A long-awaited 1982 Colorado Supreme Court ruling has affected almost everyone in the construction industry. The ruling was in favor of the industry. Yarbro v. Hilton Hotel, 655 P.2d 822 (Colo. 1982).
The case involved suit against, among others, the nationally prominent architects for the downtown Denver Hilton Hotel, I.M. Pei & Associates. It was an action for damages for wrongful death by the surviving husband of a physician who died as the result of a fall out of one of the nearly floor-to-ceiling glass window-walls of a guest room of the hotel.
The widower had claimed that the architect had been negligent in designing the window walls without protective guards to prevent people from falling through the glass.
One of the defenses raised on behalf of the architect was the Colorado statute of limitations applicable to architects, contractors, subcontractors and others participating in construction activities. That statute provides that no action may be brought more than two years following discovery of the defect or an injury complained of and in no event more than ten years after substantial completion of the building or project. Section 13 - OF REPOSE 80-127, C.R.S., 1973. Technically, the 2-year provision is a statute of limitations and the 10-year limitation is a statute of repose.1
From the Supreme Court discussion it appears that the Hilton Hotel had been completed approximately 19 years before the commencement of the suit against the architect and others. The architect's defense, based upon the above-mentioned statute of repose, was sustained by the trial court and appeals followed.
The Colorado Supreme Court upheld the validity of the statute in question against attacks that it was unconstitutional as being special or class legislation favoring the construction industry in violation of the equal protection and due process clauses of the Colorado and federal constitutions. Two Justices of the seven-member Supreme Court dissented.
1 Update note: Since this column was originally published, the Colorado legislature has amended the limitation provision to provide that a suit may not be brought more than six years after substantial completion of the improvement to the real property. If the cause of action arises in the fifth or sixth year after substantial completion, then suit must be brought within two years after the cause of action arises. § 13-80-104, C.R.S.
E-57 Appeals courts in a number of other jurisdictions (including Wyoming) have ruled that similar statutes of limitations applying only to the construction industry were unconstitutional.
Nevertheless, the Colorado Supreme Court recognized that the design construction classification was valid for statute of limitations/repose purposes when considered in light of the fact that such statutes are justifiable in preventing the litigation of stale claims where parties may very well be prejudiced as a result of the passage of time and coincident unavailability of necessary witnesses, memories and exhibits.
The crux of the decision, in the opinion of the Supreme Court, was that the legislative classification and time limit provided were reasonable exercises of legislative powers.
Colorado architects, engineers and contractors may breathe more easily after eleven years-unless the legislature decides to change the law.
2 Update note: See footnote 1 on the preceding page which is effective after July 1, 1987.