Overview

A statute of limitation establishes time limits beyond which lawsuits alleging design or construction defects are barred.; Unfortunately, the California statutes overlap and may be unclear and confusing about their application to a particular set of facts.

When analyzing a claim based on a design or construction defect, a good starting point is to determine if the defect was “patent” or “latent.” A defect is considered “patent” if it was readily discoverable or apparent by reasonable inspection. If not, and if the defect is hidden, then it is “latent.” The distinction is of great importance because the two defects have different time limits for filing a lawsuit.

4-Year Statute of Limitation

The 4-year statute of limitation applies to patent defects. Individuals engaged in performing or furnishing design, specifications, surveying, planning, supervision or construction observation services cannot have a lawsuit filed against them more than four years after the substantial completion of such improvement for any of the following:

• Any patent deficiency in the design, specifications, surveying, planning, supervision or observation of construction of an improvement to or survey of, real property;
• Injury to property, real or personal, arising out of any such patent deficiency; or
• Injury to the person or for wrongful death arising out of any such patent deficiency.

Priorities and Exceptions

• Any property damage, bodily injury or death that occurs due to a patent deficiency during the fourth year after substantial completion may be brought to court within one year after the date on which the injury occurred, irrespective of the date of death, but may not be brought to court more than five years after the substantial completion of such improvement.
• The 4-year limit for patent defects is not applicable to owner-occupied single-unit residences.

10-Year Statute of Limitation

The 10-year statute of limitation applies to latent defects.  Individuals who develop real property or are engaged in performing or furnishing design, specifications, surveying, planning, supervision, testing, or construction observation services cannot have a lawsuit filed against them more than 10 years after the substantial completion of such improvement for any of the following:

• Any latent deficiency in the design, specifications, surveying, planning, supervision or construction observation of an improvement to or survey of, real property, and;
• Injury to property, real or personal, arising out of any such latent deficiency.

Priorities and Exceptions

• This section does not apply to actions based on willful misconduct or fraudulent concealment.
• The 10-year period shall commence upon whichever of the following circumstances occurs first: the date of the final inspection, the date of recordation of a valid notice of completion, the date of use or occupation of the improvement or one year after termination or cessation of work on the improvement.

PROPERTY DAMAGE

PATENT DEFECTS
(Readily Discoverable)

• A lawsuit is barred unless it is filed within 4 years of substantial complete
• A shorter time may apply once the defect is discovered.
• The time limit is not applicable to owner-occupied single unit residence.

LATENT DEFECTS
(Hidden)

• A lawsuit is barred unless it is filed within 10 years of substantial completion.
• A shorter time may apply once the defect is discovered.

BODILY INJURY OR WRONGFUL DEATH

PATENT DEFECTS
(Readily Discoverable)

• A lawsuit is barred unless it is filed wtihin 4 years of substantial completion.
• A shorter time may apply once the defect is discovered.
• The time limit is not applicable to owner-occupied single unit residence.

LATENT DEFECTS
(Hidden)

• There is no time limit until the injury or death actually occurs.
• Once the defect is discovered it must be filed within 1 year.

This is provided for informational purposes only and does not purport to be a legal opinion. For specific information regarding statutes of limitation see the California Code of Civil Procedure §337.1 and §337.15 or consult an attorney. For more information please contact Director of Government Relations  Scott Terrell at (916) 448-9082.