Statute of Repose: A Recent Case

Statute of Repose: A Recent Case

Written by Randall C. Lenhart, Jr.

Edited by Bill Pfund

A statute of repose, like a statute of limitations, extinguishes certain legal rights if they are not brought within a specified deadline.  The difference is that a statute of limitations generally begins to run when a plaintiff’s cause of action accrues while a statute of repose commences to run from the occurrence of an event that is unrelated to the accrual of a cause of action.  Virginia’s statute of repose is found at Virginia Code § 8.01-250 and provides that:

No action to recover for any injury to property, real or personal, or for bodily injury or wrongful death, arising out of the defective and unsafe condition of an improvement to real property, nor any action for contribution or indemnity for damages sustained as a result of such injury, shall be brought against any person performing or furnishing the design, planning, surveying, supervision of construction, or construction of such improvement to real property more than five years after the performance or furnishing of such services and construction.

The limitation prescribed in this section shall not apply to the manufacturer or supplier of any equipment or machinery or other articles installed in a structure upon real property, nor to any person in actual possession and in control of the improvement as owner, tenant or otherwise at the time the defective or unsafe condition of such improvement constitutes the proximate cause of the injury or damage for which the action is brought; rather each such action shall be brought within the time next after such injury occurs as provided in §§ 8.01-243 and 8.01-246.

The Supreme Court of Virginia recently addressed Virginia’s statute of repose and the limitation found in the second paragraph dealing with “equipment” in Brian C. Potter, Personal Representative of the Estate of Daniel C. Potter, Deceased v. BFK, Inc., 2021 Va. LEXIS 87 (July 22, 2021).  In Potter, the decedent was injured in August 2015 inside a silo after a hopper containing stone material ruptured.  In 2007, Decedent’s employer had replaced some of the equipment inside the silo with products manufactured by Defendant BFK, Inc.  Therefore, the defendant argued in a Plea in Bar that Virginia’s statute of repose barred the plaintiff’s claim because more than five years had passed between when the products were installed in 2007 and when the accident occurred in 2015.  The plaintiff countered that the claim was not time barred because the defendant’s products were “equipment” and not ordinary building materials subject to the five year deadline.  The circuit court sustained the Plea in Bar and held that the defendant’s products were ordinary building materials and the plaintiff’s claim was barred by the five year statute of repose.

On appeal, the Supreme Court of Virginia reversed the judgment of the circuit court and remanded the case for further proceedings.  In its opinion, the Court noted that the Virginia General Assembly’s intent in drafting the statute of repose was “to perpetuate a distinction between, on one hand, those who furnish ordinary building materials, which are incorporated into construction work outside the control of their manufacturers or suppliers, at the direction of architects, designers, and contractors, and, on the other hand, those who furnish machinery or equipment.”  The former may rely on the statute of repose while the latter may not.

In Potter, the Court held that several facts must be analyzed to determine whether or not the defendant’s products were “equipment,” which were not covered by the statute of repose, including (1) the level of quality control exerted by the manufacturer, (2) the existence of a voidable manufacturer’s warranty, (3) the existence of use and/or installation instructions directly from the manufacturer, (4) whether the action at bar arises from a non-fungible part of the land or building and (5) whether the products were fully assembled, independent mechanical devices that are not essential structural components of a structure or building.  After weighing these factors, the Court held that the Defendant’s products were “equipment” and not ordinary building materials subject to the five year deadline.  Importantly, the Court noted that the defendant’s products were used for a specific purpose unrelated to the structural integrity of the building itself, the defendant exerted some degree of control over the installation and maintenance of its products, the products were not required for the operation of the building, and they were not fungible nor generic.

The attorneys at KPM LAW would be happy to answer any questions you may have related to the applicability of Virginia’s statute of repose to your claim.

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