Cumberland County Board of Chosen Freeholders v. Vitetta Group, P.C., A-1377-12T3; Appellate Division; opinion by Lihotz, J.A.D.; decided and approved for publication July 30, 2013. Before Judges Messano, Lihotz and Ostrer. On appeal from the Law Division, Cumberland County, L-962-07. DDS No. 11-2-0829 [20 pp.]

In 1993 Gilbane Building Company was retained by the Cumberland County Board of Chosen Freeholders to supervise construction of the expansion and remodeling of the Cumberland County Courthouse. In August 1995, Gilbane issued a substantial completion notice that transferred full possession to plaintiff and triggered the commencement of the warranty provisions. By November, leaking had caused water damage but Gilbane was neither notified nor involved in the repair attempts.

The board filed this action against Gilbane and others involved in the project in September 2007, alleging that, inter alia, its damages were directly and proximately caused by Gilbane's negligence, lack of care, willful misconduct and gross negligence in supervising the construction.

Gilbane moved to dismiss the complaint, arguing plaintiff's claims were "barred" by the statute of repose, N.J.S.A. 2A:14-1.1, because the suit was not begun within 10 years of completion of its services on the project. The Law Division granted the motion, finding the complaint untimely under the applicable 10-year statute of limitations for civil actions commenced by governmental bodies.

On appeal, plaintiff argues the judge erred as a matter of law by applying the wrong legal standard when determining whether its action was untimely.

Held: If an action is barred by the statute of limitations, it cannot be saved by the statute of repose. The timeliness of a claim remains dependent on the applicable statute of limitations.

The panel says resolution of this matter demands the interpretation of 2A:14-1.2, and 2A:14-1.1.

N.J.S.A. 2A:14-1.2a provides that, except where a limitations provision expressly applies to actions commenced by the state, and subject to any statutory provisions or common-law rules extending limitation periods, any civil action commenced by the state or its political subdivisions shall be commenced within 10 years of the accrual of the cause of action. The statute is one of limitation, fixing the time within which an action seeking redress must be instituted, typically measured from the time the cause of action accrues. It is a procedural device operating as a defense to limit the remedy available on proof of an existing cause of action. Expiration of a statute of limitations operates to bar the filing and prosecution of what is deemed a stale suit.

N.J.S.A. 2A:14-1.1(b)(2) provides that no action to recover damages for any deficiency in the supervision or construction of an improvement to real property shall be filed more than 10 years after the performance of such service but that this bar does not apply to an action by a governmental unit based on willful misconduct, gross negligence or fraudulent concealment in connection with the provision of the service. It is a statute of repose.

Plaintiff argues that its claims against Gilbane are solely governed by 2A:14-1.1(b)(2). Thus, the action falls within the exception in 2A:14-1.2a and the limitations bar of 2A:14-1.2a is inapplicable. Further, because its suit alleges willful misconduct and gross negligence in the furnishing of the supervision, plaintiff reasons the 10-year period of repose does not bar its action.

The panel rejects the syllogism as flawed. It says that statutes of limitations and statutes of repose are different. Unlike the former, the latter does not bar a remedy but rather prevents the cause of action from ever arising. It is well-accepted that 2A:14-1.1 was specifically intended to limit the time within which a cause of action may arise against a construction professional to 10 years from the date construction is substantially completed so that injuries sustained or suits filed after that period are barred.

Courts generally do not expand the limitations period defined by a statute of repose unless the Legislature carved out exceptions that permit for tolling. N.J.S.A. 2A:14-1.1b(2) includes such an exemption for governmental actions based on willful misconduct, gross negligence or fraudulent concealment. Plaintiff's allegations are drawn to fit within this exemption.

However, the panel says plaintiff cannot proceed with its complaint by ignoring its obligation to timely file claims pursuant to the applicable statute of limitations. The statute of repose will not save a claim otherwise barred by the applicable statute of limitations.

The provision of 2A:14-1.2a identifying the applicability of "another limitations period" does not impliedly refer to the statute of repose. Limitation statutes are separate and distinct from the statute of repose. In fact, the statute of repose impliedly incorporates the applicable statute of limitations for particular actions. Consequently, a plaintiff's claim is subject to the 10-year statute of absolute repose, as well as the separate and distinct statute of limitations.

Accordingly, if an action is barred by the statute of limitations, it cannot be saved by the statute of repose. Once a plaintiff is aware of the facts giving rise to the cause of action, the statute of repose does not relieve it of the obligation to file the cause within the period defined by the applicable statute of limitations. The timeliness of a claim remains dependent on the applicable statute of limitations.

Plaintiff had 10 years from the date it discovered the leakage problem to file its suit against Gilbane. It failed to do so. The complaint was properly dismissed.

For appellant — Steven L. Rothman (Lipman, Antonelli, Batt, Gilson, Rothman & Capasso; Rothman and Jane B. Capasso on the briefs). For respondent — Tracy L. Burnley (Marshall, Dennehey, Warner, Coleman & Goggin).