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PATRAKA v. ARMCO STEEL CO.

January 29, 1980

Bryant M. PATRAKA and Barbara Patraka, Plaintiffs,
v.
ARMCO STEEL CO. et al., Defendants



The opinion of the court was delivered by: NEALON

MEMORANDUM AND ORDER

This is a diversity action for personal injuries sustained as a result of a single vehicle accident on Interstate Route 80 (I-80) in Carbon County, Pennsylvania. Plaintiffs' theory of liability is that defects in the design, composition, and construction of the subbase of the section of I-80 where the accident allegedly occurred prevented adequate subbase drainage, allowing water to be "pumped" to the roadway surface where it froze, creating the hazardous condition that purportedly caused the accident. Plaintiffs' expert, Paul J. Claffey, does not find fault with the composition or construction of the highway surface itself.

 Defendant No. 1 Contracting Corporation of Pennsylvania, *fn1" the general contractor for that portion of I-80 along which the accident occurred, has moved for summary judgment on four separate grounds: (1) plaintiffs' joinder of No. 1 of Pennsylvania as a party defendant is barred by the Pennsylvania two-year statute of limitations for personal injury actions; *fn2" (2) this suit is foreclosed by the Pennsylvania twelve-year statute of limitations for actions seeking recovery of damages resulting from deficiencies in the design or construction of an improvement to real property; *fn3" (3) No. 1 of Pennsylvania's faithful adherence to all specifications and drawings in constructing the highway subbase insulates it from liability; and (4) plaintiffs' failure to join the Commonwealth of Pennsylvania as a defendant compels dismissal of the action. After careful consideration of the points and authorities advanced by the parties I am persuaded that No. 1 of Pennsylvania is not entitled to summary judgment on any issue that it has raised and, therefore, its motion will be denied.

 I. THE TWO-YEAR STATUTE OF LIMITATIONS

 On January 12, 1976, plaintiff Bryant M. Patraka was involved in a single car accident allegedly caused by defects in the design, composition or construction of the subbase of the west-bound lanes of I-80 at or near milepost 275/78 in Carbon County, Pennsylvania. On April 21, 1977, within the applicable Pennsylvania two-year limitation period, suit to recover damages for the personal injuries sustained as a result of the accident was commenced in the United States District Court for the District of New Jersey. Initially named as one of a host of defendants who purportedly participated in the construction of the pertinent section of the interstate roadway was "No. 1 Contracting Corporation, a New Jersey corporation." *fn4" But while plaintiffs did not name it as a defendant, No. 1 of Pennsylvania was served on June 17, 1977 with a summons and an amended complaint. No. 1 of Pennsylvania subsequently forwarded the complaint to its insurer, who contacted a New Jersey law firm to investigate the matter. *fn5"

 In December of 1977, this action was transferred to the Middle District of Pennsylvania. After the transfer, the insurer for No. 1 of Pennsylvania solicited present counsel to represent the corporation once the corporation had been properly named as a party-defendant. On January 9, 1978, plaintiffs moved to amend their complaint to change the designation of defendant No. 1 Contracting Corporation, a New Jersey corporation, to No. 1 Contracting Corporation, a Pennsylvania corporation. This motion was granted on February 22, 1978, and plaintiffs, on April 14, 1978, more than two years after the date of the accident, named for the first time No. 1 of Pennsylvania as a defendant.

 No. 1 of Pennsylvania argues that plaintiffs' claims against it must be dismissed because it was not made a party-defendant until after the two-year statute of limitations for personal injury actions had expired. *fn6" The dispositive question is whether the amended complaint filed on April 14, 1978 should relate back to April 21, 1977, the date on which this action was instituted.

