A Challenge Regarding the Interpretation of a Project Condition of Approval may be Filed More than 90 Days Following the Project Approval

David Blackwell | Allen Matkins

On June 25, 2020, the Fifth Appellate District decided Honchariw v. County of Stanislaus, holding that an applicant’s challenge to a local agency’s interpretation of a project condition of approval was not barred by the Subdivision Map Act’s statute of limitations because it was not a challenge to the validity of a condition of approval. This decision is important for developers, as the 90-day statute of limitations under the Subdivision Map Act (at Gov. Code § 66499.37) and the Planning and Zoning Law (at Gov. Code § 65009(c)(1)) is extremely short, and conflicting interpretations regarding a condition may not arise until months or years later. This decision provides developers with an opportunity to challenge conflicting interpretations of a condition so long as the lawsuit is filed within 90 days after the conflict has materialized.

DISPUTED VESTING TENTATIVE MAP CONDITIONS OF APPROVAL REGARDING WATER SERVICE

In Honchariw, the County Board of Supervisors conditionally approved subdivider Honchariw’s application for a vesting tentative map in 2012. This approval followed years of litigation between Honchariw (as a prolific pro per litigant) and the County regarding this riverfront property that his family had owned for decades. A primary concern was the source of water service for the subdivided lots. The County therefore imposed four conditions to the vesting tentative map approval that sought to address this issue.

During the ensuing several years, Honchariw and County staff worked to address the property’s water supply, but in 2017, the County interpreted the subject conditions to require a fire suppression system that was contrary to Honchariw’s understanding. Honchariw argued that the County’s interpretation “came at him out of the blue” because the Community Services District’s system could not supply the required flows to make fire hydrants functional, as now required by the County. The parties continued to negotiate, with Honchariw insisting that a functional fire suppression system was not required for approval of the final map and could instead be built out as the lots were developed. The parties reached an impasse in the summer of 2017, five years after the vesting tentative map was approved.

A CHALLENGE REGARDING THE INTERPRETATION OF A CONDITION DIFFERS FROM A CHALLENGE TO THE VALIDITY OF A CONDITION

After the trial court conducted a hearing on the merits, it denied Honchariw’s petition and complaint. On appeal, the County argued that to the extent that Honchariw was challenging the project’s conditions of approval imposed in 2012, the challenge was barred by the 90-day statute of limitations set forth in Government Code section 66499.37 relating to decisions regarding subdivisions, including “the reasonableness, legality, or validity of any condition attached thereto.”

Honchariw argued, and the appellate court agreed, that his challenge was not to the validity of the subject conditions, but to the County’s “misinterpretation and misapplication” of the conditions, and that the parties’ respective stances regarding the meaning of the subject conditions were not clarified until July 2017. The court held that Honchariw’s claim did not “accrue” until then, so the filing of the lawsuit on August 25, 2017 was not time-barred by the Map Act’s 90-day statute of limitations.

NO DEFERENCE TO A LOCAL AGENCY’S INTERPRETATION OF PROJECT CONDITIONS

In the unpublished portion of the opinion, the Court sought to interpret the disputed conditions of approval, and remanded the matter to the trial court to resolve conflicting evidence in the record. In so doing, the appellate court applied the general principles for construing written instruments, provided that the principles do not undermine the purposes of the Subdivision Map Act.

The Fifth District also declared that while courts typically defer to a local agency’s interpretation of its own administrative rules, such deference was not appropriate when interpreting a subdivision’s conditions of approval, and that a court should instead “resolve any ambiguity in the conditions of approval in a manner consistent with the objectively reasonable expectations of the applicant.” Failing to do so would “undermine the purpose of the vesting tentative map statute.” The court further stated: “we are not bound to accept the local agency’s interpretation of a condition of approval simply because that interpretation is one of multiple reasonable interpretations. Such an approach would reward local agencies that draft ambiguous conditions of approval by giving them flexibility not conferred by clearly drafted conditions.”

IMPLICATIONS OF HONCHARIW

Although the facts of this case are limited to the Subdivision Map Act’s 90-day limitations period, the Planning and Zoning Law has similar language regarding actions to “determine the reasonableness, legality, or validity of any condition attached to a variance, conditional use permit, or any other permit” (Gov. Code § 65009(c)(1)(E)), thus the rationale in Honchariw would arguably be applicable to disputes regarding the interpretation of basically any project condition of approval.

This decision thus provides developers with a litigation option in the event of a dispute regarding the interpretation of one or more conditions of approval long after the project is approved.

