The Negligent Maintenance and Inspection Exception to the Builders’ Statute of Repose

WDC Journal Edition: Summer 2013
By: Justin F. Wallace, Nash, Spindler, Grimstad & McCracken

The Builders' Statute of Repose, Wis. Stat. § 893.89, creates a ten year “exposure period” during which claimants can bring a cause of action arising out of any problem with the design or construction of an improvement to real property. There are four exceptions to this cutoff set forth in Wis. Stat. § 893.89(4). One of the exceptions, subsection (c), states that the ten year exposure period does not apply to “[a]n owner or occupier of real property for damages resulting from negligence in the maintenance, operation or inspection of an improvement to real property.” This exception is the focus of this Article.

What it means to negligently maintain, operate, or inspect an improvement to real property is not explained by the statute. Many responses to motions for summary judgment on the statute of repose reference this exception, and oftentimes reports from an engineer or a “premises liability” expert will baldly assert that the property has been negligently maintained and/or inspected during the ten year window. The court may have difficulty granting such a motion in the face of these assertions as it must construe all reasonable inferences against the party asserting that the statute of repose bars the claim.[1]

Differentiating between claims for design or construction defects, which can be barred by the statute of repose, from claims arising out of negligent maintenance or inspection, which are excepted from the statute by subsection 4(c), can be difficult. Certainly, it can be argued that any defect could have been inspected and fixed in the ten years preceding the claim, and that the absence of such an inspection or even an allegedly-negligent inspection is the true basis of the claim. The same position can be taken with regard to maintenance: If you had only maintained the portion of the structure that resulted in the defect, this would not have happened. Thus, there seems to be substantial overlap between the analysis of the existence of a defect and the analysis of the duty to inspect and/or maintain the portion of the structure that results in a defect.

Courts have adopted two approaches to differentiate such claims. In Wisconsin, courts have used the distinction between a “structural defect” and an “unsafe condition associated with the structure” from Safe Place law as the basis for distinguishing such claims. If an alleged defect is “structural,” the claim can be barred by the statute of repose. If the defect is merely associated with the structure, but not actually “structural” itself, then the problem could truly be with maintenance or inspection, and the subsection 4(c) exception to the statute of repose may apply.

The second approach to distinguishing between the two is the one taken in Oklahoma, in which courts consider whether the claim arises out of a building code violation or not. If the claim does arise out of such a violation, the statute of repose will be applicable. If the claim does not arise out of a building code violation, the claim may be excepted from the statute of repose as arising out of negligent maintenance or inspection.

A. There Would Be No Meaningful Statute of Repose If It Could Be Overcome by Arguing that the Defect Was Negligently Maintained or Inspected Merely Because It Was Allowed to Remain.

Broadly construed, the “negligent maintenance or inspection” exception could swallow the entire statute of repose. As the Wisconsin Supreme Court reasoned in Hocking v. City of Dodgeville[2]:

Construing the phrase “maintenance, operation or inspection of an improvement to real property” to mean maintenance or operation of a nuisance would create an exception that swallows the rule. This is so because every improvement that is negligently designed could be considered an ongoing nuisance that the owner or operator negligently maintains by failing to correct.[3]

Thus, merely because a defect was allowed to remain is not necessarily a basis to apply the negligent maintenance or inspection exception. Instead, courts in Wisconsin and in other jurisdictions have developed different tests that make more coherent and consistent distinctions between the two situations.

B. Wisconsin—Grafting the “Structural Defect/Unsafe Condition” Distinction From Safe Place Law onto the Statute of Repose's Distinction Between Design/Construction Defects and Negligent Maintenance/Inspection.

The Wisconsin Safe Place Statute differentiates between “structural defects” and “unsafe conditions associated with the structure” to determine, among other things, whether a plaintiff needs to prove that a property owner had constructive notice of the alleged defect.[4] Summary judgment motions based on the statute of repose are often brought alongside motions relating to the Safe Place Statute because both consider alleged problems with buildings. The Wisconsin Supreme Court has been amenable to drawing the line between the statute of repose and the 4(c) exception by following the Safe Place Statute's distinction between a structural defect and an unsafe condition associated with the structure, applying the statute of repose to the former situation and the 4(c) exception to the latter situation. As the court held in Mair v. Trollhaugen Ski Resort:

Under the safe place statute, a failure to “maintain” correlates to an unsafe condition associated with the structure, and thus allegations of such defects do not fall under the purview of the builder's statute of repose. Thus, from a plain reading of the statute, we can conclude that [Wis. Stat.] § 893.89 bars safe place claims resulting from injuries caused by structural defects, but not by unsafe conditions associated with the structure, beginning ten years after a structure is substantially completed.[5]

No prior case law that had reached this conclusion. Although the court relied upon the “plain reading” of the Safe Place Statute and Builders' Statute of Repose, the court's connection between the two—while logical—appears to have been derived for the most part from the arguments of counsel.

