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Statute of Limitations – Negligent Attorney Exception

Author: LegalEase Solutions

Research Findings

  1. Does the “negligent attorney” exception still apply to the Statute of limitations with respect to A.R.S. § 12-821 actions? 

A.R.S. §§ 12–820 to –826 were passed in 1984 and became effective on August 3 of that year.  The legislature substituted the 1984 Act, entitled “Actions against Public Entities or Public Employees,” for the then previous laws which governed “Actions against the State on Contract or for Negligence.” Subsection 12–821(A) provides:

“ A. Persons who have claims against a public entity or public employee shall file such claims in the same manner as that prescribed in the Arizona Rules of Civil Procedure, Rule 4(D) within twelve months after the cause of action accrues. Any claim which is not filed within twelve months after the cause of action accrues is barred and no action may be maintained except upon a showing of excusable neglect if the action is brought within the otherwise applicable period of limitations, provided that if there is no excusable neglect, and if the absence of excusable neglect is because of the conduct of the claimant’s attorney, then the action shall proceed, and the public entity and public employee shall have a right of indemnity against the claimant’s attorney for any liability assessed in the action.

City of Tucson v. Fleischman, 152 Ariz. 269,271, 731 P.2d 634,636 (Ariz. App., 1986).

In City of Tucson v. Fleischman, 152 Ariz. 269,271, 731 P.2d 634,636 (Ariz. App., 1986) the Court observed that § 12–821(A) makes a provision for appropriate conduct on counsel’s part.  The obvious purpose of the provisions of § 12–821(A) is to protect a claimant from the consequences of his attorney’s negligence.  Under the statute, the only situation in which an action may be dismissed is where the court finds first, that the failure to timely file the notice was due to the conduct of the claimant and second, that his conduct was not “excusable.” In all other cases, “the action shall proceed.” However, if the court determines that the failure to timely file was the result of counsel’s conduct, the statute also contemplates an additional preliminary finding as to whether or not counsel’s conduct was “excusable.” If the court finds that it was not, and if the action proceeds to judgment against the public entity, then the latter may seek indemnification from the attorney to the extent of its liability. In such an action, counsel may defend on any grounds showing excusable neglect. City of Tucson v. Fleischman, 152 Ariz. 269,272, 731 P.2d 634,637(Ariz. App., 1986).

The version of § 12-821 in effect before 1993 required persons having claims against a public entity to file such claims within twelve months after the cause of action accrued and provided in subsection A: “Any claim which is not filed within twelve months after the cause of action accrues is barred and no action may be maintained except upon a showing of excusable neglect if the action is brought within the otherwise applicable period of limitations….”. Flood Control Dist. of Maricopa County v. Gaines, 202 Ariz. 248, 254,  43 P.3d 196, 202 n. 11(Ariz. App. Div. 1, 2002).

Effective July 17, 1993, § 12-821 was repealed and a new § 12-821 was substituted: “All personal injury actions against any public entity or public employee involving acts that are alleged to have occurred within the scope of the public employee’s employment shall be brought within one year after the cause of action accrues and not afterward.” 1993 Ariz. Sess. Laws, ch. 90, § 8 (emphasis added). The new § 12-821 was, in turn, amended effective July 17, 1994, to delete the limitation to personal injury actions and now reads: “All actions against any public entity or public employee shall be brought within one year after the cause of action accrues and not afterward.” 1994 Ariz. Sess. Laws, ch. 162, § 1. Flood Control Dist. of Maricopa County v. Gaines, 202 Ariz. 248, 254,  43 P.3d 196, 202 n. 11(Ariz. App. Div. 1, 2002).

In Pritchard v. State, 163 Ariz. 427, 788 P.2d 1178 (1990), the Court held that the factual issue of whether a claimant’s failure to comply with the time limitation in Arizona’s notice of claim statute was excusable, must be determined by a jury. Id. at 432–33, 788 P.2d at 1183–84.  The court reasoned that under the then-applicable version of A.R.S. § 12–821, which permitted untimely filing due to “excusable neglect,” the time element was not jurisdictional, but procedural, in nature. Id. at 432, 788 P.2d at 1183.  However, the court in Lee, observed that Pritchard, decided a statutory question no longer at issue because the legislature amended the statute to remove the “excusable neglect” exception in favor of language that requires strict compliance with the statutory filing prerequisites. Lee v. State, 218 Ariz. 235, 245, 182 P.3d 1169, 1179 (Ariz., 2008).

Although excusable neglect once relieved compliance with the notice of claim statute, the Legislature eliminated that exception when it amended the statute in 1994. Simon v. Maricopa Medical Center, 225 Ariz. 55, 62, 234 P.3d 623, 630 (Ariz. App. Div. 1, 2010).

In Kosman v. State; 199 Ariz. 184, 187, 16 P.3d 211, 214 (Ariz. App. Div. 1, 2000), the court reversed summary judgment and remanded for findings on the factual issues as to the reasonableness of Plaintiff’s assumption that exhaustion via ADOC Order 802 was required and whether his neglect was excusable. Kosman v. State; 199 Ariz. 184, 187, 16 P.3d 211, 214 (Ariz. App. Div. 1, 2000).

Equitable Tolling

“It is hornbook law that limitations periods are ‘customarily subject to equitable tolling.’ ”McCloud v. State, Ariz. Dept. of Public Safety, 217 Ariz. 82, 87, 170 P.3d 691, 696 (Ariz. App., 2007).  Attorney illness, under some circumstances, could warrant tolling of the statute of limitations.  The Court  agreed that “[u]nder equitable tolling, plaintiffs may sue after the statutory time period for filing a complaint has expired if they have been prevented from filing in a timely manner due to sufficiently inequitable circumstances.” Seitzinger v. Reading Hosp. & Med. Ctr., 165 F.3d 236, 240 (3d Cir.1999). McCloud v. State, Ariz. Dept. of Public Safety, 217 Ariz. 82, 87, 170 P.3d 691, 696 (Ariz. App., 2007).

Equitable tolling applies only in “extraordinary circumstances” and not to “‘a garden variety claim of excusable neglect.’ ” McCloud, 217 Ariz. 82, ¶ 16, 170 P.3d at 697, quoting Irwin v. Dep’t of Veterans Affairs, 498 U.S. 89, 96, 111 S.Ct. 453, 112 L.Ed.2d 435 (1990). Even assuming the first two attorneys Little consulted had acted improperly, she has not explained how their actions created extraordinary circumstances warranting the application of the doctrine. Cf. McCloud, 217 Ariz. 82, ¶ 19, 170 P.3d at 698 (explaining, in cases of attorney illness, “courts have only applied the doctrine of equitable tolling where the attorney had suffered a significant incapacitating disability”). Little v. State, 225 Ariz. 466, 472, 240 P.3d 861, 867 (Ariz. App., 2010).

Conclusion

From the above discussion of cases decided after 1993, it can be seen that the negligent attorney exception as it was interpreted pre amendment (1993) does not apply to the Statute of limitations with respect to A.R.S. § 12-821 actions.  However, equitable tolling does apply, albeit requiring a higher threshold, and this may include delay on the part of the Attorney. See Also Kosman v. State (2000 case) (case was remanded to decide on the issue of excusable neglect).