Although the unpublished portion of the opinion cannot be cited as authority, it is provocative in its refusal to provide deference to a local agency’s interpretation of a project condition that it imposes and its admonishment of local agency attempts to impose ambiguous conditions that the agency can interpret to its advantage following the project approval.

Judicial Council Ends Tolling Of Statute Of Limitations To Bring Civil Suits, Effective Aug. 3

Jennifer Hernandez, Daniel Golub and paloma Perez-McEvoy | Holland & Knight

The California State Judicial Council amended California Rule of Court, Emergency Rule No. 9, on May 29, 2020, lifting its previously adopted indefinite tolling of the limitation period to bring civil lawsuits. The amended rule now provides that limitation periods of 180 days or less will be tolled only until Aug. 3, 2020, allowing project applicants to begin to plan and get financing so that development can proceed this year.

The Judicial Council issued emergency rules of court to address the COVID-19 pandemic on April 6, 2020, one of which – Emergency Rule No. 9 – tolled the statute of limitations for all civil actions from April 6, 2020, until 90 days after the date that California’s governor lifts the statewide COVID-19 state of emergency. Because the state of emergency declaration could remain in effect for a year or more, and since most developers cannot proceed to obtain financing until the period to bring litigation has lapsed, the effect of the rule was to indefinitely pause housing and other development – even while “shelter in place” orders are lifted and housing construction was declared an “essential activity” exempt from those orders.

Holland & Knight worked with a broad coalition of more than 50 trade groups, planning associations, affordable housing providers, business associations, charitable organizations, infill developers, advocacy groups and nonprofit organizations to urge the Judicial Council to amend Emergency Rule No. 9. The California Building Industry Association and the California Chamber of Commerce joined with leaders in the affordable housing nonprofit community and the “Yes In My Backyard” movement to stress the importance of allowing housing development to continue in light of the state’s unprecedented housing crisis.

In response to opponents who urged that tolling of litigation deadlines remain in effect indefinitely, the Judicial Council’s amendment keeps tolling in effect far longer than most housing advocates consider justified, but the rule does set a date when the tolling period will end. Statutes of limitations of 180 days or less – such as the 30-day to 35-day deadline for most California Environmental Quality Act (CEQA) challenges, and the 90-day limitations periods in the Planning and Zoning Law as well as the Subdivision Map Act – will be tolled only from April 6, 2020, until Aug. 3, 2020. Longer statutes of limitations remain tolled until Oct. 1, 2020.

Even after Aug. 3, project applicants and public agencies will still need to wait for the remaining number of days left in applicable statute of limitations to run. Additionally, project applicants and public agencies seeking to invoke the CEQA statute of limitations should be mindful of the need to keep CEQA notices posted for the full statutory period, as well as to consider the provisions of Executive Order N-54-20, which states that it suspends the filing requirements for CEQA notices until June 22. (See Holland & Knight’s Breaking Ground Blog, “California Executive Order Suspends Certain CEQA Noticing and Posting Requirements,” April 27, 2020.)

The Moving Finish Line: Statutes of Limitation and Repose Are Not Always What They Seem

Kenneth E. Rubinstein and Nathan Fennessy | Construction Executive

Having an end date for risk is important to construction professionals who need to know when they can close their books and destroy files relating to old projects. While professionals typically look to the statute of limitations and repose, these deadlines can sometimes be harder to determine than one might think. 

STATE LAWS PROHIBITING ALTERATION OF STATUTES OF LIMITATION

Many contractors seek to control the extent of their risk by negotiating the length of their liability period. In some instances, contractors may seek to shorten the statute of limitations to protect against stale claims. While in other instances, owners periodically negotiate for longer periods to ensure that they will not be time barred from pursuing valid claims. While the majority of states enforce such contractual provision, a number of states hold such clauses unenforceable. In these instances, the state’s original statute of limitations will apply regardless of what the contract says. 

QUESTIONS OF WHETHER STATUTES OF REPOSE APPLY TO ARBITRATION

As the construction industry has moved to binding arbitration to resolve disputes, many contractors may have assumed they would continue to enjoy the benefits of state statutes of repose that fix the end date for a contractor’s liabilities in those proceedings. Unfortunately, some contractors have learned the hard lesson that state statutes of repose (and statutes of limitation) do not always apply in arbitration. Indeed, only a few states – e.g. New York, Georgia and Washington – have statutes that specifically subject arbitration claims to the same time limitations for the commencement of actions as if the claim had been brought in court, and the majority of states have not yet addressed this question. 

The overwhelming majority of courts considering the issue (including courts in California, Connecticut, Idaho, Indiana, Maine, Massachusetts, Minnesota, North Carolina, Ohio and Washington) have determined that the time limitations set forth in a statute of repose or statute of limitations do not apply to arbitration. The only exception that the authors are aware is Florida where the Florida Supreme Court determined in Raymond James Financial Services, Inc. v. Phillips, 126 So. 3d 186 (Fla. 2013) that arbitration constituted a “civil action or proceeding” and therefore met the definition of “action” set forth in Florida’s statute of limitation. 

INCONSISTENT LAWS REGARDING APPLICATION OF TIME LIMITS UPON PUBLIC OWNERS

Public owners (including the federal government, as well as some cities, states and state agencies) often have an infinite time within which to bring a civil action. The basis for this immunity from statutes of limitations is the old English common law doctrine, “nullum tempus occurrit regi”– literally, no time runs against the King–which purports to exempt some public owners from statutes of limitations of general applicability unless statutes expressly provide otherwise. The federal government always has this protection. Accordingly, the statute of limitations won’t prevent the federal government from filing suit even decades after construction is complete. The picture is far less clear, however, with states and municipalities, as different states take different approaches to the issue. Some states reject the doctrine, other states allow the state alone to exercise the doctrine, while others allow the state, state agencies and even municipalities to benefit. 

Unfortunately, determining the end date for liability can be more difficult than simply reviewing the applicable statutes of limitation and repose. Contractors who perform work in more than one state, or who do both private and public work, should review the rules carefully before closing their books.

Potential Extension of the Statutes of Limitation and Repose for Colorado Construction Defect Claims

David McLain | Colorado Construction Litigation

On January 27th, Senator Robert Rodriguez introduced SB 20-138 into the Colorado Legislature.  The bill has been assigned to the Senate Judiciary Committee and has not yet been scheduled for its first hearing in that committee.  In short, Senate Bill 20-138, if enacted, would:

1)      Extend Colorado’s statute of repose for construction defects from 6+2 years to 10+2 years;

2)      Require tolling of the statute of repose until the claimant discovers not only the physical manifestation of a construction defect, but also its cause; and

3)      Permit statutory and equitable tolling of the statute of repose.

Colorado’s statute of repose for construction defect claims are codified at C.R.S. § 13-80-104.  In 1986, the Colorado Legislature set the statute of repose period at 6+2 years.  For the last 34 years, Colorado’s statute of repose for owners’ claims against construction professionals has been substantially the same, to wit:

(1)  (a) Notwithstanding any statutory provision to the contrary, all actions against any architect, contractor, builder or builder vendor, engineer, or inspector performing or furnishing the design, planning, supervision, inspection, construction, or observation of construction of any improvement to real property shall be brought within the time provided in section 13-80-102 after the claim for relief arises, and not thereafter, but in no case shall such an action be brought more than six years after the substantial completion of the improvement to the real property, except as provided in subsection (2) of this section.

(2)  In case any such cause of action arises during the fifth or sixth year after substantial completion of the improvement to real property, said action shall be brought within two years after the date upon which said cause of action arises.

C.R.S. § 13-80-104.

The language of SB 20-138 would amend these sections to read:

(1) (a) Notwithstanding any statutory provision to the contrary, all actions against any architect, contractor, builder or builder vendor, engineer, or inspector performing or furnishing the design, planning, supervision, inspection, construction, or observation of construction of any improvement to real property shall MUST be brought within the time provided in section 13-80-102 after the claim for relief arises, and not thereafter LATER, but in no case shall such MAY an action be brought more than six TEN years after the substantial completion of the improvement IMPROVEMENTS to the real property, except as provided in subsection (2) of this section.

(2) In case IF any such cause of action DESCRIBED IN SUBSECTION (1) OF THIS SECTION arises during the fifth NINTH or sixth TENTH year after substantial completion of the improvement IMPROVEMENTS to real property, said THE action shall MUST be brought within two years after the date upon which said THE cause of action arises.

It cannot be overstated what a devastating effect this would have on the ability of builders to provide affordable or attainable housing in Colorado.  Such a shock to the system would make insurers shy away from insuring projects more than they already do.  With the hardening of the insurance market as it is, this would certainly not help the housing crisis in Colorado.

With respect to the accrual of construction defect claims, Senate Bill 138 would change Colorado law as follows:

(b) (I) Except as otherwise provided in subparagraph (II) of this paragraph (b) SUBSECTION (1)(b)(II) OF THIS SECTION, a claim for relief arises under this section at the time the claimant or the claimant’s predecessor in interest discovers or in the exercise of reasonable diligence should have discovered BOTH the physical manifestations AND THE CAUSE of a defect in the improvement which THAT ultimately causes the injury.

Enactment of this section would legislatively overturn a long line of Colorado Appellate Court decisions, including Highline Village Assocs. v. Hersh Cos., 996 P.2d 250, 253 (Colo. App. 1999) (holding, “under the contractors’ statute, a claim accrues when a physical manifestation of a defect appears, even though its cause is not known at that time.”); United Fire Group v. Powers Elec., Inc., 240 P.3d 569, 572 (Colo. App. 2010) (stating, “we also conclude that it was not necessary to know that the defect caused the fire for the fire to be the defect’s physical manifestation.”), and; Broomfield Senior Living Owner, LLC v. R.G. Brinkmann Co., 413 P.3d 219, 226 (Colo. App. 2017) (“Accrual under CDARA, therefore, depends on the discovery of the manifestation of the defect and not its cause.”) (emphasis in the original).

Finally, with respect to equitable tolling of the statute of repose, Senate Bill 138 inserts a section, which reads:

(3) The limitations provided by this section:

(a) ARE SUBJECT TO BOTH STATUTORY AND EQUITABLE TOLLING;

There are several statutes that may toll the statute of repose, including C.R.S. 13-80-104(3), which this bill would amend to read:

(3) The limitations provided by this section:

*          *          *

(b) Shall MAY not be asserted as a defense by any person in actual possession or control, as owner or tenant or in any other capacity, of such an improvement at the time any deficiency in such an THE improvement constitutes the proximate cause of the injury or damage for which it is proposed to bring an action.

Colorado’s Common Interest Ownership Act also provides for statutory tolling for claims brought under C.R.S. § 38-33.3-311(1), which states, in pertinent part: “Any statute of limitation affecting the association’s right of action under this section is tolled until the period of declarant control terminates.”  While it is hard to conceive of a claim that would arise under this section arising out of a construction defect claim, it may be theoretically possible.

In any event, the fact that Senate Bill 138 seeks to provide for equitable tolling is a frontal assault on the Colorado Supreme Court, which previously did away with the repair doctrine, a form of equitable tolling, by stating: “”equitable tolling is not permissible where it is inconsistent with the text of the relevant statute.”  Smith v. Exec. Custom Homes, Inc., 230 P.3d 1186, 1191-1192 (Colo. 2010).  The Court concluded on this issue, stating: “equitable tolling pursuant to the repair doctrine is inconsistent with the CDARA [the Construction Defect Action Reform Act, C.R.S. § 13-20-801, et seq.] because the CDARA already provides an adequate legal remedy in the form of statutory tolling of the limitations periods under specific and defined circumstances, including during the time in which repairs are being conducted.”  Id.

It remains to be seen whether this bill gets legs at the state legislature, stay tuned in that regard.  Between this and SB 20-093, previously discussed, it appears that after quiet session in 2019, the plaintiffs’ lawyers are back at the Colorado State Capitol, with a vengeance, seeking their laundry list of legislative changes to open the tap for construction defect litigation.  Will one-way attorneys’ fees provisions and uncapping the treble damage component of the Colorado Consumer Protection Act be next?  I hope not, but this legislative session is certainly starting off with a bang.

Statutes of Limitations Are Moving Targets During the COVID-19 Pandemic

Rebecca Brazzano and Martine C. Wilson | Thompson Hine

Key Notes:

  • Carefully review the raining orders that address tolling of the statutes of limitations in your jurisdictions.
  • Be mindful of governing choice of law provisions.
  • Best practices include using tolling agreements and dusting off the defense of equitable tolling.

One of the tried and true defenses to a claim is that the statute of limitations has expired. Before COVID-19 this was a simple determination, now it is not. As state executives and the judiciary across the United States rapidly issue orders tolling certain statutes and rules, and then extend those same orders, lawyers and clients must continuously track them. Every time we thought our analysis was “done,” another order dropped, and we then reviewed each of the prior orders to confirm that we have real-time information to share. That said, the information we provide here as it applies to civil statutes of limitations is up to date through April 7, 2020.

