In 328 Barry Avenue v. Nolan Properties Group, the Minnesota Supreme Court held that the statute of limitations under section 541.051, applying to claims of defective construction of an improvement to real property, does not require that construction be substantially complete before such claims accrue. The court further held that there was a genuine issue of material fact as to when the owner discovered the actionable injury sufficient to trigger the statute of limitations, so it reversed and remanded the district court’s grant of summary judgment on that issue. The court’s decision regarding the statute of limitations question accurately reflected legislative intent to protect construction companies from liability for stale claims. However, the court should have taken a firm stance favoring a more lenient “discovery of injury” standard to protect owners from losing claims to the strict statute of limitations period. This approach would result in an increase in judicial efficiency and would ensure the most cost- and resource-efficient path to recourse for both parties.
This Note first gives an overview of the historical purpose of statutes of limitations and traces the modern trend of applying the discovery rule in construction litigation. It then reviews the discovery rule’s adoption and rejection in Minnesota common law.
This Note then discusses both parties’ arguments and the rationale of the 328 Barry decision. After evaluating the relevant law and the rationale of this decision, this Note endorses the court’s narrow interpretation of the statute of limitations; but, it also discusses the implications of the court’s failure to clarify the “discovery of injury” standard. This Note agrees that the Minnesota Supreme Court made the correct decision that the statute of limitations on construction-defect claims may begin before substantial completion. This Note concludes, however, that the court missed an opportunity to adopt a bright-line discovery of injury rule that would be reflective of public policy and facilitate future adjudication of complex construction-related litigation.