Second Appellate District Clarifies Two-year Statute of Limitations on Personal Injury Claims

April 1, 2005

By: Michael J. Nunez

Holding: On April 14, 2005, the Court of Appeal held that the two-year statue of limitations period for personal injury actions applied to any personal injury claims that had not already expired on January 1, 2003, when the statute of limitations period was extended from one to two years.

Application: Prior to this ruling, an argument could have been made that the two-year statute of limitation (C.C.P. section 335.1), did not apply retroactively to revive claims that would have been time barred under the former one-year limitation (section 340(3)), at the time the complaint was filed.

Example: An accident occurs on December 15, 2002 and the action is not filed until April 6, 2004. Under former section 340(3), the action would have been time barred on April 6, 2004 because it was filed 16 months after the accident. In arguing against applying new section 335.1 to this scenario, it might have been asserted that the appropriate statute of limitations to utilize would be the statute in existence at the time of the accident. At the time of the accident, December 15, 2002, former section 340(3) was in effect. To utilize the new section 335.1 in April 2004 to validate this claim might have been construed as retroactively applying section 335.1 to an already time barred claim.

The court of appeals clarified that neither the date of the accident, nor the date of filing is the critical date in this statute of limitations analysis. Rather, the date of enactment of section 335.1, January 1, 2003, is the determinative date in this analysis. If a plaintiff's claim was not already time barred by the one-year statute of limitations on January 1, 2003, plaintiffs are entitled to the two-year statute of limitations to bring claims for personal injuries.

Thus, accidents occurring on or after January 1, 2002 are entitled to a two-year statute of limitations and accidents occurring on or before December 31, 2001 are subject to the one-year statute of limitations.

Facts: The case arose from a slip and fall incident on December 15, 2002 at a May Department Store. Sixteen months after the accident, plaintiff filed a complaint for damages on April 6, 2004 alleging negligence and a willful failure to warn under Civil Code section 846. Defendant demurrered to the complaint on the grounds that the action was time barred under the one-year statute of limitations under former section 340(3).

Plaintiff opposed the demurrer and argued that the two-year statute of limitations in new section 335.1 governed her claim because her action was not time barred as of the date section 335.1 became effective.

The trial court sustained the demurrer without leave to amend, ruling that plaintiff's action was filed more than one year after she sustained her injuries and that section 335.1 did not apply retroactively to her action.

The court of appeals reversed.

Analysis: The court of appeals recited and relied upon several cases in reaching its decision. First, "A basic cannon of statutory interpretation is that statutes do not operate retrospectively unless the legislature plainly intended them to do so." Citing, Western Security Bank v. Superior Court, 15 Cal.4th 232, 243 (1997) ""[W]here the application of a new or amended statute of limitations would have the effect of reviving an already time barred claim, the general rule against retroactive application of the statute is applicable in the absence of a clear indication of legislative intent to the contrary." Moore v. State Bd. of Control, 112 Cal.App.4th 371, 378 379; 5 Cal.Rptr.3d 116 (2003).

A new statute that enlarges a statutory limitations period applies to actions that are not already barred by the original limitations period at the time the new statute goes into effect. Douglas Aircraft Co. v. Cranston, 58 Cal.2d 462, 465, 24 Cal.Rptr. 851 (1962); Mudd v. McColgan, 30 Cal.2d 463, 468, 183 P.2d 10 (1947); Thompson v. City of Shasta Lake, 314 F .Supp.2d 1017, 1024 (E.D.Cal.2004). The newly enlarged limitations period will apply retroactively, reviving actions that are already time barred, only if the Legislature expressly stated such an intent. Douglas, supra, 58 Cal.2d at p. 465; Thompson, supra, 314 F.Supp.2d at p. 1024. "These rules afford warning to potential defendants that until the statute of limitations has run it may be extended, whereas after it has run, they may rely upon it in conducting their affairs." Douglas, supra, 58 Cal.2d at p. 465.