The first item to note is there is no consistency at the state level. Given the swift pace at which these tolling orders are rolling out, the best approach appears to be the path taken first by Kansas, whose Supreme Court issued an administrative order on March 18 that “suspended until further order” all statutes of limitations deadlines. Connecticut followed, with Governor Ned Lamont issuing an executive order effective March 19 suspending statutes of limitations for the duration of the of “this public health and civil preparedness emergency.” By extending the limitations period from a specific date to a date in the future that can be easily tracked, Kansas and Connecticut have given durability to their statutes of limitations tolling. In contrast, the Rhode Island Supreme Court issued an order on March 17 that gives less than clear direction, offering that “[r]equests for extensions to applicable statutes of limitations necessitated by the current health crisis shall be entertained by the respective courts after thirty (30) calendar days from the date of this Order.” As April 16 approaches, affected parties must be diligent in checking and rechecking to see if another order is issued that yet again extends the limitations period. Rhode Island’s order is particularly concerning for clients, as it appears to give the state’s judges a certain degree of discretion once these requests to extend certain limitations periods are heard in the various courts. As the current Stay-at-Home Executive Order 20-13 issued by Rhode Island Governor Gina Raimondo expires on April 13, further action will likely be needed. As states take differing approaches to tolling their civil statutes of limitations, litigants will be looking at jurisdiction advantages moving forward. For example, if a claim can be litigated in Rhode Island or New Jersey, a party may want the certainty of the New Jersey Supreme Court’s definitive order (described below) over the discretion provided in Rhode Island.

New Jersey has taken a unique approach. On March 27, its Supreme Court ordered that “[i]n the computation of time periods under the Rules of Court and under any statute of limitations for matters in all courts, for purposes of filing deadlines, the additional period from March 28 through April 26, 2020 shall be deemed the same as a legal holiday, thus extending the tolling established by the [earlier] March 17 Order,” making March 16 through March 27 a legal holiday. For clients and lawyers, this provides a degree of certainty; at least they know that this period is considered a legal holiday for statutes of limitations purposes.

A number of states have done nothing, which is puzzling. Equally perplexing is why there has been no movement on the federal level. Lawyers and clients are increasingly frustrated by what “governing rules” means. Currently, in the federal courts, litigants must consult the Federal Rules of Civil Procedure, then the local district and appellate courts’ rules, and then individual judges add their own rules to the pile.

The randomness of the state courts’ tolling starting and ending dates continues. In its March 22 order, the Supreme Court of Appeals of West Virginia stated:

Statutes of limitations and statutes of repose that would otherwise expire during the period between March 23, 2020 and April 10, 2020 are hereby extended until April 11, 2020. Deadlines, statutes of limitations, and statutes of repose that are not set to expire between March 23, 2020, and April 10, 2020, are not extended or tolled by this order. Proceedings previously scheduled between March 23, 2020, and April 10, 2020, are continued until a later date determined by the presiding judicial officer. The Court may extend this Order in the event the public health crisis continues.

West Virginia Governor Jim Justice declared a state of emergency on March 16 and later issued a Stay-at-Home Order effective March 24 at 8:00 p.m. It appears that litigants in the gap between the two directives are not shielded by the tolling of the limitations period in West Virginia. Litigation to determine fair application of these orders from the start of a state’s declared state of emergency until that declaration is lifted is expected.

Neighboring Virginia took yet another approach, which requires counsel to chase the limitations tolling period again and again. On March 16, the Supreme Court of Virginia ordered “[p]ursuant to Va. Code § 17.1-330, a judicial emergency was ordered; effective March 16, to April 6, 2020 (all deadlines are hereby tolled and extended, pursuant to Va. Code § 17.1-330(D), for a period of twenty-one (21) days).” Virginia’s declaration of a state of emergency was issued on March 12, but statutes of limitations were not tolled until March 16. Litigants will have to contend with the differing gaps. As April 6 approached, Virginia’s Supreme Court had to again address its statutes of limitations tolling by issuing a new order on March 27 that provides an extension of the statutes of limitations tolling for the “duration of this Order,” from April 6 to April 26. This order excepts certain claims, too many to list here, creating even less clarity.

Georgia’s tolling offers relief from March 14 through April 13, suspending, tolling, extending and “otherwise grants relief from any deadlines or other time schedules or filing requirements imposed by otherwise applicable statutes, rules, regulations, or court orders, whether in civil or criminal cases or administrative matters, including, but not limited to any: (1) statute of limitation.” The Georgia Supreme Court saw April 13 as fast approaching and issued another order extending the tolling to May 19. Multiple executive and judicial orders are being issued to stretch the original orders’ expirations while stay-at-home orders continue in place.

