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Timing is Everything

Timothy R. Hughes, Esq.
Hughes & Associates, P.L.L.C.

Timing can literally be the difference between an architect facing a huge level of exposure and being able to escape a case without paying anything.  The interpretation of statutes of limitations can have a dramatic impact on your potential case.  This is an area where the specifics of where you practice can also greatly influence your potential exposure.  We will look at some of the basics of statutes of limitations locally and compare and contrast those rules.

Virginia

In Virginia, the statute of limitations for breach of a written contract is five years.  The statute of limitations for breach of an oral or implied agreement is three years.  For contract claims, the statute “accrues” (i.e. the clock starts ticking) when the breach of contract occurs and the plaintiff suffers damage, “no matter how slight”.

In the context of typical AIA contracts with payments phased according to the phases of design, the Supreme Court of Virginia has ruled that the limitations period starts to run when the owner accepts a defective design.  At that point, the architect could demand payment for architectural design phase work.  Further, the owner has suffered some slight amount of damage in not receiving the value it contracted to receive.  You should note that the owner has not suffered the true eventual impact of a defective design as that is not required to demonstrate the damage trigger for contract claims.

For personal injury claims, Virginia applies a two year statute of limitations.  Property damage claims have a five year statute of limitations.  These claims again accrue when the damages are suffered, but by their nature, such tort claims may in fact occur later in time than the underlying contract claims discussed above.

Maryland

Maryland has a general three year statute of limitations.  Maryland applies this statute of limitations to breach of contract, personal injury and property damage cases.  Importantly, Maryland uses a “discovery” trigger for accrual of the limitations period.  Thus, the limitations period runs from when the plaintiff knew or reasonably should have known of the claim.  There are some exceptions to these rules.  Different limitations and accrual triggers apply, for example, to claims under the Uniform Commercial Code. 

District of Columbia

As with Maryland, the District of Columbia applies a three year statute of limitations for breach of contract, personal injury and property damage claims.  For personal injury and property damage claims, the District of Columbia uses a discovery trigger.  Case law in the District establishes that breach of contract cases run from the breach.  Unlike Virginia, the District has a more elastic standard in tending to permit both tort and contract claims that flow from a contractual relationship.  Thus, the District’s use of a shorter accrual period for contract claims than Maryland may be less helpful than meets the eye.

Conclusion

The application of statute of limitations and accrual rules can mean literally a claim surviving or failing completely independent of the merits of the case.  The potential for extended periods of limitations in Maryland and the District of Columbia translates to a far greater potential period of risk, particularly given that many construction and design defects can take an extended period to fully manifest.  Architects should not only be familiar with the rules of their home jurisdiction, but also wherever they are performing work.