Which of the following best describes the purpose of a statute of limitations?

"Statute of Limitations" is a term used by courts to describe the maximum amount of time plaintiffs can wait before bringing a lawsuit after the events they are suing over have occurred. This time limit is typically set by state statute and is intended to promote fairness and keep old cases from clogging the courts.

Each state sets it own time limits for bringing a lawsuit and a court will typically apply the appropriate statute of limitations of the state in which the suit is filed. A relatively short limitations period is an acknowledgment of the importance of free speech principles, since a short time period reduces the potential chilling effects of speech-challenging lawsuits.

Because each state has its own statute of limitations for defamation claims, which vary between one and three years, you should refer to the State Law: Defamation section to find out what the specific statute of limitations is in your state.

Determining When the Statute of Limitations Period Begins

Generally speaking, the limitations period begins to run when a defamatory statement is "published" (i.e., communicated to someone other than the plaintiff).

This rule is relatively easy to apply when a defamatory statement is spoken to a third person. But what about situations where publication is to a mass audience, such as on the Internet? In these situations, could the statute of limitations begin anew at the time of each publication, such that the statute of limitations could restart every time someone reads a blog post or finds an archive copy of a newspaper in a library, even if the original material was published years ago?

Single Publication Rule

Most states have adopted the so-called "single publication rule," which states that the statute of limitations period begins to run when a defamatory statement is first published. For example, if a magazine is distributed to thousands of news stands, only "one publication" is deemed to have occurred for purposes of the statute of limitations. As a result, the limitations period begins when the magazine was initially made available, not when an extra copy of it left over on the news stand is sold two weeks later.

However, the single publication rule is not absolute. If the purported defamatory content is re-published to a substantially different audience or is altered in a substantial way, a new statute of limitations period may begin to run. For example, if the material in a magazine is incorporated into a book, a new statute of limitations period will likely begin when the book is published.

Most states have applied the single publication rule to the Internet. Generally, the statute of limitation period begins when a defamatory statement is first made available online. Courts will likely find re-publication has started a new statute of limitations period only when online material is altered in a significant way: be careful to consider this if you are thinking of substantially editing or rewriting old material. See your individual state section for information on whether the state recognizes the single publication rule.

From time to time in business it may become necessary to enforce your legal rights by way of Court action. You may, for example, need to enforce the terms of a contract, seek redress for negligence or enforce your statutory rights. If you do find yourself in that position it is important to understand, as a starting point, what limitation periods apply to your proposed claim and whether they have expired or are close to expiring.

A ‘limitation period’ is the maximum period of time which can elapse from the time of a cause of action arises until the commencement of court proceedings pertaining to that cause of action. It operates as a statutory bar preventing a person from instituting a claim after a substantially long period of time after the cause of action first arises. If a cause of action were to be permitted to go ahead after substantial delay it could have a problematic effect on the administration of the court proceedings as it relates to the evidence presented, namely, the availability of witnesses and documents and the accuracy of detail which is the subject of the evidence. In that way limitation periods seek to balance the interests of all parties and the effective administration of justice.

In this article we provide a practical guide to understanding when and how limitation periods apply.

Limitation periods for different causes of action

In Queensland, the Limitation of Actions Act 1974 (Qld) (‘the Act’) prescribes the limitation periods applying to different causes of action.

The following table summarises various causes of action and their respective limitation period:

Which of the following best describes the purpose of a statute of limitations?

When does the limitation period start to run?

Time, for the purpose of calculating a limitation period, starts running from when the cause of action accrues. When the cause of action arises will differ depending on the type of action you are looking to maintain. In short, a cause of action will accrue when all elements required to establish the particular claim come into existence. That may occur at once or progressively over a period of time.

For example a cause of action based on a breach of contract occurs when the breach itself occurs. An example may be the giving of negligent advice by a lawyer. The cause of action arises in contract when the negligent advice is given. The time period however for a claim in negligence (which would also arise by reason of the negligent advice) may not commence until a later time, that is, when any loss is suffered or damage occurs. A person may have causes of action in both contract and in negligence each with different limitation periods.

