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By: Jeff Alitz
In John C. Rankin v. South Street Downtown Holdings, Inc v. Truexcullins and Partners Architects, decided August 6, 2019, The New Hampshire Supreme court extended the application of that state’s Statute of Repose to bar not only direct claims filed by plaintiff’s, but also to claims for indemnification and contribution that are filed by third-party plaintiffs after that state’s 8 year statute of repose period has run. In so ruling the Court clarifies – at least in New Hampshire – confusion over the reach and application of the Statute.
Unlike a statute of limitation, a statute of repose period typically starts to run on the completion of an improvement to real property and the period ends on a date established by state law. A substantial majority of states have enacted such time bar statutes of repose though there are state by state variations in them that should be considered by parties and their counsel. The statutory period is set by state law and it can vary from as short a period as 4 years (Tennessee) to up to 15 years (Iowa). Unlike the statute of limitations, there is no “discovery” component to the statute of repose or any “tolling” of the running of the statutory time period, rather, the period described in that statute starts to run when a real estate improvement is complete and ends with finality when the statutory time period concludes. No exceptions are typically available. At least one state’s highest court has called the application of the statute of repose “draconian”.
Consistent with that comment, after considering if third-party claims (brought by parties who were timely joined to the Rankin lawsuit), could be filed after the New Hampshire Statue of Repose period had run the New Hampshire Supreme Court implicitly ruled that the third party claims did not relate back to the successfully pled initial complaint, nor was there any exception that could save and preserve the third party claims. Accordingly, in broadly interpreting the preclusive language in the New Hampshire statute, that state’s highest court found that the statute does in fact means what it says and it does bar indemnification and contribution based claims that are not filed within the 8 year period established by the statute. While the Rankin decision is of course only binding in New Hampshire lawsuits the straightforward issue the case presents and the near universal presence of statutes of repose in other states suggests the case decision will be instructive to other state courts that consider this issue.
If you have any questions or would like more information, please contact Jeff Alitz at [email protected]