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Walsh Construction Co. v. Advanced Explosives Demolition, Inc.

United States District Court, S.D. Indiana, New Albany Division

May 22, 2018

WALSH CONSTRUCTION COMPANY, Plaintiff,
v.
ADVANCED EXPLOSIVES DEMOLITION, INC., JERRY KEITH, and PREMIER ENGINEERING, INC., Defendants.

          ORDER ON DEFENDANT AED'S MOTION TO DISMISS OR, ALTERNATIVELY, FOR MORE DEFINITE STATEMENT

          Debra McVicker Lynch United States Magistrate Judge

         Defendant Advanced Explosives Demolition, Inc. (“AED”) moved to dismiss the plaintiff's complaint on the grounds that the claims are barred by the economic loss rule or the statute of limitations. In its reply brief, to which the court allowed plaintiff Walsh Construction Company to file a surreply, AED raised another ground for dismissal-lack of constitutional standing. In the alternative to these dismissal arguments, AED asks the court to order Walsh to provide a more definite statement of its claims.

         AED's motion is denied because (1) plaintiff Walsh Construction has standing; (2) the economic loss rule and statute of limitations arguments are not resolvable in this case on a motion to dismiss; and (3) Rule 12(e) “more definite statement” relief is inappropriate and unnecessary.

         The Complaint

         Walsh Construction's complaint alleges that under a contract with the Indiana Department of Transportation, it built a new bridge between Milton, Kentucky and Madison, Indiana (the “New Milton-Madison Bridge” or “New Bridge”). The New Bridge was built adjacent to the existing or “old” Milton-Madison Bridge. At some point, Walsh Construction entered into a contract with a company named Omega Demolition to “perform, among other services, explosive demolition services in connection with” Walsh's New Bridge construction project. Omega, in turn, contracted with AED to perform explosive demolition services for the removal of the Old Milton-Madison Bridge. See Complaint, Dkt. 1, ¶¶ 7-8. During AED's explosive demolition work on the Old Bridge on certain days in July, August, and September 2013, “flying shrapnel struck the new adjacent Milton-Madison Bridge causing indentation/gouges of the Bridge's structural members and paint chipping.” Id., ¶ 10.

         Walsh asserts it suffered damages from AED's conduct because Walsh had to repair the resulting physical damage to the New Bridge. Walsh seeks relief under a negligence theory (AED “negligently managed, operated, used, controlled, conducted, and carried out its” explosive demolition and negligently failed to control the premises so as not to damage the New Bridge, complaint, ¶ 16), a negligence per se theory based on AED's alleged failure to comply with the Explosive Materials Code, a set of guidelines adopted as part of Indiana's Fire Prevention Code (id., ¶¶ 20, 24), and a “strict liability” theory based on AED's engaging in an ultra-hazardous activity. (Id., ¶ 12).

         AED's Motion to Dismiss

         AED's motion to dismiss raises three arguments: (1) that Walsh lacks standing; (2) that the economic loss rule bars relief; and (3) that Walsh's claims are barred by the statute of limitations. The court addresses first the statute of limitations and standing arguments because Walsh's response to AED's statute of limitations contention caused AED to assert in its reply brief that Walsh lacks standing. The court will then address the economic loss rule argument.

         I. AED is not entitled to dismissal based on the statute of limitations.

         Dismissing a complaint based on a statute of limitations affirmative defense is unusual because a complaint need not plead around an affirmative defense, but it is appropriate to do so when the complaint alleges facts “sufficient to establish the complaint's tardiness.” Cancer Foundation, Inc. v. Cerberus Capital Mgmt., L.P., 559 F.3d 671, 674 (7th Cir. 2009). The complaint alleges that the damages caused by AED's demolition work occurred in July, August, and September 2013. There is no suggestion that any cause of action against AED accrued any later than the time of this work. Walsh Construction filed its complaint on August 28, 2017, around four years after the work complained of.

         In its opening brief, AED argued that Walsh Construction's claims are governed either by Indiana's two-year statute of limitations for injuries to personal property, Ind. Code § 34-11-2-3, or Kentucky's one-year statute of limitations governing claims in contract and tort arising out of alleged acts or omissions in rendering professional services, Ky Stat. § 413.245.[1] If AED is right that one of these statutes applies as a matter of law, then the court could agree that the complaint alleges facts sufficient to establish its tardiness. But Walsh Construction asserts that its claims are governed by Indiana's six-year statute of limitations at Ind. Code § 34-11-2-7(3), governing actions “for injuries to property other than personal property. . . .” It argues that its claims seek recovery for injuries to the New Bridge, and the New Bridge is considered to be real property, not personal property, and thus fall within the six-year limitations statute.

         In reply, AED asserts that the claim for damages to the New Bridge cannot be considered a claim for injuries to real property because, supposedly, “Indiana rejects Plaintiff's characterization of repair damages as real property damage.” Dkt. 29 at p. 2. The only authority cited by AED to support this assertion is an economic loss rule case, Indianapolis-Marion County Public Library v. Charlier Clark & Linard, P.C., 929 N.E.2d 722, 732 (Ind. 2010). Public Library's discussion about whether certain losses were “property” losses concerned whether the Library had suffered injury to “other property” in the context of the economic loss rule. The case has nothing to do with a statute of limitations. Public Library never mentions the injury to real property statute of limitations in Ind. Code § 34-11-2-7(3), or any other statute of limitations. It thus provides no insight into whether this six-year statute of limitations should apply.

         It is not obvious to the court that Walsh is wrong that its claims to recover for repairs to the New Bridge is an action for injury to real property within the meaning of Ind. Code § 34-11-2-7-(3). AED does not counter Walsh's assertions that the New Bridge is “property other than personal property” or that Walsh is seeking to recover for an injury to the New Bridge. It may be that later in this case, a more developed factual record will point to the application as a matter of law of a particular limitations period, but AED has not yet demonstrated that the six-year statute of limitations relied on by Walsh cannot apply. The court therefore DENIES AED's request that the court dismiss Walsh's claims against it on statute of limitations grounds.

         II. Walsh ...


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