6-year statute bars contractor indemnity
By Steven G. Wraith

Washington’s six-year statute of repose for construction claims applies to claims of both written and equitable indemnity, the Washington Court of Appeals has held in Ledcor v. Nidash, 48337-4-I (Oct. 2002). The case could have far-reaching implications for the defense of construction-defect claims.

The Ledcor court held that the six-year contractor’s statute of repose, RCW 4.16.300 - .320, bars such indemnity claims if the underlying settlement or judgment on which indemnity is based occurs six years after substantial completion of the project. That statute bars all claims "arising from" constructing improvements to real estate that do not "accrue" within six years after substantial completion. The court also reaffirmed that the "discovery rule" applies to breach-of-contract claims in such cases.

In Ledcor, apartment owner Parkridge Associates sued Ledcor, a contractor, for workmanship failures and construction defects. Ledcor, in turn, sued subcontractor Freeman Roofing for breach of contract and contractual and equitable indemnity. The date of substantial completion on the project was December 30, 1993, but Freeman continued to work on the project until December 5, 1994.

Parkridge sued Ledcor on November 29, 1999. On May 19, 2000, Ledcor tendered defense of the suit to Freeman, which provided roofing, waterproofing, and other work on the project. Freeman did not accept that tender, so Ledcor commenced a third-party action against Freeman on August 19, 2000. On December 22, 2000, Parkridge and Ledcor reached a mediated settlement. Freeman did not participate in the settlement. Ledcor then pursued its third-party claim against Freeman, alleging that Freeman’s defective work accounted for a significant portion of the settlement payment to Parkridge.