On Appeal from the United States District Court for Delaware; D.C. Civil No. 88-128.
Higginbotham, Chief Judge and Cowen and Nygaard, Circuit Judges.
In this diversity case, Aronow Roofing Co. ("Aronow") appeals from a summary judgment granted to Gilbane Building Co. ("Gilbane"), because the statute of limitations had expired on Aronow's claim. At issue is whether the contract is under seal and, as a specialty, subject to a twenty year, not a three year limitations period. The district court concluded that the document was not under seal and subject to the three year limitation. We agree and will affirm.
Pursuant to a primary construction contract between Gilbane and the Nemours Foundation concerning the A.I. DuPont Hospital, Gilbane subcontracted with Aronow to perform roofing work on a hospital. After the contract was negotiated, Gilbane sent Aronow an unsigned subcontract along with instructions for executing that contract. One of the instructions required the subcontractor to affix its corporate seal to the document and have the signature witnessed. Marvin Aronow, Vice-President of Aronow, complied with this instruction, signed and affixed the corporate seal to the subcontract and then returned it to Gilbane. David Gregory, Gilbane's Regional Manager, signed the subcontract on behalf of Gilbane without affixing its corporate seal and returned a copy to Aronow. Aronow completed the roof in June, 1982. Several disagreements arose out of Aronow's subcontracting work, including: (1) completion of Aronow's obligations; (2) the amount of money owed to Aronow; and (3) Aronow's contractual promise to guarantee the roofing work. Aronow provided Gilbane with an acceptable guarantee in June, 1987.*fn1
Aronow brought this action in 1988, claiming that Gilbane had breached the contract by failing to pay money due. Gilbane filed a motion for summary judgment, maintaining that the three year statute of limitations period for breach of contract actions had expired in June, 1985. The district court granted defendant's motion on September 28, 1989 and this appeal followed.
On review, we apply the same test for summary judgment which the district court applied with all evidentiary inferences resolved in a light most favorable to the non-moving party. Erie Telecommunications, Inc. v. City of Erie, 853 F.2d 1084, 1093 (3d Cir. 1988). Summary judgment will be granted where the non-moving party fails to "establish the existence" of an element essential to the case. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). Thus, summary judgment becomes appropriate where no genuine issue of material fact exists. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986); see Fed.R.Civ.P. 56 (c).
The claim is subject to Delaware law which provides a three-year limitation for causes of action based upon contracts. 10 Del.C. § 8106. Aronow first argues that the statute did not begin to run until Gilbane accepted the roof guarantee which, it claims, constituted the final act under the contract.
Under Delaware law, however, the statute of limitations begins to run when the contract is breached. Freedman v. Beneficial Corp., 406 F. Supp. 917, 923 (D.Del. 1975). The duty to pay arises upon completion of construction. The roofing work was completed by Aronow in 1982. Aside from any lingering guarantee disputes unrelated to completion of the actual work, Gilbane refused to pay in 1982 and the alleged breach occurred at that time. Gilbane's 1987 acceptance of the roofing guarantee does not renew Aronow's cause of ...