 It is clear that the prerequisites for relation back set out in Rule 15 of the Federal Rules of Civil Procedure have been satisfied here. *fn7" First, the claim asserted in the amended pleading clearly arises out of the occurrence set forth in the original pleading. Second, No. 1 of Pennsylvania was notified of the institution of the action within the applicable limitations period. Third, No. 1 of Pennsylvania concedes that no prejudice has been suffered in maintaining its defense on the merits. And fourth, No. 1 of Pennsylvania knew within the period of time provided by law for commencing the action that, but for a mistake concerning the identity of the proper party, the action would have been brought against it. See Slack v. Treadway Inn of Lake Harmony, Inc., 388 F. Supp. 15, 18-19 (M.D.Pa.1974). Accordingly, the amended complaint will be deemed to relate back to April 21, 1977 and, therefore, the action against No. 1 of Pennsylvania is not time-barred by the two-year personal injury statute of limitations. *fn8"

 II. THE TWELVE-YEAR STATUTE OF LIMITATIONS

 In 1965, the Pennsylvania General Assembly enacted legislation limiting the time in which an action may be brought against those involved in the design, planning and construction of improvements to realty. Act of December 22, 1965, P.L. 1183, Pa.Stat.Ann. tit. 12, §§ 65.1 et seq. (Supp.1977) (Purdon) (hereinafter referred to as the Act). The Act, which is set out in toto in the margin, *fn9" provides in pertinent part that an action to recover damages for personal injuries arising out of a deficiency in the design, planning, supervision of construction, or construction of an improvement to real property may not be brought more than twelve years after completion of the improvement. Where, however, personal injuries attributable to a design or construction defect are suffered during the twelfth year after completion of the improvement, a personal injury action may be brought within two years after the date on which the injuries are sustained.

 It is undisputed that the subbase for the section of I-80 along which the accident occurred was finished by the end of 1963; the roadway was paved in the summer of 1964; No. 1 of Pennsylvania, as general contractor, participated in both the laying of the subbase and the paving of the roadway surface; and the completion certificate for the highway project was issued sometime after October of 1964. The issue raised by No. 1 of Pennsylvania is whether the subbase of the highway is an "improvement" within the intendment of the Act. If a subbase is an "improvement", then the action is barred because the accident occurred more than twelve years after its completion and the two-year extension provided under Pa.Stat.Ann. tit. 12, § 65.2 is unavailable. If, however, the "improvement" referred to in the Act is the highway project under construction, *fn10" then the action is timely regardless of whether the completion date for paving the highway or the date of issue for the completion certificate is used.

 While at least two trial court decisions have contended with the question of what is an "improvement" under the Act, see Kaczmarek v. Mesta Machine Co., 324 F. Supp. 298, 301 (W.D.Pa.1971) (fifty-ton machine permanently affixed to a building was not an "improvement to realty"); Fromm v. Frankhouser, 7 Pa. D. & C.3d 560 (Lanc. County 1977) (mobile home from which wheels have been removed and which has been set upon cinder blocks is an improvement to realty), no cases have been found addressing the question of whether a distinct component of an entire construction project is by itself an "improvement." In the absence of controlling state-wide precedent, this Court's task is to predict how the Pennsylvania Supreme Court would resolve the issue. See Keystone Aeronautics Corp. v. R. J. Enstrom Corp., 499 F.2d 146, 147 (3rd Cir. 1974). In making this determination, the federal court may draw upon such sources as analogous state court decisions, state rules of statutory construction, the Restatement of the Law, treatises, law review commentaries, and "the majority rule." See C. Wright, Handbook of the Law of Federal Courts § 58 (3rd ed. 1976).

 The Pennsylvania Supreme Court in Wolff Chemical Co. v. Philadelphia, 217 Pa. 215, 224, 66 A. 344, 347 (1907), recognized that "the word "improvement' is a relative term and its meaning must be ascertained from the context and the subject-matter of the instrument or writing in which it is used." Thus, although the subbase of highway may literally constitute an "improvement" to realty, *fn11" the court's duty here is to determine whether the legislature intended the subbase of a highway construction project to be an improvement from the completion of which the twelve-year limitations period would have begun running. This intent may be ascertained by viewing the circumstances under which the Act was passed, the object sought to be attained by the Act, and the consequences of the particular interpretation No. 1 of Pennsylvania would have the court make. See 1 Pa.Cons.Stat.Ann. § 1921 (Supp.1978) (Purdon).

 Pennsylvania common law, like the common law of most states, originally insulated builders from liability to a third-party who, after a structure had been completed and accepted by the owner, sustained injuries caused by defects in the design or construction of the structure. *fn12" This rule of non-liability, aptly coined the "completed and accepted" rule, fixed the date on which the improvement was completed and accepted by the owner as the bright line for marking when a builder's liability to third persons ...


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