty
shall be commenced within six years of the date of completion of
the improvement . . . .”). The district court granted Miner’s
motion on the grounds that the Builders’ Statute of Repose had
run on June 9, 2015, six years after the last certificate of
occupancy was issued, Blueridge’s third-party complaint was
not filed until July 15, 2015, and Blueridge’s third-party
complaint did not relate back to the filing of Plaintiff’s initial
complaint because Appellees were not named parties in the
initial complaint.
¶5 The remaining Appellees followed suit by filing motions
for summary judgment, arguing that the Builders’ Statute of
Repose barred Blueridge’s third-party complaint. Blueridge
opposed the motions, arguing that the Builders’ Statute of
Repose did not bar its claims because rule 14 of the Utah Rules of
Civil Procedure permitted it to “bring in a third party at any
time after the commencement of the action.” In other words,
1. Because the statutory provision in effect at the relevant time
does not differ in any material way from the provision now in
effect, we cite the current version of the Utah Code.
20180310-CA 3 2019 UT App 149Blueridge Homes v. Method Air
Blueridge argued that under rule 14, its third-party complaint
should relate back to the initial complaint.
¶6 The district court rejected Blueridge’s argument and
granted the motions for summary judgment in favor of
Appellees. The court ruled that where the last certificate of
occupancy on the nine buildings for the Project was issued on
June 9, 2009, and the third-party complaint was filed on July 15,
2015, the six-year Builders’ Statute of Repose had run. The
district court further ruled that if third-party complaints
automatically related back to the filing of the original complaint,
then rule 14 would become “an all-encompassing rule that
would eliminate all limitations on third-party actions.” (Citing
Perry v. Pioneer Wholesale Supply Co., 681 P.2d 214, 217 (Utah
1984).)
¶7 Blueridge later filed a motion to reconsider and motion to
alter or amend pursuant to rule 59(e) for relief from judgment
under rule 60(b) of the Utah Rules for Civil Procedure (Motions
for Reconsideration). 2 In its Motions for Reconsideration,
Blueridge raised three issues for the first time: (1) the existence of
three certificates of occupancy for one of the nine buildings
created a genuine dispute of material fact—which should
preclude summary judgment—concerning when the Builders’
Statute of Repose began to run for that building, (2) an exception
to the Builders’ Statute of Repose should have applied to
Appellees, and (3) the Builders’ Statute of Repose was
unconstitutional as applied. The district court denied the
Motions for Reconsideration, stating, “Having considered the
written and oral arguments of the parties, the Court finds no
persuasive grounds to reconsider its orders or to alter or amend
its judgments.”
2. A new judge was assigned to the case prior to Blueridge filing
its Motions for Reconsideration.
20180310-CA 4 2019 UT App 149Blueridge Homes v. Method Air
¶8 Blueridge appeals.
ISSUES AND STANDARDS OF REVIEW
¶9 Blueridge argues that the district court erred in granting
Miner’s motion to dismiss and Appellees’ motions for summary
judgment. “A district court’s grant of a motion to dismiss based
upon the allegations in the plaintiff’s complaint presents a
question of law that we review for correctness.” Osguthorpe v.
Wolf Mountain Resorts, LC, 2010 UT 29, ¶ 10, 232 P.3d 999(cleaned up). “We review the district court’s grant of summary
judgment for correctness and accord no deference to its
conclusions of law.” Gardiner v. Anderson, 2018 UT App 167, ¶ 14,
436 P.3d 237 (cleaned up).
¶10 Blueridge also contends that the district court erred by
denying its Motions for Reconsideration. “Because [district]
courts are under no obligation to consider motions for
reconsideration, any decision to address or not to address the
merits of such a motion is highly discretionary.” Mower v.
Simpson, 2017 UT App 23, ¶ 43, 392 P.3d 861 (cleaned up).
Accordingly, “we will not disturb a district court’s decision to
grant or deny such a motion absent an abuse of discretion.” Id.(cleaned up).
