McFadden v. Dryvit Systems, Inc.

• Decision Date: 26 May 2005
• Citation: 338 Or. 528,112 P.3d 1191
• Parties: Dixie McFADDEN; Gregory W. Byrne; and Debra D. Byrne, Plaintiffs, v. DRYVIT SYSTEMS, INC., a Rhode Island corporation, Defendant.
• Court: Oregon Supreme Court

112 P.3d 1191

338 Or. 528

Dixie McFADDEN; Gregory W. Byrne; and Debra D. Byrne, Plaintiffs, v. DRYVIT SYSTEMS, INC., a Rhode Island corporation, Defendant.

(USDC CV-04-103-HA; SC S51901).

Supreme Court of Oregon, En Banc.

Argued and Submitted March 7, 2005.

Decided May 26, 2005.

Gregory W. Byrne, Portland, argued the cause and filed the brief for plaintiffs.

Kenneth Hobbs, of Stafford Frey Cooper, Seattle, Washington, argued the cause and filed the brief for defendant.

Peter R. Chamberlain, of Bodyfelt Mount Stroup & Chamberlain LLP, Portland, filed a brief for amicus curiae DaimlerChrysler Corporation.

GILLETTE, J.

This case presents a question of law certified to this court by the United States District Court for the District of Oregon. See generally ORS 28.200 to 28.255; Western Helicopter Services v. Rogerson Aircraft, 311 Or. 361, 364-71, 811 P.2d 627 (1991) (setting out and explaining certification process). The certified question asks whether a 2003 amendment to ORS 30.905, which revives certain product liability actions for which a court had entered a final judgment of dismissal before the effective date of the amendment, violates the separation of powers provisions of the Oregon Constitution. For the reasons that follow, we conclude that the answer to that question is "no."

We take the following facts from the District Court's certification order:

"Plaintiffs own adjacent townhouse residences in Portland, Oregon. Plaintiffs seek to recover damages allegedly resulting from water intrusion to their residences, which they allege stems from improper installation of an exterior stucco siding system (EIFS) and defective components.

"In 2001, plaintiffs filed a lawsuit against the siding installer and against defendant Dryvit Systems, Inc. (`Dryvit'), the manufacturer of the siding. After plaintiffs settled with the siding installer, the lawsuit was removed from state court to federal court, and then transferred to the Judicial Panel on Multidistrict Litigation (`MDL Panel'). In December 2003, the MDL Panel dismissed all of plaintiffs' claims against Dryvit as time-barred under ORS 30.905, the two-year statute of limitations applicable to a product liability action.

"The Oregon legislature amended ORS 30.905, effective January 1, 2004, to allow a products liability civil action to be commenced within two years after the date on which the plaintiff discovers or reasonably could have discovered the injury or property damage and the causal connection between the injury or damage and the product. The amendment also contains a provision that revives any cause of action that was filed under the former Oregon product liability law and dismissed as untimely under the former version of ORS 30.905, so long as a final judgment was entered prior to January 1, 2004. Plaintiffs' claims are covered by this revival provision.

"As a result, plaintiffs filed this action on January 22, 2004. Plaintiffs assert the same five causes of action against Dryvit that they alleged in their prior lawsuit: deceit, strict liability, breach of implied warranty of merchantability, breach of implied warranty of fitness, and a claim under the Magnuson-Moss Warranty Act. However, Dryvit claims that the Oregon legislature's attempt to revive a dismissed cause of action violates the doctrine of separation of powers under the Oregon Constitution."

The District Court concluded that Oregon case law does not provide a definitive answer to the constitutional question presented and, therefore, certified the following question of law to this court:

"Whether § 2 of the 2003 amendments to ORS 30.905 (Sec. 2, Chap. 768, Or. Laws 2003), which revives certain product liability causes of action for which a final judgment of dismissal has been entered prior to the effective date of the amendments, violates the separation of powers clause in Article VII, § 1, of the Oregon Constitution."

We accepted the certified question.

Article VII (Amended), section 1, of the Oregon Constitution provides:

"The judicial power of the state shall be vested in one supreme court and in such other courts as may from time to time be created by law. * * *"

Although that clause does not, by its terms, strictly address the separation of governmental powers, this court has acknowledged that a separation of powers concept inheres in those words. As this court stated in Circuit Court v. AFSCME, 295 Or. 542, 547, 669 P.2d 314 (1983), "[w]hen this provision is invoked it becomes our task to examine whether some other department of government, by legislation or otherwise, prevents or obstructs the courts' exercise of its judicial power."

