- Breach of Contract/Warranty – action must be brought within 6 years of completion or abandonment of construction, unless contract provides for a different period of time.
- All other Actions – within 2 years of discovering the cause of action, but in no event can an action be brought more than 9 years after completion or abandonment of construction, although 2 years are allowed from discovering the cause of action if that occurs in the 8th or 9th year after construction or abandonment of construction.
Introduction: The time frames in which claims for damages related to improvements to real property are limited by statute and further limitations can be imposed by contract. Some of the limitations require claims to be brought within a certain time from the claim becoming apparent. Other limitations limit claims regardless of when they are discovered or made apparent. Utah code section 78B-2-225 governs these statutory limitation. A brief summary of the section follows.
Applicable Parties: The statute applies to “providers,” which the legislature defines as “any person contributing to, providing, or performing studies, plans, specifications, drawings, designs, value engineering, cost or quantity estimates, surveys, staking, construction, and the review, observation, administration, management, supervision, inspections, and tests of construction for or in relation to an improvement.” § 78B-2-225(1)(f). The legislature has stated that exposing providers to suits and liability for breach of duty after the possibility of injury or damage has become highly remote creates costs and hardships to providers and the Utah’s citizens. §78B-2-225(2)(a). According to the legislature, those “costs and hardships constitute clear social and economic evils.” § 78B-2-225(2)(c).
Statute of Limitations: To overcome the social and economic evils, the legislature has provided that an action by or against a provider based on a contract or warranty must commence within six years of the completion of the improvement or abandonment of construction. However, if a provision in an express contract (could be an oral contract) or warranty provides for a different limitation period, the contractual period shall apply. § 78B-2-225(3)(a). All other actions by or against a provider must be commenced within “two years from the earlier date of discovery of a cause of action or the date upon which a cause of action should have been discovered through reasonable diligence.” § 78B-2-225(3)(b) (italics added).
Statute of Repose: Notwithstanding Subsection (3)(b), an action may not be commenced against a provider more than 9 years after completion of the improvement or abandonment of construction. Two more years is allowed if the injury is discovered or should have been discovered in the eighth or ninth year. § 78B-2-225(4).
The 9 year statute of repose does not apply to a provider who has fraudulently concealed his act, error, etc., or has willfully or intentionally acted, erred, etc. § 78B-2-225(5).
Other Provisions: If a person is entitled to bring an action but does not because the person was a minor or mentally incompetent and without a legal guardian, that person will have two years from the date the disability is removed to commence an action. § 78B-2-225(6)
The section does not apply to an action for the death of or bodily injury to an individual while engaged in the design, installation, or construction of an improvement. § 78B-2-225(7). Furthermore, the time limitation does not apply to an action against a person in actual possession or control of an improvement at the time the defective or unsafe condition proximately causes the injury. § 78B-2-225(8).
The section does not extend the period of limitation or repose otherwise prescribed by law or a valid contract. § 78B-2-225(9). Nor does the section create or modify any claim or cause of action. § 78B-2-225(10).