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Marchand v. Golden Rule Plumbing Heating & Cooling, Inc.

Court of Appeals of Iowa

November 8, 2017

DENIS MARCHAND and CHRISTINE E.T. MARCHAND, Plaintiffs-Appellants,
v.
GOLDEN RULE PLUMBING HEATING & COOLING, INC., K&E DISTRIBUTING, INC., VAN'S HEATING & COOLING, L.L.C., and BOSCH THERMOTECHNOLOGY CORP., Defendants-Appellees.

         Appeal from the Iowa District Court for Madison County, Paul R. Huscher, Judge.

         Homeowners appeal the district court's summary judgment ruling in favor of three of the four defendants on claims for damages associated with a malfunctioning geothermal heating and cooling system.

          Timothy J. Van Vliet of Wetsch Abbott Osborn Van Vliet P.L.C., Des Moines, for appellants.

          Jason M. Zager of Shook, Hardy & Bacon, L.L.P., Kansas City, MO, and Jason C. Palmer of Bradshaw, Fowler, Proctor & Fairgrave, P.C., Des Moines, for appellee Bosch Thermotechnology Corp.

          Joseph A. Happe, Kelsey K. Crosse, and Lucas B. Draisey of Davis, Brown, Koehn, Shors & Roberts, P.C., Des Moines, for appellee Golden Rule Plumbing Heating & Cooling, Inc.

          Considered by Vaitheswaran, P.J., and Tabor and Mullins, JJ.

          VAITHESWARAN, PRESIDING JUDGE.

         Years after building a home, the owners sued various entities for damages associated with a malfunctioning geothermal heating and cooling system. The district court granted summary judgment to three of the four defendants. On appeal, the homeowners argue the statute of limitations did not preclude their action. They also assert that genuine issues of material fact foreclosed summary judgment.

         I. Background Facts and Proceedings

         Denis and Christine Marchand built a home with a geothermal heating and cooling system. The home was completed in 2005. In 2015, the Marchands sued K&E Distributing, Inc., Golden Rule Plumbing Heating & Cooling, Inc., Bosch Thermotechnology Corp., and Van's Heating and Cooling, L.L.C. alleging (1) "[t]he heating and cooling system did not work properly [al]most immediately upon completion of the home"; (2) "the entire geothermal system failed"; (3) in 2009, Bosch provided them "with a new unit" but "that unit . . . also . . . failed"; and (4) the system continued to "not work properly, . . . causing substantial discomfort and stress to the . . . entire family." They sought "just compensation" against all the defendants for (I) manufacturing defect, (II) design defect, (III) breach of express warranty, (IV) breach of implied warranty, and (V) negligence.

         Van's Heating and Cooling participated only to the extent of filing an answer. The remaining three defendants filed motions for summary judgment. Meanwhile, the Marchands sought leave to amend their petition to add a breach-of-contract claim. Golden Rule moved to dismiss this claim on statute of limitations grounds. Bosch joined in Golden Rule's motion and filed a motion for specific statement, in which Golden Rule joined. K&E filed an affidavit addressing the contract claim and other issues.

         Following an unreported hearing on pending motions, the district court granted all three defendants summary judgment on all the Marchands' claims. The court did not address the claims against Van's Heating and Cooling or a counterclaim filed by Golden Rule. The Marchands appealed.

         II. Summary Judgment Ruling

         The well-established summary-judgment standard is as follows:

Summary judgment is appropriate only when the moving party has demonstrated there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. In determining whether a grant of summary judgment was appropriate, [the reviewing court] examine[s] the record in the light most favorable to the nonmoving party, drawing all legitimate inferences that may be drawn from the evidence in his or her favor.

Homan v. Branstad, 887 N.W.2d 153, 163-64 (Iowa 2016). At the outset, the Marchands list several facts they contend are disputed. These facts appear to be immaterial. Id. at 164 ("A fact is material when its determination might affect the outcome of a suit."). To the extent any of them could be tethered to a legal issue, we will address them in that context.

         A. Golden Rule and K&E[1]

         1. Statute of Limitations - Manufacturing Defect, Design Defect, Implied Warranty, Negligence

         Iowa Code section 614.1(4) (2015) sets forth a limitations period of five years for actions founded on "unwritten contracts, " "injuries to property, " fraud, and "all other actions not otherwise provided for." Iowa Code section 614.1(2A)(a) sets forth a statute of repose of fifteen years for claims

founded on . . . injuries to the person or property brought against the manufacturer, assembler, designer, supplier of specifications, seller, lessor, or distributor of a product based upon an alleged defect in the design, inspection, testing, manufacturing, formulation, marketing, packaging, warning, labeling of the product, or any other alleged defect or failure of whatever nature or kind, based on the theories of strict liability in tort, negligence, or breach of an implied warranty.

See Albrecht v. General Motors Corp., 648 N.W.2d 87, 92 (Iowa 2002) ("Unlike a statute of limitations, the period established in section 614.1(2A)(a) does not run from the accrual of the plaintiffs claim; rather, it runs from the date the product was first purchased or installed for use."); see also Estate of Ryan v. Heritage Trails Assocs., Inc., 745 N.W.2d 724, 729 (Iowa 2008) ("In a products liability action brought in Iowa, the statute of repose begins to run 'after the product was first purchased, leased, bailed, or installed for use or consumption unless expressly warranted for a longer period of time by the manufacturer, assembler, designer, supplier of specifications, seller, lessor, or distributor of the product.'" (quoting Iowa Code § 614.1(2A)(a))).

         The Marchands argued for application of the fifteen-year statute of repose, but the district court applied the five-year limitations period to the Marchands' claims against Golden Rule and K&E for manufacturing defect, design defect, implied warranty, and negligence. The court concluded these claims were time-barred. Contrary to the Marchands' assertion, the court did not rely on this defense with respect to their express-warranty claim against Golden Rule and K&E or any of their claims against Bosch.[2]

         (a) Five-Year Limitations Period

         The Marchands argue they "generated a genuine issue of material fact on the discovery of the injury and its cause which would determine when the statute of limitations period began and [they] should have the opportunity to present such evidence to a jury of their peers."[3] The discovery rule, when applicable, provides that a cause of action does not accrue until the plaintiff "has in fact discovered" an injury or "by the exercise of reasonable diligence should have discovered" the injury. Franzen v. Deere & Co., 334 N.W.2d 730, 732 (Iowa 1983) (citation omitted) (applying discovery rule to a products liability case involving allegation of defective manufacture and design); see also Speight v. Walters Dev. Co., 744 N.W.2d 108, 116 (Iowa 2008) (applying the discovery rule to case arising from implied warranties); Brown v. Ellison, 304 N.W.2d 197, ...


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