Under Minnesota Statutes § 541.051, an action arising out of the construction or improvement of real property must be commenced within two years after the cause of action accrues.[1] But when does the cause of action accrue? The Minnesota Supreme Court answered this question on February 3, 2021, when it decided Moore v. Robinson Environmental. [2]
In Moore, a homeowner, Moore, sued Robinson Environmental for damages caused by Robinson’s improper removal of asbestos in his home.[3] Moore brought his cause of action four years after the asbestos removal.[4] Robinson moved to dismiss the claim and argued that the 2-year statute of limitations in Minnesota Statutes § 541.051, subdivision 1(a) had expired.[5] Moore, on the other hand, argued that the 2-year statute of limitations did not apply because the removal was not an improvement to real property.[6] Moore argued that the statute of limitations did not begin to run upon the commencement of demolition work, but rather on the commencement of work which added to real property.[7] The Court, assisted by amicus curiae Construction Law Section of the Minnesota State Bar Association, rejected this argument on the basis that “virtually every construction project involves both types of work[,]” and construction projects should be viewed as a whole.[8] Therefore, the Court held that if demolition is necessary prior to making additions to real property, then a cause of action under § 541.051 accrues when demolition begins.[9]
Following Moore, both contractors and owners need to be aware that a construction project is viewed as a whole even if multiple contractors are working on the project. Therefore, if a project is completed by two contractors and the first contractor does defective work, regardless of whether such work is demolition or addition, the cause of action accrues and the statute of limitations begins to run. As a practical matter, this means that owners must be vigilant in their detection of construction defects throughout the course of the project and must ensure to bring a cause of action within two years of the defective work, not two years of the project completion. Contractors, on the other hand, should recognize that the Moore decision affords them greater protection from construction defect claims through the use of a statute of limitations defense.
[1] Minn. Stat. 541.051, subd.1(a).
[2] 954 N.W.2d 277 (Minn. 2021).
[3] Id. at 279.
[4] Id.
[5] Id.
[6] Id. at 281.
[7] Id. at 284.
[8] Id.
[9] Id.
