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Hampton Hall, LLC v. Chapman Coyle Chapman & Associates Architects Aia Inc.

United States District Court, D. South Carolina

February 2, 2018

Hampton Hall, LLC
Chapman Coyle Chapman & Associates Architects AIA, Inc., and Choate Construction Company, Defendants.


          Richard Mark Gergel United States District Court Judge

         This matter is before the Court on Plaintiffs motion to reconsider the Court grant of partial summary judgment for Defendants. For the reasons set forth below, the Court grants in part and denies in part the motion.

         I. Legal Standard

         Rule 59(e) of the Federal Rules of Civil Procedure governs motions to alter or amend a judgment; however, the rule does not provide a legal standard for such motions. The Fourth Circuit has articulated "three grounds for amending an earlier judgment: (1) to accommodate an intervening change in controlling law; (2) to account for new evidence not available at trial; or (3) to correct a clear error of law or prevent manifest injustice." Pac. Ins. Co. v. Am. Nat'l Fire Ins. Co., 148 F.3d 396, 403 (4th Cir. 1998) (citing EEOC v. Lockheed Martin Corp., 116 F.3d 110, 112 (4th Cir. 1997); Hutchinson v. Staton, 994 F.2d 1076, 1081 (4th Cir. 1993)). "Rule 59(e) motions may not be used, however, to raise arguments which could have been raised prior to the issuance of the judgment, nor may they be used to argue a case under a novel legal theory that the party had the ability to address in the first instance." Id. at 403 (internal citations omitted). Rule 59(e) provides an "extraordinary remedy that should be used sparingly." Id. (internal citation omitted). The decision to alter or amend a judgment is reviewed for an abuse of discretion. Id. at 402.

         II. Discussion

         Defendant Chapman Coyle Chapman & Associates Architects, AIA ("Chapman") was responsible for the design and oversight of the construction of the Hampton Hall Development amenity facilities, including a golf house, sports center, and community clubhouse. Defendant Choate Construction Company was the general contractor. Plaintiff alleges the construction of the community clubhouse was defective and asserts claims for breach of contract, breach of warranty, negligence, gross negligence, and breach of express and implied warranties.

         The community clubhouse was designed and constructed in 2006 and 2007. Plaintiff alleges there was a failure of the truss members in the community clubhouse mezzanine roof over an activity room with a vaulted ceiling and skylight. Plaintiff alleges the truss assemblies failed in March 2007-before completion of the community clubhouse-and again in 2009. Remedial work was performed in 2009 or 2010 but the truss members allegedly remained deficient. Plaintiff also asserts that there were defects in stucco over parapet walls.

         Plaintiff filed the present action on May 12, 2017. Defendants moved for partial summary judgment, asserting that the applicable eight-year statute of repose, South Carolina Code § 15-3-640, bars Plaintiffs claims, because the structure was substantially completed in 2007. Plaintiff responded that the building permit did not include a statutorily required notice of the statute of repose, that claims for gross negligence are not barred by the statute of repose because South Carolina Code § 15-3-670 specifically provides that the statute of repose is not a defense to such claims, and that the statute of repose had not yet accrued because the structure was not yet substantially completed. On December 27, 2017, the Court granted summary judgment for Defendants on all claims except gross negligence. On January 23, 2018, Plaintiff moved for reconsideration on several bases.

         First, Plaintiff argues the golf house was mistakenly referred as the "gold house" on page one of the order granting partial summary judgment. The Court agrees and amends page one of its order of December 27, 2017 to replace "gold house" with "golf house."

         Second, Plaintiff repeats its argument that substantial completion never occurred because the construction was in violation of applicable building codes. To the extent Plaintiff argues an uncorrected building code violation means substantial completion cannot have occurred, its argument is without merit. No. authority suggests defects that violate a building code are exempted from the statute of repose governing claims for defective construction. To the contrary, South Carolina Code § 15-3-670(B) provides, "the violation of a building code of a jurisdiction or political subdivision does not constitute per se fraud, gross negligence, or recklessness" for purposes of the gross negligence, recklessness, fraud, or concealment exception to the statute of repose.

         Third, Plaintiff argues the parties agreed to use a substantial completion date other than the date of the certificate of occupancy, based on the following contract language:

All Work, including the filing of papers and reports required to secure Certificate of Occupancy (and/or Certificates of Completion and Building Department "sign offs") and customary evidence of legal compliance and insurance rating approvals, if required, shall be the obligation of Contractor, the completion of which is a condition precedent to the achievement of Substantial Completion. [Emphasis added.]

(Dkt. No. 28 at 3 (emphasis in original).) That argument is entirely without merit. The contract language plainly provides that an application for a certificate of occupancy, not the issuance of a certificate of occupancy, is a condition precedent of substantial completion. Further, the same contract provides,

9.8.4 When the Work or designated portion thereof is substantially complete, the Architect will prepare a Certificate of Substantial Completion which shall establish the date of Substantial Completion, shall establish responsibilities of the Owner and Contractor for security, maintenance, heat, utilities, damage to the Work and insurance, and shall fix the time within which the Contractor shall finish all items on the list accompanying the Certificate. Warranties required by the Contract Documents shall commence on the ...

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