John Moore, Appellant, vs. Robinson Environmental, et al., Respondents, Century Surety, Defendant.
A19-0668
STATE OF MINNESOTA IN SUPREME COURT
February 3, 2021
Gildea, C.J.
Court of Appeals. Filed: February 3, 2021. Office of Appellate Courts.
Mahesha P. Subbaraman, Subbaraman PLLC, Minneapolis, Minnesota, for appellant.
Robert E. Kuderer, Thomas C. Brock, Madeline E. Davis, Erickson, Zierke, Kuderer & Madsen, P.A., Minneapolis, Minnesota, for respondents.
Mark R. Becker, Fabyanske, Westra, Hart & Thomson, P.A., Minneapolis, Minnesota; and Jennifer A. Thompson, Thompson Tarasek Lee-O‘Halloran PLLC, Edina, Minnesota, for amicus curiae Construction Law Section of the Minnesota State Bar Association.
S Y L L A B U S
Affirmed.
O P I N I O N
GILDEA, Chief Justice.
The issue in this case is whether the 2-year statute of limitations in
FACTS
Moore‘s appeal comes to us from the district court‘s grant of Robinson‘s motion to dismiss under
According to the complaint, Moore‘s asbestos-insulated boiler stopped working sometime before October 2013. In October, Centerpoint Energy “red tagged” the boiler, meaning that a licensed contractor needed to remove the boiler and abate the asbestos around the boiler before it could be replaced. Moore thought it financially prudent to remove the remainder of his home‘s asbestos pipe insulation, original to the 1922 construction of his home, at this time as well. To that end, Moore hired Robinson for the abatеment and removal work. He hired a separate contractor to install the new boiler.
On November 6, 2013, Robinson removed the boiler and pipe insulation. Robinson‘s workers set up several polyethylene sheets in Moore‘s basement to prevent asbestos from spreading during the removal work. Nonetheless, Moore observed debris strewn outside the containment sheets. Robinson‘s workers told him it was “just dirt.” Moore also watched the workers carrying chunks of iron across his front lawn outside of any protective packaging. After Robinson‘s workers completed the job, they tore down the polyethylene sheets, causing asbestos debris to scatter on the floor of Moore‘s basement.
The heating contractor installed Moore‘s new heating system soon afterward. Because Robinson‘s workers failed to sufficiently scrub the pipes, the heating contractor unknowingly scraped asbestos onto the floor and then tracked that asbestos, along with the asbestos that Robinson‘s workers scattered by ripping down the polyethylene sheets, through the rest of Moore‘s home. An environmental report dated March 12, 2014, confirmed that the substance traсked through Moore‘s home was asbestos.1
Moore sued Robinson on April 20, 2018. Robinson moved to dismiss under
The district court granted Robinson‘s motion, holding that most of Moore‘s claims were barred by
Moore appealed, and the court of appeals affirmed using a similar analysis. Moore v. Robinson Env‘t, No. A19-0668, 2020 WL 413352, at *2 (Minn. App. Jan. 27, 2020). We granted Moore‘s petition for review.
ANALYSIS
The оnly issue in this case is whether the 2-year statute of limitations in
Moore argues that the district court and the court of appeals erred in concluding that the 2-year statute of limitations applies. The statute reads, in relevant part:
no action by any person in contract, tort, or otherwise to recover damages for any injury to property, real or personal, or for bodily injury . . . arising out of the defective and unsafe condition of an improvement to real property, shall be brought against any person performing or furnishing the design, planning, supervision, materials, or observation of construction or construction of the improvement to real property . . . more than two years after discovery of the injury . . . .
Moore relies on three different parts of the statute to support his contention that the 2-year statute of limitations does not apply. He argues that the removal of his broken, asbestos-insulated boiler was not “an improvement to real property.”
I.
We turn first to Moore‘s argument that
In answering that question, the parties dispute the relevant scope of work to be examined. Moore urges that we examine Robinson‘s removal and abatement work in isolation, while Robinson contends that we should analyze its work in light of the replacement project as a whole—including the relationship of Robinson‘s work to the installation of Moore‘s asbestos-free heating system.
