October 30, 2008
EVESHAM TOWNSHIP BOARD OF EDUCATION, PLAINTIFF-APPELLANT/ CROSS-RESPONDENT,
VITETTA GROUP, DEFENDANT-RESPONDENT/CROSS-APPELLANT, AND ROLAND ARISTONE, INC., DEFENDANT/THIRD-PARTY PLAINTIFF, AND NEW ROAD CONSTRUCTION MANAGEMENT CO., INC. AND HARTFORD FIRE INSURANCE COMPANY, DEFENDANTS,
ERTLE ROOFING & SHEET METAL, INC., THIRD-PARTY DEFENDANT/ CROSS-APPELLANT, AND PATRIOT ROOFING, INC., CERTAINTEED CORP., THIRD-PARTY DEFENDANTS, AND DANIEL S. FALASCA PLUMBING, HEATING, COOLING, INC., THIRD-PARTY DEFENDANT/ CROSS-APPELLANT/FOURTH-PARTY PLAINTIFF,
SHARON SHEET METAL, ATLANTIC MILLER SERVICES AND SOUTH JERSEY AIR BALANCING CO., INC., FOURTH-PARTY DEFENDANTS, AND BARBER COLEMAN AND INVESYS BUILDING SYSTEMS, FOURTH-PARTY DEFENDANT/RESPONDENT.
RONALD ARISTONE, INC., PLAINTIFF,
PENNSYLVANIA MANUFACTURERS ASSOCIATION INSURANCE CO. (PMA), ROYAL INSURANCE COMPANY OF AMERICA, ABC INSURANCE CO., DEF INSURANCE CO., DEFENDANTS.
On appeal from the Superior Court of New Jersey, Law Division, Camden County, Docket No. 10565-05.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued: March 5, 2008
Before Judges Axelrad, Payne and Sapp-Peterson.
Plaintiff Evesham Township Board of Education ("Board") sought damages based on negligence and breach of contract for faulty design and construction of the Frances S. DeMasi School. The defendants were the project architect and engineer, the Vitetta Group ("Vitetta"), the general contractor, Roland Aristone, Inc. ("Aristone"), the construction manager, New Road Construction Management Company, Inc. ("New Road"), and the general contractor's performance bond surety, Hartford Fire Insurance Company ("Hartford"). Aristone impleaded several third-party defendants, including Ertle Roofing & Sheet Metal, Inc. ("Ertle") and the heating, ventilation and air conditioning (HVAC) contractor, Daniel S. Falasca Plumbing, Heating, Cooling, Inc. ("Falasca"). Falasca, in turn, impleaded several fourth-party defendants, including Barber Coleman and Invesys Building Systems ("Barber Coleman").
The Board, by leave granted, appeals from the March 2, 2007 amended order of the Camden County Superior Court motion judge granting partial summary judgment to Vitetta and Falasca dismissing the Board's HVAC and mold claims and the March l6, 2007 order for summary judgment to Barber Coleman dismissing all HVAC claims as barred by the statute of repose, N.J.S.A. 2A:14-1.1. The court held the complaint, filed within the ten-year period, which generally alleged "defects and deficiencies" in the school but did not specifically allege a deficient HVAC system or a mold problem, did not sufficiently raise the HVAC and mold claims.
Vitetta, Ertle, and Falasca cross-appeal from the January 27, 2005 order of the Burlington County Superior Court motion judge*fn1 striking all statute of limitations defenses, N.J.S.A. 2A:14-1, asserted by defendants, third-party defendants and fourth-party defendants on equitable estoppel grounds, and from the latter judge's determination that the 2005 order constituted the law of the case regarding the statute of limitations defense.*fn2 We reverse on both the appeal and the cross-appeal, concluding the HVAC and mold claims were not barred by the ten-year statute of repose but the Board's roof and HVAC claims, and resulting mold damage claims, were barred by the six-year statute of limitations.
During the years 1989 to l99l, the Board contracted with Vitetta to perform architectural services in connection with the DeMasi School construction, New Road to perform construction management services as the Board's agent, and Aristone to work as general contractor. Construction occurred from l99l to l993. Evesham Township issued temporary Certificates of Occupancy on July 22, 1993*fn3 and September 7, 1993. The Board took occupancy of the building on September 7, 1993 and has continuously used the building since then. On October 11, 1993, Vitetta issued a letter establishing September 7, 1993 as the date of "substantial completion."*fn4 The Board accepted the DeMasi School as substantially complete by resolution on December l3, 1994 and executed a Certificate of Completion and Acceptance of the project on February l4, 1995. Evesham Township issued a final Certificate of Occupancy on February 10, 1995. From l993 through l995, the Board identified and consolidated an extensive series of punch list items, including those relating to the roof and HVAC system.
In October 1993 water leaks were discovered in the building originating from the roof, and during the l993-1994 school year, the Board complained of ongoing concerns with the HVAC system. Defendants made repairs through l995, and at the time the general contractor received final payment in June, it was believed all roof leaks and HVAC issues had been corrected. However, significant additional roof leakage occurred following a major snowstorm in January 1996. The Board's last contact with Aristone occurred in May l996, when the contractor apparently indicated it saw no further problems with the roof. The Board, however, still experienced roof leaks as late as l999 and 2000, which it had addressed by its maintenance staff.
On February l2, 2001, a teacher in the school complained of respiratory illness and reported worsening roof leaks and mold in the ceiling and rug. The principal responded by having the maintenance staff replace ceiling tiles and spray for mold.
