Court of Appeals: Contractual Accrual Clauses Apply to Tort Claims

In Wood Park Terrace Apts. v. Tri-Vest, LLC, 254 Or App 690 (2013), the Oregon Court of Appeals upheld a trial court ruling dismissing a negligent construction claim as time-barred due to a contractual accrual clause. The Court of Appeals affirmed that parties may contractually agree on a date of accrual for causes of action, including non-contract causes of action. The contractual accrual clause in the general contractor-plaintiff contract provided:

"As to acts or failures to act occurring prior to the relevant date of Substantial Completion, any applicable statute of limitations shall commence to run and any alleged cause of action shall be deemed to have accrued in any and all events not later than such date of Substantial Completion[.]"

Plaintiff had argued that interpreting the accrual clause to apply to negligence claims (as opposed to only contract claims) would amount to an improper waiver of its right to bring that type of action. The court rejected this argument because the accrual clause was not a waiver. The owner’s argument "fails for the simple reason that the contract did not deprive plaintiff of a negligence remedy," it only limited when plaintiff could bring a negligence claim. "We acknowledge that the practical result of applying the accrual clause is that plaintiff's negligence claims are time barred. But that result stems from plaintiff's failure to timely file its claims, not from any contractual provision that deprived plaintiff of negligence remedies altogether. [. . .] In short, the trial court correctly determined that plaintiff's claims were time barred, and the court did not err in granting summary judgment to defendants on that basis."

At the trial court level, RMB successfully fought plaintiff’s attempt to amend its complaint to bring direct claims against RMB’s client, who had been named as a third-party defendant by the general contractor. Therefore, with the dismissal of plaintiff’s claims against the general contractor, the claims against RMB’s client were dismissed as well.

The full opinion can be found here:

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