Moore argues that
Robinson responds that we should look at its work in light of the replacement project as a whole. In Robinson‘s view, Moore‘s new, asbestos-free heating system meets our definition of an improvement to real property, and all work integral to the construction of that improvement is covered under
To resolve these arguments, we interpret
Our analysis begins by addressing whether
A.
We first address whether
But the statute could also reasonably be read more inclusively to cover all persons whose work is necessary to the process of a construction project, as urged by Robinson. This is so because, in addition to listing specific types of work, the statute also generally applies to anyone performing “construction of the improvement.”
Because
B.
Having determined that
The word “construction” is not defined in
The word “process,” as defined, includes actions that move toward the completion of something. And when used together with the word “construction,” the “process” of construction includes actions that are necessary to move a construction project toward completion. Using these definitions to interpret “construction of the improvement,” then, the statute tells us to view a contractor‘s coverage under the statute in light of the entire process of the building project.
In urging us to focus just on Robinson‘s work, rather than on the entire project, Moore emphasizes the part of
Rather than limit the statute to just the six categories of work and to those who add something “tangible” to the project, as Moore argues, the Legislаture has seen fit to expressly include all contractors involved in the process of a construction project. The statute covers contractors involved at the very beginning of the process, including those who design the improvement and plan the implementation of the improvement‘s construction. It also covers contractors who do not engage in the physical labor that one would normally associate with construction; it covers those who supervise and observe the construction project. And lastly,
The Legislature‘s amendments to
Finally, we turn to the consequences of the parties’ interpretations. See
Moore‘s interpretation requires us to draw a distinction betweеn contractors working on the same project. In Moore‘s view, a contractor needs to add something “tangible” to the property to be covered under
A statutory construction that focuses on the project as a whole avoids these problems. See Minn. Mining & Mfg. Co., 565 N.W.2d at 20 (we may interpret the statute “in a sensible manner“). By focusing on the project as a whole, the statute treats all contractors similarly.
Based on the language of the statute, dictionary definitions, legislative history, and the consequences of the competing interpretations, we conclude that we must analyze Robinson‘s abatement and removal work in the context of the heating system installation project as a whole. Here, Robinson‘s work was an essential part of the overall project, and its work was necessary to the process of installing the heating system. The heating systеm project could not be completed and the new boiler installed until the broken, asbestos-insulated boiler was removed, given that the broken boiler had been red-tagged. Because the new asbestos-free boiler could not be installed until Robinson removed the old boiler, Robinson‘s work moved the project toward completion and was therefore construction
C.
With the proper framework in mind, we next evaluate Moore‘s argument that
We have interpreted the phrase “improvement to real property” and applied a “common-sense” interpretation of the phrase. See Pac. Indem. Co. v. Thompson-Yaeger, Inc., 260 N.W.2d 548, 554 (Minn. 1977), superseded by statute, Act of Apr. 7, 1980, ch. 518, § 2, 1980 Minn. Laws 595, 596 (codified as amended at
a permanent addition to or betterment of real property that enhances its capital value and that involves the expenditure of labor or money and is designed to make the property more useful or valuable as distinguished from ordinary repairs.
Id. (citing Kloster-Madsen, Inc. v. Tafi‘s Inc., 226 N.W.2d 603 (Minn. 1975)).
In Siewert v. Northern States Power Co., we derived a three-factor test from the definition in Pacific Indemnity Co. to determine whether the work is an improvement to real property: “[1] whether the addition or betterment is permanent, [2] whether it enhances the capital value of the property, and [3] whether it is designed to make the real property more useful or valuable, rather than intended to restore the property‘s previous usefulness or value.” 793 N.W.2d 272, 287 (Minn. 2011).8
Applying this test, we have recognized in several cases that utilities similar to Moore‘s new heating system are improvements. For example, in Pacific Indemnity Co., we held that the installation of a furnace was, as a matter of law, an improvement to real property. 260 N.W.2d at 554. And in Siewert, we noted that “[u]tilities and similar installations [are] generally . . . considered real property improvements.” 793 N.W.2d at 287 (holding that the installation of an electrical system was an improvement to real property). We have also held that replacing an existing utility with a more valuable utility was an improvement. State Farm Fire & Cas. v. Aquila Inc., 718 N.W.2d 879, 884 (Minn. 2006) (holding that the replacement of an “existing propane steel pipeline system” with “a new natural gas polyethylene pipeline system” was an improvement to real property). We reach the same conclusion here.9
Moore disputes the third factor, arguing that the new heating system is not designed to make his home more useful or valuable but rather is intended to restore its previous usefulness or value. Essentially, Moore claims that what happened here was a repair and not an improvement. We are not persuaded.
