{"id":892991,"date":"2017-10-04T12:15:19","date_gmt":"2017-10-04T18:15:19","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=892991"},"modified":"2017-10-04T12:15:19","modified_gmt":"2017-10-04T18:15:19","slug":"new-jersey-supreme-court-clarifies-statute-limitations-construction-defect-cases","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/new-jersey-supreme-court-clarifies-statute-limitations-construction-defect-cases\/","title":{"rendered":"New Jersey Supreme Court Clarifies Statute of Limitations in Construction Defect Cases"},"content":{"rendered":"<p>Christopher J. Marino and Timothy J. DeHaut | <a href=\"https:\/\/www.natlawreview.com\/article\/new-jersey-supreme-court-clarifies-statute-limitations-construction-defect-cases\" target=\"_blank\">National Law Review<\/a> | September 27, 2017<\/p>\n<p class=\"rtejustify\">In\u00a0<em>The Palisades at Fort Lee Condominium Association, Inc. v. 100 Old Palisade, LLC<\/em>, ___ N.J. ___ (2017), the plaintiff was the Condominium Association that brought suit based upon defects in the condominium building after the Association took over control from the Sponsor and after the Association obtained its own engineering report.\u00a0 Summary judgment on statute of limitations grounds was obtained by the defendants in the trial court; the Appellate Division reversed.\u00a0 The New Jersey Supreme Court held that a cause of action for construction defects, for statute of limitations purposes, accrues when\u00a0<em>any owner<\/em>\u00a0in the chain of title \u201cfirst knows or reasonably should know of the actionable claim against an identifiable party.\u201d\u00a0 A plaintiff\u2019s case must be commenced within six years after a claim \u201caccrues.\u201d\u00a0 The general rule is that accrual begins upon substantial completion of the project.\u00a0 However, under the \u201cdiscovery rule\u201d the statute begins to run from when a plaintiff \u201cknows or reasonably should know of an actionable claim against an identifiable defendant.\u201d\u00a0 The Court has now made it clear that if an \u201cearlier owner knew or should have known of a cause of action against an identifiable defendant, then the accrual clock starts then.\u201d\u00a0 \u201cThe statute of limitations clock is not reset every time property changes hands.\u201d<\/p>\n<p class=\"rtejustify\">Thus, the plaintiff Association in\u00a0<em>The Palisades<\/em>\u00a0took title subject to the rights of the prior two owners \u2013 the entity that operated the building as apartments and the second entity which converted the units to condominiums.\u00a0 The second owner had obtained an engineering report during its ownership.\u00a0 Based on the facts before it, the Court remanded the case for a so-called\u00a0<em>Lopez<\/em>\u00a0hearing, in order to determine when the Association\u2019s claims accrued.\u00a0 The Court made it clear that it is the plaintiff\u2019s burden, for the purposes of the\u00a0<em>Lopez<\/em>\u00a0hearing, to prove that its claims accrued sometime later than substantial completion.<\/p>\n<p class=\"rtejustify\">While the issue was not specifically before it, the Court also took the opportunity to address the ten year statute of repose.\u00a0 This statute begins to run upon a project\u2019s substantial completion; the ten years sets the outer limit for filing of a construction defect claim.\u00a0 This outer limit remains unaffected by the decision in\u00a0<em>The Palisades<\/em>.\u00a0 \u201cFor example, if for purposes of the property-damage statute of limitations \u2026 a construction-defect action accrues eight years after a project\u2019s substantial completion, a plaintiff will have only two years to file a claim before it is barred by the repose statute.\u201d\u00a0 Thereafter, a claim will still be barred by the statute of repose.<\/p>\n<p class=\"rtejustify\">The holding in\u00a0<em>The Palisades<\/em>\u00a0has significant potential impact on construction defect property damage\/tort claims as it can mean that there is a significantly shorter time period within which plaintiff Associations must file suit over claimed defects as the Associations will be charged with knowledge of an actionable claim that is possessed by a Sponsor.\u00a0 On the flip side, this decision also imposes on Developers\/Sponsors the need to be diligent about pursuing claims of which it becomes aware, particularly in slow-selling communities.\u00a0 The holding also potentially impacts how Successor Sponsors approach transactions for existing or partially-complete communities.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Christopher J. Marino and Timothy J. DeHaut | National Law Review | September 27, 2017 In\u00a0The Palisades at Fort Lee Condominium Association, Inc. v. 100 Old Palisade, LLC, ___ N.J. ___ (2017), the plaintiff was the Condominium Association that brought suit based upon defects in the condominium building after the Association took over control from&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/new-jersey-supreme-court-clarifies-statute-limitations-construction-defect-cases\/\">Continue reading <span class=\"screen-reader-text\">New Jersey Supreme Court Clarifies Statute of Limitations in Construction Defect Cases<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[4],"tags":[9895,19,139,187],"class_list":["post-892991","post","type-post","status-publish","format-standard","hentry","category-construction-defects","tag-advise-consult","tag-construction-defects-2","tag-new-jersey","tag-statute-of-limitations","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>New Jersey Supreme Court Clarifies Statute of Limitations in Construction Defect Cases - Advise &amp; 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