Violation of Home Improvement Contractor Act is Subject to Statute of Repose

A sharply divided Supreme Judicial Court has held that claims by a homeowner against a contractor, under the state home improvement contractor law, are subject to the statute of repose. Thus, when improper work done in 2001 was not discovered until 2012, a lawsuit commenced in 2016 was untimely. In fact, per the 4-3 decision, it was already too late for the homeowner’s claim when the problem was discovered in 2012.

The Massachusetts statute of repose, Mass. Gen. Laws c. 260, § 2B, bars tort claims arising from design or construction six years after substantial completion of the work. Thus, it cuts off the “discovery rule” even if the underlying cause of action is unknown or even inherently unknowable until six years have passed. Contract claims are unaffected by the repose bar.

This case arose from improper electrical wiring, performed in 2001, that started a fire in 2012. Until the fire and subsequent investigation, the homeowner had no knowledge of the improper wiring work. The homeowner then filed claims under the consumer protection law (chapter 93A) and the home improvement contractor law (chapter 142A). Massachusetts case law provides that violation of certain portions of the latter constitutes violation of the former. Thus, the argument concerned whether claims under c. 93A arising from a violation of c. 142A would be subject to the statute of repose.

The homeowner argued that the statute of repose does not apply to consumer protection claims under c. 93A. But the slim majority of the SJC said otherwise.

The homeowner noted that claims under c. 93A are based on statutory rights, and thus completely outside the orbit of tort claims. In response, the court discussed the need to examine the “gist of the action” in determining whether the claim sounded in tort or not.

The majority decision talked about the statute of repose providing certainty to contractors and designers, not allowing them to be sued in tort many years after providing services or performing work, and this recitation was a clear precursor to the court’s ultimate decision.

The court held:

Bridgwood’s claim is essentially that the defendants failed to perform the electrical work in compliance with the standards set forth in G.L. c. 142A, §17(10). It is indistinguishable from a claim of negligence. Therefore, it sounds in tort and, having been commenced well beyond the six-year deadline, is barred by G.L. c. 260, § 2B. Were we to hold otherwise, no contractor would ever be able to “put a project to rest.”

In sum, the majority held that the plaintiff’s claim was “sufficiently tort-like” to bring it within the ambit of the statute of repose. Frankly, the SJC provided no connection between a statutory violation and its statement that such a violation “is indistinguishable from a claim of negligence.”

The dissent noted that claims under c. 93A are subject to a four-year statute of limitations. It also noted that the statute of repose does not encompass claims arising under c. 93A. And it further noted that a plaintiff pursuing both tort claims and claims for violation of c. 93A would be entitled to the statute of limitations governing c. 93A claims. Parsing legislative history and the sequence of legislation establishing and addressing both c. 93A and c. 142A, the dissent argued that claims under c. 93A were not subject to the statute of repose. It noted prior precedent, whereby a claim that was a “tort-like statutory claim brought under c. 93A” (emphasis in original) would be subject to the four-year limitation for c. 93A, and not the three-year limitation for tort claims. And stated: “It does not make sense to exempt c. 93A claims from the statute of limitations in § 2B and yet still subject such claims to the statute of repose in § 2B.”

The dissent appears to provide more cogent analysis, in my view. But the other side had one more vote. The case is Bridgwood v. A.J. Wood Construction, Inc. (Mass. SJC, Aug. 29, 2018).