STATUS OF OHIO STATUTE OF REPOSE

The following is a summary of the current status of the Ohio Construction Statute of Repose R.C. 2305.131 (“SOR”). Briefs have been filed by parties as well as numerous Amicus briefs filed on behalf of interested parties. The Ohio Supreme Court has set oral argument for March 5, 2019 at 9:00 a.m. It is expected a ruling will be made later this year.

• The language of the statute states that it applies to all causes of action regardless of a conflicting statute of limitation;
• R.C. 2305.131 (G) defines “substantial completion” as “when the real property is first available for use” after having the improvement completed “in accordance with the contract or agreement” covering the improvement;
• R.C. 2305.131 (D) includes a carve out for warranty claims that would not be necessary if the statute did not apply to contract claims;
• R.C. 2305.131 (F) states the SOR “shall be applied in a remedial manner in any civil action commenced” on or after the effective date of the statute and per R.C. 1.11, which requires remedial laws to be liberally construed;
• Legislative history for the SOR indicates that the General Assembly recognized that designers and contractors have no control over maintenance, wear and tear, or prevention of intervening causes, and are disadvantaged by availability of witness and the lack of records, and that a ten year period strikes a fair balance between potential claimants and designers/contractors;
• If the legislative intent was to limit the SOR to “tort actions” then it would have been stated in the statute, but that term is not used;
• Other statutes of repose with similar legislative histories have been applied to bar claims even when the specific cause of action is not mentioned in the statute, citing the Ohio medical malpractice statute of repose; and
• The vast majority of other states with a similar SOR apply to contract and tort causes of action.

• Prior attempts by General Assembly to create SOR with substantially similar language were held to apply only to tort claims (determined later to be unconstitutional for other reasons);
• SOR applies to causes of action that “accrue” after ten years from substantial completion, whereas contract causes of action accrue at the time of breach, which is when the project is delivered to the owner. Since the contract statute of limitation for this project is 15 years, the SOR would render the statute of limitation meaningless if it applied to contract causes of action as well as tort;
• SOR applies only to causes of action asserting damages arising “out of a defective andunsafe condition.” If a cause of action does not assert that a design or construction caused an unsafe condition, then SOR does not apply; the use of “unsafe condition” supports the position that SOR only applies to tort claims because it contributes to bodily injury or injury to property;
• Legislative history indicates the intent was to override other statutes of limitation and specifically sets forth statutes which are tort statutes of limitations, indicating intent is to limit SOR to tort causes of action;
• Historical context of SORs is to protect designers and contractors from claims asserted by those not in privity more than ten years after substantial completion;
• The SOR only prevents claims from accruing after ten years – in this case the Appellee’s cause of action accrued within ten years of substantial completion and is thus not barred since breach accrued upon completion of building whereas a tort claim would accrue over ten years after substantial completion and thus be barred, which is what the General Assembly intended.