Moore‘s complaint states that the asbestos insulating the heating system in his home, like the asbestos in many buildings, was original to the home‘s construction in 1922. The new, asbestos-free heating system therefore was not designed to restore the home to the condition it was in before Moore‘s boiler broke down; rather, the new heating system was designed to make the property more valuable by replacing a heating system that had bеen laden with asbestos since the home‘s construction in 1922. Moreover, Moore‘s argument is inconsistent with our holding in State Farm Fire & Casualty, where we held that the replacement of a pipeline with a better, more valuable pipeline was an improvement to real property. 718 N.W.2d at 884. Similarly, in this case, Moore‘s old heating system was replaced with a better, more valuable heating system. The third Siewert factor is therefore satisfied.
In sum, a new, asbestos-free, heating system satisfies our definition of an improvement to real property, and Robinson “perform[ed] . . . construction” of that improvement because its abatement and rеmoval work was a necessary part of the process of installing the new heating system. We therefore hold that Robinson‘s work is covered by the 2-year statute of limitations under
II.
We next consider Moore‘s argument that
Moore‘s argument is identical to the argument presented by the plaintiff in Lietz, who claimed that its “injuries arose out of ‘negligent construction activities’ rather than the defective and unsafe condition of” an improvement. 718 N.W.2d at 871.
Lietz involved the construction of a fiber-optic communications system in St. Cloud. Id. at 868. During construction, contractors struck a gas line while installing a utility pole support anchor, causing an explosion which damaged a nearby restaurant. Id. In the subsequent suit against the contractors, the plaintiff argued that its
Because the anchor had been “bent out of alignment and had pierced a gas line,” we concluded that the anchor was in a “defective and unsafe condition.” Id. at 872. We further rejected the plaintiff‘s argument that its damages did not arise out of that condition. We noted that we had not yet “define[d] the exact parameters” of the “arising out of” language in
Notably, it made no difference to our analysis in Lietz that the defective and unsаfe condition of the anchor was the result of the contractors’ negligence. Indeed, we explained that we had previously held that the negligence of construction workers “can create a defective and unsafe condition.” Id. at 872 (citing Pac. Indem. Co., 260 N.W.2d at 552–55). As alleged in Moore‘s complaint, that scenario is exactly what happened here.
Moore‘s complaint essentially alleges that his new heating system was left in a defective and unsafe condition. His complaint states that Robinson‘s workers negligently failed to scrub his home‘s piping and negligently tore down polyethylene containment sheets, both of which led to asbestos scattering on Moore‘s basement floor. The heating contractor then stepped on that asbestos and tracked it through Moore‘s home.10 In other words, Moore alleges that Robinson‘s negligence caused the new heating system, which was supposed to be asbestos-free, to be in a defective and unsafe condition by leaving asbestos on and around it. As in Lietz, it makes no difference to our analysis that the heating system‘s defective and unsafe condition was allegedly the result of the negligence of Robinson‘s workers. Negligence “can create a defective and unsafe condition,” and that is exactly what Moore‘s complaint alleges. Id. at 872.
Ultimately, Moore alleges that his damages arose out of the defective and unsafe condition of the heating system because the heating contractor stepped in the asbestos and tracked it through his home. In short, Moore‘s damages arose out of the defective and unsafe condition of an improvement to real property, and the 2-year statute of limitations in
CONCLUSION
For the foregoing reasons, we affirm the decision of the court of appeals.
Affirmed.