ANALYSIS
I. The Builders’ Statute of Repose Barred Blueridge’s
Third-Party Claims.
¶11 The Builders’ Statute of Repose provides that “[a]n action
. . . based in contract or warranty shall be commenced within six
years of the date of completion of the improvement.” Utah Code
Ann. § 78B-2-225(3)(a) (LexisNexis 2018) (emphasis added). The
date of completion is “established by the earliest of: (i) a
20180310-CA 5 2019 UT App 149Blueridge Homes v. Method Air
Certificate of Substantial Completion; (ii) a Certificate of
Occupancy issued by a governing agency; or (iii) the date of first
use or possession of the improvement.” Id. § 78B-2-225(1)(c).
¶12 Here, the final certificate of occupancy on the Project was
issued on June 9, 2009, and the third-party complaint was filed
on July 15, 2015—more than six years later. Accordingly,
Blueridge concedes that its third-party complaint was filed after
the Builders’ Statute of Repose had run. 3 Blueridge contends,
however, that its third-party complaint should relate back to the
filing of the initial complaint because rule 14 of the Utah Rules of
Civil Procedure allows for filing a third-party complaint at any
time after the commencement of the initial complaint.
¶13 Rule 14 of the Utah Rules of Civil Procedure provides that
“[a]t any time after commencement of the action a defendant, as
a third-party plaintiff, may cause a summons and complaint to
be served upon a person not a party to the action.” While we
agree that rule 14 permits a party to file a third-party complaint
at any time during the pendency of an action, it does not follow
that rule 14 also bars third-party defendants from raising a
statute of limitations or repose as an affirmative defense. See
Raithaus v. Saab-Scandia of Am., Inc., 784 P.2d 1158, 1161 n.5 (Utah
1989) (“[T]he statute of repose [is] a separate affirmative
defense.”). In other words, the language Blueridge relies on
merely dictates when a third-party complaint can be filed—not
3. Blueridge contended in its Motions for Reconsideration and
on appeal that a genuine dispute of material fact exists
concerning whether its third-party complaint was timely for one
of the nine buildings due to the existence of three certificates of
occupancy for that building. As discussed below we conclude
that this argument is without merit, infra ¶ 20, and further find
that the district court did not abuse its discretion in declining to
reach this issue in the first instance, infra ¶ 21.
20180310-CA 6 2019 UT App 149Blueridge Homes v. Method Air
what the substantive effect of the third-party complaint is or
what defenses may be raised against the claims stated in a third-
party complaint. See Choate v. United States, 233 F. Supp. 463, 464
(W.D. Okla. 1964) (acknowledging that a statute of limitations
can be an affirmative defense to third-party claims properly
raised under rule 14 of the Federal Rules of Civil Procedure).
Therefore, we conclude that the district court did not err in
dismissing Blueridge’s third-party complaint because, although
Blueridge was permitted to file its third-party complaint at any
time under rule 14, rule 14 did not bar application of the
Builders’ Statute of Repose.
¶14 In spite of this, Blueridge argues that Sharon Steel Corp. v.
Aetna Casualty & Surety Co., 931 P.2d 127 (Utah 1997),
demonstrates that its third-party complaint should relate back.
In Sharon, the federal government sued a steel corporation,
which then tendered the claim to three insurers. Id. at 130–31.
Later, the corporation filed suit against all three insurers,
claiming they were obligated to defend and indemnify the
corporation in the initial suit. Id. The court determined that all
three insurers had an obligation to defend and indemnify the
company. Id. at 131. One of the three insurers paid the bulk of
the defense costs on behalf of the corporation in the initial suit.
Id. That insurer later filed a crossclaim against the two other
insurers, both of whom were defendants in the action, to recover
defense costs in excess of its obligation. Id. The insurers named
in the crossclaim argued that the statute of limitations barred the
crossclaim. Id. Our supreme court held, however, that the
crossclaim would relate back because the parties in the
complaint were the same as those in the crossclaim. Id. at 133.
