School District filed suit against its architect for fraudulent misrepresentation following subsidence of a coal mine beneath a school building. The factual dispute was whether the architect had provided sufficient notice to the school concerning the site conditions and the possibility of future subsidence. The applicable contract was the American Institute of Architects (AIA) “Standard Form of Agreement Between Owner and Architect.”
The Engineer filed a motion to dismiss the Owner’s claims because the period of time under the statute of limitations for filing suit had lapsed if it were measured from the date of Substantial Completion as stated in the contract. If, however, the normal “discovery” rule for learning of one’s alleged right to file suit were applied, the Owner might have had longer to file suit. The court determined the date of Substantial Completion and applied the contract language to judge the period by which the District had to file suit against the Architect. It granted summary judgment to the architect based on the running of the statute of limitations.
This was affirmed on appeal, with the appellate court not only applying the contract language but also rejecting the school district’s argument that there was no statute of limitations period for fraudulent misrepresentation claims. The court affirmed summary judgment for the architect. Gillespie Community Unit School District v. Wight & Company, 2104 Il 115330 (Illinois, 2014).
Comment: Rather than leaving it up to a court to determine from factual circumstances the date on which the statute of limitations should begin to run, it can alleviate a lot of headache and confusion to specify the date in the contract itself. That is what is accomplished by the AIA contract language that establishes the date of substantial completion as the date for measuring the statute of limitations period. This can avoid unnecessary arguments later on over whether or not the statue of limitations bars an action.
About the author: Article written by J. Kent Holland, Jr., a construction lawyer located in Tysons Corner, Virginia, with a national practice (formerly with Wickwire Gavin, P.C. and now with Construction Risk Counsel, PLLC) representing design professionals, contractors and project owners. He is founder and president of a consulting firm, ConstructionRisk, LLC, providing consulting services to owners, design professionals, contractors and attorneys on construction projects. He is publisher of ConstructionRisk.com Report and may be reached at Kent@ConstructionRisk.com or by calling 703-623-1932. This article is published in ConstructionRisk.com Report, Vol. 16, No. 3 (Mar 2014).
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