Wash. Supreme Court Upholds Time Limit on Construction Defect Lawsuits

September 10, 2001

The American Insurance Association (AIA) reported that insurers and builders are applauding a unanimous decision by the Washington Supreme Court to reaffirm the statute of repose barring construction defect lawsuits six years after construction is completed.

“This is a major victory for insurers and builders in the state of Washington, said Bill Gausewitz, assistant vice president, state affairs. “If the Court had overturned the statute and ruled that contractors were subject to lawsuits indefinitely, the price of homes would inevitably go up.”

Plaintiffs in the case of Lakeview Blvd. Condominium Association v. Apartment Sales Corporation argued that the statute of repose violates the state constitution for two reasons. First, they claimed that the statute of repose prevented access to the court system because a contractor’s liability is limited to only six years. Additionally, plaintiffs claimed the equal protection clause was violated because owners or renters were not protected from construction defect liability. The nine-member Court ruled on the basis of the equal protection clause and declined to comment on the issue of access to the courts.

“Insurers offering coverage for builders in the state of Washington price the product to cover six years of liability,” said Gausewitz. “This ruling gives insurers a way to accurately predict loss and properly price their product.”

The American Insurance Association had joined organizations such as the Liability Reform Coalition in filing an amicus brief urging the Court to uphold the current statute of repose.

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