Background
In November 2014, Jeremy Hanson entered into a purchase agreement with Dabbert Custom Homes, LLC, for the construction of a single-family residence in West Fargo, North Dakota. Dabbert provided a one-year residential warranty. Hanson closed on the home in February 2015. Within months, he noticed persistent cold conditions in the home’s northwest corner — including frost buildup on interior walls, temperature differentials of roughly twenty degrees between rooms, and drafts severe enough that he placed towels against a closet door. By spring 2015, Hanson had contacted the Home Builders Association of Fargo-Moorhead to complain, and on December 28, 2015, he emailed Dabbert’s warranty coordinator specifically requesting an “insulation check — in upper north west corner house.”
After Dabbert coordinated repairs through its insulation subcontractor, Draft Busters, Inc., in 2016 — including a thermal imaging inspection and caulking work — the parties had approximately three years of inactivity. Hanson reinitiated contact in November 2019, and Dabbert continued post-warranty remediation efforts through at least August 2020, when it drafted (but never executed) a release agreement proposing to remove siding and fill any insulation voids. In February 2022, Hanson hired Nordic Companies for an independent inspection, which revealed surface temperatures as low as 26°F in the northwest bedroom, missing or insufficient insulation, and fungal growth. Hanson filed suit on July 5, 2022, asserting breach of warranty, breach of contract, and negligence.
Dabbert answered, raising the statute of limitations as an affirmative defense. After discovery and a third-party complaint against seven subcontractors (all eventually dismissed), Dabbert moved for summary judgment in June 2025. The District Court of Cass County granted the motion, holding Hanson’s claims were time-barred under North Dakota’s six-year limitations period and rejecting his arguments based on forfeiture and equitable estoppel. Hanson appealed.
The Court’s Holding
The North Dakota Supreme Court affirmed, holding that Hanson’s claims accrued no later than December 28, 2015 — the date he memorialized in writing his suspicion of an insulation deficiency in the northwest corner of his home. Applying the discovery rule under N.D.C.C. § 28-01-16(1), the court held that accrual requires only that the plaintiff be aware of facts placing a reasonable person on inquiry notice of a potential claim, not subjective certainty or professional confirmation of a defect. Because Hanson did not file suit until July 5, 2022 — more than six and a half years after accrual — his claims were time-barred as a matter of law.
The court rejected Hanson’s forfeiture argument, concluding that Dabbert’s litigation conduct — filing a third-party complaint against subcontractors and conducting discovery before moving for summary judgment — was not fundamentally inconsistent with its limitations defense, which had been timely asserted in its answer. The court also rejected equitable estoppel, holding that Dabbert’s good-faith post-warranty repair and inspection activities were not conduct “naturally calculated” to lull Hanson into believing litigation would be unnecessary. The court further held that the duty-to-disclose exception to equitable estoppel did not apply because Hanson failed to show Dabbert possessed and withheld actual knowledge of a specific defect uniquely within its knowledge, and because Hanson had independent means to investigate.
Additionally, the court declined to adopt — though it did not expressly reject — the out-of-state principle that active litigation conduct can forfeit a pleaded limitations defense, finding that even if it were to adopt such a doctrine, Dabbert’s conduct here fell well short of the threshold.
Key Takeaways
- Under North Dakota’s discovery rule, the six-year limitations period for construction-defect claims begins to run when the plaintiff has facts sufficient to place a reasonable person on inquiry notice — not when the full extent of the defect is professionally confirmed. A homeowner’s own contemporaneous written complaints can establish accrual as a matter of law.
- A contractor’s good-faith efforts to remedy a homebuyer’s complaints — including post-warranty inspections and repair work — do not constitute the kind of conduct “naturally calculated” to induce forbearance from filing suit and therefore do not support equitable estoppel. Holding otherwise would deter contractors from attempting remediation.
- Filing a third-party complaint against subcontractors, standing alone, is not fundamentally inconsistent with a statute of limitations defense and does not forfeit that defense even when years of litigation have elapsed before a summary judgment motion.
- The duty-to-disclose exception to equitable estoppel requires the defendant to have possessed actual knowledge of a material fact uniquely within its control that it affirmatively withheld. A vendor-purchaser relationship between a homebuilder and buyer does not create the kind of fiduciary or confidential relationship that triggers this exception.
- A plaintiff’s own testimony attributing delay in filing to reasons unrelated to the defendant’s conduct — here, financial hardship from a workplace injury — undermines the reliance element necessary to establish equitable estoppel.
Why It Matters
This decision reinforces the objective standard governing accrual of construction-defect claims in North Dakota and signals that courts will resolve accrual as a matter of law when the plaintiff’s own documented knowledge forecloses genuine dispute. Attorneys representing homeowners in construction-defect cases must advise clients that inquiry notice — triggered by symptoms observable to a layperson — starts the limitations clock, even if the precise scope or cause of a defect is not yet established by professional inspection.
Equally significant is the court’s treatment of equitable estoppel in the repair context. By holding that a contractor’s good-faith remediation efforts do not, without more, constitute conduct calculated to induce a homeowner to forgo litigation, the court draws a clear line between legitimate repair activity and the kind of misleading conduct equitable estoppel is designed to remedy. Contractors facing post-sale defect complaints can pursue good-faith remediation without automatically exposing themselves to an estoppel defense — but must be careful that their communications do not cross into affirmative assurances that litigation will be unnecessary.