AZAPP is a blog that provides a thorough, up-to-date, and efficient resource to stay abreast of significant developments concerning civil cases in Arizona's appellate courts - the two Divisions of the Arizona Court of Appeals and the Arizona Supreme Court.
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Monday, April 26, 2004
Maycock v. Asilomar Development: Division One Rules in Case of First-Impression that a Prior Owner’s Knowledge of Defects is Imputed to Subsequent Owners for Purposes of Statute of Repose
A.R.S. § 12-552 precludes contract and implied warranty claims against builders filed more than eight years after substantial completion of the improvements unless a latent defect is discovered in the eighth year. If the latent defect is discovered in the eight year, the action must be filed within one year of such discovery. Plaintiffs filed this case against the builder nine years after substantial completion. The trial court dismissed plaintiffs’ contract and warranty claims on summary judgment, finding that prior owner of the home admitted to knowledge of the defect and that his knowledge is imputed to the current owners, thus, defeating any argument that the defect was latent.
The Court of Appeals, Division One held that fact questions precluded summary judgment. The appeals court, however, agreed with the trial court that a prior owner’s knowledge is imputed to later owners (an issue of first-impression in Arizona). According to the court, the plain language of A.R.S. § 12-552 focuses on the discovery of the defect, not on who discovered it. The court was unconvinced that public policy of protecting innocent homebuyers embodied in an Arizona Supreme Court precedent predating enactment of § 12-552 required a different result.
Judge Gemmill wrote the opinion; Judges Thompson and Winthrop concurred.
A.R.S. § 12-552 precludes contract and implied warranty claims against builders filed more than eight years after substantial completion of the improvements unless a latent defect is discovered in the eighth year. If the latent defect is discovered in the eight year, the action must be filed within one year of such discovery. Plaintiffs filed this case against the builder nine years after substantial completion. The trial court dismissed plaintiffs’ contract and warranty claims on summary judgment, finding that prior owner of the home admitted to knowledge of the defect and that his knowledge is imputed to the current owners, thus, defeating any argument that the defect was latent.
The Court of Appeals, Division One held that fact questions precluded summary judgment. The appeals court, however, agreed with the trial court that a prior owner’s knowledge is imputed to later owners (an issue of first-impression in Arizona). According to the court, the plain language of A.R.S. § 12-552 focuses on the discovery of the defect, not on who discovered it. The court was unconvinced that public policy of protecting innocent homebuyers embodied in an Arizona Supreme Court precedent predating enactment of § 12-552 required a different result.
Judge Gemmill wrote the opinion; Judges Thompson and Winthrop concurred.
Posted date: Mon, Apr 26, 2004