On December 20, 2001, the Board filed a complaint in Burlington County against Vitetta, Aristone, New Road and Hartford seeking damages for negligent design and construction and breach of contract arising from "water leakage and other problems principally, although not exclusively, related to the roof." Vitetta and New Road asserted the statute of repose and statute of limitations as affirmative defenses in their answers to the complaint. Aristone asserted the statute of limitations as an affirmative defense in its answer. At some point prior to June 26, 2003, Aristone filed a third-party complaint against several roofing companies, including Ertle, and against Falasca, the HVAC contractor.*fn5 Falasca also asserted the statute of limitations as an affirmative defense in its answer.*fn6
In late 2002 through 2003, several defendants filed motions for summary judgment to dismiss the Board's complaint based on the six-year statute of limitations bar, and the Board filed a cross-motion. Following oral argument in February 2004, the court concluded the statute of limitations defenses presented factual issues that necessitated a Lopez*fn7 hearing to determine under the "discovery rule" when the Board became aware of the defects on which it based the suit. The hearing was scheduled for July 2004.
While the motions were pending, the Board served a January 8, 2003 expert report on all parties, focusing on two principal design and construction deficiencies: a defective roofing system resulting in persistent leaks and the absence of mechanical ventilation and thermostatic controls in the HVAC system in Area 5 of the school resulting in an inability to control the temperature and overall environment of the corridor. After detecting substantial mold growth in the school in August, the Board engaged experts to conduct tests to determine its cause and extent. The mold issue was discussed at a Case Management Conference in September 2003, and scheduling orders were established. On March 12, 2004, the Board served supplemental expert reports attesting to pervasive mold growth in the school that had begun to infect the classroom air, and opining that the mold was caused, over a period of years, by a combination of water leakage from the defective roof and excessive humidity from the defectively designed and built HVAC system. The experts further faulted the HVAC system for failing to bring sufficient fresh air into the school.
Several defendants then moved to bar these expert reports as untimely. By order of May 28, 2004, the court barred the reports and the testimony based on them, permitted the Board to introduce at trial only mold evidence as previously provided in discovery prior to March 12, 2004, and "permitted [defendants] to offer expert testimony on the mold issue." The Board filed an interlocutory appeal, and by order of September l6, 2004, we granted leave to appeal and "summarily reverse[d] the order of May 28, 2004, which barred the [three] expert reports . . . and precluded testimony as to [their] contents" and further provided that all other parties be given ample opportunity to secure their own experts and inspect the school. We also remanded for the "fixing of an appropriate discovery order."
In the interim, on May 11, 2004, the Board filed another complaint against defendants specifically alleging HVAC problems causing the mold. Defendants filed motions to dismiss the new action based on the statute of repose. The Board withdrew the second action by stipulation of dismissal without prejudice filed on December 2, 2004, stating such dismissal was based on our reversal of the order barring the Board's supplemental experts' reports.
In July 2004, the court conducted a Lopez hearing over seven days, during which nine witnesses testified and in excess of sixty-nine exhibits were placed into evidence regarding the roof, HVAC and mold claims.*fn8 On January 14, 2005, the court issued an oral ruling striking all statute of limitations defenses, memorialized in a January 25, 2005 order and February 16, 2005 written opinion. In its written opinion the court found, among other facts, that: (1) plaintiff first noted leaks originating from the roof sometime in l993; (2) roof-related problems were reflected in the punch lists from l993 to l995; (3) on June l9, 1995, there was an indication the roof was repaired and no problems were noted; (4) substantial leaks occurred on January 7, 1996 as a result of a significant snowstorm; (5) after investigating leaks in the valley areas of the roof in May l996, the Board was informed through Vitetta that Aristone saw no further problem with the roof and would not be doing any further work; and (5) there were further roof repairs performed by the Board's maintenance personnel in l999 and 2000.
The court acknowledged that the "discovery rule encompasses injured parties['] knowledge regarding the origin and existence of his injuries as related to the conduct of another" and found "plaintiff was aware the deficiencies existed before the certificate of substantial completion [and] [f]urther, there is no question plaintiff had knowledge that the injuries were caused by the contractors, as there were numerous communications between plaintiff's representatives and the contractor between l993 through l996." The court then concluded that despite no evidence of misrepresentation or concealment of a material fact by defendants, the Board was permitted to invoke the doctrine of equitable estoppel to toll the statute of limitations until January 7, 1996, the date of the snowstorm, based on its reliance upon the contractor's completion of performance of items on the punch list as part of its "continual contractual obligation." The court stated:
The Court finds the plaintiff relied upon the defendant to cure these [roof-related] problems [contained in the punch lists]. . . . The Court finds that the tolling of the statute ran from the cessation of the contract performance until the last defect came to the plaintiff's attention
The Court finds based upon equitable principles that the school district accepted Aristone's assurance and confirmation that the roof was fixed, that the items on the punch list were corrected. Leaks were assumed corrected until the problem arose in January l996. Based upon the ruling of the Appellate Division,*fn9 as this Court understands it, the mold issue remains a viable issue. Although there was evidence that mold could have been detected as early as 2001, the plaintiff contends that by way of scientific analysis, mold was definitely present September 2003. Further the plaintiff alleges the leaky roof, HVAC problems and air flow system all contributed to the mold issue. In that regard, plaintiff is left to its proofs.
It is this Court's opinion that a global approach must be exercised along with public policy consideration.
Accordingly, this Court finds that the statute of limitation[s] on the plaintiff's claim for the design construction defects did not begin to run until January l996, accordingly the Complaint that was filed in December 200l is within the six (6) years statute of limitation[s]. The Court finds the statute of limitation[s] defense asserted is dismissed with prejudice.