¶15 Blueridge’s reliance on Sharon is misplaced. In Sharon, the
two defendant insurers named in the crossclaim were initially
named as defendants when the steel corporation sued all three
insurers for indemnification. Id. at 130–31. Thus, where the two
defendant insurers had been timely brought into the case by the
20180310-CA 7 2019 UT App 149Blueridge Homes v. Method Air
initial complaint, the crossclaim could relate back. See Utah R.
Civ. P. 15(c). But in this case, Appellees were not parties to the
suit until the third-party complaint was filed and served.
Therefore the Builders’ Statute of Repose was properly applied
to Blueridge’s claims. See Gables & Villas at River Oaks
Homeowners Ass’n v. Castlewood Builders, LLC, 2018 UT 28, ¶ 3,
422 P.3d 826 (“[W]e conclude that the homeowners association’s
claims are time-barred because no viable complaint was filed
within the [Builders’ Statute of Repose] period and the
complaint did not relate back to a timely pleading.”).
¶16 Conversely, Appellees cite Perry v. Pioneer Wholesale
Supply Co., 681 P.2d 214 (Utah 1984)—a case with nearly
identical facts to this case. In Perry, a subcontractor provided
doors to a general contractor for construction of a medical center.
Id. at 216. The subcontractor ordered the doors from a
distributor, who ordered them from a manufacturer. Id. The
doors were deemed defective, and the general contractor sued
the subcontractor. Id. Almost three years later, the subcontractor
brought a third-party complaint against the distributor and the
manufacturer. Id. When the distributor and the manufacturer
brought motions for summary judgment on the ground that the
subcontractor’s claims were barred by a statute of repose, the
subcontractor argued that the third-party complaint should
relate back to the filing of the initial complaint. Id. Our supreme
court rejected this argument, holding that the relation back
doctrine does not apply to a pleading that “adds new parties
who have no identity of interest with existing parties.” Id. at 217.
¶17 Perry is applicable to these facts and further demonstrates
that Blueridge’s third-party complaint does not relate back to the
initial complaint in this case. Simply put, Perry illustrates that
when a pleading adds new parties to an action—as is the case
here—that pleading cannot relate back to the initial complaint.
See id. at 216. This holding is consistent with myriad other Utah
cases related to complaints or amendments which add new
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parties. See, e.g., Noor v. State, 2019 UT 3, ¶ 42, 435 P.3d 221(“[A]n amended pleading may relate back as long as the parties
in an action have been reasonably put on notice of the new
claims before the statute of limitations has expired.”); 2010-1
RADC/CADC Venture, LLC v. Dos Lagos, LLC, 2016 UT App 89,
¶ 11, 372 P.3d 683 (stating that the relation back “rule generally
does not apply to an amendment which substitutes or adds new
parties” (cleaned up)), aff’d, 2017 UT 29, 408 P.3d 313.
¶18 In light of the fact that Blueridge’s third-party complaint
was filed after the Builders’ Statute of Repose had run and our
conclusion that third-party complaints adding new parties do
not relate back to prior pleadings under rule 14 or Utah case law,
we conclude that the district court properly dismissed
Blueridge’s third-party complaint as time-barred.
II. The District Court Did Not Err in Denying Blueridge’s
Motions for Reconsideration.
¶19 Blueridge raised three arguments in its Motions for
Reconsideration: First, that the existence of three certificates of
occupancy for building two created a genuine dispute of
material fact that should have precluded summary judgment
(for claims related only to that building); second, that the district
court should have applied an exception to the Builders’ Statute
of Repose to Appellees; and third, that the Builders’ Statute of
Repose is unconstitutional as applied. Importantly, the court
never ruled on the merits of these arguments. 4 Instead, having
4. We note that Blueridge’s claims related to its Motions for
Reconsideration are potentially unpreserved, see Wilde v. Wilde,
2001 UT App 318, ¶ 37 n.5, 35 P.3d 341 (“Raising an issue in a
post-trial motion fails to preserve that issue for appeal without
evidence that the [district] court considered and ruled on the
(continued…)
20180310-CA 9 2019 UT App 149Blueridge Homes v. Method Air
reviewed the motions and entertained extensive oral argument,
the district court found “no persuasive grounds to reconsider its
orders or to alter or amend its judgments.”
