Can Utah's builders statute of repose constitutionally bar construction defect claims after fixed periods? Craftsman Builder's Supply v. Butler Manufacturing Explained

In Craftsman Builder’s Supply v. Butler Manufacturing, the Utah Supreme Court addressed whether Utah’s builders statute of repose violates the state constitution’s open courts clause when it bars construction defect claims after fixed time periods.

Background and Facts

In 1977, Craftsman entered a contract with U.S. Construction to erect a prefabricated metal building with roof specifications to withstand forty pounds per square foot. The building was completed in 1978. Fifteen years later, in 1993, the roof collapsed under snow weight. Craftsman sued both Butler Manufacturing (the building manufacturer) and U.S. Construction in 1995, asserting claims for products liability, breach of warranty, and negligence. The district court granted summary judgment for defendants, ruling that Utah Code Ann. § 78-12-25.5 (the builders statute of repose) barred all claims.

Key Legal Issues

The primary issue was whether Utah’s builders statute of repose violates the open courts clause of the Utah Constitution (Article I, Section 11). Craftsman also argued that even if constitutional, the statute shouldn’t apply because: (1) the repose periods are subject to a discovery rule, (2) an express warranty extended beyond six years, and (3) the products liability statute should control as the more specific statute.

Court’s Analysis and Holding

The Court applied the two-part test from Berry v. Beech Aircraft Corp. for constitutional analysis. Since no alternative remedy was provided, the Court examined whether the statute eliminated clear social and economic evils through reasonable means. The legislature had identified specific costs: liability insurance costs, records storage costs, unlimited liability risks, and difficulties defending old claims. Finding that less than one percent of claims arise after the statutory periods, the Court concluded the possibility of injury becomes “highly remote and unexpected,” making the statute reasonable. The Court rejected Craftsman’s other arguments, finding no discovery rule exception, no warranty extending beyond six years, and determining the builders statute specifically encompasses products liability claims for construction improvements.

Practice Implications

This decision demonstrates that carefully drafted statutes of repose with specific legislative findings can survive open courts challenges. The Court’s emphasis on statistical evidence showing remote possibilities of injury provides guidance for defending similar statutes. Practitioners should note that repose periods are not subject to discovery rules, and claims for construction defects must be filed within the statutory timeframes regardless of when damage occurs or is discovered, subject only to limited exceptions for fraud, intentional acts, or express warranties extending beyond the repose period.