Defendants filed motions for leave to appeal this order, which we denied by orders of April 13, 2005, and the Supreme Court denied by order of June 9, 2005.
On November l8, 2005, the case was transferred from Burlington County to Camden County. Various trial dates were set, the last being March 12, 2007. On January l7, 2007, Vitetta filed a motion for partial summary judgment striking the Board's claims pertaining to the HVAC system based on the statutes of limitations and repose. New Road*fn10 and Falasca filed similar motions. In his bench opinion of March 2, 2007 following oral argument, the judge considered himself bound by the prior judge's ruling as to the statute of limitations even though he noted his belief that she had not expressly addressed the HVAC mold claim. However, he granted partial summary judgment to defendants on the statute of repose defense, finding that under either the substantial completion date or the January 1996 tolled date pursuant to the Lopez hearing as the commencement date, the Board's HVAC and mold claims were barred by the ten-year statute of repose. Specifically, the judge reasoned that the December 2001 complaint that did not specifically allege mold in the school or make any reference to HVAC defects, and which was not amended, did not provide sufficient "knowledge or notice" to encompass such claims, and thus concluded the HVAC and mold claims were "not in the case" and could not now be asserted as the ten-year period of the statute of repose had passed. The court's March 2, 2007 order granted partial summary judgment to Vitetta and Falasca pursuant to the statute of repose "as to all HVAC claims and mold claims arising from any alleged problems with the HVAC system." In response to the Board's letter seeking clarification as to whether the order barred the Board from presenting evidence at trial of mold caused by leaks from the defective roof or that the defective HVAC system contributed to the roof failure, the court issued an amended order, also dated March 2, 2007, granting partial summary judgment "as to all HVAC claims and mold claims."*fn11
Pursuant to the Board's motion, on April l8, 2007, we granted leave to appeal and stayed trial pending appeal. On June 4, 2007, we granted Vitetta's, Ertle's and Falasca's motions to file cross-appeals as within time.
On appeal, the Board argues the Camden County judge erred in declining to find that defendants waived the statute of repose defense. The Board further argues the judge erred in dismissing its mold and HVAC claims under the statute of repose, contending that both its complaint was filed and its injuries relating to the HVAC system and mold occurred within the ten-year repose period. The Board makes several alternative arguments as to the commencement date for the statute of repose. The Board primarily asserts that the statute of repose for its claims against defendants began to run when Vitetta completed its services in February l995. At that time, the final Certificate of Occupancy was issued by the Township, the Board executed the Certificate of Completion and Acceptance, and Vitetta substantially completed its work of approving and recommending final payment to the general contractor in accordance with its contractual administrative duties. As a secondary and alternative position, the Board contends the repose period commenced at the earliest in December 1994, when the Board accepted the school as substantially complete, emphasizing that Vitetta's October 11, 1993 letter designating September 7, 1993 as the date of substantial completion did not constitute a certificate of substantial completion under either the contract documents or the law, and that there still remained 3500 to 5000 outstanding punch list items. Lastly, though not conceding this date, the Board submits that even accepting September l993 as the commencement of the repose period as urged by defendants, the claims are timely because the injuries occurred and the HVAC and mold claims were pled within the ten-year period.
According to the Board, the judge read its complaint too narrowly. The Board urges that although the HVAC and mold claims were not expressly pled, they were encompassed within the broad scope of the complaint and satisfied New Jersey's liberal notice-pleading standard. According to the Board, the judge also failed to consider the history of the case and the inextricable connection among the Board's roof, HVAC and mold claims in analyzing the judgment of repose defense. More particularly, the Board submits that defendants had sufficient notice the HVAC and mold claims were involved in the action based on the discovery, experts' investigations and reports, testimony and evidence presented at the lengthy Lopez hearing, and extensive proceedings continuing up to defendants' motions on the eve of trial. The Board further points to our September l4, 2004 order, and it argues that by summarily reversing the trial court's preclusion of expert testimony regarding mold and the HVAC system, we effectively ruled that the Board's HVAC and mold claims were part of the action.
The Board also urges that the judge should have applied Rule 4:9-2 to conform the pleadings to the evidence, arguing that the policy underlying New Jersey's liberal approach concerning amendment of the pleadings to conform to evidence militates strongly in favor of allowing the Board to delineate by discovery and elaborate by expert reports its claims regarding the deficient HVAC system and mold growth. According to the Board, such application is particularly appropriate in a case such as the present one in which its defective roof claims, which were found to be timely filed as sufficiently pled in the complaint, are inextricably intertwined with its claims that:
(1) mold exists in the school because mold is caused, in part, by the leaky roof; and (2) the HVAC system is defective because it contributed to the roof failure, a position supported by one of Ertle's experts. Thus, according to the Board, because of this interrelationship, the dismissal of its HVAC and mold claims prejudices its claims relating to the roof.
In its last point, the Board makes the alternative argument, for the first time on appeal, that the jury should decide whether defendants were grossly negligent such that an exception to the statute of repose applies.
Defendants note they raised the statute of repose defense in their answers and interrogatory answers. They explain they filed their summary judgment motions after completing as much discovery as possible before the trial date, which they contend is the procedure we have stated to be the "preferable practice." Defendants point out the cases cited by the Board that find a waiver of the statute of repose involve dissimilar factual scenarios and egregious behavior not present in this case.
