Lack of Knowledge Doesn't Save Claim from the Statute of Limitations.

In the interest of fairness, when an injured party doesn't know about the claim, should the statute of limitations bar the action? That is an interesting question and the answer, as in most legal questions, is that, "It depends."

In a recent case, a blogger allegedly defamed Arthur Alan Wolk, who brought an action in Federal Court. Wolk argued that the statute of limitations did not apply because he had no way of knowing about the defamation. He didn't discover the alleged defamation within the time required.  As he argued, he couldn't pick up a newspaper and discover the alleged defamation. The statute of limitations for defamation is one year.

The court said that the statute barred the claim. Max Kennerly, in an interesting blog about the case, notes that you can find a lot on Google, and that is where the plaintiff found the reference. He just didn't look within the time required. Max notes that the effect of the rule is that everyone has constructive knowledge of everything on the internet.  I'm not sure I would go that far, but it isn't hard to Google yourself. 

Sometimes the statute of limitations doesn't start until the person injured has or should have knowledge. In other words, if a reasonable person would have discovered the claim by a certain date, then the statute starts to run at that time. Sometimes the statute runs regardless of knowledge, as in this case.

Bring claims based on some action in the distant past is a problem; witnesses are gone, records destroyed and memories are changed. So having a limitation of action is a good thing. You can't usually sit on your claim. Sometimes claims are never discovered until long after the statute has barred any action.

Is this fair? Maybe not of the claimant, but for the legal system it is probably the only fair thing to do. I think this is a case of the greater good, the efficient operation of a legal system, at the expense of some individuals with old claims.

The one thing I like about this case is that the court made the ruling at the motion stage of the proceedings. It is very frustrating to have a court deny a motion to dismiss based on the statute of limitations, have the trial, and then have the court rule that you proved your case but the claim is barred by the statute of limitations.

It Doesn't Get Any Better Than This!

This why I love business litigation. Maxwell Kennerly provides a detailed report and analysis of a fascinating case involving movie distribution rights. (i.e. the case involves who gets the money.) The case arose from a series of contracts between various parties. Now the parties are litigating over what those agreements actually did. I am sure all of the parties had lawyers drafting and negotiating these agreements; and now lawyers get to fight in court over what the contracts mean. This case is a law professors dream. Take a look at Max's analysis, it is fun reading.