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Goodwin v. Kingsmen Plastering, Inc.

Court of Appeals of Oregon

December 10, 2014

J. MICHAEL GOODWIN and SHEILA GOODWIN, husband and wife, Plaintiffs-Appellants,
v.
KINGSMEN PLASTERING, INC., a Washington corporation; Defendant-Respondent, and KINGSMEN CONTRACTING, INC., a Washington corporation; and T & M PIPELINE, INC., an Oregon corporation, dba T & M Pipeline Construction, Inc., Defendants. KINGSMEN PLASTERING, INC., a Washington corporation, Third Party Plaintiff,
v.
UNITED COATINGS MANUFACTURING COMPANY, a Washington corporation, Third Party Defendant

Argued and Submitted August 13, 2014.

Benton County Circuit Court. 1110128. Locke A. Williams, Judge.

Christopher C. Grady argued the cause for appellants. With him on the briefs were Dean E. Aldrich and Aldrich Eike, P.C.

Jonathan W. Henderson argued the cause for respondent. With him on the brief were Davis Rothwell Earle & Xochihua, P.C., Katie L. Smith, and Henrie & Smith, LLP.

Before Garrett, Presiding Judge, and Ortega, Judge, and DeVore, Judge.[*].

OPINION

Page 170

[267 Or.App. 508] DEVORE, J.

Plaintiffs brought this action against defendants for damages arising out of alleged defects in the construction of their home. The trial court granted defendants' motion for summary judgment on the basis that, in the absence of a discovery rule, plaintiffs' claims were barred by the six-year statute of limitations in ORS 12.080(3), which governs actions for " interference with or injury to any interest of another in real property[.]" Plaintiffs appeal the resulting judgment and argue that ORS 12.080(3) includes a discovery rule. Defendants disagree and, in the alternative, contend that plaintiffs' claims are barred by the two-year statute of limitations in ORS 12.110(1). In two recent cases, discussed below, we have concluded that ORS 12.080(3) governs and contains a discovery rule. Accordingly, we reverse and remand.

In reviewing the trial court's grant of defendants' motion for summary judgment, we state the facts in the light most favorable to plaintiffs, the nonmoving party. Loosli v. City of Salem, 345 Or. 303, 306 n 1, 193 P.3d 623 (2008). Plaintiffs, Michael and Sheila Goodwin, purchased their home in December 2004. Defendant Kingsmen Plastering, Inc. (KPI), was the subcontractor responsible for installing the synthetic stucco siding--or exterior insulated finish system (EIFS)--during the construction of the home in 2001. Plaintiffs alleged that in May 2010, they discovered numerous construction defects in the EIFS, which resulted in water intrusion and hidden property damage to the home. On March 10, 2011, plaintiffs filed suit against KPI, Kingsmen Contracting, Inc. (KCI), and T& M Pipeline, Inc., asserting claims of negligence and negligence per se in the construction of the home.

KPI filed a motion for summary judgment, in which KCI joined, arguing that plaintiffs' claims were time-barred by the two-year statute of limitations for negligence claims in ORS 12.110. Defendants contended that plaintiffs were aware of potential claims

Page 171

more than two years before filing suit against defendants. Defendants' reliance on ORS 12.110 was largely predicated on dicta in a footnote in Abraham v. T. Henry Construction Inc., 350 Or. 29, 249 P.3d 534 (2011). [267 Or.App. 509] The Supreme Court described the facts in that case and the plaintiffs' discovery of water damage in their home more than six years after it was constructed. The court commented:

" The statute of limitations for contract actions is six years. ORS 12.080(1). Tort claims arising out of the construction of a house must be brought within two years of the date that the cause of action accrues, but, in any event, within 10 years of the house being substantially complete. ORS 12.110 ; ORS 12.135. Tort claims ordinarily accrue when the plaintiff discovers or should ...

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