On the merits, defendants contend the judge scrutinized the Board's complaint for any allegation arising from deficiencies in the HVAC system or the presence of mold with both a mindset that New Jersey is a notice-pleading state and that the purpose of the statute of repose is to prevent "liability for life" against contractors and architects. According to defendants, the judge properly concluded the HVAC and mold claims had not been pleaded. They note the Board never amended its complaint to include these issues, which they urge are different in character and kind from a leaky roof, and failed to supplement its pleading pursuant to Rule 4:9-4. Defendants further contend the Board's injuries did not occur and its position was not contemplated until 2004, when the mold was discovered and the expert reports were prepared, which was more than ten years after the September 7, 1993 date of substantial completion.
We consider the Board's appeal in the context of both the statute of repose and notice pleading. New Jersey's statute of repose was intended to "limit the expanding liability of contractors, builders, planners, and designers" and "cut back on the potential of this group to be subject to liability for life." Russo Farms, Inc. v. Vineland Bd. of Educ., 144 N.J. 84, 116 (1996) (quoting Horosz v. Alps Estates, Inc., 136 N.J. 124, 128 (1994)). N.J.S.A. 2A:14-1.1 states in pertinent part:
a. No action, whether in contract, in tort, or otherwise, to recover damages for any deficiency in the design, planning, surveying, supervision or construction of an improvement to real property, or for any injury to property, real or personal . . . shall be brought against any person performing or furnishing the design, planning, surveying, supervision of construction or construction of such improvement to real property, more than l0 years after the performance or furnishing of such services and construction. . . .
Two important elements control its applicability: (1) when the injury occurred; and (2) when the action was filed. "[I]njuries sustained or suits filed after the ten-year period are barred." Greczyn v. Colgate-Palmolive, 183 N.J. 5, 18 (2005). Our Supreme Court characterized N.J.S.A. 2A:4-1.1 as a "special statutory limitation or 'hybrid[,]'" further explaining:
On the one hand, it bars a right of action from coming into existence if the accident occurs subsequent to the ten-year period; but as to those events happening before the statutory period has run, the provision disallows, like any other statute of limitations, the institution of suit after the prescribed ten years has expired. [O'Connor v. Altus, 67 N.J. 106, 121-22 (1975).]
The statute of repose does not bar an otherwise valid cause of action, but strips an injured party of any cause of action. Rosenberg v. Town of N. Bergen, 6l N.J. 190, 199 (1972). The Court explained the difference between the statute of repose and statute of limitations:
"[i]n an important respect, [a statute of repose] is unlike the typical statute of limitations . . . [because t]he time within which suit may be brought under [the statute of repose] is entirely unrelated to the accrual of any cause of action." Unlike a statute of limitations, the Statute of Repose "does not bar a cause of action; its effect, rather, is to prevent what might otherwise be a cause of action from ever arising." For that reason, "injury occurring more than ten years after the negligent act allegedly responsible for the harm forms no basis for recovery." [Daidone v. Buterick Bulkheading, 191 N.J. 557, 564-65 (2007) (quoting Rosenberg, supra, 61 N.J. at 199) (internal citations omitted).]
The Legislature intended the harsh consequences of the statute:
"The injured party literally has no cause of action. The harm that has been done is damnum absque injuria -- a wrong for which the law affords no redress. The function of the statute [of repose] is thus rather to define substantive rights than to alter or modify a remedy. The Legislature is entirely at liberty to create new rights or abolish old ones as long as no vested right is disturbed." [Daidone, supra, 191 N.J. at 565 (quoting Rosenberg, supra, 61 N.J. at 199-200).]
The Board argues that, although defendants asserted the statute of repose as an affirmative defense in their answers to the complaint, they waived the defense by failing to raise it at the Lopez hearing or thereafter prosecute the defense in the ensuing two and one-half years. See Williams v. Bell Tel. Labs., Inc., 132 N.J. 109, 118-20 (1993) (holding defendant, although pleading the statute of limitations defense in its answer, waived that defense by failing to assert it at any stage of the proceedings, through the entire three-and-one-half year span of the litigation, through preparation for and conduct of the protracted trial, and into a post-verdict submission); Zaccardi v. Becker, 88 N.J. 245, 256-60 (1982) (holding under the unique circumstances of the case, defendants were estopped from asserting the statute of limitations as an affirmative defense since defendants' own conduct contributed to the delay); White v. Karlsson, 354 N.J. Super. 284, 290-91 (App. Div.) (holding the statute of limitations defense to a personal injury claim was waived due to defendant's inaction in moving for summary judgment until the eve of trial and the resulting time, energy and money expended by the parties in preparing for trial), certif. denied, 175 N.J. 170 (2002).
According to the Board, as of the time we issued our September 14, 2004 ruling, defendants had everything they needed to file a dispositive motion under the statute of repose - they knew the Board was asserting claims based on mold in the school and a defective HVAC system, they knew the construction completion dates for the school, they knew when the Board discovered mold in the school, and they had the Board's March 2004 expert reports substantiating the claims. The Board emphasizes that Vitetta's July 2004 motion arguing that the statute of repose bars the Board's mold and HVAC claims asserted in the second complaint evidences that fact and undermines Vitetta's contention in the trial court that it was required to complete all discovery before moving for summary judgment under the statute of repose. According to the Board, defendants could have avoided conducting "grueling, arduous discovery" regarding the Board's mold and HVAC claims over the ensuing several years and the resulting expenditure of significant time, money and energy by having brought the motion earlier. The Board urges that, under all the circumstances, defendants' delay in waiting slightly less than a month before the trial justified a finding of waiver of the statute of repose defense.
