THE STATUTE OF REPOSE:
RECENT DEVELOPMENTS AND
PRACTICAL SUGGESTIONS ON ITS USE

1. What is it and where do I find it?
2. Who's protected and who's not?
1. An improvement to real property
2. One who constructs or repairs an improvement
3. Substantial completion of the improvement
3. Is the statute of repose invincible?
1. Injury occurs during 10th year
2. Written warranty, guaranty or other contract
3. Actual possession at time damage, injury or death occurs
4. Willful misconduct or fraudulent concealment
4. How can I make it work for me?
1. Owner/General Contractor's Perspective
2. Subcontractor's Perspective
5. Conclusion
6. Appendix

Abstract

A repose statute is one which is enacted for the express purpose of insulating persons involved in the construction business from endless liability on projects long since completed. A repose statute differs from a statute of limitations in that a limitations statute commences with the accrual of the plaintiff's cause of action. In the typical case, a cause of action may not accrue for many years after the wrongful act or omission which proximately causes an injury. By contrast, a repose statute establishes a definitive time period during which all lawsuits must be filed, and, if not, such lawsuits are barred forever. See Trinity River Authority v. URS Consultants, Inc., 889 S.W.2d 259, 261 (Tex. 1994). One court has characterized a repose statute as a substantive definition of rights rather than a procedural limitation of rights. Lamb v. Wedgewood South Corp., 302 S.E.2d 868, 872 (1983).

Many states have statutes of repose which protect a limited class of persons involved in the construction business. In Texas, we have two such statutes. The first statute (now Tex.Civ.Prac. & Rem. Code §16.008) was enacted in 1969 for the purpose of limiting the liability of architects and registered or licensed engineers for acts involving the design or inspection of improvements to real property. The second statute (now Tex.Civ.Prac. & Rem. Code §16.009) was enacted in 1975 for the purpose of granting the same protection to persons who construct or repair improvements to real property. The Appendix contains the current versions of each of these statutes. For a discussion of the legislative intent in enacting the statutes of repose, review Judge Fisher's opinion in Dayton Independent School District v. U.S. Mineral Products Co., 800 F.Supp. 1439, 1432-37 (E.D. Tex. 1992).

Statutes of repose in the United States vary in how an improvement to real property is defined and the length of the period of repose, but generally they all provide a mechanism whereby persons who engage in construction annexed to real property are protected from liability. The Texas statutes of repose have been held constitutional in the face of due process, open courts, and equal protection challenges under both the Texas and United States Constitutions. Barnes v. J.W. Bateson Co., Inc., 755 S.W.2d 518 (Tex.App.--Fort Worth 1988, no writ); Dubin v. Carrier Corp., 798 S.W.2d 1 (Tex.App.--Houston [14th Dist.] 1989, writ dism'd by agreement); Reames v. Hawthorne-Seving, Inc., 949 S.W.2d 758 (Tex.App.--Dallas 1997, writ denied).

This paper is not meant as an extensive overview of all cases which have attempted to interpret the statutes of repose. Rather, it is a review of the current law regarding the statutes. For a comprehensive review of the subject, I would refer you to a law review article by David E. Colmenero, "Manufacturers May Claim Repose Under Section 16.009 Only If They Install Their Products Onto Real Property: The Supreme Court Corrects Misguided Lower Court Opinions: Sonnier v. Chisholm-Ryder Co., 909 S.W.2d 475 (Tex. 1995)", 27 Tex.Tech.L.Rev. 1595 (1996).

A statute of repose has great potential for protecting contractors, but it can also create a hazard to those who are less than vigilant. It is important for attorneys representing owners, general contractors, and subcontractors to review the contracts and advise their clients of the benefits and the hazards associated with the statute of repose.

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