Wash. State Major League Baseball Stadium Pub. Facilities Dist. v. Huber, Hunt & Nichols–Kiewit Constr. Co.

• Decision Date: 31 January 2013
• Docket Number: No. 86210–9.,86210–9.
• Court: Washington Supreme Court
• Parties: WASHINGTON STATE MAJOR LEAGUE BASEBALL STADIUM PUBLIC FACILITIES DISTRICT, a special purpose district of the State of Washington; and The Baseball Club of Seattle, L.P., a Washington limited partnership, Appellants, v. HUBER, HUNT & NICHOLS–KIEWIT CONSTRUCTION COMPANY, a Washington joint venture; Hunt Construction Group, Inc., a foreign corporation; and Kiewit Construction Company, a foreign corporation, Respondents.

176 Wash.2d 502

296 P.3d 821

WASHINGTON STATE MAJOR LEAGUE BASEBALL STADIUM PUBLIC FACILITIES DISTRICT, a special purpose district of the State of Washington; and The Baseball Club of Seattle, L.P., a Washington limited partnership, Appellants,

v.HUBER, HUNT & NICHOLS–KIEWIT CONSTRUCTION COMPANY, a Washington joint venture; Hunt Construction Group, Inc., a foreign corporation; and Kiewit Construction Company, a foreign corporation, Respondents.

No. 86210–9.

Supreme Court of Washington, En Banc.

Argued Jan. 10, 2012.

Decided Jan. 31, 2013.

Zachary Tomlinson, John Hitchcock Parnass, Stephen Michael Rummage, Davis Wright Tremaine LLP, Seattle, WA, for Appellant.

David Clark Groff, Jr., Michael Porter Grace, Groff Murphy, PLLC, Christopher Wright, Watt, Tieder, Hoffar & Fitzgerald, LLP, William Jennings O'Brien, III, Law Office of William J. O'Brien, Richard Lawrence Martens, Steven A. Stolle, Martens & Associates, PS, Seattle, WA, for Respondent.

Todd Christopher Hayes, Harper Hayes PLLC, Seattle, WA, amicus counsel for Associated General Contractors of Washington.

MADSEN, C.J.

[176 Wash.2d 506]¶ 1 This action arises out of a contract for construction of a baseball stadium and home field for the Seattle Mariners baseball team. It is the second time the case has been before us. In Washington State Major League Baseball Stadium Public Facilities District v. Huber, Hunt & Nichols–Kiewit Construction Company, 165 Wash.2d 679, 202 P.3d 924 (2009) (PFD I), we held that the statute of limitations did not bar the owner's suit against the general contractor because the action was brought for the benefit of the State, and therefore the exemption from the statute of limitations set out in RCW 4.16.160 applied. The present case raises questions about whether the construction statute of repose bars suit against the general contractor and, if not, whether the general contractor may pursue third party claims against two of its subcontractors.

¶ 2 The trial court granted summary judgment of dismissal in favor of the general contractor and the subcontractors on statute of repose grounds. We reverse the trial court. In light of a provision in the prime contract defining when causes of action accrue, the statute of repose does not bar suit against the general contractor. In accord with several provisions in the subcontracts, the subcontractors are subject to liability to the same extent that the general contractor may be liable for any defective materials or work under the subcontracts. Thus, the trial court erred in holding that the statute of repose bars Hunt Kiewit's third party claims against the subcontractors. We remand for further proceedings.

FACTS

¶ 3 In May 1996, the Washington State Major League Baseball Stadium Public Facilities District (PFD) executed a construction contract with Huber, Hunt & Nichols–Kiewit Construction Company (Hunt Kiewit) for construction of Safeco Field, the stadium and home field of the Baseball Club of Seattle, L.P., i.e., the Seattle Mariners baseball team. The PFD is a Washington municipal corporation that developed and owns Safeco Field. The Mariners maintain and make necessary repairs to the field. Pursuant to contractual agreement, PFD must reimburse the Mariners for any unanticipated capital costs incurred in making repairs.

¶ 4 The construction contract required that exposed structural beams and columns at the stadium be fireproofed. Hunt Kiewit subcontracted this work to Herrick Steel Inc. (Herrick), which was responsible for priming the beams and columns at the time they were fabricated and then installing them, and Long Painting Company (Long), which was responsible for applying an intumescent product to the beams and columns and then painting them.

[176 Wash.2d 508]¶ 5 In February 2005, the Mariners president noticed blisters on the face of the structural steel. The problem was widespread and involved separation of the intumescent product from the beams and columns. Allegedly, instead of the primer that had been specified, another product had been used and this resulted in incompatibility between the primer and the intumescent coating. After initial repairs were begun, the PFD and the Mariners learned that defects in the intumescent coating were far more extensive than had appeared at first, resulting in several million dollars' worth of needed repairs.

