Most residents of Colorado have heard of the state’s statute of limitations, but very few Coloradans understand the precise meaning of the term. Even fewer have heard of the state’s statute of repose.
In construction law, the statute of limitations is intended to limit the time in which a lawsuit may be commenced to recover damages for faulty construction work. The limitation period begins on the date upon which the alleged defect is discovered. The statute of repose is intended to foreclose any and all claims arising from alleged defects in the construction project, regardless of the cause.
This post will provide a brief summary of both statutes and an enumeration of their significant differences.
Statute of limitations
Like most states, Colorado has laws that provide strict time limits for starting a lawsuit to recover damages from another party. The statutory limitation period may be different for different causes of action. In this post, we will address the various limitation periods that apply to construction of improvements to real property.
The limitation period for commencing a lawsuit to recover damages caused by an alleged defect in the design, construction or operation of real property is two years from the date on which the cause of action (the legal basis for the claim) accrues. The party seeking to invoke the statute of limitation must raise the defense in its answer and must prove that the statutory limitations period expired before the complaint was served on the defendant.
Statute of repose
Colorado’s statute of repose states that any claim alleging damages caused by an alleged defect in the design or construction of real property must be brought within six years after substantial completion of the improvement in question. If the claim arises within the fifth or sixth year after substantial completion, the claim must be asserted within two years from the date on which the cause of action arose.
If either the statute of limitation or the statute of repose is asserted in a timely fashion, the court will have no choice but to dismiss the claim. If a party who may have had a defense by raising wither the statute of limitation or the statute of repose fails to assert the defense, the defense will be deemed to have been deliberately and permanently waived.