Nebraska Homebuilding Claims: What is the Deadline for Filing a Lawsuit?
The homebuilding process is rarely simple. Even after a home is completed, potential issues may continue to cause headaches for everyone involved. If something goes wrong during the homebuilding process, how long does a home owner have to bring such a claim?
For both the owner and homebuilder, it is important to understand when the clock may run out to file a claim for any construction issues. This “clock” is referred to as the “statute of limitations.” All lawsuits must be filed before the statute of limitations period runs out, because once it does, there is almost nothing that can be done to recover damages.
In Nebraska, claims arising from issues in the homebuilding and residential construction process generally must be filed within four years of the alleged act under Neb. Rev. Stat. § 25-223. If the lawsuit is not filed within four years, the homeowner is likely out of luck when bringing a claim past the deadline. The date when the clock starts running is incredibly significant because a couple days could make all the difference in whether a lawsuit is successful.
General Contractor vs. Separate Contractors: When the Clock Starts Running
There are a variety of ways to build a home. A landowner may chose to work with a homebuilder or general contractor who oversees the entire process. Alternatively, the landowner may decide to work with separate contractors and manage the homebuilding process themselves. After a recent Nebraska Supreme Court case,[1] this distinction impacts when the clock starts running in the event that anything goes wrong.
When a homebuilder or general contractor is used, the home is viewed as a single project and the clock will begin running on the date the home construction is substantially completed. No matter at what stage an alleged wrongful act takes place, the four year limitation will not begin to run until the home is considered to be finished.
For homeowners acting as their own general contractor, however, there is a different standard. These are homeowners who enter into separate agreements with a variety of contractors to perform specific projects. The Nebraska Supreme Court held that the clock begins to run on the dates that each contractor substantially completed its respective project.
For homeowners acting as a general contractor, this means there are clocks ticking after each project is completed. For example, let’s consider a home that was completed over the span of 1 year with Project A being completed in month 1 while Project B was completed in month 11. The clock for a claim relating to Project A will run out 10 months before the clock does for Project B.
Homeowners who chose to act as their own general contractor must be aware of this distinction or risk their ability to bring a lawsuit.
Take Away
While no one wants to think about potential mishaps, all parties should be prepared in the event something goes wrong. The first step is knowing when a claim must be filed, which is not always a straightforward answer. The Nebraska Supreme Court has now clarified that in cases with a homebuilder or general contractor, the home is viewed as a single project so a singular clock will begin to run on the day the home is substantially completed. In cases where the homeowner directly works with separate contractors, a clock will begin to run when each individual contractor’s project is substantially completed.
If you have any questions about the statute of limitations regarding a homebuilding or residential construction project, please contact a member of the Koley Jessen Construction Practice Group.
[1] McCaulley v. C L Enterprises, Inc., 309 Neb. 141 (2021).