Statutes of Limitation and Repose

Talking Points

  • Adopt statutes of repose, which bar actions against design professionals after a certain period of time following the completion of services or the substantial completion of construction.
  • Statutes of repose do not absolve the design professional of all liability, but do provide protection against actions being brought many years after the completion of a project, for conditions the design professional cannot reasonably be held responsible.
  • Statutes of repose are preferable to statutes of limitation because it more narrowly limits the time period that a design professional can be held liable.

NSPE Position
NSPE supports the enactment of statutes of repose, which bar actions against design professionals after a certain period of time following the completion of services or the substantial completion of construction. These laws recognize that design professionals should not be held liable in perpetuity for their services and that the primary responsibility falls on the party in control the property-the owner.

NSPE also supports statutes of limitation, which bar actions against design professionals after a specified period of time following the date of injury or discovery of the deficiency.

Background
Professional engineers face a substantial degree of liability exposure for property damage, economic damages, bodily injury, and wrongful death.

Professional engineers were once insulated from liability exposure by the concept of privity, but a 1957 decision by a New York appeals court, Inman v. Binghamton Housing Authority (3 N.Y. 2d 137, 143 N.E. 2d 895), stripped design professionals of that liability protection. In Inman, the court found that design professionals were liable to parties to which they were not in privity.

As a consequence of Inman, suits against design professionals proliferated. Designers found themselves owing a duty of care to parties to whom no duty had been previously owed or contemplated. State legislatures responded to this situation by enacting statutes of repose.

Statutes of repose bar actions against design professionals after a defined period of time following the completion of services or the substantial completion of construction. Statutes of repose do not absolve the design professional of all liability. Rather they protect professionals from having to defend an action brought many years after a project has been completed, for conditions the design professional cannot reasonably be held responsible. The statutes are based on the general legal principle that a potential defendant in a lawsuit should not be required to defend him/herself against stale claims that could easily be based upon faded memories, lost evidence, or witnesses who have since disappeared. Stale claims are a possibility in the construction industry because the real property on which the services were performed may last several decades.

Statutes of repose differ from statutes of limitations in terms of the point of time from which the limitation is measured. Statutes of limitation begin at the date of injury or discovery of the deficiency. Since this discovery could occur at any time, the limitation can run indefinitely. Statutes of repose, on the other hand, begin at a period of time following the completion of services or the substantial completion of construction. This substantially narrows the time period in which the design professional is exposed to liability, making statutes of repose preferable to statutes of limitation.

References
Professional Policy 162 - Model Engineers' Statute of Repose
Professional Policy 150 - Responsibility of Engineers During Construction
A State-by-State Summary of Liability Laws Affecting the Practice of Engineering – Professional Liability Committee of the Professional Engineers in Private Practice, a division of NSPE, in cooperation with Victor O. Schinnerer & Co., Inc. – 2007

Issue Brief and Position: