Beating the Statute of Limitations: Filing Suit Is Only Half The Battle

Statute of LimitationsWe are frequently asked by clients to file suit in a case where the statute of limitations expires in a matter of a day—even hours. In some cases, we are asked to file in order to toll an impending statute of limitations and give the client more time to negotiate a settlement or take other action. Some states have unusually short limitation periods, including Louisiana (1 year for personal injury and property damage) and Ohio (1 year for medical malpractice). One and two-year limitation periods go by quickly in pending claims and filing suit is often necessary in order to preserve the right of subrogation. An action is usually commenced within the applicable statute of limitations by filing a summons and/or complaint. Filing the complaint, however, is only the first step. Where service of the complaint on the defendant is not pursued with reasonable diligence or obtained within a prescribed number of days after filing, the defendant may be able to argue that the statute of limitations has run and the lawsuit should be dismissed, even if it was timely filed.

In Texas, once a defendant argues that the statute of limitations has run because service of process has not been diligently pursued, the burden shifts to the plaintiff to prove that the plaintiff diligently pursued service. Diligence is not based on the number of days it took to obtain service. It is shown, rather, by the totality of the circumstances. The judge or jury must determine “whether the plaintiff acted as an ordinarily prudent person would have acted under the same or similar circumstances and was diligent up until the time the defendant was served.” A failure to show sufficient attempts at service or the revelation of reasonable service efforts during one or more lapses of time, leads to lack of diligence as a matter of law. Proulx v. Wells, 235 S.W.3d 213 (Tex. 2007).

In Ashley v. Hawkins, 293 S.W.3d 175 (Tex. 2009), the plaintiff tried and failed to serve the defendant within the limitations period. However, eight months passed before another attempt at service was made. The defendant argued that service of process was untimely, and the burdened shifted to the plaintiff to show the requisite diligence. To meet that burden, the plaintiff testified that he spent 20 hours trying to locate the defendant but failed to specify when those efforts were made. The court held the effort was inadequate and that the plaintiff exercised diligence for the first two months but didn’t prove an alternate form of process was attempted and ruled the statute ran because he was not diligent.

Compare that with Proulx v. Wells, 235 S.W.3d 213 (Tex. 2007), in which the plaintiff provided 37 attempts at service over nine months and five different addresses. The court held that such efforts were reasonably diligent.

Some states go beyond simply requiring efforts at service to be “reasonable.” They literally require effective service within a certain period of time. In Oklahoma, § 2004(I) requires service within 180 days. If the plaintiff cannot show “good cause” why service was not made within that time period, the suit will be dismissed. Nevada’s Rules of Civil Procedure simply require that the complaint be served on the defendant within 120 days unless a court grants an extension of that time period.

Missouri’s Sup. Ct. R. 53.01 says that “diligent” service efforts are not a factor in determining if the complaint has been filed within the applicable statute of limitations. Instead, Sup. Ct. R. 54.21 provides that if process cannot be served it must be returned to the court within 30 days after the date of issue with a statement of the reason for failure to serve same. The time for service may be extended up to 90 days from the date of issue by order of the court.

Minnesota approaches it a little differently. Rule of Civil Procedure 3.01 says that a civil action is “commenced” when the summons is served, or when the summons is delivered to the sheriff in the county where the defendant resides. However, service in ineffectual unless it is actually served within 60 days. Courts have held that this effectively amounts to a 60-day “grace period” after the summons is delivered to the sheriff. Johnson v. Husebye, 469 N.W.2d 742 (Minn. App. 1991).

Florida requires that service be made on a defendant within 120 days after filing, or the court (after notice or on its own motion) will order that service be had within a specified period of time or that the case is dismissed. Fla. R. Civ. P. 1.070(j). “Good cause” or “excusable neglect” must be shown in order for the court to extend the time period for an appropriate number of days.

Illinois Supreme Court Rule 103(b) mandates that a plaintiff exercise “diligence” in serving a defendant. In Mular v. Ingram, 33 N.E.3d 771 (Ill. App. 2015), the Illinois Court of Appeals provides a harsh example of what can happen if diligence in getting service is not used. The plaintiff was injured on July 18, 2010 and filed suit on July 16, 2012 – just before the statute of limitations ran. For several months, the plaintiff issued multiple summonses to the wrong address. Nearly three years from the date of the incident and a full six months after the limitations period expired, plaintiff finally served the defendant. The plaintiff’s case was dismissed with prejudice for lack of diligence in serving the defendant under SCR 103(b). The Court of Appeals affirmed, noting that Rule 103(b) protects a defendant from unnecessary delays and designed to give a defendant a fair opportunity to investigate the nature of a plaintiff’s claims. The rule doesn’t specify a specific amount of time for a defendant to be served and the trial court has wide discretion in considering a Rule 103(b) motion.

Once a defendant makes an initial showing that the plaintiff was not diligent in serving him, the burden shifts to the plaintiff to refute this. The reasonable diligence standard is an objective one and the court does not consider whether the plaintiff intentionally delayed service. While the defendant isn’t required to prove he was prejudiced by the delay, prejudice to the defendant is still a factor considered by the court. Multiple factors guide Illinois courts on a Rule 103(b) motion to dismiss. These include:

  • the length of time it took to serve the defendant;
  • plaintiff’s efforts to obtain service;
  • whether plaintiff knew of defendant’s whereabouts;
  • whether defendant’s whereabouts could be easily obtained;
  • whether defendant was actually aware of the suit;
  • whether defendant was actually served; and
  • any special circumstances that justify a service delay.

States require actions to be filed within a statute of limitations period and service to be had within a specified or reasonable time period because they believe that litigation must have an end date. These rules increase the probability that actions will be resolved when the underlying facts are fresh in the minds of the parties and witnesses and lessens the chance that trials will be tainted by stale evidence or faded memories.

Subrogated insurance companies and their lawyers should remember that simply filing suit in order to preserve the statute of limitations and allow the carrier an opportunity to finalize settlement negotiations or process a first-party claim will not be enough to protect it from dismissal indefinitely. They must be familiar with the nuances of service of process rules, statutes, and case decisions in any state in which they file suit.

A chart detailing the statutes of limitations time periods and service of process rules for all 50 states can be viewed HERE. For questions regarding filing suit or service of process rules, contact Gary Wickert at [email protected].

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Gary L. Wickert
Partner

Gary L. Wickert is an insurance trial lawyer and partner with the law firm of Matthiesen, Wickert & Lehrer, S.C. Gary has 35 years of litigation experience and is regarded as one of the world’s leading experts on insurance subrogation. He is the author of several subrogation books and legal treatises and a national and international speaker and lecturer on subrogation and motivational topics.