15th Place Condominium Association v. South Campus Development Team, LLC
14 N.E.3d 592
Ill. App. Ct.2014Background
- SCDT contracted with Fitzgerald (architect) and Linn-Mathes (general contractor) for two condominium towers; accrual clauses say actions accrue on substantial completion; dates determined by architects; tolling agreement in 2009 paused claims; underlying 2008 action by Association alleged defects; third-party claims included breach of contract, implied warranty, implied and express indemnity; trial court held accrual, dates of substantial completion, and time-barred implied claims; court reversed regarding express indemnity against Linn-Mathes and remanded that claim only.
- SCDT’s contracts provide accrual upon substantial completion for acts/failures; dates for substantial completion are May 16, 2003 (Tower I) and Oct 11, 2004 (Tower II).
- Forgione offered 2006 as substantial completion per schedule, but DeRouin’s documents showed contract-defined dates; the trial court found no genuine issue of material fact.
- The trial court initially dismissed; on reconsideration enforced accrual provisions; determined four-year statute applies to construction-related claims; held some claims time-barred and others potentially timely.
- On appeal the Illinois Appellate Court affirmed dismissal of breach of contract and implied indemnity claims as time-barred, but reversed as to express indemnity against Linn-Mathes, remanding for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are accrual provisions enforceable against third-party claims? | SCDT contends accrual clauses do not bar third-party claims. | Linn-Mathes/Fitzgerald argue accrual clauses apply to third-party actions. | Yes; accrual provisions enforceable against third-party claims. |
| Did the court improperly resolve a material factual issue on substantial completion? | SCDT argues genuine issue as to substantial completion dates (2006 vs 2003/2004). | Defs rely on contract dates and DeRouin affidavit; Forgione disputed but not material. | No genuine issue; dates May 16, 2003 and Oct 11, 2004 control. |
| Which limitations apply to breach of contract/indemnity vs. construction claims? | Implied indemnity and contract claims should follow four-year construction statute. | Implied indemnity is time-barred; contract and indemnity may be governed differently. | Implied indemnity and breach of contract are time-barred; express indemnity governed by 10-year contract statute. |
| Does the 10-year statute apply to express indemnity within a construction contract? | Travelers supports 10-year for express indemnity; Guzman irrelevant to express indemnity. | Court previously applied four-year period to indemnity. | 10-year limitations period applies to express indemnity against Linn-Mathes. |
| Is the express indemnity claim against Linn-Mathes time-barred overall? | Less than 10 years between completion and tolling filing; claim timely. | Even with accrual, 4-year period would bar. | Remand to proceed on express indemnity; not time-barred. |
Key Cases Cited
- Florsheim v. Travelers Indemnity Co. of Illinois, 75 Ill. App. 3d 298 (Ill. App. 1979) (contractual limitations may be reasonable even if shorter than general statute)
- Konstant Architecture Planning, Inc., 388 Ill. App. 3d 120 (Ill. App. 2009) (accrual clause governing all statutes of limitations; eliminate discovery rule)
- Quake Construction, Inc. v. American Airlines, Inc., 141 Ill. 2d 281 (Ill. 1990) (determine intent from contract language when no ambiguity)
- Travelers Casualty & Surety Co. v. Bowman, 229 Ill. 2d 461 (Ill. 2008) (express indemnity falls under 10-year written contract statute)
- Guzman v. C.R. Epperson Construction, Inc., 196 Ill. 2d 391 (Ill. 2001) (implied indemnity; distinctions from express indemnity)
- Armstrong v. Guigler, 174 Ill. 2d 281 (Ill. 1996) (assists in distinguishing contract actions based on promissory language)