Company filed suit within applicable limitations

A construction company's attempt to cast itself in the same class of professionals as attorneys or architects was rejected by the Indiana Court of Appeals today. The appellate court upheld on interlocutory appeal the denial of the company's motion for summary judgment in a breach of contract complaint.

In Powers & Sons Construction Co. Inc. v. Healthy East Chicago, No. 45A05-0904-CV-204, Powers & Sons filed a motion for summary judgment alleging Healthy East Chicago filed its complaint against the construction company for breach of contract outside of the applicable statute of limitations.

Healthy East Chicago hired Powers & Sons in late 1997 to serve as the construction manager for the building of a new health service facility. After construction was completed in December 1998, Healthy East Chicago discovered cracks in the floors, walls, and ceilings. The construction company claimed the cracks were normal because of movement and settling. In February 2007, Healthy East Chicago sued the company.

The dispute in this case is over which statute of limitations applies – Powers & Sons claimed a 2-year statute of limitations on injury to personal property applies; Healthy East Chicago argued the 10-year statute of limitations on contracts applies.

Even in the "broad and natural sense" of the term, Healthy East Chicago's building isn't personal property, wrote Judge Margret Robb. The building would typically be considered part of the real estate, so the appellate court rejected Powers & Sons argument that the 2-year statute of limitations applied.

Healthy East Chicago argued the substance of its action is in contract; Powers & Sons argued the action is in tort, citing Whitehouse v. Quinn, 477 N.E.2d 270, 272 (Ind. 1985). The construction company also attempted to claim it was in the same class as professionals that may be held liable in tort if they fail to exercise reasonable care in fulfilling their contractual duties, and that Healthy East Chicago's complaint is professional negligence.

"We have never held the responsibility of a general contractor to be akin to that of an attorney or a doctor, however," wrote Judge Robb. "The relationship between the parties and Powers & Sons's duties and responsibilities as general contractor arose from the contract rather than from a standard of care imposed by law."

Healthy East Chicago's complaint sought recovery of damages sustained as a result of Powers & Sons' failure to perform according to the contract, therefore, its complaint is governed by the 10-year statute of limitations applicable to written contracts, the appellate court ruled.