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Two, Four, Six, Eight…Just How Long Can They Wait?

May 12, 2014

It is difficult to know who is on which side of the current battle to change the statute of limitations for legal malpractice cases in New Jersey. One would assume, in this arena at least, all lawyers should be on the same side desiring to reduce their exposure to claims of negligence, and perhaps lower the cost of professional liability insurance. Nevertheless, plaintiffs’ lawyers argue strongly against the latest bill before the Assembly Judiciary Committee in early February.

The bill, Assembly, No. 1254, sponsored by Assemblyman Vincent Prieto, requires certain civil actions against certain licensed professionals to be brought within two years. If enacted, the bill would amend N.J.S. 2A:14-1 to remove legal malpractice cases from the group of cases currently governed by a six year statute of limitations, and shorten the statute of limitations for a professional liability case against a lawyer to two years, thus treating malpractice like other tort claims which have a two year limitations period. The statute would also govern claims against accountants, architects, dentists, engineers, physicians, podiatrists, chiropractors, registered professional nurses, health care facilities, physical therapists, veterinarians, insurance providers, midwives and pharmacies, so that claims against all of the listed professionals would be subject to a two year statute of limitations.

Currently there is inconsistency in the treatment of claims against professionals in New Jersey. Claims against doctors and health care professionals already fall under a two year statute of limitations, while plaintiffs have six years to sue attorneys, accountants and architects. There does not seem to be any rhyme or reason as to why professionals in the same state are treated so differently with respect to how long the consumer has to make a claim. Passage of the bill would provide a more uniform approach to the treatment of professional negligence claims in New Jersey.

The bill also includes language which would eliminate the awarding of attorneys’ fees in legal malpractice cases, as well as the other professional liability cases included in the bill. Enactment of the bill would overturn the New Jersey Supreme Court’s 1996 decision in Saffer v. Willoughby, which awards attorneys’ fees to successful plaintiffs in legal malpractice cases. Removing attorneys’ fees from the equation might make these claims easier to settle, where often this element of damages can be a hurdle in settling these cases. The proposed removal of attorneys’ fees is another reason why plaintiffs’ lawyers oppose the bill.

This is not the first effort in New Jersey to change the statute of limitations for legal malpractice cases. The bill was originally introduced to the Legislature in the 2010-2011 session on May 5, 2011 as A3929 and was subsequently referred to the Assembly Regulated Professions Committee on December 8, 2011. The Committee put the bill to a vote and it was passed 5-1 (1 not voting). The session ended on December 31, 2011 with the bill still in committee. On February 21, 2012, with Assemblyman Vincent Prieto as its primary sponsor, the bill was reintroduced during the 2012-2013 session as A2553 and was referred to the Assembly Judiciary Committee where it remains. Senator Stephen Sweeney is the primary sponsor of a parallel bill introduced to the Senate on October 1, 2012 where it remains.

The New Jersey State Bar Association has backed versions of the legislation for years. However, the New Jersey Association for Justice which represents plaintiffs’ lawyers is staunchly opposed to the change in the limitations period. A shortened limitations period leaves less opportunity for an alleged injured Plaintiff to being a case, but it would provide so much more certainty for law firms and insurers as to what could be coming down the pike. Costs for insurance would likely decrease and New Jersey’s laws would bear greater similarity to its neighbors such as Pennsylvania which has a two year statute of limitations and New York which has a three year period.

At this point we can only watch and wait as the bill goes through both the Senate and Assembly Judiciary Committees, and possibly on to a vote on the floor. The potential enactment of the bill could have significant implications for both the legal profession and the insurance industry.

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