Recent District of Columbia Court of Appeals Opinion Provides Guidance for a Condo Association’s Statute of Limitations Defense Against a Condo Owner’s Claim for Breach of Duty to Repair

On January 11, 2024, the District of Columbia Court of Appeals issued a decision in the matter of Steven W. Nicklin v. The Stonesdale Unit Owners’ Association, et al., which relays how the District of Columbia’s highest court interprets critical aspects of the statute of limitations on breach of contract claims brought by a condominium owner against a condominium association.

Plaintiff Steven Nicklin (“Mr. Nicklin”) is a condominium owner in a community called Stonesdale, governed by the Stonesdale Condominium Unit Owners’ Association (the “Association”). Mr. Nicklin’s lawsuit against the Association (as well as its individual board of directors and other condominium unit owners) was based on an alleged failure of the Association to repair multiple aspects of Mr. Nicklin’s condominium that he contended were within the Association’s responsibility under the Association’s governing documents and the District of Columbia Condominium Act. In his lawsuit against the Stonesdale entities and individuals (collectively, “Stonesdale”), Mr. Nicklin alleged violations of the District of Columbia Condominium Act, breach of contract, breach of fiduciary duty, and negligence.

The lower court had granted summary judgment in favor of Stonesdale on all claims, which Mr. Nicklin appealed to the Court of Appeals. Upon its review, the Court of Appeals affirmed summary judgment on the negligence and breach of fiduciary duty claims (because Mr. Nicklin’s appeal brief didn’t argue that part of the lower court’s ruling), but reversed the Superior Court’s grant of summary judgment on the breach of contract and violation of Condominium Act claims.   

The crux of this appeal was whether Mr. Nicklin’s breach of contract claims against the Association were time-barred by the undisputed 3-year statute of limitations. The lower court had found that the breach claims were all time-barred because the evidence showed that Mr. Nicklin had notice of each complained-of issue (roof leaks, mold, foundation defects), more than 3 years before he filed his lawsuit. The lower court based its ruling on the fact that, generally, breach of contract claims “accrue” once a party knows of an injury or, in the exercise of reasonable diligence, should know of an injury. (Here, the “injury” would be the damage/problems with Mr. Nicklin’s unit.) The point of “accrual” is important since “accrual” of an action marks the beginning of the 3-year period within which a lawsuit must be filed; a breach of contract lawsuit such as Mr. Nicklin’s if filed more than 3 years beyond its accrual is considered untimely and is subject to dismissal for violation of the statute of limitations.

However, the Court of Appeals disagreed with the lower court’s analysis of when Mr. Nicklin’s claims “accrued,” which is what led to its reversal of the lower court’s decision on the breach claims. The appellate court reasoned that since the claims were for breach of a purported Association duty to repair issues with Mr. Nicklin’s condo, the timing of Mr. Nicklin’s own awareness of the underlying issues was not the appropriate marker to trigger the statute of limitations. The Court further held that even the earliest date on which Mr. Nicklin notified the Association that a given issue needed repair also was not the time of “accrual” of the Association’s alleged failure to make that repair. Instead, the Court noted that a failure to repair case like Mr. Nicklin’s sometimes may not accrue until a time well after a condo owner, himself, notices a problem, and gives their association notice of a problem in their unit.

The Court of Appeals explained a need to account for additional time for a condo association to consider a unit owner’s request for repair, for the association to investigate its options, and then for the association to ultimately refuse to perform the repair (or perform it only partially or deficiently), before the 3-year statute of limitations clock would begin to run for a potential failure to repair contract claim. In essence, the Court of Appeals held that if the Association “repudiated its promise to repair” Mr. Nicklin’s unit issues within the 3-year statute of limitations period, even if Mr. Nicklin’s first notice of the problem and initial communication with the Association of the problem were well before the 3-year period predating the lawsuit, Mr. Nicklin’s lawsuit would still be timely. The appellate court reasoned that the Association’s repudiation of Mr. Nicklin’s repair request would constitute its own, individual “breach” of the Association’s duty to repair, and therefore it is from that point in time that the 3-year statute of limitations would begin to run (i.e., that Mr. Nicklin’s claim would “accrue”).

In this particular case, the Court found that the evidentiary record did not support finding as a matter of law that the accrual dates for each of Mr. Nicklin’s breach claims came earlier than 3 years before his suit was filed. Since the record demonstrated there were genuine disputes of material fact as to when the dates of Association repudiation of repair requests actually occurred, the Court found that summary judgment was not proper and reversed the lower court’s ruling.

Stonesdale’s affirmative defense of laches was also considered by the Court of Appeals, but was also rejected. “Laches” is the equitable equivalent to the statute of limitations; it is an affirmative defense that allows for a court to dismiss a claim that is brought with undue and unexplained delay and which works an injustice, or prejudice, to the other party. A court is free to interpret the period of laches as different than the length of the statute of limitations, depending on what a court deems reasonable. Here, the Court found Stonesdale failed to show how it was prejudiced by any delay of Mr. Nicklin in filing his claims, which was fatal to the laches defense.

The Nicklin holding is not favorable to condominium associations defending against breach of contract lawsuits of this nature, and has real implications for future lawsuits brought in the District of Columbia by a condominium owner against an association for a failure to repair. The Nicklin Court goes so far as to say that the issue of whether a delay in undertaking or completing a repair is “unreasonable” (for purposes of calculating the date of “accrual” of an action based on such delay) is “an intensively factual question that is rarely appropriate for summary disposition”. There is no doubt the Court is suggesting that in this type of case future summary judgment motions based on expiration of the statute of limitations are unlikely to succeed, absent substantial detailed proof of the timing with which a condo association repudiates a condo owner’s request for repair.

This Court of Appeals holding provides guidance to condominium associations and homeowners’ associations for District of Columbia properties. Definitive repudiation of an association member’s request for repair, and documentation thereof, could be the key to a successful statute of limitations defense should the member bring a lawsuit years later alleging a failure to repair. Associations, or their insurers, facing these questions should contact MacDonald Law Group, LLC, for its ability to protect the rights and interests of condominium associations, homeowners’ associations, their boards of directors, and their members, and others involved in related disputes.