Leave it to Oregon. We proudly possess some of the most confusing statutes of limitation and repose anywhere, especially as they relate to construction claims. We always have interesting questions that linger unanswered for years or even decades before finding resolution by case law or statute. Even when we get answers, those answers always seem to raise more questions. Three current questions warrant brief discussion.
1. What is the statute of limitations for negligent injury to real property?
The first is a very basic question. Oregon has two statutes competing for the limelight. The first is ORS 12.110(1), which provides two years for “any injury to the person or rights of another, not arising on contract.” This language is fairly inclusive, but does not seem particularly targeted toward real property injury claims. The second statute is ORS 12.080(3) that provides six years for “any injury to any interest of another in real property.” This language seems more generally more appropriate, but yet not perfect.
Surprisingly, no case has resolved the conflict between those two statutes, and trial courts have been bombarded with various arguments in favor of both. Supporting the two year statute is dictum from an Oregon Supreme Court footnote stating “Tort claims arising out of the construction of a house must be brought within two years.” On the other hand, supporting the six years is the clear language of the statute, and legislative history indicating it was intended to apply to negligent property damage claims.
As expected, the decisions from the various trial court judges are split on the issue. Fortunately two cases are currently working through the Court of Appeals now, which could finally bring resolution to this issue. We’ll summarize those results when they are posted.
2. Does Oregon’s discovery rule apply to tort claims for injury to real property?
Another issue that has evaded final resolution is the presence or absence of a discovery rule, which would start the applicable statute of limitations when a claim is first discovered rather an earlier date such as substantial completion or the date damage first occurs. Again, no case has directly decided this issue for negligent construction. In 1966, the Supreme Court stated that the very definition of the word “accrued” creates a discovery rule wherever that term is used throughout ORS Chapter 12. However, in 2008, the Court of Appeals announced that such an interpretation is simply “misplaced,” at least as applied to breach of contract claims, because no discovery rule can be found in the language of the statute of limitations itself.
Regarding negligent construction claims, neither of the two statutes above contains express discovery rule language. Therefore, trial courts have been faced with the difficult task of sorting through the potentially conflicting case law on this issue, and have reached different conclusions. Fortunately this issue too should be decided soon.
3. Does Oregon’s discovery rule now also apply to breach of contract claims?
For our bonus round, there is an open question that will not likely be resolved soon. As noted above, the Court of Appeals in 2008 said the broad interpretation of the word “accrued” had been misplaced as to contract claims. However, the Supreme Court recently re-affirmed that broad interpretation of the word “accrued” in the context of a conversion (private theft) claim. There is a very real question as to whether the Oregon Supreme Court’s recent statements have the effect of creating a discovery rule for breach of contract actions.
No case will soon answer that question, so trial courts should expect this to be the next difficult question about Oregon statutes of limitation. Even when that issue finally finds resolution, other issues certainly will arise.
Oregon has a long and proud tradition of nurturing confusion in our statutes of limitation, and I don’t expect this to end any time soon.