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McGinty v. K. Hovnanian Companies of New Jersey, Inc.

A-6100-07T3 (N.J. Super. App. Div. 2009) (Unpublished)

CONTRACTORS; STATUTE OF REPOSE — New Jersey’s Statute of Repose relating to construction and design defects bars all claims first filed more than ten years after the date of substantial construction, including those that might otherwise have been permitted to be filed by a person who was a minor at the time of his or her injury.

A husband and wife, with their two daughters, moved into a condominium in 1985. Shortly thereafter, and until the time they moved out in 2004, the family suffered from multiple allergies, including severe mold allergy; chronic fatigue; depression; and abnormal blood cultures. They sued the condominium association and various other parties claiming that they became sick, sore, and disabled and had been diagnosed with “sick building syndrome” as a result of the wrongful exposure to toxic substances.

The lower court dismissed the homeowners’ complaint against the developer. It found the claims were barred by the New Jersey Statute of Repose (relating to construction and design defects) because it had been filed after the ten-year statutory limitation had run. It ruled that the claims against the condominium association were not barred because the statute did not apply to condominium associations. The lower court later dismissed the claims by one of daughters against the condominium association and against the plumbing contractor because they were filed after the time permitted by a minor to sue for personal injuries. Stipulations were filed dismissing the claims against the remaining defendants. The homeowners and their children appealed, arguing that the lower court erred by finding that the Statute of Repose prohibited them from pursuing their claims against the developer.

The Appellate Division affirmed, holding that the Statute of Repose is unlike the typical statute of limitations because the time within which suit may be brought under the statute is entirely unrelated to the accrual of any cause of action. It noted that statute’s effect is to prevent what might otherwise be a cause of action from ever arising. Thus, the Court found that an injury occurring more than ten years after the negligent act formed no basis for recovery. It also held that the statute is not tolled even if the cause of action accrued during an injured party’s infancy. The record was clear that the complaint was filed more than ten years after the date of substantial completion of the unit itself. It also rejected the homeowner’s argument that the statute began to run upon substantial completion of the entire condominium project as opposed to substantial completion of their own unit. Finally, there was no valid claim against the developer for negligent repairs after the initial construction because these repairs were also made more than ten years before the action was instituted and were thus barred by the Statute of Repose.

As to the homeowner’s claims that the lower court improperly dismissed claims against the condominium association and the plumber because of the Statute of Repose, the Court stated that there was no basis for any appeal because these matters were settled by stipulation. The Court also ruled that the lower court was correct when it determined that the two-year statute of limitations barred a claim against the developer by one of the daughters.

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