In a major victory for the construction industry, the Kentucky Court of Appeals has issued its opinion in Carolyn Breedlove v. Smith Custom Homes, Inc. et al., 2016-CA-00173. The opinion addressed a number of issues, including applicability of two statutes of limitation that affect homebuilders’ potential liability for alleged construction defects and/or building code violations, KRS 413.120(13) and KRS 198B.130(2).
The Court affirmed the lower court’s enforcement and held that Breedlove’s claims against Smith Custom Homes, Inc. and John Smith were time-barred by the statutes. The Court distinguished the present case from Saylor v. Hall, Ky., 497 S.W.2d 218 (1973) which previously held KRS 413.120(13) unconstitutional as to personal injuries arising from “latent” defects in construction and/or design. Instead, the Court agreed with the lower court’s finding that the alleged defect at issue in this case was “non-latent” and that accordingly the ruling in Saylor did not apply.
The Court’s holding is significant for the construction industry in that the five-year statute of limitation on claims arising from defective construction and/or design is enforceable as to “non-latent” defects.
Additionally, with regard to alleged building code violations, the Court determined that the type of injury being alleged (i.e. whether person injury or property damage) is irrelevant to application of KRS 198B.130(2).
The Court’s rulings regarding the enforceability of KRS 413.120(13) and KRS 198B.130(2) will likely have far-reaching effects on how construction defect and design cases are litigated in Kentucky in the future. Homebuilders now have protection against stale claims asserted well-beyond completion of their work.