DeVille Furniture Co. v. Jesco, Inc., 53932

• Decision Date: 22 December 1982
• Docket Number: No. 53932,53932
• Citation: 423 So.2d 1337
• Parties: DeVILLE FURNITURE CO. v. JESCO, INC., et al.
• Court: Mississippi Supreme Court

Page 1337

423 So.2d 1337

DeVILLE FURNITURE CO. v. JESCO, INC., et al.

No. 53932.

Supreme Court of Mississippi.

Dec. 22, 1982.

Rehearing Denied Jan. 12, 1983.

Holcomb, Dunbar, Connell, Khayat, Chaffin & Willard, Grady F. Tollison, Jr., Dan W. Webb, Oxford, for appellant.

Marc A. Biggers, Greenwood, Ralph L. Holland, Tupelo, Dan T. Bing, Clarksdale, Dennis W. Voge, F.M. Bush, III, Thomas D Before SUGG, P.J., and ROY NOBLE LEE and DAN M. LEE, JJ.

Murry, Tupelo, William Waller, Jr., Jackson, for appellees.

SUGG, Presiding Justice, for the Court:

This case was certified by the United States Court of Appeals for the Fifth Circuit as authorized by Mississippi Supreme Court Rule 46. The agreed statement of facts as set forth in the per curiam opinion of the Fifth Circuit follow as Part I, and the questions certified with our response follow as Parts II and III.

PART I

On August 23, 1971, DeVille Furniture Company (DeVille) entered into an agreement with Jesco, Inc. (Jesco) to construct a furniture plant for DeVille in Pontotoc, Mississippi. On January 24, 1972, a second contract was entered into between Jesco and DeVille for construction of an addition to the plant. Jesco employed A.J. Staub, III, (Staub) an architect, to develop specifications for the design of the plant. The design and specifications for the original building and the addition called for the equivalent of a "Barrett's 20-year type" built up roof over poured roof deck. Jesco assumed responsibility for the design and engineering, as well as being the general contractor for the original building and the addition.

Clark-Burt Roofing Company (Clark-Burt), roofing subcontractor, Cooper-Weir, Inc. (Cooper-Weir) and Abernathy & Clark Sheet Metal & Roofing Works, Inc. (Abernathy & Clark) roof deck subcontractors, and The Celotex Corporation (Celotex) and W.R. Grace & Co. (Grace), material suppliers, were involved in the construction of or furnishing of materials for the roof of the DeVille plant under Jesco's general contract.

In a separate agreement, Clark-Burt Roofing Company issued a guarantee that the work would be free from defective materials and workmanship for three years from the date of acceptance.

On February 26, 1972, Staub, the architect, gave DeVille written notice of substantial completion of the structure. As early as February, 1972, DeVille became aware of a problem with regard to the leaking of water into the plant through the roof. The problem with leaks in the roof continued, and on February 2, 1974, there was considerable seepage of water through the roof in one area of the plant. DeVille attempted to repair or patch the roof over a period of time using its own maintenance personnel. In February of 1972, Ken W. Davis, an employee of DeVille questioned a Jesco representative on the site about leaks; therefore, DeVille was aware of leaks. Jesco's job foreman informed Mr. Davis that there was no need to worry since the water dripping inside was caused by condensation.

DeVille contended that because of its reliance on Jesco's employee stating that the leaks were caused by condensation, it was unaware of the substantial, concealed deterioration of the roof until 1977-78. It was not until re-roofing was in progress in the summer of 1979 and gravel was removed from the old roof that it became apparent, according to DeVille, that the felt was exposed to weather, allowing water to seep through the roof. It was not known until then, according to DeVille, that double-coated felt was insufficient to provide a twenty-year type roof.

Clark-Burt was never notified on any problem with the roof prior to being served with process after the lawsuit was filed.

On January 4, 1979, six years and ten months after substantial completion and acceptance, DeVille commenced a diversity action by filing a complaint in the United States District Court for the Northern District of Mississippi, alleging that the general contractor, architect, roofing subcontractor and roof deck subcontractors had negligently designed and constructed and used and supplied improper materials in the construction of the roof on DeVille's plant. The primary complaint was that the roof was deficient in a number of respects, resulting in the leakage of water into the plant and necessitating eventual replacement On November 7, 1980, based substantially on language in M.T. Reed Construction Company v. Jackson Plating Company, 222 So.2d 838 (Miss.1969), the court in a bench opinion sustained a motion for summary judgment by the defendants, dismissing the action as barred by the six-year statute of limitations, Sec. 15-1-49, Miss.Code Ann. (1972).

of the roof. DeVille's complaint sought more than $300,000 to compensate DeVille for replacing the roof and for damage allegedly sustained by certain property inside the plant. The material suppliers were subsequently joined as third party defendants in this action.

