This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2006).
STATE OF MINNESOTA
IN COURT OF APPEALS
Daniel J. Van Hook, d/b/a Van Hook Homes,
Filed April 10, 2007
Olmsted County District Court
File No. C2-04-4375
Jaren L. Johnson,
Kimberly A. Chapman, BenePartum Law Group, P.A.,
Steven J. Sheridan, Molly C. Kramer, Foley & Mansfield, 250 Marquette Avenue, Suite 1200, Minneapolis, MN 55402 (for respondent Daniel J. Van Hook)
Timothy W. Waldeck, Waldeck & Lind, P.A., 1400 TCF Tower, 121 South Eighth Street, Minneapolis, MN 55402 (for respondent Palmer-Soderberg, Inc.)
Neal J. Robinson, Law Offices of Bakken & Robinson, 2550 University Avenue West, Suite 220-South Court International, St. Paul, MN 55114 (for respondent Andersen Corporation)
Peter C. Sandberg,
Douglas A. Boese, Dunlap & Seeger, P.A., 206 South Broadway,
Considered and decided by Minge, Presiding Judge; Stoneburner, Judge; and Dietzen, Judge.
Appellant challenges the district court’s orders and resulting judgments dismissing his claims against respondents arising out of the construction of a new home, arguing that genuine issues of material fact preclude summary judgment, and that the district court erred in concluding that (1) the claims were barred by the statute of limitations as set forth in Minn. Stat. § 541.051, and (2) that respondent Van Hook’s bankruptcy precluded appellant’s claims. We affirm.
Appellant Todd Hoffman owns
a lot located in rural
Because of the stage of the project and the economies of the situation, Hoffman decided to act as his own general contractor for the completion of the project. Hoffman solicited bids for exterior stucco application, and respondent Palmer-Soderberg submitted a bid in February 1998, but Hoffman did not accept it until June 1998. The bid provided for installation of the stucco but excluded caulking and flashings. Palmer-Soderberg applied the stucco in June-July 1998. Hoffman moved into the home sometime before the installation of the stucco after receiving a temporary certificate of occupancy. Hoffman did not obtain a final certificate of occupancy or have the work inspected to determine if the work met the requirements of the building code.
In the fall of 1998, Hoffman noticed small cracks in the stucco and moisture buildup on the windows, particularly during cold weather, and in the fall of 1999 observed “severe” stucco cracking. Following a complaint from Hoffman, Palmer-Soderberg inspected the building and concluded that the cracks were due to structural movement of the home and not the stucco application. Palmer-Soderberg applied cosmetic repairs to the cracks and contacted Resource Supply and the Minnesota Lath and Plaster Bureau (Minnesota Lath) for additional opinions. Following its inspection, Minnesota Lath reported in a letter dated November 7, 2000, that “the Bureau’s opinion does not appear to be substantially different from Palmer-Soderberg’s or Resource Supply’s. It seems apparent that the cracking is the result of a structural issue not connected to the stucco installation.” The letter offered several suggestions for methods of repairing the cracked stucco.
In November 2002, Hoffman found a mushroom growing in the house and contacted Private Eye, Inc. to conduct a moisture analysis. In June 2003, Private Eye submitted its report to Hoffman, which concluded that Hoffman’s home had “one or more areas showing signs of excessive moisture intrusion and soft or damaged sheathing.” The report noted that caulking was not satisfactory on door joints and that the window head, door head, and kickout flashings were not present.
In September 2003, Hoffman filed a complaint against respondents Van Hook, Palmer-Soderberg, Andersen Corporation, and Hershberger. The complaint alleged (1) breach of contract; (2) breach of statutory warranty; (3) breach of warranty; (4) strict liability; (5) negligent design and construction; (6) fraud, misrepresentation and fraudulent concealment; (7) false promises, misleading statements, and deceptive practices in violation of Minn. Stat. § 325F.69 (2006); and (8) promissory estoppel. Palmer-Soderberg filed a counter-claim against Hoffman. Palmer-Soderberg, Van Hook, and Hershberger also filed cross claims, seeking indemnity from the other defendants.
Van Hook and Palmer-Soderberg brought a motion for summary judgment. Following a hearing, the district court granted the motions for summary judgment, finding that the claims were time barred under the two-year limitation of Minn. Stat. § 541.051, subd. 1; and that Van Hook’s discharge in bankruptcy enjoined Hoffman from recovering against Van Hook. Hoffman moved for reconsideration, which the court denied.
Respondents Andersen Corporation and Simon Hershberger then filed motions for summary judgment. Following a hearing, the district court granted the motions for summary judgment concluding that “the reasoning as set forth in the previous order granting summary judgment equally applies to the remaining two defendants.” This appeal follows.
D E C I S I O N
Hoffman contends that the
district court erred by concluding that his claims were barred by the statute
of limitations. “A motion for summary
judgment shall be granted when the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any,
show that there is no genuine issue of material fact and that either party is
entitled to a judgment as a matter of law.” Fabio v.
Bellomo, 504 N.W.2d 758, 761 (
To survive summary judgment,
a party need not show substantial evidence; it needs only to produce sufficient
evidence to permit reasonable persons to draw different conclusions. Schroeder
Here, the district court concluded that Hoffman’s claims were barred by Minn. Stat. § 541.051, subd. 1 (2002). When Hoffman brought the claim in 2003, Minn. Stat. § 541.051 provided:
Subdivision 1. (a) Except where fraud is involved, no action by any person in contract, tort, or otherwise to recover damages for any injury to property, real or personal, or for bodily injury or wrongful death, arising out of the defective and unsafe condition of an improvement to real property . . . shall be brought against any person performing or furnishing the design, planning, supervision, materials, or observation of construction or construction of the improvement to real property . . . more than two years after discovery of the injury . . . .
Subd. 4. This section shall not apply to actions based on breach of the statutory warranties set forth in section 327A.02, or to actions based on breach of an express written warranty, provided such actions shall be brought within two years of the discovery of the breach.
A. Subdivision 4
Hoffman argues that the district court erred in concluding that his warranty claims were governed by Minn. Stat. § 541.051, subd. 1 rather than Minn. Stat. § 541.051, subd. 4. Essentially, subdivision 4 provides that claims for “statutory warranties set forth in section 327A.02,” or “actions based on breach of an express written warranty” are not governed by subdivision 1, which has a two-year limitation “after discovery of the injury,” but rather have a two-year limit from “discovery of the breach.” Minn. Stat. § 541.051, subd. 4.
In his complaint, Hoffman alleges breach of statutory warranty against Van Hook. Hoffman also alleges breach of express and implied warranty claims against subcontractors Palmer-Soderberg and Hershberger, and material supplier Andersen Corporation, but was unable to identify any statutory or express written warranty that applied to them. Appellant asserts that such warranty was implied. Here, the statute does not cover an “implied warranty.” Thus, Hoffman’s claims against Palmer-Soderberg, Hershberger, and Andersen Corporation do not have either an express written warranty or the statutory warranty under Minn. Stat. § 327A.02, and, therefore, we conclude that those claims are not covered by Minn. Stat. § 541.051, subd. 4. We turn then to Hoffman’s subdivision 4 warranty claim against Van Hook.
accrual period under subdivision 4 begins to run at “discovery of the breach,”
or “when the homeowner discovers, or should have discovered, the builder’s
refusal or inability to ensure the home is free from major construction
defects.” Vlahos v. R & I Constr. of Bloomington, Inc., 676 N.W.2d
672, 678 (
Hoffman relies on Vlahos to argue that notice of a vendor’s breach of warranty is always a question of fact that precludes summary judgment. But this argument misconstrues Vlahos, which held that “[b]ased on the information presented to the district court, the question of when either the Rovicks or the Vlahoses discovered or should have discovered R&I’s refusal or inability to ensure the home was free from major construction defects was a factual question, inappropriate for resolution on summary judgment.” Vlahos, 676 N.W.2d at 679. We do not read Vlahos to preclude summary judgment when the material facts are not in dispute.
Here, it is not disputed
that Van Hook abandoned the project and refused to respond to Hoffman’s
requests to complete the project in 1998.
As of that date, Van Hook refused to do anything, which would reasonably
include refusing to ensure that the home was free from any major construction
defects. Thus, we see no genuine issue
of material fact, and conclude as a matter of law that the discovery of the
breach for purposes of Hoffman’s subdivision 4 claims accrued in 1998. Consequently, Hoffman’s statutory warranty
claim against Van Hook is barred as a matter of law by the two-year statute of
limitation in Minn. Stat. § 541.051, subd. 4, and Van Hook is entitled to
summary judgment. Therefore, we affirm
on grounds other than those offered by the district court. See
Northway v. Whiting, 436 N.W.2d 796, 798 (
Additionally, Van Hook argues that Hoffman failed to
comply with the notice requirements of Minn. Stat. § 327A.02 and,
therefore, is barred from asserting a warranty claim. Minn. Stat. § 327A.02 excludes “[l]oss
or damage not reported by the vendee or the owner to the vendor or the home
improvement contractor in writing within six months after the vendee or the
owner discovers or should have discovered the loss or damage.”
