Minn. Stat. § 480A.08, subd. 3 (1996).
STATE OF MINNESOTA
IN COURT OF APPEALS
Drake Construction, Inc.,
a/k/a Raymond Drake Homes,
File No. 9616688
Richard S. Stempel, Stempel & Schmidt, PLC, 41 12th Ave. N., Hopkins, MN 55343 (for appellant)
Stephen J. Nash, Randall J. Fuller, Babcock, Locher, Neilson & Mannella, 118 East Main St., Anoka, MN 55303 (for respondent)
Considered and decided by Klaphake, Presiding Judge, Davies, Judge, and Harten, Judge.
Appellants, purchasers of real property, challenge the district court's grant of summary judgment in favor of respondent homebuilder and denial of appellants' motion to amend the pleadings. We affirm.
Appellants Allen A. and Paula Filipiak are the third owners of a home built in 1987 by respondent Drake Construction, Inc. Appellants sued respondent in conciliation court for breach of implied warranty, alleging that respondent's poor workmanship necessitated the replacement of the home's roof and steps. The conciliation court ruled in favor of respondent.
Appellants removed the case to the district court for trial de novo. Respondent moved for summary judgment, arguing that the implied warranty claim was barred because appellants lacked privity with respondent. Appellants moved to amend their original complaint to include U.C.C. and express warranty claims, and to add additional defendants. The district court granted respondent's motion for summary judgment and denied appellants' motions to amend. This appeal followed.
Leave to amend a pleading is freely granted when justice so requires. Minn. R. Civ. P. 15.01. But a district court's decision to deny a motion to amend is reversed only if the court abused its discretion. Copeland v. Hubbard Broad., Inc., 526 N.W.2d 402, 405 (Minn. App. 1995), review denied (Minn. Mar. 29, 1995).
Here, the district court did not abuse its discretion by denying appellants' motions to amend. Appellants' motion to add a U.C.C. claim failed to state a cognizable legal claim and was properly denied. See Envall v. Independent Sch. Dist. No. 704, 399 N.W.2d 593, 597 (Minn. App. 1987) (amendment denied if it does not state cognizable legal claim), review denied (Minn. Mar. 25, 1987). Article 2 of the U.C.C. is inapplicable to the subject matter of this dispute--a service contract for the installation of a roof on a new home. See Minn. Stat. § 336.2-102 (1996) (Article 2 applies to transactions in "goods"). Even if the U.C.C. did apply, appellants' claim would be barred by the U.C.C. statute of limitations. See Minn. Stat. § 336.2-725 (1996) (action for breach of sales contract must be commenced within four years after cause of action has accrued).
Appellants' motion to add an express warranty claim was properly denied, for they failed to provide evidence that such a warranty ever existed. See Bib Audio-Video Prods. v. Herrold Marketing Assocs., Inc., 517 N.W.2d 68, 73 (Minn. App. 1994) (motion to amend without evidence supporting additional claims should be denied). If any express warranty existed, it was between appellants and the preceding owners, but appellants' motion to add additional defendants failed to identify them.
Summary judgment is proper when there is no genuine issue as to any material fact and one party is entitled to judgment as a matter of law. Minn. R. Civ. P. 56.03. On appeal from summary judgment, a reviewing court must determine: "(1) whether there are any genuine issues of material fact; and (2) whether the lower court erred in its application of the law." Lubbers v. Anderson, 539 N.W.2d 398, 401 (Minn. 1995). There are no issues of fact in this case because the matter was submitted on stipulated facts. Therefore, we need only determine whether the district court erred in its application of the law.
The district court applied the law properly, for this court does not extend implied warranties to subsequent purchasers who lack privity with an original builder. Tereault v. Palmer, 413 N.W.2d 283, 286 (Minn. App. 1987), review denied (Minn. Dec. 18, 1987). In Tereault, plaintiffs were the third owners of a home built seven years earlier. Shortly after purchasing the home, they discovered that it had settled unevenly, resulting in large foundation cracks and water leakage that could only be repaired at a cost exceeding the value of the home. The owners sued the homebuilder for, among other things, breach of implied warranty. Id. at 284-85.
In Tereault, we noted that many states, including Minnesota, recognize an implied warranty of fitness in the sale of land and buildings. Id. at 285; see also Robertson Lumber Co. v. Stephen Farmers Coop. Elevator Co., 274 Minn. 17, 24, 143 N.W.2d 622, 626 (1966) (building purchasers who are in privity with builder may recover on breach of implied warranty theory). But we declined to extend the implied warranty to a subsequent purchaser, noting that relatively few states allow subsequent purchasers who lack privity with the builder to enforce an implied warranty. Tereault, 413 N.W.2d at 285-86.
We continue to hold that enforcement of an implied warranty requires privity between purchaser and builder. Because appellants are subsequent purchasers who lack privity with respondent, they may not recover under an implied warranty of fitness.
The district court did not abuse its discretion by denying appellants' motions to amend the pleadings and add additional defendants. The district court did not err in its application of the law by granting respondent's motion for summary judgment.