We find no error in the judge's conclusion that the statute of repose defense was "raised at an appropriate time" particularly in view of the judge's familiarity with the nature and procedural history of the case and the numerous letters submitted to him regarding outstanding discovery issues. However, although we find no procedural bar to defendants' motion to dismiss, we reverse the 2007 order on the merits. We conclude that, even accepting defendants' position that the repose period commenced in September l993, the date of substantial completion as defined by the contract, Russo Farms, supra, 144 N.J. at ll8, the Board's HVAC and mold claims are not barred by the ten-year statute of repose. We are satisfied these claims were timely asserted in the complaint and the Board's injuries relating to these claims were sustained within the repose period.
Defendants concede that the Board's claims stemming from roof defects are not exposed to the statute of repose defense as they were pled in the Board's complaint filed in December 2001, less than ten years after substantial completion. Their position, however, adopted by the motion judge, was that the issues concerning the HVAC and mold in the building were not referenced and thus not raised in the complaint. We disagree and find that to be too narrow a reading of the complaint. We are satisfied the complaint also encompassed the HVAC and mold claims though not expressly pled, and thus these claims were timely asserted within the ten-year repose period.
New Jersey is a notice-pleading state, which means that only a short, concise statement of the claim need be given in the complaint, without requiring any technical forms of pleading. R. 4:5-7; see Grobart v. Soc'y for Establishing Useful Mfrs., 2 N.J. 136, 150-52 (1949). Moreover, Rule 4:5-7 requires that "[a]ll pleadings shall be liberally construed in the interest of justice." Even where certain key words are not used or "more by way of facts regarding the [cause of action] would have been enlightening," a complaint will survive provided it fairly apprises the adversary of the claims and issues in dispute. Dewey v. R.J. Reynolds Tobacco Co., 121 N.J. 69, 76-77 (1990). "[W]hen reviewing pleadings to determine whether a cause of action has been stated, courts are charged with the responsibility of searching 'the complaint in depth and with liberality to ascertain whether the fundament of a cause of action may be gleaned even from an obscure statement of claim . . . .'" Velop, Inc. v. Kaplan, 301 N.J. Super. 32, 56 (App. Div. 1997) (quoting Di Cristofaro v. Laurel Grove Mem'l Park, 43 N.J. Super. 244, 252 (App. Div. l957)), appeal dismissed, 153 N.J. 45 (1998).
The Board was required only to provide "simple, concise and direct" allegations in its complaint, R. 4:5-7; the subject matter involved none of the "special matters" as to which Rule 4:5-8 required particularized pleading. The Board's complaint generally apprised the architect, the general contractor and its surety, and the construction manager of the claims and issues in dispute - they were being sued under negligence and breach of contract theories for defects and deficiencies in connection with the DeMasi School construction project.
The allegations expressly were not limited to problems with the roof. Defendants were informed that "[f]ollowing completion of construction, the DeMasi school began to experience water leakage and other problems principally, although not exclusively, related to the roof" (emphasis added), and despite assurances over an extended period, defendants did not accurately determine the cause of the problems and correct them. Defendants had notice that the action could encompass any deficiencies in the school from the complaint's broad claim that the "DeMasi school was designed and built negligently, improperly, carelessly, in breach of defendants' contractual obligations . . . all as evidenced by the defects and deficiencies in the Project." Moreover, although the Board specifically listed deficiencies related to the roof, such as insufficient underlayment and lack of code-required ice protection underlayment, incorrect installation of shingles and metal flashings, incorrect fabrication and installation of metal coping, and incorrect installation of unit skylights, the complaint expressly alerted defendants that the enumerations were "by way of example only."
The Board's omission of a reference to the HVAC system in the complaint, and the further refinement of its claim regarding the HVAC system and mold subsequent to its complaint, was not fatal to a finding that the complaint contained a "fundament of a cause of action" encompassing an HVAC deficiency claim based on defective design and construction. This is not a situation where defendants were completely unaware until after the ten- year period of repose that the Board was asserting a claim regarding a defective HVAC system. Rather, defendants demonstrated by their behavior that they understood that issues involving the HVAC system were "in the case." Critically, prior to June 26, 2003, Aristone, the general contractor, filed a third-party complaint against Falasca, the HVAC contractor.
The omission of any reference to mold in the complaint does not make the mold claim susceptible to the statute of repose defense. The existence of mold, to a large extent, is an element of damage arising from the negligent design, construction and installation of the school project and, as such, need not be specifically alleged in the complaint for the issue to be in the case. This fact was implicitly recognized by counsel for Vitetta who did not take the position that the Board's mold claim resulting from the allegedly defective roof was barred by the statute of repose because mold was not expressly mentioned in the complaint.
Additionally, as the injuries sustained by the Board from the defective HVAC system occurred within the ten-year period, the judge erred in dismissing these claims under the statute of repose. Unhealthy indoor air conditions potentially caused by climate control, insufficient airflow and humidity problems related to the HVAC system and the mold growth potentially caused by leaks and the defective HVAC system existed in the school before September 2003. Temperature regulation issues also appeared to be a problem from the outset. A teacher first reported what she believed to be mold in the classroom in February 2001; the Board's January 2003 expert report referenced an analysis of areas affected by water infiltration to determine the extent of "mold growth on finished surfaces and concealed areas"; and after detecting substantial mold growth in many locations in the interior during the spring and summer of 2003, the Board engaged additional experts to conduct tests and determine its extent and cause.
