The Connecticut Supreme Court recently reversed, in a unanimous published opinion, a trial court's entry of summary judgment in favor of 27 defendants involved in the allegedly defective design and construction of the University of Connecticut Law School's law library. In State of Connecticut v. Lombardo Brothers Mason Contractors, Inc., the court rejected the defendants’ claims that the state waited too long to file suit, finding that Connecticut’s statutes of limitations and repose did not apply. The court remanded the case for further proceedings, breathing new life into the state’s lawsuit.
The library experienced water intrusion problems starting soon after its construction was completed in January 1996, requiring the state to make more than $15 million in repairs. The defendants, including construction and design professionals, prime contractors, subcontractors, product suppliers, and sureties, asserted that because the state waited more than 12 years, until March 2008, to bring suit, all claims were barred by Connecticut's statutes of limitations and repose. (Statutes of limitations bar a right of action unless it is filed within a specified time after an injury occurs. Statutes of repose terminate any right of action after a specific time has elapsed, regardless of whether there has as yet been an injury).
The trial court granted summary judgment to all of the defendants under Connecticut's seven-year statute of repose. It also ruled that one contractor was entitled to summary judgment on the additional ground that its contract provided that the state expressly agreed to be bound by "any statutory period of repose then otherwise applicable to professional design work."
The state supreme court held, however, that under the ancient common-law rule of “nullum tempus occurrit regi,” meaning “time does not run against the king,” the statutes of limitations and of repose do not apply to the state. The court also held that to the extent the chief deputy commissioner of public works intended to contractually waive the repose period, the waiver was ineffective because the commissioner lacked specific authority to do so.
The decision raises a number of issues regarding how firms dealing with a sovereign entity should price bids for public works, evaluate litigation risk, determine the number of years of insurance coverage to maintain for completed projects, determine how long to retain project documentation, and evaluate whether a state or state agency's representative has authority to bind the state to contractual terms.
The answers will likely vary from state to state and even agency to agency. For example, in a 2011 Pennsylvania case, Selinsgrove Area School District v. Lobar, Inc., the Commonwealth Court ruled in a matter of first impression that under state law, the nullum tempus doctrine can be waived as a contractual matter. In that case, a school district sued contractors over alleged negligence in the construction of a school.
Because the contract demonstrated by clear and unambiguous language the intent of the school district to negate the applicability of nullum tempus, the court ruled that "where a Commonwealth agency has offered and entered into a contract addressing applicable statutes of limitations with no mention of the nullum tempus doctrine, it would be fundamentally unfair and contrary to public policy in general to permit the agency to nullify provisions of the same contract by subsequently invoking the doctrine."
Given such variations, businesses seeking to contract with a sovereign entity or state agency should pay careful attention to the applicable jurisdiction's laws and precedent regarding the nullum tempus doctrine in drafting the contract.