Sherwood Forest No. 2 Corp. v. City of Norman, 52746

• Decision Date: 23 December 1980
• Docket Number: No. 52746,52746
• Citation: 1980 OK 191,632 P.2d 368
• Parties: SHERWOOD FOREST NO. 2 CORPORATION, Appellant, v. The CITY OF NORMAN, Oklahoma, a Municipal Corporation, Appellee.
• Court: Oklahoma Supreme Court

Page 368

632 P.2d 368

1980 OK 191

SHERWOOD FOREST NO. 2 CORPORATION, Appellant, v. The CITY OF NORMAN, Oklahoma, a Municipal Corporation, Appellee.

No. 52746.

Supreme Court of Oklahoma.

Dec. 23, 1980.

Appeal from the District Court, Cleveland County; Alma Wilson, district judge.

Appellant appeals from a judgment for the City of Norman in an action on a subdivision improvement bond.

AFFIRMED.

Ray G. Moss, Charles E. Cheatham, McAfee & Taft, Oklahoma City, for appellant.

Douglas J. Juergens, Norman City Atty., Norman, for appellee.

IRWIN, Vice Chief Justice:

On April 5, 1978, the City of Norman (appellee) sued Sherwood Forest Corporation (appellant) as principal upon a subdivision improvement bond posted with appellee on April 5, 1971, as security for the installation of sidewalks within Sherwood Forest No. 1 addition to the City of Norman. ¹ The sidewalks were not installed and appellee sought recovery for the installation costs. Judgment was rendered for appellee and appellant appealed.

The primary issues presented are: What is the applicable period of limitations, and when did appellee's cause of action accrue?

Appellant contends that the applicable period of limitations is either two (2) years from the date of the bond (April 5, 1971) as appellee's ordinances ² provide, or two years from the expiration of the bond (April 5, 1973) as the bond provides; and that appellee's cause of action accrued when sixty-five percent (65%) of the development was completed as provided in appellee's ordinance.

Appellee contends the general five (5) year Statute of Limitations (12 O.S.1971, § 95(1)) is applicable; and that its cause of action accrued on April 5, 1973, the expiration date of the bond.

The district court concluded that appellee was subject to the general five (5) year Statute of Limitations provided by 12 O.S.1971, § 95 (First), computed from April 5, 1973 ³, the expiration date of the bond, and that appellee's cause of action upon said bond first accrued at that time, and not when the lots within the platted subdivision were then 65% developed. The trial court found the action was timely commenced and rendered judgment for appellee. Appellant appealed.

The issues presented in the case at bar are similar to those in City of Norman v. Liddell, (Okl.) 596 P.2d 879 (1979). The surety bond in Liddell contained the two (2) year limitation the same as the improvement bond in the case at bar. Also, the same ordinance of the City of Norman was considered in Liddell as considered here. In Liddell we said:

"Ordinarily an action will not lie on a bond until a breach of the condition of the bond occurs. The cause of action does not accrue until that time, and the statute of limitations begins to run at that time. Under the above ordinance owners are given two years to complete improvements. If the ordinance is strictly construed, suit should have been brought before the bond expired."

In Liddell we held the two year proviso in the ordinance was not a statute of limitations but merely a directory proviso and non-compliance did not bar the action. The two year proviso in the ordinance does not bar the instant action.

Appellant also argues that the language "Any suit under this bond must be instituted before the expiration of two (2) years from the date in which payment falls due" in the bond, and the two year limitation period prescribed in the sidewalk ordinance for enforcement of the subdivision bond are valid and binding upon appellee and both bar the present action.

We are concerned here with the legislative authority of appellee in enacting the sidewalk ordinance and with the contractual obligations between appellant and appellee. The two year limitation period prescribed in the sidewalk ordinance is void because it violates Art. 5, § 46 of our Constitution which prohibits a state or a municipality from enacting any local or special laws for limitation of civil actions. City of Tulsa v. Macura, 186 Okl. 674, 100 P.2d 269 (1940). The two year limitations prescribed in the bond is void under 15 O.S.1971, § 216. ⁴

Appellant's contention that appellee's action on the bond became barred five years after 65% of the development was completed cannot be sustained. Although 65% of the lots in two blocks had been developed prior to the expiration of the bond, this does not necessarily mean that the five year statute of limitations commenced to run on the date of completion. Generally, a statute of limitations begins to run when a cause of action accrues, and a cause of action accrues at the time when a litigant first could have maintained his action to a successful conclusion. Oklahoma Brick Corporation v. McCall, Okl., 497 P.2d 215 (1972).

The City ordinance in question authorizes the City Commission to grant extension for the installation of sidewalks. When the two (2) years for completion language in the bond is considered in connection with the 65% completion...