¶20 “Whether to reconsider a prior ruling is ordinarily within
the sound discretion of the district court . . . .” Colony Ins. Co. v.
Human Ensemble, LLC, 2013 UT App 68, ¶ 6, 299 P.3d 1149.
“Factors that weigh in favor of the district court’s decision
to reconsider include, but are not limited to, (1) the matter
being presented in a new or different light, (2) a change in the
governing law, (3) the discovery of new evidence, or (4) a
conviction that the prior decision was clearly erroneous.” Id. 5
Importantly, when a district court determines that these
factors do not weigh in favor of reconsideration, as the district
court did here, we will reverse only if the court has abused
its discretion. See Bergmann v. Bergmann, 2018 UT App 130, ¶ 12,
428 P.3d 89. Conversely, when a district court reaches the
merits of a motion to reconsider and provides legal analysis
and legal conclusions, we would reach the merits of its
ruling. See State v. Boyden, 2019 UT 11, ¶ 21, 441 P.3d 737.
Accordingly, on appeal we must decide whether the district
court acted within its discretion in declining to reconsider
its rulings.
(…continued)
merits of the issue.”), but because neither party has briefed the
apparent preservation flaw, we address these arguments.
5. The fact that a new judge had been assigned to this case for the
Motions for Reconsideration, supra ¶ 7 n.2, has no bearing on our
review, see McLaughlin v. Schenk, 2013 UT 20, ¶ 23, 299 P.3d 1139(“[T]he replacement judge was free to reconsider the fairness
hearing issue that had been previously ruled upon by the retired
judge.”).
20180310-CA 10 2019 UT App 149Blueridge Homes v. Method Air
¶21 We conclude that the district court did not abuse
its discretion because all of the evidence and arguments raised
for the first time in Blueridge’s Motions for Reconsideration
existed and could have been asserted when the underlying
motion to dismiss and/or motions for summary judgment were
briefed, argued, and ruled upon. The existence of three
certificates of occupancy for building two was disclosed to
Blueridge prior to Appellees’ motions for summary judgment
and it was available through public records all the while. 6 Thus,
the other certificates of occupancy were not “new” evidence as
Blueridge argues. Similarly, Blueridge’s other arguments—that
an exception to the Builders’ Statute of Repose should have
applied to Appellees and that the Statute is unconstitutional—
were legal points that could have been raised by Blueridge at the
time the dispositive motions were before the court in the first
instance. We thus see the Motions for Reconsideration as nothing
more than an effort to secure a do-over, and the district court
acted well within its discretion in refusing to address the issues
anew.
¶22 In sum, Blueridge has not shown that the evidence
presented in its Motions for Reconsideration was “new” or that
any arguments asserted could not have been made initially
before the district court ruled on the motions to dismiss and for
summary judgment. Therefore, the district court here did not
6. Without expressly ruling on the issue, we are hard-pressed to
see how the existence of more than one certificate of occupancy
would delay the time to file under the Builders’ Statute of
Repose because the plain language of the statute provides that
the time to file begins at the earliest occurrence of a number of
events, one being the issuance of a certificate of occupancy
(whether or not additional certificates are issued later in time).
See Utah Code Ann. § 78B-2-225(1)(c) (LexisNexis 2018).
20180310-CA 11 2019 UT App 149Blueridge Homes v. Method Air
abuse its discretion in declining to reconsider its previous
rulings and denying Blueridge’s motions.
CONCLUSION
¶23 The district court did not err in granting summary
judgment and dismissing Blueridge’s third-party claims, because
they were time-barred by the Builders’ Statute of Repose.
Further, we decline to reach the merits of the issues raised for
the first time in the Motions for Reconsideration because the
district court did not address the merits and Blueridge has not
shown that the court abused its discretion in declining to do so.
¶24 Affirmed.
20180310-CA 12 2019 UT App 149