Mair's decision to graft the Safe Place distinction onto an analysis of the 4(c) exception to the Builders' Statute of Repose has the benefit of a much richer history of cases from Safe Place law that can now be used to analyze factual scenarios in the statute of repose context. For example, prior case law under Safe Place law had analyzed the following factual scenarios and differentiated between "unsafe conditions" and "structural defects":

“Unsafe conditions associated with the structure” have been found in cases involving: improper lighting; the failure to remedy the movement of gravel that resulted in a height disparity between the edge of a paved parking lot and an abutting gravel strip; a loose window screen; and an improperly connected elevator motor. The common theme of these cases is that the property hazards arose from the failure to keep an originally safe structure in proper repair or properly maintained.

“Structural defects” have been found in cases involving: the failure to install a handrail along a staircase; a trapdoor that was not surrounded by a railing; a balcony railing that was not high enough; and a false ceiling that did not support a worker's weight.[6]

Due to Mair connecting Safe Place law to the Builders' Statute of Repose, these factual distinctions can now also serve as the basis for differentiating construction/design defect cases from negligent inspection/maintenance cases.

C. Oklahoma—Building Code “Aftercare or Cleanup”

An alternative approach is the one set forth by the Oklahoma Supreme Court in Gorton v. Mashburn.[7] Gorton used an analysis of whether a claim alleged building code violations or not as a way to distinguish “negligent maintenance and inspection” claims from design or construction defect claims.

In Gorton, the plaintiff slipped on a wooden bridge during a rainstorm. He contended that the bridge violated the building code and that the City was negligent per se in the bridge’s maintenance. The defendant moved for summary judgment, alleging that the claim was barred by the statute of repose. The plaintiff argued that the claim was excepted from the statute of repose because it alleged negligent maintenance and inspection. The defendants’ summary judgment motion was granted in the trial court, reversed by the court of appeals, and certiorari was granted by the Oklahoma Supreme Court.

The Oklahoma Supreme Court reversed the court of appeals and affirmed the trial court's decision, holding that the claim was barred by the statute of repose and the negligent maintenance/inspection exception did not apply. In doing so, the court expressed some frustration with the plaintiff, who had used the phrase “negligent maintenance” without acknowledging the true nature of his claim: "Resolution of the present cause requires statement of the obvious: Maintenance is not the same as nor synonymous with design and construction. Maintenance is best characterized as after-care or upkeep.”[8] The court concluded that because the plaintiff was alleging building code violations, he was actually alleging a defect in the design and construction of the bridge, the negligent maintenance/inspection exception did not apply, and his claims were therefore barred by the statute of repose.

In sum, analyzing whether a claim alleges building code violations as a basis for differentiating between design/construction defect claims and those alleging negligent maintenance/inspection, as the Oklahoma Supreme Court did in Gorton, sets forth an alternative approach to determining whether to apply the Builders' Statute of Repose or not.

Conclusion

Courts may have difficulty concluding that a plaintiff’s claim is barred on summary judgment by the statute of repose if the plaintiff characterizes the claim as one for negligent maintenance and inspection or there is expert testimony to that effect. By referring to the “structural defect”/”unsafe condition associated with the structure” distinction set forth by the Wisconsin Supreme Court in Mair, or by relying on Oklahoma case law making use of the building code to differentiate between the two situations, the defense practitioner will be on more solid ground to argue for application of the statute of repose to bar the plaintiff's claim.


[1] The Wisconsin Supreme Court recently noted, in a statute of repose case, that “[s]ummary judgment should not be granted, ‘unless the facts presented conclusively show that the plaintiff's action has no merit and cannot be maintained.’” Kohn v. Darlington Cmty. Sch., 2005 WI 99, ¶ 11, 283 Wis. 2d 1, 698 N.W.2d 794 (quoting Mayberry v. Volkswagen of Am., 2005 WI 13, ¶ 15, 278 Wis. 2d 39, 692 N.W.2d 226) (additional internal quotations and citations omitted).

[2] 2010 WI 59, 326 Wis. 2d 155, 785 N.W.2d 398.

[3] Id., ¶ 47.

[4] See Barry v. Employers Mut. Cas. Co., 2001 WI 101, ¶¶ 22-23, 245 Wis. 2d 560, 630 N.W.2d 517.

[5] See Mair v. Trollhaugen Ski Resort, 2006 WI 61, ¶ 29, 291 Wis. 2d 132, 151, 715 N.W.2d 598.

[6] See Barry, 245 Wis. 2d 560, ¶¶ 27, 29.

[7] 995 P.2d 1114 (Okla. 1999).

[8] Id. at 1116 (emphasis in original).