In addition to the provision just quoted, however, the Oregon Constitution contains another separation of powers clause, in Article III, section 1, which addresses a somewhat different concern, viz., whether one department of government, by its actions, exercises a function that the constitution commits to another department of government. Article III, section 1, provides:

"The powers of the Government shall be divided into three separate (sic) departments, the Legislative, the Executive, including the administrative, and the Judicial; and no person charged with official duties under one of these departments, shall exercise any of the functions of another, except as in this Constitution expressly provided."

This court has described its inquiry under Article III, section 1, as whether, in taking an action, "a `person' or member of one department is exercising a function of another department of government." AFSCME, 295 Or. at 547, 669 P.2d 314.

Plaintiffs contend that this court's separation of powers jurisprudence is grounded at least as much on Article III, section 1, as on Article VII (Amended), section 1, and that the precise question presented here implicates the considerations in Article III more than those in Article VII (Amended), because it concerns whether the legislature, in enacting a law that revives certain actions that courts already had dismissed as untimely, has usurped a judicial function in some way. For those reasons, plaintiffs urge this court to exercise its discretionary authority to reframe the question so as to consider the constitutionality of ORS 30.905 under both Articles III and VII (Amended).

We agree that the question of the constitutionality of the claim revival provisions of ORS 30.905 includes whether the legislature has improperly exercised a judicial function and, therefore, is one properly answered by reference to Article III. Indeed, as will be seen below, the cases on which the parties principally rely to support their respective positions here are based on Article III, rather than on Article VII (Amended).¹ For that reason, we exercise our discretion to modify the question certified to us to address whether the 2003 amendment to ORS 30.905 violates the separation of powers provisions of Article VII (Amended), section 1, or of Article III, section 1, of the Oregon Constitution. See Western Helicopter, 311 Or. at 370-71,

811 P.2d 627 (describing circumstances under which this court reserves the right, in the exercise of its discretion, to reframe questions); A.K.H. v. R.C.T., 312 Or. 497, 501, 822 P.2d 135 (1991) (reframing certified question because court assumed that certifying court would wish to have answer on issue and reframed question was easily resolved without further briefing from parties).

We turn now to answer the certified question, as reframed.

In 2001, when plaintiffs first filed an action against Dryvit, ORS 30.905 provided, in part:

"(1) * * * [A] product liability civil action shall be commenced not later than eight years after the date on which the product was first purchased for use or consumption.

"(2) Except [in circumstances not relevant to this case], a product liability civil action shall be commenced not later than two years after the date on which the death, injury or damage complained of occurs."

In Gladhart v. Oregon Vineyard Supply Co., 332 Or. 226, 26 P.3d 817 (2001), this court held that, under the foregoing statutory provision, the two-year limitations period for a product liability action begins to run when the "death, injury or damage complained of" occurs, whether or not the plaintiff discovers the harm within the ensuing two-year period. Id. at 234, 26 P.3d 817. That is, the court held that ORS 30.905 (2001) did not include a "discovery rule" that extended the statute of limitations in those cases in which the plaintiff could not have discovered the harm within two years of purchasing the product. Id. The record in this case discloses that plaintiffs purchased the allegedly defective siding product in 1997. Apparently, the harm began to occur immediately, but plaintiffs did not learn of that harm until 2000 and did not file their action against Dryvit until 2001. Accordingly, in 2003, the federal district court dismissed plaintiffs' action against Dryvit as untimely under ORS 30.905 (2001).

In early 2004, however, plaintiffs refiled their claims against Dryvit under authority granted by a 2003 amendment to ORS 30.905, which added a discovery rule to the statute of limitations for product liability actions and which revived certain actions that previously had been dismissed under the earlier version of the statute. Oregon Laws 2003, chapter 768, section 1, amended ORS 30.905 to provide, in part, as follows:

"(2) Except [in circumstances not relevant here], a product liability civil action for personal injury or property damage must be commenced not later than the earlier of:

"(a) Two years after the date on which the plaintiff discovers, or reasonably should have discovered, the personal injury or property damage and the causal relationship between the injury or damage and the product, or the causal relationship between the injury or damage and the conduct of the defendant; or

"(b) Ten years after the date on which the product was first purchased for use or

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