Opinion
No. C3-02-1734.
Filed April 29, 2003.
Appeal from the District Court, Ramsey County, File No. C00111817.
Jonathan D. Miller, Boynton Law Offices, P.A., (for appellants)
John E. Hennen, League of Minnesota Cities, (for defendant City of Shoreview)
Dale M. Wagner, Bassford, Lockhart, Truesdell Briggs, P.A., (for respondent TSI, Inc.)
Considered and decided by Shumaker, Presiding Judge, Randall, Judge, and Wright, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2002).
UNPUBLISHED OPINION
Applying the two-year statute of limitations in Minn. Stat. § 541.051, subd. 1(a) (2002), the district court granted summary judgment dismissing claims against a commercial-property owner whose holding pond caused water to overflow and damage appellants' property, and against the city that issued a building permit for the construction of the pond. Contending that the two-year statute does not apply to their trespass claim, appellants challenge the summary judgment. Because appellants failed to raise the issue of the applicability of a six-year statute of limitations in the district court and because the district court correctly applied the two-year statute, we affirm.
FACTS
After obtaining a building permit from the City of Shoreview, respondent TSI, Inc. expanded its commercial parking lot and built a holding pond to collect excess runoff water from the lot.
Extremely heavy rain on June 28, 1997, caused TSI's holding pond to overflow. The water overflowed onto abutting residential property owned by appellants Michael and Joan Hendrickson, flooded their basement, and caused property damage. The pond overflowed a second time during a heavy rainstorm on September 2, 2000, and again flooded the Hendricksons' basement and damaged property.
On April 30, 2001, the Hendricksons sued TSI and the City of Shoreview for damages resulting from the two flooding incidents. As to both defendants, the Hendricksons alleged that TSI's "stormwater drainage system, including the holding pond" did not prevent the water overflow and that the Hendricksons' losses were "due to the inadequacy of Defendant TSI's stormwater drainage system, including the inadequacy of the holding pond."
In Count One of their complaint, the Hendricksons alleged that TSI committed a trespass on their property because of the water overflow; in Count Two that TSI was negligent in failing to prevent the overflow because of "the design of its parking lot and the design of its holding pond"; and in Count Three that the city was negligent in issuing a building permit to TSI "notwithstanding the fact that defendant TSI's stormwater drainage system was inadequate" to prevent the overflow onto the Hendricksons' land.
Both TSI and the city pleaded affirmatively that the Hendricksons' claims were barred by the statute of limitations, and both moved for summary judgment on that ground. The city also urged other grounds for summary judgment.
In its moving papers, TSI asserted that the two-year statute of limitations in Minn. Stat. § 541.051, subd. 1(a) (2002), barred both the trespass and negligent-design claims and moved to "dismiss plaintiffs' claims in their entirety." The city in its motion relied on the same statute in urging the dismissal of the negligence claim against it.
In response to the summary judgment motions, the Hendricksons argued that the drainage to their property resulted from "the inadequacy of * * * TSI's stormwater drainage system, including the inadequacy of the holding pond on * * * TSI's property." They argued that, because the damage was intermittent, the two-year statute, if applicable, did not begin to run upon the first discovery of the water damage and that there existed a fact issue as to whether TSI fraudulently concealed the cause of the damage. Although they had not pleaded a claim of negligent maintenance of the pond against TSI, they argued that in any event the two-year statute of limitations would not apply to such a claim.
On July 26, 2002, the district court granted the summary judgment motions, ruling that the negligent-design claim against TSI is barred by the two-year statute of limitations; that there was no evidence to create a genuine issue of material fact as to negligent maintenance; and that the negligence claim against the city is directly related to the design of the pond.
The Hendricksons appealed and for the first time raised the issue of whether the two-year statute of limitations on which the district court based its decision applies to trespass claims. They argue that the six-year statute of limitations in Minn. Stat. § 541.05 (2002) controls that claim and that the district court erred in dismissing the trespass cause of action.
DECISION
On appeal from a summary judgment, this court's review is limited to determining "(1) whether there are any genuine issues of material fact and (2) whether the trial court erred in its application of the law." Patton v. Yarrington, 472 N.W.2d 157, 159 (Minn.App. 1991) (quotation omitted), review denied (Minn. Aug. 29, 1991).
The Hendricksons do not now argue that any issues of material fact exist for trial but rather that the district court erred as a matter of law by dismissing their trespass claim, a claim they contend "does not arise out of a defective and unsafe condition of an improvement to real property." They concede that they never raised in the district court the applicability of the six-year statute to their trespass claim, but they contend they failed to do so because TSI did not address the trespass claim in its motion for summary judgment. This contention is unfounded. In its Memorandum of Law in Support of Summary Judgment, TSI discussed legal authorities relating to the negligent maintenance of property and stated in a footnote:
Significantly, plaintiffs have not alleged claims of negligent maintenance against TSI in this case, only claims of trespass and negligent design, to which the two year statute of limitations contained in Minn. Stat. § 541.051 applies.
Thus, at the summary-judgment stage, the Hendricksons had clear and express notice that TSI was moving for the dismissal of the "claims in their entirety" and that TSI was arguing that the trespass claim was also barred by the two-year statute of limitations. It is the rule that an appellate court will not consider an issue not raised and ruled upon in the district court. Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988). In Thiele, the supreme court held it was error for the court of appeals to consider the applicability of a statute of limitations when that issue had not been raised in the district court. Id. In Minnesota Mutual Fire Casualty Co. v. Retrum, 456 N.W.2d 719, 722 (Minn.App. 1990), we not only held that a new theory cannot be raised for the first time on appeal but also that the two-year statute of limitations in Minn. Stat. § 541.051 can apply to trespass claims.
Thus, the sole issue properly before us is whether the district court erred in ruling that the Hendricksons' negligent-design claim is barred by the statute of limitations. When the district court grants summary judgment based on the application of a statute to undisputed facts, the result is a legal conclusion, which this court reviews de novo. Lefto v. Hoggsbreath Enters., Inc., 581 N.W.2d 855, 856 (Minn. 1998).
Minn. Stat. § 541.051, subd. 1(a), provides:
Except where fraud is involved, no action by any person in contract, tort, or otherwise to recover damages for any injury to property, real or personal * * * arising out of the defective and unsafe condition of an improvement to real property * * * shall be brought against any person performing or furnishing the design, planning, supervision, materials, or observation of construction or construction of the improvement to real property or against the owner of the real property more than two years after discovery of the injury.
Minn. Stat. § 541.051, subd. 1(a) (2002) (emphasis added).
There is no dispute that the parking lot and the holding pond were improvements to real property or that it allegedly was the defective design of the improvements that created an unsafe condition in that it jeopardized and in fact damaged property on adjoining land. There is no dispute that the Hendricksons first discovered the water damage on June 28, 1997, and learned on or about that date that the damage resulted from the failure of TSI's drainage system and holding pond adequately to contain water runoff and overflow.
An improvement to real property is defective if it is incomplete or faulty. Fiveland v. Bollig Sons, Inc., 436 N.W.2d 478, 480 (Minn.App. 1989), review denied (Minn. Apr. 24, 1989). Allegedly, the design of TSI's drainage system and pond was faulty and that faulty design allowed water to escape onto the Hendricksons' property and cause damage.
The Hendricksons have failed to raise any genuine issue of material fact that would make the two-year statute of limitations inapplicable, that would delay its commencement beyond the damage discovery date, or that would toll its running. The district court did not err in granting summary judgment and dismissing all claims.