Applying this authority to the facts of this case, the court found that when plaintiff allegedly sustained her injuries on December 15, 2002, the statute of limitations then in effect for personal injuries was one year. C.C.P. §340(3). By legislation which became effective on January 1, 2003, the statute of limitations in effect when plaintiff filed her action on April 6, 2004 was two years. The one year statute of limitations (§340(3)) had not barred her action at the time the two year statute of limitations (§ 335.1) became effective. Thus, plaintiff's action was governed by the two year statute of limitations in effect when she filed her action (§ 335.1) rather than the one year statute of limitations in effect at the time she allegedly sustained her injuries (§ 340, subd. (3)).

Basis for rejecting defense position: Citing Krupnick v. Duke Energy Morrow Bay, 115 Cal.App.4th 1026; 9 Cal.Rptr.3d 767 (2004), defendant argued that section 335.1 has no retroactive application to plaintiff's action. The court commented that defendant correctly noted that when the Legislature enacted the two year statute of limitations under section 335.1, it made its application retroactive only to actions brought by the victims of the terrorist attacks of September 11, 2001. (Stats.2002, C. 448, § 1, subds.(c), (d); Code Civ. Proc., §340.10(a) & (b); Krupnick, supra, 115 Cal.App.4th at p. 1029, 9 Cal.Rptr.3d 767.) Defendant argued that by expressly making 335.1 retroactive to actions brought by victims of the terrorist attacks of September 11, 2001, the Legislature intended to exclude all other retroactive applications of the statute. In rejecting this argument that court observed that "[a]pplication of section 335.1 to this case, however, is not, as defendant argues, a matter of retroactivity, and, thus, defendant's reliance on Krupnick, is unavailing."

In Krupnick, the plaintiff contended that section 335.1 "operated retroactively to revive his lapsed claim." Krupnick, supra, 115 Cal.App.4th at p. 1028. Plaintiff alleged he sustained injuries on January 26, 2001. Id . at p. 1027. He did not file his action until January 8, 2003. Ibid. Under the one year statute of limitations applicable when he sustained his injuries, he had only until January 26, 2002 to file his complaint. Id. at p. 1028. The court held that section 335.1 did not apply to plaintiff's action because it was time barred prior to the January 1, 2003 effective date of the new two year statute, and section 335.1 did not operate retroactively to revive his already time barred action. Id. at pp. 1028 1029.

Again, under the facts of this case, plaintiff allegedly sustained her injuries on December 15, 2002, and her claim was but 17 days old and not time barred when section 335.1 became effective on January 1, 2003. Thus, unlike the plaintiff in Krupnick or the victims of the terrorist attacks of September 11, 2001 whose claims would have been barred as of September 11, 2002 (i.e., before section 335.1 became effective) plaintiff's action did not have to be revived through retroactive application of section 335.1.

Defendant also relied on Abreu v. Ramirez, 284 F.Supp.2d 1250, 1255 (C.D.Cal.2003), for the proposition that the "statute of limitations in effect at the time a claim accrues is the limitation applicable to that claim for all time." In Abreu, a magistrate judge held that the plaintiff did not benefit from the enlarged two year limitations period in section 335 .1 because his claim accrued before January 1, 2003. Ibid. In rejecting this case the court stated that "Abreu is not persuasive authority. The court in Abreu failed to consider the holdings in Douglas, supra, 58 Cal.2d 462, 24 Cal.Rptr. 851, 374 P.2d 819 and Mudd, supra, 30 Cal.2d 463, 183 P.2d 10 that a new statute that enlarges a statutory limitations period applies to actions that are not already barred by the original limitations period at the time the new statute goes into effect (Douglas, supra, 58 Cal.2d at p. 465, 24 Cal.Rptr. 851, 374 P.2d 819; Mudd, supra, 30 Cal.2d at p. 468, 183 P.2d 10), and its holding is inconsistent with those cases.