¶ 6 In August 2006, PFD and the Mariners (hereafter, together PFD) brought this breach of contract action against Hunt Kiewit, alleging that the fireproofing work or materials, or both, was defective. Hunt Kiewit brought third party claims against the subcontractors and subsequently moved for summary judgment, claiming, among other things, that PFD's action was barred by the statute of limitations. The trial court granted the summary judgment motion and also dismissed the third party claims against the subcontractors.

¶ 7 On appeal, we held in PFD I that the statute of limitations does not bar PFD's suit against Hunt Kiewit under the “for the benefit of the state” exemption to the six-year contract statute of limitations in RCW 4.16.160. We also reversed summary judgment in favor of the subcontractors.

¶ 8 On remand, a number of motions for summary judgment and reconsideration ensued. Included in these was a motion for summary judgment by Hunt Kiewit on statute of repose grounds. By November 2009, the motions to date had all been denied, including Hunt Kiewit's repose-based motion. Then, in January 2010, Herrick moved for summary judgment, seeking dismissal of Hunt Kiewit's third party claim against it on the ground that the statute of repose barred the claim. Following argument, the trial court responded by dismissing all claims in the case on statute of repose grounds, including the claims against Hunt Kiewit brought by PFD, even though at that point Hunt Kiewit did not have a motion for summary judgment pending seeking dismissal of PFD's claims.

¶ 9 Notwithstanding the peculiar procedural course of this case on remand, and although a number of issues are raised, we find it necessary to address only the issues that follow. Additional facts are related below as relevant.

ANALYSIS

¶ 10 Review of a grant of summary judgment is de novo, and the court engages in the same inquiry as the trial court. Wash. Imaging Servs., LLC v. Dep't of Revenue, 171 Wash.2d 548, 555, 252 P.3d 885 (2011). Summary judgment is proper if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. CR 56(c).

Contractual Time of Accrual Provision

¶ 11 The first issue is whether the statute of repose bars suit against the general contractor, Hunt Kiewit. PFD contends that in the prime contract the parties contractually specified the time of accrual for claims arising from acts or omissions occurring prior to substantial completion of the project, setting accrual as no later than the date of substantial completion. PFD maintains the accrual clause is valid and that PFD's accrued claims, as defined by the clause, were brought within the statutory repose period. We agree.

¶ 12 Section 13.7 of the construction contract with Hunt Kiewit states in relevant part that “[a]s to acts or failures to act occurring prior to the relevant date of Substantial Completion, ... any alleged cause of action shall be deemed to have accrued in any and all events not later than such date of Substantial Completion.” Clerk's Papers (CP) at 793. Words in a contract are given their ordinary, usual, and popular meaning, absent indication of any contrary intent or use of technical terms. Hearst Commc'ns, Inc. v. Seattle Times Co., 154 Wash.2d 493, 504, 115 P.3d 262 (2005); Berg v. Hudesman, 115 Wash.2d 657, 669, 801 P.2d 222 (1990); Blue Mountain Mem'l Gardens v. Dep't of Licensing, 94 Wash.App. 38, 44, 971 P.2d 75 (1999). According to its plain language, Section 13.7 sets accrual in this case at no later than substantial completion, which the parties agree occurred on July 1, 1999. In addition, the clear language of this contractual provision establishes the time of accrual “in any and all events.” Therefore, the contractual accrual time applies for purposes of both the statute of limitations and the statute of repose.

¶ 13 The construction statute of repose provides that “[a]ny cause of action which has not accrued within six years after such substantial completion of construction, or within six years after such termination of services, whichever is later, shall be barred.” RCW 4.16.310. A cause of action that accrues no later than substantial completion will not be barred by the statute of repose because it will always accrue before the later of substantial completion or termination of services. Therefore, because of the parties' unambiguous agreement that accrual occurs no later than substantial completion, the statute of repose cannot have run on PFD's claims arising out of the construction contract.

¶ 14 Hunt Kiewit maintains, however, that the statute of repose ran from substantial completion on July 1, 1999, and PFD had just six years from that date to file suit. We do not agree. First, as explained Section 13.7 sets accrual of the cause of action for statute of repose purposes as of the date of substantial completion and the statute of repose requires accrual by the later of substantial completion or termination of services. Therefore, PFD's cause of action necessarily accrued within six years of substantial completion and thus satisfied the statute of repose.

¶ 15 Second, the argument confuses the application of a statute of repose with a statute of limitation. There is a significant difference between a statute of limitation and a statute of repose, as we have recognized in cases involving suits arising out of construction projects. E.g., Cambridge Townhomes, LLC v. Pac. Star Roofing, Inc., 166 Wash.2d 475, 484–85, 209 P.3d 863 (2009); Davis v. Baugh Indus. Contractors, Inc., 159 Wash.2d 413, 426 n. 2, 150 P.3d 545 ...