Senate Bill 20-138 has been introduced to increase Colorado’s statute of repose for construction defects from six to ten years. If enacted as proposed, SB20-138 would also start the timer for Colorado’s statute of repose later—only after both physical manifestation AND the cause of a defect are identified. In addition, SB20-138 would make it easier for claimants to toll Colorado’s statute of limitations for construction defects. In practice, this means construction defect claims will likely rise with extended time to file, and defenses based on the statutes of limitations and repose will be all but eliminated.
Other states have ten-year statutes of repose on their books. New Mexico’s statute of repose expires ten years following substantial completion of a project. Ten years after the 2008 construction downturn, New Mexico saw construction defect cases filed in which it was not uncommon for construction company clients to have dissolved, and for companies still in existence to have disposed of project files as no longer needed for tax purposes. Statutes of repose serve as a cutoff to the tolling of construction defect statute of limitations, however the result of New Mexico’s statute of repose—and likely SB20-138—is that litigation can be initiated long after projects are complete, project files are destroyed, and construction companies are in existence.