Michael G. Hansen, et al. v. Stanley Martin Companies, Inc., 266 Va. 345

Summary

The Supreme Court of Virginia reviewed summary judgment in a dispute concerning EIFS synthetic stucco used in the construction of the homeowners' Maryland residence. The court applied Virginia procedural statutes of limitation and Maryland substantive contract law, affirming dismissal of some contract, fraud, and negligent-misrepresentation claims while reversing dismissal of other claims based on unresolved factual issues concerning discovery and notice. The court also reversed summary judgment on the Maryland Consumer Protection Act claim and remanded the case.

Holdings

1. The claim was barred by the applicable three-year Maryland statute of limitations because the homeowners knew no later than the February 22, 1997 contract signing, and in any event by the August 29, 1997 closing, that the home would use EIFS rather than conventional stucco.
2. Summary judgment was improper because the record did not establish as a matter of law that the homeowners' notation of baseboard discoloration placed them on notice of a building-code violation or triggered a duty of due diligence.
3. Summary judgment was proper because the homeowners knew by closing that the home was clad with EIFS rather than conventional stucco, and the claims accrued outside the applicable two-year limitations period.
4. Summary judgment was proper because the homeowners received written notice at closing that EIFS required regular inspection and caulking, establishing knowledge of the alleged misrepresentation more than two years before suit.
5. Summary judgment was improper because reasonable persons could disagree whether the November 7, 1998 Washington Post article placed the homeowners on actual or implied notice that Stanley Martin's representations about the type and performance of EIFS were false.
6. For purposes of this appeal, Stanley Martin was bound by its concession that the discovery rule applied to the MCPA claim, and summary judgment was improper because reasonable minds could differ regarding the notice imparted by the Washington Post article.

Questions Presented

1. Whether the homeowners' breach-of-contract claim based on an alleged contractual right to conventional stucco was barred by the applicable statute of limitations.
2. Whether summary judgment was proper on the breach-of-contract claim alleging that EIFS, sealants, windows, and flashing were not installed in compliance with the building code.
3. Whether the homeowners' fraud and negligent-misrepresentation claims based on representations concerning the type of stucco, North Carolina EIFS problems, and maintenance requirements were barred by the statute of limitations.
4. Whether summary judgment was proper on the homeowners' Maryland Consumer Protection Act claim based on the applicable accrual and discovery rules.

Disposition

reversed_and_remanded