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Statute of repose not limited to vicarious liability

The statute of repose bars a claim based on the defendant contractor’s own conduct, the Court of Appeals held in Maxwell v. Atlantic Richfield Co., 15 Wn. App. 2d 569, 476 P.3d 645 (2020).

In that case, an oil company hired a general contractor in 1968, to design and construct a refinery. The insulation subcontractor used insulation containing asbestos. Its method of handling the materials allegedly released asbestos dust into the air. The project was completed in the early 1970s. A former refinery employee was diagnosed with mesothelioma in 2018. The personal representative of his estate sued the general contractor and subcontractor for causing his exposure to asbestos.

The contractors moved for summary judgment, arguing the claim was time-barred by the construction statute of repose. A statute of repose terminates a plaintiff’s right to file a claim after the specified time even if the injury has not yet occurred or the claim has not otherwise accrued. It differs from a statute of limitations, which does not begin to run until a claim accrues. RCW 4.16.300 and -.310 provide a six-year limit for claims arising from the construction, alteration or repair of an improvement upon real property.

The estate argued (1) the contractors did not satisfy the statute and (2) the version of the statute as amended in 2004 applied. The trial court granted summary judgment, and the estate appealed.

The Court of Appeals rejected the estate’s argument that the statute of repose must be interpreted narrowly to bar only those claims based on vicarious liability or circumstances beyond the contractor’s control, not the contractor’s liability for its own negligence. The court recognized that the statute is intended to protect a defendant from stale claims that could arise many years after the construction at issue has been completed. Additionally, the statute’s plain language, “all claims or causes of action of any kind,” is too broad to support the estate’s proposed narrow reading.

The Court of Appeals also rejected the estate’s argument that the case did not involve construction activities. The estate posited that, because the general contractor agreement with the owner was on a cost plus basis, the transaction was a sale of materials. However, the court pointed out that sale of materials is not equivalent to being reimbursed for actual costs incurred – not only costs for materials purchased, but also other expenses like labor and machinery.

Finally, the Court of Appeals rejected the argument that the contractors did not make improvements on real property. The statute of repose applies to construction of the structure as a whole, including systems integrated into the structure itself. The estate argued a question of fact remained about whether installing the insulation could be considered constructing the structure itself or an integrated system. The court disagreed, finding no dispute on this point because the contract scope included insulating portions of the refinery itself, and the installation of insulation was part of the original construction project.

As to the 2004 amendment that the estate argued would prevent summary judgment, the court adopted another division’s determination that the version in effect at the time of substantial completion applies. An amendment cannot reinstate claims that were already forever barred.

The Court of Appeals agreed that the six-year statute of repose barred the claim, and affirmed the trial court’s dismissal of the estate’s claim on summary judgment.

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