Calder v. City of Crystal
| Decision Date | 23 April 1982 |
| Docket Number | No. 81-38.,81-38. |
| Citation | 318 NW 2d 838 |
| Parties | Jack M. CALDER, et al., Plaintiffs, v. CITY OF CRYSTAL, defendant and third-party plaintiff, Appellant, Richard E. Hipp, individually and d/b/a Hipp Construction Co., Hipp's Construction Co., and Northern Contracting Co., Third Party Defendants, William D. Schoell, individually and d/b/a Caswell and Schoell, third-party defendants, Respondents. |
| Court | Minnesota Supreme Court |
Cousineau, McGuire, Shaughnessy & Anderson, Henry A. Cousineau, Jr., and Barbara A. Burke, Minneapolis, for defendant and third-party plaintiff, appellant.
Meagher, Geer, Markham, Anderson, Adamson, Flaskamp & Brennan and J. Richard Bland, Minneapolis, for Schoell.
Heard, considered, and decided by the court en banc.
This is an appeal from the grant of third-party defendant Schoell's motion for summary judgment. This motion was based on the ground that the City of Crystal's cause of action against Schoell for contribution or indemnification was barred by Minn.Stat. § 541.051 (1980). Only the City of Crystal and Schoell are parties to this appeal; the other third-party defendants, Hipp and Northern, have agreed to abide by the determination. The original matter is currently pending in district court.
Appellant, City of Crystal, contends that Minn.Stat. § 541.051 (1980) does not apply to the city's cause of action against the third-party defendants or, if it does apply, that the statute is unconstitutional as a denial of equal protection and a denial of due process. The Attorney General has been notified pursuant to Rule 144 of the Minnesota Rules of Civil Appellate Procedure and has declined to intervene. We affirm.
Plaintiffs, all residents of defendant City of Crystal, brought this action in June 1979 in Hennepin County District Court to recover for property damage to their homes of approximately $351,200 allegedly sustained during heavy rainfalls in June and July of 1978. Plaintiffs claimed the city's negligent design, installation, and maintenance of the water drainage system was the proximate cause of the damage.
Approximately 15 months after the initiation of that lawsuit, the city impleaded, with the district court's permission, the designers and installers of the drainage system. The city alleged that it was entitled to indemnification or contribution for any sums it might be required to pay plaintiffs. The city served the third-party summons and complaint upon Northern in August 1980, upon Schoell in September 1980, and upon Hipp in December 1980.
Hipp was the general contractor of the water drainage system located in the area of Hampshire Avenue North and 36th Avenue North in Crystal, Minnesota. He subcontracted the design of the system to Schoell and the construction of the system to Northern. Affidavits from each of the third-party defendants verify that the design and installation of the system was substantially completed by April 29, 1958.
Schoell moved for summary judgment, arguing that because more than 22 years had elapsed since substantial completion of the water drainage system, the City of Crystal's claim for contribution or indemnification was barred by Minn.Stat. § 541.051 (1980). The Hennepin County District Court granted Schoell's motion on October 24, 1980, without accompanying memorandum and entered judgment on November 3, 1980. This appeal followed.
A brief summary of the history of section 541.051 is helpful in reviewing the significance of various dates in this case. The Minnesota Legislature first enacted the statute in 1965. Act of May 21, 1965, ch. 564, § 1, 1965 Minn.Laws 803. In 1977, this court held Minn.Stat. § 541.051 (1965) unconstitutional because it granted immunity from suit to a certain class of defendants without a reasonable basis for the classification. Pacific Indemnity Co. v. Thompson-Yaeger, Inc., 260 N.W.2d 548 (Minn.1977). In 1980, the legislature amended section 541.051, seeking to cure the constitutional defects. Act of April 7, 1980, ch. 518, §§ 2-4, 1980 Minn.Laws 595-96. This amended version became effective August 1, 1980. Minn.Stat. § 645.02 (1980).
The following time line is provided for assistance:
The issues on appeal are:
Minn.Stat. § 541.051 (1980) provides:
The city's position is that when the events giving rise to this lawsuit occurred in June and July of 1978, the city had an inchoate right to contribution or indemnity. It argues that the application of section 541.051, which became effective on August 1, 1980, to its cause of action would give the statute retroactive application,1 contrary to Minn.Stat. § 645.21 (1980).2 The keystone to the city's argument is its claim that it had acquired a cause of action prior to the effective date of Minn.Stat. § 541.051 (1980).
In Grothe v. Shaffer, 305 Minn. 17, 232 N.W.2d 227 (1975), this court was called upon to determine at what point a cause of action for contribution accrues and the statute of limitations begins to run. After rejecting the argument that a cause of action for contribution accrues when the original action is commenced, we noted:
A claim for contribution does not accrue or mature until the person entitled to the contribution has sustained damage by paying more than his fair share of the joint obligation. Gustafson v. Johnson, 235 Minn. 358, 51 N.W.2d 108 (1952). Thus, the statute of limitations does not begin to run on the claim of one joint tortfeasor for contribution from another joint tortfeasor until one of the joint tortfeasors had paid more than his fair share of the damage. State Farm Mutual Auto. Ins. Co. v. Schara, 56 Wis.2d 262, 201 N.W.2d 758, 57 A.L.R.3d 922 (1972).
Id. at 23-24, 232 N.W.2d at 232. Indicating that this was also the conclusion reached by virtually every jurisdiction that has considered the question,3 we then applied these basic rules to a third-party complaint situation and concluded:
The third-party claim is thus contingent on the outcome of the original action and upon the payment by one joint tortfeasor of more than his fair share of the common obligation. 1 Hetland & Adamson, Minnesota Practice, Civil Rules Ann., p. 508. When a right is dependent on a contingency, the cause of action accrues and the statute begins to run on the date of the happening of the contingency. Bachertz v. Hayes-Lucas Lumber Co., 201 Minn. 171, 275 N.W. 694 (1937). An action for contribution remains contingent until that time when the obligation of one joint tortfeasor is fixed, and that does not occur until the joint tortfeasor has paid more than his fair share of the damage.
Id. at 25-26, 232 N.W.2d at 233.
Similarly, a claim for indemnity does not arise generally at the time of the injury, but upon a showing that liability has been incurred. Altermatt v. Arlan's Department Stores, 284 Minn. 537, 169...
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