Toxic Tort and Environmental Law Update: September 2012 -- Indiana Supreme Court Interprets Application of Statute of Repose in an Asbestos Case

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[author: Harmon Cooper]

Statutes of repose can provide immunity for contractors against latent asbestos personal injury claims filed several years after the work was performed and the plaintiff was exposed.  Under many states’ statutes of repose, contractors can receive immunity if they can show that their work constituted an enhancement or improvement to the property at issue.  In Gill v. Evansville Sheet Metal Works, Inc., 49S05-1111-CV-672 (Ind. Sup. Ct. June 25, 2012), the defendant, Evansville Sheet Metal Works, Inc. (ESMW), requested summary judgment based on Indiana’s statute of repose, contending that its work amounted to an improvement to the property.  While a lower court granted summary judgment, the Indiana Supreme Court in Gill reversed the decision, holding that the defendant did not provide any evidence to show that its actions enhanced the property.  Given this lack of evidence, the court could not rule in the defendant’s favor.

Plaintiff Sharon Gill was the wife of the decedent, Gale Gill, who worked for Alcoa in Indiana for more than 20 years operating and maintaining smelting pots.  While employed with Alcoa, Gale was allegedly exposed to asbestos because he worked near a project conducted by the ESMW.  ESMW’s project was concluded in 1989; after his retirement, Gill was eventually diagnosed with an asbestos-related disease, dying of lung cancer in 2005.

In May 2007, the plaintiff filed a complaint against ESMW, seeking damages for contractor negligence.  ESMW sought summary judgment, arguing that the contractor-negligence claim was barred by the statute of repose.  In support of its motion, ESMW asserted that the plaintiff’s allegation that ESMW’s “appli[cation] [of] asbestos containing products … caused [the] injury” was enough to constitute an “improvement to real property” within the meaning of the statute.

 

While the trial court agreed with ESMW, the Indiana Supreme Court reversed.  Since the statute did not define the phrase “improvement to real property,” the court followed the majority of other states and interpreted the plain meaning to be a permanent addition to real property that enhanced its capital value, thus making the property more valuable.  This was in contrast to the approach in several other jurisdictions that look to the common law of fixtures, which focuses on the intent of a party to annex an article to the property.  Applying the majority’s approach, the court declined to grant summary judgment based solely on the allegation that ESMW applied asbestos-containing products at the decedent’s worksite.  Ultimately, the record did not contain any evidence to show that the defendant’s actions had actually improved the property.

 

The Indiana Supreme Court’s decision to follow the majority of states, including Illinois and Ohio, in defining what improvement to property means for statutes of repose indicates that defendants hoping to invoke the statutes to bar asbestos personal injury claims should put forth evidence showing that their work permanently enhanced the value of property.