McCaulley v. C L Enters.
959 N.W.2d 225
Neb.2021Background
- Richard and Michelle McCaulley acted as their own general contractors for a home built beginning in 2006 and moved in late February/early March 2008.
- They contracted separately with multiple specialty contractors (plumbing, roofing, masonry, hardwood floors, doors/windows, waterproofing, retaining wall) rather than hiring a single general builder.
- The McCaulleys sued on February 7, 2012, alleging negligence against seven contractors and breach of warranty against four, asserting defective workmanship and latent defects.
- Each contractor moved for summary judgment under Neb. Rev. Stat. § 25-223 (four-year limitations), claiming the limitations period ran from the date that contractor substantially completed its work; the McCaulleys argued the clock began when the entire home was substantially complete.
- The district court granted summary judgment for the contractors (finding each claim time barred based on each contractor’s substantial-completion date) and denied the McCaulleys’ oral motion to file a fourth amended complaint to add an express warranty-to-repair claim; the McCaulleys appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| When does the § 25-223 four-year limitations period begin to run for construction-defect claims against individual contractors? | McCaulley: Limitations run from substantial completion of the entire house (moved in 2008). | Contractors: Limitations run from each contractor’s substantial completion of its separate project. | Court: Where owner contracted separately with specialty contractors and work completion dates are independent, limitations run from each contractor’s substantial completion; claims were time barred. |
| Did the district court abuse its discretion by denying leave to amend to add an express warranty-to-repair claim? | McCaulley: Leave should be granted (relying on a concurrence in Adams suggesting such a claim may accrue later). | Contractors: Amendment was untimely, prejudicial, and futile given summary-judgment posture. | Court: Denial affirmed—request was unduly delayed and prejudicial; no abuse of discretion. |
Key Cases Cited
- Fuelberth v. Heartland Heating & Air Conditioning, 307 Neb. 1002 (2020) (explains divisible vs. indivisible contracts and applies substantial-completion accrual rule when projects may be separate)
- Adams v. Manchester Park, 291 Neb. 978 (2015) (applies substantial-completion rule to homebuilder; concurrence noted later-accruing warranty-to-repair theory)
- Murphy v. Spelts-Schultz Lumber Co., 240 Neb. 275 (1992) (limitations runs from substantial completion for defective construction claims)
- Witherspoon v. Sides Constr. Co., 219 Neb. 117 (1985) (same rule: accrual at substantial completion)
- Durre v. Wilkinson Development, 285 Neb. 880 (2013) (applies § 25-223 to construction defect claims)