B. Subdivision 1
Hoffman argues that he did
not have notice of the injury until he received a report from Private Eye, Inc.
Moisture Testing Services and that he commenced the lawsuit within two years of
that notice. Under subdivision 1, a
cause of action accrues “upon discovery of the injury.” Minn. Stat. § 541.051, subd. 1(b). The statute begins to run “when an actionable
injury is discovered or, with due diligence, should have been discovered,
regardless of whether the precise nature of the defect causing the injury is
known.” Dakota v. BWBR Architects, 645 N.W.2d 487, 492 (
It is undisputed that Hoffman first noticed cracking in the stucco in the fall of 1998, noticed severe cracking in the fall of 1999, and learned through a letter from Minnesota Lath that the cause of the cracking was the “result of a structural issue not connected to the stucco installation” in November 2000. Although the time of Hoffman’s earliest discovery of the injury may be disputed, it cannot be reasonably disputed that Hoffman had discovered the injury at the latest by November 2000. On this record, Hoffman has failed to present genuine issues of material fact regarding the discovery of the injury and the start of the accrual period.
Hoffman argues that respondents are estopped from asserting the statute of limitations as a bar to his underlying negligence action against Palmer-Soderberg. Specifically, Hoffman argues that Palmer-Soderberg made assurances that minor stucco cracking was repairable and that those assurances induced him to not commence legal action. Palmer-Soderberg admits that it informed Hoffman that minor stucco cracking could be repaired but made no assurances as to the structural integrity of the home or its ability to repair any structural issues. Further, it asserts that after Hoffman noticed “severe” stucco cracking and received a copy of the November 2000 letters from Resource Supply and Minnesota Lath, that he was on notice that the stucco cracking was a structural problem, and that minor stucco repairs would not resolve the problem.
Estoppel is an equitable
doctrine that prevents a party from “taking unconscionable advantage of his own
wrong by asserting his strict legal rights.” Mut. Serv. Life Ins. Co. v. Galaxy Builders, Inc., 435 N.W.2d 136,
140 (Minn. App. 1989) (quotation omitted), review
denied (Minn. Apr. 19, 1989). “To raise estoppel, one must show
representations made by one party that the other has reasonably relied on to
his detriment.” BWBR Architects, 645 N.W.2d at 493.
In the context of Minn. Stat. § 541.051, estoppel is pleaded where “after
discovery of a cause of action, the injured party has been induced to forego
suit in reliance on the other party’s assurances that corrective action would
The district court found that (1) although Palmer-Soderberg attempted to repair the minor cracks in the stucco, there was no representation that those repairs would resolve any structural problems with the house; (2) “there [was] clearly no evidence that Palmer-Soderberg induced [Hoffman] to delay the filing of [his] complaint. In fact, quite the opposite is true. [Hoffman] unilaterally severed his contact with Palmer-Soderberg after a dispute over the terms of an agreement regarding re-meshing of the home;” and (3) that Hoffman’s “claim of equitable estoppel is without merit and does not toll the statute of limitations.”
Hoffman argues that under Brenner v. Nordby, 306 N.W.2d 126,
Here, it is not disputed that minor web-like cracking of stucco is normal and repairable, and that Palmer-Soderberg repaired those cracks in the stucco. And it is not disputed that Palmer-Soderberg made no assurances that it would remedy any structural problems or requested that Hoffman not file a lawsuit. Hoffman argues that by attempting cosmetic repairs, Palmer-Soderberg was assuring him that such repairs would take care of the problem. But Palmer-Soderberg and the letter from Minnesota Lath clearly state that the problems were structural and not caused by the stucco. Such statements would not reasonably induce a party to forego suit. On this record, there is no genuine issue of material fact, and the district court properly found that as a matter of law, equitable estoppel does not toll the statute of limitations.
Hoffman contends that the district court erred in concluding that Van Hook’s bankruptcy precluded his claims because Van Hook did not schedule Hoffman as a creditor, and the automatic bankruptcy stay does not apply to actions that were not or could not have been commenced prior to the bankruptcy. Because we find that Hoffman’s claims were barred by the statute of limitations, this issue is moot. Accordingly, we decline to address it.
 A portion of the statute not at issue here
was subsequently amended in 2004. See 2004
 Hoffman’s remaining non-warranty claims are for (1) breach of contract; (2) strict liability; (3) negligent design and construction; (4) fraud, misrepresentation and fraudulent concealment; (5) false promises, misleading statements, and deceptive practices in violation of Minn. Stat. § 325F.69; and (6) promissory estoppel.