All causes of action, whether based in tort or contract, must be brought within a certain period of time after “accrual” of the cause of action. The limitations periods are set forth in statutes and typically vary from one year to ten years, depending on the cause of action involved. In some instances, the running of the statute of limitations is suspended for a period of time. This can occur based on “delayed discovery” of the cause of action, a topic discussed in another article published by this firm, or it may be suspended for any number of reasons specified by statutes or judicial decisions. This article discusses the most common instances of “tolling,” or suspension, of the running of limitations periods based on such statutes and judicial decisions.
- Absence of the Defendant from the State.
If a potential defendant is outside the state of California for a particular period of time, the limitations period is suspended or tolled during the time he is out of the state. It is not necessary that the potential defendant be out of the state at the time the cause of action accrues. If the cause of action accrues, and begins to run, and the potential defendant leaves the state while the limitations period is running and before it expires, the limitations period is suspended during the time the potential defendant is outside of the state.
As with most tolling provisions, there are exceptions, and this article does not discuss all such exceptions. However, an important exception involves the Commerce Clause of the United States Constitution. The Commerce Cause prohibits the suspension of the running of the limitations period against a nonresident individual who is sued based on a contractual obligation incurred in interstate commerce. The rationale for this prohibition is that the application of the tolling provision would hinder interstate commerce by forcing a nonresident defendant to choose between engaging in interstate commerce or remaining subject to suit with virtually no limitations period.
- Arbitration.
Many commercial contracts include an arbitration provision, requiring that any dispute between the parties be submitted to arbitration. In many instances, however, a party to the contract will file an action in court, and the defendant will bring a motion to compel arbitration. The applicable statute of limitations is tolled from the date the civil action is commenced until 30 days after the court renders a final decision requiring arbitration of the dispute, or until 30 days after the civil action itself is terminated, whichever occurs first.
- Class Actions.
If a class action is filed, typically a member of the class may opt out, and file his or her own action against the defendant sued in the class action. The limitations period is tolled from the time the class action is filed until the time the plaintiff opts out of the class.
- Commencement of an Action.
The limitations period is tolled from the time an action is commenced until a final determination of the action. The final determination of the action will be the running of the period during which a judgment may be appealed, without the filing of a notice of appeal, or a final determination of the appeal, which typically occurs when the Court of Appeal renders a decision and issues a remittitur to the trial court.
- Cross-complaints.
If a defendant files a cross-complaint against the plaintiff, the statute of limitations for asserting the claim set forth in the cross- complaint is tolled upon the filing of the complaint by the plaintiff. It is not clear whether such tolling applies to only compulsory (related) cross-complaints, or to all cross-complaints, permissive as well as compulsory, and the case authorities differ on this issue. What is clear is that a cross-complaint against a third-party is not tolled by the filing of the plaintiff’s complaint.
- Fictitiously-Named Defendants.
If a Plaintiff is not aware of the identity of a potential defendant at the time the plaintiff files his or her complaint, the statute of limitations against the fictitiously-named defendant is tolled from the time the complaint is filed until the plaintiff learns of the identity of the originally unknown defendant, and adds his or her name as a DOE defendant.
- Amended Pleadings.
If the original complaint is timely filed, a later amended pleading, adding additional causes of action, will “relate back” to the date of the filing of the original complaint, so long as the amended pleading seeks a remedy based on the same general set of facts set forth in the original complaint. The “relation back” doctrine will apply even if the amended pleading seeks to add an additional defendant, so long as the claim against the additional defendant relates to the wrongdoing and damages alleged in the original complaint.
- Death of the Defendant.
If a person against whom the plaintiff may assert a cause of action dies before the running of the statute of limitations on the claim the plaintiff could assert against the decedent, the plaintiff may assert the claim against the deceased’s personal representative within one year of the date of the deceased’s death. That one-year limitations period may either extend or shorten the applicable limitations period.
For instance, if the applicable statute of limitations is three years, and the potential defendant dies after the running of one year, the effective limitations period is shortened to two years — the one year that had already elapsed and the one year limitations provision in Code of Civil Procedure section 366.2. Conversely, if the deceased dies 2 ½ years after the three-year limitations period begins to run, the limitations period is effectively lengthened to 3 ½ years — the initial 2 ½ years plus the one year limitations period in Code of Civil Procedure section 366.2.
- Death of a Potential Plaintiff.
If a potential plaintiff dies, the question arises whether the cause of action he had survives. If it does not survive, the limitations period is moot. If the cause of action does survive, the deceased’s personal representative or other person with standing may assert the deceased’s cause of action so long as he or she does so within six months of the deceased’s death.
- The Plaintiff’s Minority.
If a cause of action arises when the potential plaintiff is under the age of 18, the applicable limitations period will be tolled from that date until the person reaches the age of 18.
- Lack of Legal Capacity to Make Decisions. The limitations period is tolled during the time the plaintiff lacks the capacity to make decisions. “Lacking the legal capacity to make decisions” is described in case authority as one being “incapable of caring for his or her property or transacting business or understanding the nature or effects of his or her acts.” The inability to make decisions may result from a variety of factors, such as unconsciousness, injury and advanced age.
- Prisoner Serving Less than a Life Term.
By statute, the limitations period for claims of prisoners serving less than a life term is tolled during the time the individual is disabled based on his incarceration, but not to exceed two years. The phrase “less than a lifetime” includes a life term having the possibility of parole.
- Military Service.
The limitations period on claims a person in military service has is tolled during the period of his military service.
- War.
If a person is incapable of asserting a claim by reason of the existence of a state of war, the limitations period on any claims he has is tolled during the time he is unable to bring an action. For instance, the claims of a nonresident alien against a resident of California may be tolled during the time the nonresident alien is residing in a country that is occupied by an enemy military force.
- Disability of an Attorney.
A physical disability of a person’s attorney will toll the running of the statute of limitations on a client’s claims if the attorney’s disability makes compliance with the limitations period impossible, and an injustice would result in not suspending the running of the limitations period.
- Legal Prohibitions to Sue. If one is legally prohibited from filing an action, the limitations period on his claims will be tolled during the period of the prohibition. As an example, if an injunction is issued prohibiting one from filing suit, the limitations period on the individual’s claims is suspended so long as the injunction is in effect.
The commencement of an action may also be prohibited until the potential plaintiff has made a request of an administrative agency, and the administrative agency has issued a decision. In that instance, the time from the making of the request to the agency’s determination will be tolled.
- Bankruptcy Proceedings.
When a potential defendant files a bankruptcy petition, any claims against that individual are automatically stayed unless and until the court issues an order permitting the claim to go forward. The limitations period for any claims the creditor has against the debtor is tolled during the time the creditor is prohibited from proceeding against the debtor.
- Dismissal of Supplemental State Claims asserted in Federal Court.
In some cases, there is an apparent basis for filing state law claims, together with federal claims in federal court. In some such cases, the federal court will determine it is appropriate for it to entertain the state law claims. However, if the court determines it would not be appropriate for it to entertain those claims, and the state law claims are dismissed, the limitations period on those claims is suspended from the time of the filing in federal court until the federal court dismisses the state law claims.
Caveat. The rules discussed above are general rules, and as is the case with most general rules, there are exceptions. Few exceptions to the above rules are discussed in this article. The reader should also be aware that, in addition to tolling provisions described in applicable statutes and cases, a period of limitations may be tolled for equitable reasons, a subject not covered in this article.
The Law Office of William J. Tucker is familiar issues involving statutes of limitation applicable to tort and contract claims, and provides free initial phone consultations to individuals and companies dealing with such issues. Feel free to Schedule an Appointment.