Moreover, by this time, all interested parties were joined in the action, including Falasca, the HVAC contractor, and all defendants were aware of the existence of mold in the building. A September 29, 2003 Case Management Order, memorializing an earlier September management conference, evidenced that HVAC and mold issues were "in the case" even though the parameters of the claims may have been evolving. The supplement specifically authorized the Board to amend its interrogatory answers and document production to specify "particular complaints with hvac systems" and "mold problems, if any" in addition to the particular areas of roof leaks. It also set a timetable for the Board's further expert reports, which would include "the details of any hvac and mold complaints." As the Board's experts continued their investigation, they discovered indications that the HVAC system was contributing to mold growth by bringing excessive humidity and a lack of fresh air into the school and potentially causing roof problems. The specifics of the Board's mold claims relating to the HVAC system and roof were explained in subsequent expert reports. As both the injuries were sustained and suit was instituted within the prescribed ten years, the fact alone that the expert reports crystallizing the Board's position were not submitted until after 2003 is not a valid basis upon which to find a statute of repose bar.
In view of our decision, we need not address the Board's alternative argument seeking a jury determination of whether defendants were grossly negligent such that an exception to the statute of repose applies. We further note that this issue was not raised to the trial court and is thus not appropriate on appeal. Nieder v. Royal Indem. Ins. Co., 62 N.J. 229, 234 (1973).
We turn now to defendants' cross-appeal on the statute of limitations issue. Defendants argue the Camden County judge erred in accepting the Burlington County judge's ruling that all statute of limitations defenses were tolled to January l996 as the law of the case. They contend the initial ruling was an erroneous application of law to the facts, constituting a clear denial of justice under the law, Clarkson v. Kelly, 49 N.J. Super. 10, 18 (App. Div. l958), and was limited to the defective roof claim and was not intended to apply to the HVAC and mold issues.
Defendants further argue the 2005 order striking the statute of limitations defenses as to the roof issues should be reversed as it was erroneously based on the doctrine of equitable estoppel. Defendants contend the essential elements of this doctrine, i.e., that defendants lulled the Board into missing the filing deadline by concealing the seriousness of defects in the construction or by promising to repair all of the defects without the need for litigation, were not satisfied. See Trinity Church v. Atkin Olshin Lawson-Bell, 394 N.J. Super. 159, 172 (App. Div. 2007); Torcon, Inc. Alexian Bros. Hosp., 205 N.J. Super. 428, 436-38 (Ch. Div. l985), aff'd o.b., 209 N.J. Super. 239 (App. Div.), certif. denied, 104 N.J. 440 (1986). In fact, the judge expressly found there was no evidence of either misrepresentation or concealment of a material fact known to defendants and unknown to the Board.
Moreover, even if the Board were entitled to invoke the doctrine of equitable estoppel, defendants contend this would not toll the running of the statute of limitations and the Board's action would still be barred because a reasonable time remained under the statute after the Board became aware it had a cause of action for it to file suit and it failed to do so. See Torcon, supra, 205 N.J. Super. at 437 ("[I]f, after the cessation of any basis for continued reliance by a plaintiff on the conduct of a defendant there remains a reasonable time under the applicable limitations period to commence a cause of action, the action will be barred if not filed within the remaining time."); Trinity Church, supra, 394 N.J. Super. at 173 (same). Defendants emphasize that even assuming the Board was not aware until the recurrence of roof leaks during the January l996 snowstorm that it could no longer rely on Aristone to properly repair the roof because of design or construction deficiencies, the Board still had over three and one-half years to file suit based on the substantial completion date of September l993.*fn12
The Board did not file this action until December 20, 2001, almost six years later.
In their cross-appeal, defendants also argue that the Camden County judge should have granted their motion for summary judgment dismissing the Board's HVAC and mold claims based on the six-year statute of limitations because the Board was aware of problems with the HVAC system virtually from the time of substantial completion and occupancy in September l993. They point to the testimony of Joseph B. Tobens, Jr., the School District Facilities Manager, in depositions and the Lopez hearing about the "myriad" of recurring problems with the HVAC system from l993 to l995, including complaints about "comfort" issues in which the rooms were too hot or too cold, temperature variation and system control problems, as well as lack of heat and ventilation in corridor 5. These problems were repeatedly included on punch lists and were discussed orally and in writing on numerous occasions with defendants. Defendants request we exercise original jurisdiction if necessary to complete the determination of their cross-appeal on this issue, R. 2:10-5, to end the protracted litigation, and based on the extensive record in the Lopez hearing also find the Board's claims relating to the HVAC system and mold are time-barred by the six-year statute of limitations.
The Board responds that defendants' cross-appeal should be dismissed because no order was entered from which defendants may appeal. According to the Board, Vitetta's brief submitted with its notice of motion for leave to cross appeal the March 2, 2007 order reflects that Vitetta "sought to appeal from a denial of Vitetta's motion for reconsideration of [the Burlington County judge's] January 27, 2005 order, striking all statute of limitations defenses[.]"*fn13 The Board argues, however, that the March 2007 order solely granted partial summary judgment to defendants as to all HVAC and mold claims pursuant to the statute of repose and did not explicitly deny defendants' motions regarding the statute of limitations, merely stating that "[a]ll other motions are withdrawn without prejudice as moot." Thus, according to the Board, defendants have improperly appealed from the judge's comments during the oral argument colloquy that he was bound by the prior judge's ruling on the statute of limitations. See Do-Wop Corp. v. City of Rahway, 168 N.J. 191, 199 (2001) ("[I]t is well-settled that appeals are taken from orders and judgments and not from opinions, oral decisions, informal written decisions, or reasons given for the ultimate conclusion.").
