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Guzman v. C.R. Epperson Construction, Inc., v. MJE Construction, Inc., No. 4-98-1050

4th District, 7 January 2000

PRESIDING JUSTICE COOK delivered the opinion of the court:

In September 1992, plaintiffs, Milton and Donna Guzman (Guzmans), sued defendant and third-party plaintiff, C.R. Epperson Construction, Inc. (Epperson), for breach of contract due to the alleged improper construction of their new home by Epperson. The Guzmans voluntarily dismissed their complaint without prejudice in March 1996 but refiled it in April 1996, alleging the same causes of action. In September 1996, Epperson filed a third-party breach-of-contract complaint against various subcontractors that it hired to help construct the Guzman home and later amended its complaint to add indemnity claims as well. In April 1998, the trial court dismissed Epperson's complaint against one subcontractor as barred by the statute of limitations and later dismissed claims against two others and granted summary judgment to a third. Epperson appeals. We reverse and remand with directions.

BACKGROUND

In 1988, the Guzmans contracted with Epperson to build a residence in Bloomington, Illinois. Epperson then contracted out work to various subcontractors, including third-party defendants MJE Construction, Inc. (MJE); Michael Hadden, d/b/a Hadden Concrete (Hadden); Hardesty Heating and Ventilating, Inc. (Hardesty); and Robert Georgi, d/b/a G&G Roofing (Georgi). On September 25, 1992, the Guzmans sued Epperson, claiming that their home had been constructed improperly, resulting in numerous structural defects. In March 1996, the Guzmans voluntarily dismissed their complaint but refiled it on April 12, 1996, alleging the same claims.

On September 4, 1996, Epperson filed a third-party breach-of-contract complaint against subcontractors MJE, Hadden, Hardesty, Georgi, and a fifth subcontractor that Epperson later voluntarily dismissed from the lawsuit. The complaint detailed the various problems for which each subcontractor was allegedly responsible, stating that the residence had flooded and leaked repeatedly in 1989 and 1990 and subsequently during periods of heavy rainfall. On February 10, 1997, Epperson amended its complaint to include express and implied indemnity claims. Epperson also added a claim against a sixth subcontractor, since deceased, who is not part of this litigation.

MJE and Hardesty then filed motions to dismiss the amended claims directed at them, arguing that Epperson admitted in its original complaint to having known of the alleged deficiencies as early as 1989 or 1990 and, therefore, had failed to file its complaint within the four-year limitations period of section 13-214(a) of the Code of Civil Procedure (Code) (735 ILCS 5/13-214(a) (West 1996)), which provides:

"Actions based upon tort, contract[,] or otherwise against any person for an act or omission of such person in the design, planning, supervision, observation[,] or management of construction, or construction of an improvement to real property shall be commenced within 4 years from the time the person bringing an action, or his or her privity, knew or should reasonably have known of such act or omission."

The trial court denied the motions. However, in a subsequent motion to dismiss, Georgi included an August 1996 letter from Epperson informing Georgi of the lawsuit, which stated that Epperson had tried unsuccessfully to resolve the matter since 1990. Epperson argued in response that it had not suffered any "injury" until the Guzmans sued it in April 1996 or, at earliest, when they originally sued Epperson in September 1992.

Epperson further contended that section 13-204 of the Code (735 ILCS 5/13-204 (West 1996)) applied to its indemnity claims. Section 13-204, which was amended (Pub. Act 88-538,