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By: Jake Carroll
Georgia’s statute of repose provides an eight (8) year deadline for actions seeking to recover damages for deficiencies in construction. The period runs from the substantial completion of the work, and was enacted with the intent of establishing an outside time limit on actions arising out of the improvement of real property. While Georgia courts have consistent held that the statute of repose bars claims for negligent construction, and that common law claims for indemnity and contribution are also barred by this statute of repose, Georgia state courts have never addressed whether the statute also bars related contractual claims (i.e. indemnity, contribution, and breach of warranty).
In S. States Chem., Inc. v. Tampa Tank & Welding, Inc., the Georgia Court of Appeals clarified the reach and application of the statute, holding that since Georgia’s statute of repose makes “no distinction” among claims sounding in negligence and those sounding in contract, “the statute broadly precludes any action to recover damages brought outside the eight-year period of repose.” “It is well settled that ‘a statute of ultimate repose frames the time period in which a right may accrue, if at all. Therefore, if an injury occurs outside this time period, the injury is not actionable[.]’” While the opinion specifically addressed claims for breach of an express promise to renovate a storage tank, the court’s reasoning appears to apply to bar all untimely contractual claims alleging deficiency in construction—including indemnity, contribution, and breach of warranty.
The decision provides clarity as to which claims are subject to the statutory window of liability for completed projects. However, even with these changes, owners and contractors should still review their construction contracts for specific provisions regarding completion, statutes of limitations, and indemnity. Additionally, the Court’s decision in S. States does not extend the statute of repose to claims for contractual indemnification where the indemnitor does not allege deficient construction and the indemnification provision does not require a showing of negligence. Those claims would still be governed by the applicable statute of limitations.
If you have questions regarding this decision, or any other construction questions, Jake Carroll practices construction and commercial law as a member of Freeman Mathis & Gary’s Construction Law, Commercial Litigation, and Tort and Catastrophic Loss practice groups. Mr. Carroll represents business and commercial entities in a wide range of disputes and corporate matters involving breach of contract and warranty claims, business torts, and products liability claims.