Assuming the cross-appeal is procedurally proper, the Board contends the Camden County judge correctly refused to reconsider the Burlington County judge's Lopez hearing decision under the principles of comity. Substantively, the Board argues the January 27, 2005 order should be affirmed although it concedes it did not argue equitable estoppel and the judge confused that doctrine with the discovery rule. The Board asserts, however, that it was entirely appropriate for the judge to apply equitable considerations in determining the date when the statute of limitations began to run and correctly concluded from the evidence that considerations of equity and fairness dictated tolling the statute of limitations as to the Board's roof claims under the discovery rule until January l996. See Abboud v. Viscomi, 111 N.J. 56, 62 (1988) (the essential purpose of the discovery rule is to avoid the harsh result that otherwise would flow from a mechanical application of a statute of limitations); Lopez v. Swyer, 62 N.J. 267, 273-74 (1973) ("The discovery rule is essentially a rule of equity," and therefore, "in each case the equitable claims of opposing parties must be identified, evaluated and weighed.").
The Board acknowledges it was aware of roof leaks and HVAC problems in the school since 1993 but emphasizes that all parties believed the items were corrected and there were no other problems with the building as of the Board's acceptance and final Certificate of Occupancy in February l995. The Board claims its first knowledge of a potential design or construction defect in the roof was in January l996 when the large snowstorm resulted in extensive leaks, and that previously everyone had regarded roof leaks as typical punch list items which were easily correctible and which were, in fact, corrected. Thus the Board contends it did not become aware until the January l996 snowstorm either that it had been injured, or that the injury was due to the fault or neglect of an identifiable entity. Therefore, it did not have facts to equate in law with a potential cause of action. See Abboud, supra, 111 N.J. at 62-63 (internal citations omitted) (The discovery rule "'postpon[es] the accrual of a cause of action' so long as a party reasonably is unaware either that he has been injured, or that the injury is due to the fault or neglect of an identifiable individual or entity[,]" after which the claim accrues because "he or she is actually or constructively aware 'of that state of facts which may equate in law with a cause of action.'"). Accordingly, the Board submits that its complaint filed on December 20, 2001, just shy of the six-year deadline, was filed within time.
The Board also contends the judge implicitly rejected the statute of limitations defenses as to its mold and HVAC claims as there was extensive testimony and evidence presented at the Lopez hearing, the written decision refers to these claims, and the order dismisses all statute of limitations defenses without qualification. According to the Board, the record established that it did not discover mold in the school until 2001, when it was suspected by a teacher in a classroom, and then in 2003, when it was sampled from classrooms and scientifically confirmed. The Board further contends it did not discover that the HVAC system was contributing to the mold problem and was further causing unhealthy indoor air conditions by generating high humidity and bringing in too little fresh air into the school until 2004, when it received the supplemental expert reports. According to the Board, these problems were different than the HVAC issues that arose during construction, relating to rooms being too hot or too cold, which it contends were corrected by a change order modifying the HVAC system controls. The Board requests we exercise original jurisdiction and hold that its mold and HVAC claims were timely under the statute of limitations based on the judge's factual findings and the evidence presented at the Lopez hearing.
We are not persuaded by the Board's argument for dismissal of defendants' cross-appeal. After reviewing all submissions, we granted both sides' requests for interlocutory relief. Vitetta's Notice of Cross-Appeal referenced both the 2005 and 2007 orders as being appealed and its Case Information Statement identified the statute of limitations defense as an issue on appeal. As the Board has been on notice from the outset of the appeal that defendants were challenging the prior judge's substantive ruling, we discern no reason not to address the merits of that decision at this time.
The facts are not in dispute. On September 7, l993, a temporary Certificate of Occupancy was issued and the Board began occupying the school. It has continuously used the building since that time. In October, Vitetta issued a letter establishing the September date as the date of "substantial completion" as defined by the contract. From l993 to l995, the Board complained of roof leaks and various heating and cooling problems with the HVAC system, which were included in the approximately 3500 to 5000 punch list items, and repairs were made by defendants. On at least two occasions, the Board expressed some concern about the design of the HVAC system. In a January 5, 1994 letter to Vitetta, Tobens noted concerns with the HVAC system and asked the architect to evaluate all the related systems so he could obtain "assurance that the system was installed as designed." Additionally, Tobens testified at the Lopez hearing that on an undefined date he had a discussion with Mr. Van Leuven of Falasca, who indicated to him that "some of these [HVAC] issues are a design problem" and recommended he speak with Vitetta. Tobens testified he followed up with a letter to Richard Sherman of Vitetta.*fn14
In February l995, Evesham Township issued a Certificate of Occupancy, Vitetta authorized final payment to Aristone, and the Board executed a Certificate of Completion and Acceptance of the Project. At that time, all parties believed the roof leaks and problems regarding the HVAC system had been repaired and corrected. Substantial roof leaks occurred following a major snowstorm on January 7, 1996, necessitating relocation of classes from the affected rooms. The Board had no further contact with Aristone after May l996 and had its maintenance staff repair roof leaks as late as l999 and 2000. On February 12, 2001, a teacher reported worsening roof leaks and mold in the ceiling and rug. On December 20, 2001, the Board filed this action.