DeVille has prosecuted an appeal to the United States Court of Appeals for the Fifth Circuit, contending, inter alia, that the six-year statute applied by the district court is not applicable to its cause of action, but rather that Sec. 15-1-41 Miss.Code Ann. (Supp.1981), provides the appropriate statute of limitation.

PART II

The first question presented for decision is whether the ten year limitation provision of Mississippi Code Annotated section 15-1-41 (Supp.1981), as amended subsequent to M.T. Reed Construction Company v. Jackson Plating Company, 222 So.2d 838 (Miss.1969) is applicable so that DeVille's complaint was timely filed against all the defendants.

Before answering the question certified by the Fifth Circuit, the historical background ¹ of the abolition of the doctrine of "privity of contract" ² should be noted. Architects, builders, and suppliers engaged in the design and construction of structures on real property mounted an offense in recent years against expanded liability thrust upon them as an indirect result of the decision in MacPherson v. Buick Motor Co., 217 N.Y. 382, 111 N.E. 1050 (1916). Before that time, courts had denied recovery to a third party against architects, builders, and other persons involved in the design and supervision of the construction of such structures for injuries sustained as a result of any defective or unsafe conditions in such structures. The denial was based on the privity of contract doctrine. However, in Inman v. Binghamton Housing Authority, 3 N.Y.2d 137, 164 N.Y.S.2d 699, 143 N.E.2d 895, 59 A.L.R. 1072 (1957), the "no privity of contract" ³ defense of an architect was found untenable. This gave rise to architects and builders being held liable in some states to parties who were injured as a result of defective or unsafe conditions in structures designed and erected by them. The expanded liability of architects and engineers to third parties was compounded by the fact that statutes of limitation afforded little or no protection because the limitation commenced on the date of the injury notwithstanding the fact that such injury might have occurred many years after the structure was completed and occupied by the owner.

The application of the "discovery" or "know or ought to know" ⁴ rule as to when an owner's claim against an architect or builder accrues compounded the potential liability of architects and builders. In this historical setting, architects and builders began to lobby for the adoption of statutes of limitation to ameliorate what they perceived In the light of this historical background, the Mississippi Legislature enacted Chapter 397 Mississippi General Laws of 1966 to fix a time within which actions could be brought against architects, builders and others arising out of any patent deficiency in the design or construction of a structure on real property. The statute was approved on June 15, 1966 before our decision in State Stove, supra, footnote 2, and appears as section 15-1-41 Mississippi Code Annotated (1972). ⁵ Chapter 397 provided:

to be an intolerable situation. During the two year period between 1965-1967, thirty states adopted, in one form or another, statutes similar to section 15-1-41. See Comment, Recent Statutory Developments Concerning Limitations of Actions Against Architects, Engineers and Builders, 60 Ky.Law Journal 462 (1971).

AN ACT to limit the time within which actions may be brought for patent deficiencies in design, planning, inspection, supervision or construction of improvements to immovable property or for property damage, personal injury or wrongful death arising from such deficiency.

Be it enacted by the Legislature of the State of Mississippi:

Section 1. No action to recover damages for injury to property, real or personal, or for an injury to the person, or for bodily injury or wrongful death, arising out of any patent deficiency in the design, planning, supervision or observation of construction, or construction of an improvement to real property, nor any action for contribution or indemnity for damages sustained on account of such injury except by prior written agreement to the contrary, may be brought against any person, firm or corporation performing or furnishing the design, planning, supervision of construction or construction of such improvement to real property more than ten (10) years after the written acceptance of such construction by the owner pursuant to the performance or furnishing of such services and construction. This limitation shall not apply to any person, firm or corporation in actual possession and control as owner, tenant or otherwise of the improvement at the time the defective and unsafe condition of such improvement constitutes the proximate cause of the damages or injury for which it is proposed to bring an action as heretofore controlled by other statute or the laws of...