We have defended many lawsuits that were filed after the expiration of the statute of limitations. There are a few different statutes of limitation which may apply to a given case in Maryland. As discussed in this blog post, Maryland has a general three year statute of limitations, with some exceptions which are not discussed here (such as a contract under seal which is subject to a 12 year limitations period).
In Maryland, regardless of conflict of laws, a statute of limitations is considered a “procedural” rule “for choice-of-law purposes,” and “[p]rocedural matters…are always governed by the law of the forum.” Lewis v. Waletzky, 422 Md. 647, 657-58, 31 A.3d 123, 129-30 (2011); Doughty v. Prettyman, 219 Md. 83, 88, 148 A.2d 438, 440 (1959)( “[i]ncluded in the procedural matters governed by the law of this state is the statute of limitations.”).
Md. Code Ann., CJP § 5-101 states that “A civil action at law shall be filed within three years from the date it accrues unless another provision of the Code provides a different period of time within which an action shall be commenced.” The Court of Appeals has held that “[i]n contract cases, the general rule is that the period of limitations begins to run from the date of the breach, for it is then that the cause of action accrues and becomes enforceable.” Himmelfarb v. American Express Co., 301 Md. 698, 703 (1984).
As stated by the Court of Appeals, a statute of limitations is designed to:
(1) provide adequate time for diligent plaintiffs to file suit, (2) grant repose to defendants when plaintiffs have tarried for an unreasonable period of time, and (3) serve society by promoting judicial economy.
Carroll v. Konits, 400 Md. 167, 182, 929 A.2d 19, 28 (2007) (quotations and citations omitted).
As a matter of policy and construction, “statutes of limitations are to be strictly construed and courts will decline to apply strained construction that evades the effect.” Sheng Bi v. Gibson, 205 Md. App. 263, 266, 45 A.3d 305, 307 (2012) (citations omitted).
The Court of Appeals explained the policy reasons behind the statute of limitations in the Benjamin case:
The statutory period provided by a statute of limitations …reflects a policy decision regarding what constitutes an adequate period of time for a person of ordinary diligence to pursue his claim. By creating a limitations period, the legislature determined that a plaintiff should have only so long to bring his action before he is deemed to have waived his right to sue and to have acquiesced in the defendant’s wrongdoing.
Georgia-Pacific Corp. v. Benjamin, 394 Md. 59, 84–85, 904 A.2d 511 (2006) (citations omitted). The Court of Appeals recently reiterated that policy in the Smith case:
[A] statutory period of limitations represents a policy judgment by the Legislature that serves the interest of a plaintiff in having adequate time to investigate a cause of action and file suit, the interest of a defendant in having certainty that there will not be a need to respond to a potential claim that has been unreasonably delayed, and the general interest of society in judicial economy.
Smith v. Wakefield, LP, 462 Md. 713, 724, 202 A.3d 1240, 1246 (2019) (quotation omitted).
Maryland is not alone in its policy. As stated by the United States Supreme Court, the right to be free of stale claims is more important that the right to pursue them:
[S]tatutory limitation periods are ‘designed to promote justice by preventing surprises through the revival of claims that have been allowed to slumber until evidence has been lost, memories have faded, and witnesses have disappeared. The theory is that even if one has a just claim it is unjust not to put the adversary on notice to defend within the period of limitation and that the right to be free of stale claims in time comes to prevail over the right to prosecute them.
American Pipe & Const. Co. v. Utah, 414 U.S. 538, 554 (1974).
In addition, the Maryland legislature chose to affirmatively prohibit a creditor from filing “a consumer debt collection action after the expiration of the statute of limitations applicable to the consumer debt collection action.” Md. Code Ann., CJP § 5-1202(a).
CONTACT US: If you think you have been sued past the statute of limitations, feel free to contact us for a consultation.