The Supreme Court of Minnesota has ruled that the MN statute of repose, for a multi-building condominium project, is determined on a building-by-building basis, and not on completion of the entire project. As noted below, a federal court judge in Massachusetts has certified a similar issue to the Massachusetts Supreme Judicial Court.
The court was faced with two issues. First, is the statutory warranty triggered by completion and occupancy of a unit, or completion of the entire building? Second, does the statute of repose trigger on a building-by-building basis or on completion of the entire community? (In this case there were two buildings, completed about one year apart.)
The court struggled with the statutory warranty issue: “the language of the statute does not fit comfortably with condominium developments.” It noted various sections of the statute which would appear to presume the construction and sale of a single-family residence. And it concluded that “there are two reasonable interpretations of when the ‘warranty date’ begins to run on a condominium.” One interpretation would be that the statutory warranty begins when the first owner takes possession, and the second interpretation is that each unit would have its own warranty date tied to the sale of that unit.
The court analyzed the nature of statutory warranties, but concluded that a consumer-protection purpose “does not compel a conclusion that the Legislature intended that each condominium unit is entitled to its own warranty date.”
Analysis of the statute of repose issue was not as complex (this is a thoughtful decision, and worth the read for those interested). The statute of repose refers to “an improvement to real property”, and the statute of repose ends ten years after substantial completion. Each building was an improvement, and each building had its own date of substantial completion. Thus, the court held that the statute of repose would commence, for each building, upon substantial completion of that building.
The outcome: statutory warranties and the statute of repose on condominiums, under Minnesota law, will be based on the completion of each building. Not on a unit-by-unit basis, and not on completion of the project as a whole when there is more than one building. The case is Village Lofts at St. Anthony Falls Ass’n v. Housing Partners, 2020 Minn. LEXIS 6 (Jan. 15, 2020.
In Massachusetts, a federal district court judge has certified the following question to the Massachusetts Supreme Judicial Court:
Where the factual record supports the conclusion that a builder or developer was engaged in the continuous construction of a single condominium development comprising multiple buildings or phases, when does the six-year period for an action of tort relating to the construction of the condominium's common or limited common elements start running?
The Massachusetts statute of repose is six years after substantial completion. That case is D'Allessandro v. Lennar Hingham Holdings, 2020 U.S. Dist. LEXIS 7568 (Jan. 16, 2020) (subscription required). More to come later in 2020, or after.
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