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FROM THE BENCH: Indemnities and the Statute of Limitations

from ConstructionRisk.com

an or should a client that alleges negligence against its design professional use its contract's indemnity provision to sue for its alleged damages, and — by the way — just when does the statute of limitations begin to toll on a multiphasic consultant agreement? Both these questions were answered unequivocally in Hensel Phelps Construction v. Cooper Carry, Inc., 2016 WL 5415621 (U. S. District Ct., District of Columbia, 2016). The case began when Hensel Phelps, the constructor-in-charge, won a contract for a Marriott Hotel in Washington, D.C. In preparing its proposal, Hansel Phelps relied on the "preliminary design documents" prepared by an engineering firm engaged by the project owner. After Hensel Phelps got the award, however, the engineering firm contracted with the constructor to provide the balance of the design services. The constructor went on to claim that those services were flawed, requiring the constructor to make costly corrections to comply with code requirements. When the constructor filed suit to collect its damages, based upon the contract’s indemnity provision. The engineering firm responded by filing a motion for summary judgment, arguing that the three-year statute of limitations for breach of contract had lapsed and that the contract’s indemnity provision could be used only if damages resulted from third-party claims. more


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