As noted by the Supreme Court in Russo, we have "determined that the date of substantial completion is to be used for statute of limitations purposes." Russo, supra, 144 N.J. at 115-16 (citing Mahony-Troast Constr. Co. v. Supermarkets Gen. Corp., 189 N.J. Super. 325, 329 (App. Div. l983)). To mitigate a potentially harsh result that might arise from a draconian adherence to the statute of limitations, our courts have adopted the discovery rule. The substance of the rule was stated in Lopez, supra, 62 N.J. at 272: "[I]n an appropriate case a cause of action will be held not to accrue until the injured party discovers, or by an exercise of reasonable diligence and intelligence should have discovered that he may have a basis for an actionable claim."
We have explained the distinction between the discovery rule and the theory of equitable estoppel:
There is a significant distinction between the two equitable doctrines affording relief from unfair and unnecessarily harsh results. The discovery rule avoids the mechanical application of a statute of limitations by postponing the accrual of a cause of action so long as a party is unaware either that he has been injured or that the injury was due to the fault or neglect of an identifiable person. Equitable tolling assumes the accrual of the action but intercepts and delays the bar of the statute of limitations because the plaintiff lacked vital information which was withheld by a defendant. [Villalobos v. Fava, 342 N.J. Super. 38, 45-46 (App. Div. 2001).]
The Board argues the six-year limitations period should not begin running in September l993, the date of occupancy and "substantial completion" under the contract, but should be tolled on general equitable principles. The Board concedes it was aware of recurring roof leaks and ongoing temperature problems with the HVAC system from that date. The belief of all parties was that the problems were corrected as of the Board's Certificate of Acceptance and Final Certificate of Occupancy in 1995. The Board acknowledges, however, there was no misrepresentation or concealment by defendants at this time or thereafter, and there is no claim defendants lulled the Board into missing the filing deadline by concealing the seriousness of the design or construction defects or by promising to repair all such defects without the need for litigation. See Trinity Church, supra, 394 N.J. Super. at 172. The Board's position for tolling the statute of limitations under the discovery rule until January l996, however, appears to be based on reliance. The Board argues that everyone's belief the roof problems were resolved in l995 somehow affected its ability to "know" of a potential design or construction defect in the roof until extensive leaks reoccurred following the snowstorm. Without explanation, it then waited almost six years to file suit.
We are not persuaded by the Board's arguments. The six-year statute of limitations began to run upon Vitetta's designation of substantial completion in September l993, or at the latest, the Board's acceptance in February l995. Even analyzing the case under the discovery rule, the statute of limitations was not tolled beyond February 1995. Thus the Board's suit was untimely filed in December 2001.
Clearly, the Board knew it was injured when it experienced roof leakage and HVAC problems from the outset of its occupancy in l993. It is also undisputed these were recurring or ongoing problems. The January 7, l996 roof leaks may have been more severe but they were not the first. The convenient use of this date by the Board, five years and eleven and one-half months before the filing of its complaint, is transparent. Furthermore, the Board's attempt to distinguish between the problems with the HVAC system from l993 to l995 as involving uneven temperature issues and insufficient warming and cooling, rather than the insufficient airflow or excessive humidity problems noted in the l994 expert reports, is a distinction without a difference.
Only the fact of the injury and the identity of the party causing the injury must be known to commence running of the statute of limitations. "[T]he discovery rule centers upon an injured party's knowledge concerning the origin and existence of his injuries as related to the conduct of another person." Lynch v. Rubacky, 85 N.J. 65, 70 (1981). In Russo, the Court held that a landowners' suit against an architect and contractor filed in l990, alleging that improper siting and construction of a school caused flooding which damaged their crops and farmland, was time-barred by the statute of repose and statute of limitations. Russo, supra, 144 N.J. at 115. The plaintiffs testified they noticed general water erosion damage on their property in l981 soon after the school was built. The Court expressly rejected the plaintiffs' claim that they did not "discover" the cause of action until the damage first became severe and the real extent of injury became apparent during the onset of serious flooding in l985. The court stated that "[i]t is not necessary that the injured party have knowledge of the extent of injury before the statute begins to run." Russo, supra, 144 N.J. at ll5 (citations omitted).
Nor is it necessary that the injured party's knowledge be impeccable or that the exact cause of the injury be known to trigger the statute of limitations under the discovery rule. Torcon, supra, 205 N.J. Super. at 435. The Board did not have to know that its claim involved design or construction defects or the full extent of its cause of action to constitute knowledge of the injury to commence the six-year limitations period. A plaintiff need only have knowledge of "the existence of that state of facts which may equate in law with a cause of action." Burd v. New Jersey Tel. Co., 76 N.J. 284, 291 (1978). Our courts have consistently interpreted that to mean "a" cause of action or "an" actionable claim and have not required a plaintiff to have knowledge about "the specific cause." See Torcon, supra, 205 N.J. Super. at 436.
The Board also had the knowledge and belief the injuries were attributable to the fault of the parties involved in the construction process as it had ongoing contacts with them to complete punch list items and make repairs. Practically speaking, if the January l996 snowstorm caused the Board to consider that it had a potential claim for defective design and construction relating to the school, we do not understand why it waited almost six years to file suit.
As previously stated, we view mold as an element of damage, not as a separate claim. Mold was alleged by the Board solely in conjunction with its roof and HVAC claims as resulting from water infiltration and/or excess humidity. As the existence of mold is an injury or damage to the building that allegedly resulted from defects or deficiencies in the roof or HVAC system, and since these claims are time-barred by the six-year statute of limitations, the mold claim must also be dismissed.
Reversed and remanded to enter judgment dismissing the Board's complaint as to the Board's claims for damages, including mold, arising from issues with the roof and the HVAC system as time-barred by the statute of limitations.