Learning from its neighboring states’ patchwork of expiring orders, on March 27, the Ohio Supreme Court issued an order tolling statutes of limitations in conformance with Am. Sub. H.B. No. 197, which was signed into law by Governor Mike DeWine on March 27. It immediately tolled, retroactive to March 9, all statutes of limitations, time limitations and deadlines in the Ohio Revised Code and the Ohio Administrative Code until the expiration of Executive Order 2020-01D or July 30, 2020, whichever is sooner. Ohio’s retroactive application of tolling to March 9 has a reasonable relationship to the state of emergency Governor DeWine issued on March 10.

Per Executive Order 202.8 issued by New York Governor Andrew Cuomo on March 20:

[A]ny specific time limit for the commencement, filing, or service of any legal action, notice, motion, or other process or proceeding, as prescribed by the procedural laws of the state, including but not limited to the criminal procedure law, the family court act, the civil practice law and rules, the court of claims act, the surrogate’s court procedure act, and the uniform court acts, or by any other statute, local law, ordinance, order, rule, or regulation, or part thereof, is hereby tolled from the date of this executive order until April 19, 2020.

With April 19 approaching, Governor Cuomo issued another executive order on April 7 tolling all dates covered by the previous executive order to May 7.

For those states that explicitly do not toll statutes of limitations in their respective orders (Alabama, Idaho and Indiana (trial courts may petition where necessary to toll “for a limited time all laws, rules, and procedures setting time limits for … all other civil and criminal matters before all State of Indiana trial courts”)) and the states that do not even address statutes of limitations in their orders[1] (Alaska, Arizona, Arkansas, California, Colorado, Florida, Hawaii and Illinois), while most have declared states of emergency and issued stay-at-home orders, their silence on the tolling issue is inexplicable and disadvantageous to litigants.

Advising on best practices during this pandemic is a day to day, and at times, hour by hour, challenge. While it is unclear why the Kansas/Connecticut/Ohio approach has not caught on, the orders and amended orders being issued make docketing and tracking all the more painstaking. Although we do not address the thousands of other orders issuing from state judiciaries and individual courts on scheduling issues, court closures and openings, and discovery extensions, individual judges issuing their own personal emergent COVID-19 orders is a morass that lawyers need to navigate carefully.

State supreme courts need to take a pause and consider issuing a single order governing their civil statutes of limitations that expires coextensively with their declared state of emergency plus 30 days. It is not practical to have the thousands of filings that have not been filed during the pendency of these tollings snap back and everyone filing the date that tolling expires in any particular jurisdiction. Given that many state civil courts are effectively closed, absent extraordinary relief being sought, the judiciary is already facing a backlog of cases whose proceedings are already in the queue. Rather than burdening an already taxed system, counsel should be proactively reaching out to their current and potential adversaries and entering into simple tolling or standstill agreements as a best practice with one caveat. A tolling agreement does not, except in very complex cases, need to be a complicated 20-page agreement. The parties can simply agree to toll the filing of claims to a specific date that is tied to the governing state of emergency that has been declared in the jurisdiction where the parties are litigating or plan to litigate. This will eliminate the need to check executive and judicial orders almost daily. The agreement should include language stating that the defendant or potential defendant is waiving the right to challenge the claim on the grounds that the limitations period passed. In addition to buying more time and protecting litigants’ rights, tolling agreements can lower litigation costs and support settlement negotiations.

Another best practice is to review existing contracts. The pandemic’s consequences for supply chains and essential businesses will cause ripple effects. Review choice of law provisions in agreements and put them in summary form where the data is readily available, which allows quick retrieval of contracts for review of relevant choice of law and force majeure clauses that will impact potential disputes moving forward. Keep in mind that some states are allowing individual trial courts to determine if a statute of limitations is tolled, and it is prudent to determine if such orders apply to potential disputes.

Finally, consider equitable tolling as a standard defense moving forward. The principle of equitable tolling is that a litigant should not be precluded from bringing a claim when, due to unexpected circumstance, it was prevented from pursuing the claim before the expiration of the statute of limitations. A litigant is entitled to equitable tolling where it has diligently pursued its claim and some extraordinary circumstance prevented a timely filing. It is important to review the relevant jurisdiction’s case law regarding equitable tolling, as it varies by jurisdiction.