Calculation of commencement of a limitation period can be simple or it can be more complex depending on the cause of action and the circumstances. You should not delay in looking to commence court proceedings because if you do, you may miss a limitation period and lose your ability to enforce your legal rights.

The running of the limitation period is stopped by the commencement of the court proceedings.

Potential litigants should also be aware that even though they may commence an action within a relevant limitation period, a court will still have the inherent power to dismiss or stay an action based on delay in bringing the claim.

By way of example, in Reid International Pty Ltd v Ron Farris Real Estate Pty Ltd, the Supreme Court of Western Australia dismissed an action on the basis that the three year delay between the relevant breach and commencement of proceedings amounted, in the factual circumstances of that case, to an abuse of process.

Extensions and exceptions to limitation periods

It is possible to seek an extension of a limitation period in certain (very limited) circumstances. In claims which include a claim for damages for personal injury based in tort (for example negligence, trespass, nuisance or breach of duty) an extension of up to 1 year may be granted where the claimant can establish that there was a material fact of a decisive character not within their means of knowledge until after the commencement of the last year of the limitation period and that there is evidence to establish the right of action.

It is also possible to seek an extension of a limitation period in claims for defamation. The court may extend the limitation period (ordinarily 1 year) by up to 3 years where it was “not reasonable” in the circumstances for a plaintiff to bring a defamation action within 1 year. The test as to the reasonableness of the circumstances is objective and mere ignorance of the strict time limits fixed by virtue of the Act is not enough.

Summary

Limitation periods are a threshold question. If a limitation period has expired, that will be a complete defence to your claim.You are best off keeping your money in your pocket.

The application of limitation periods, particularly the likelihood of an extension or relevance of any exception, can be a complex area of law. We recommend that you seek legal advice as to applicable limitation periods as soon as possible if you suspect that you may have a cause of action. Time waits for no one!

Unconscionable conduct is generally understood to mean conduct which is so harsh that it goes against good conscience. Under the Australian Consumer Law, businesses must not engage in unconscionable conduct, when dealing with other businesses or their customers

Unconscionable conduct does not have a precise legal definition as it is a concept that has been developed on a case-by-case basis by courts over time. Conduct may be unconscionable if it is particularly harsh or oppressive. To be considered unconscionable, conduct it must be more than simply unfair—it must be against conscience as judged against the norms of society.

Business behaviour may be deemed unconscionable if it is particularly harsh or oppressive, and is beyond hard commercial bargaining.

For example, Australian courts have found transactions or dealings to be 'unconscionable' when they are deliberate, involve serious misconduct or involve conduct which is clearly unfair and unreasonable.

There are a number of factors a court will consider when assessing whether conduct in relation to the selling or supplying of goods and services to a customer, or to the supplying or acquiring of goods or services to or from a business, is unconscionable.

These include:

  • the relative bargaining strength of the parties
  • whether any conditions were imposed on the weaker party that were not reasonably necessary to protect the legitimate interests of the stronger party
  • whether the weaker party could understand the documentation used
  • the use of undue influence, pressure or unfair tactics by the stronger party
  • the requirements of applicable industry codes
  • the willingness of the stronger party to negotiate
  • the extent to which the parties acted in good faith.

This is not an exhaustive list and it should be noted that the court may also consider any other factor it thinks relevant.

The following practical tips may assist businesses to avoid becoming a victim of unconscionable conduct:

  • ensure all commercial agreements are in writing
  • make sure you fully understand all the terms of the transaction
  • do not sign any agreements without reading them carefully
  • ask for plain language explanations and obtain independent professional legal or financial advice if unsure
  • if you think you are being treated differently, ask why
  • do not allow yourself to be talked into a deal that is wrong for you by high pressure sales tactics. Be wary of tight decision deadlines
  • look for the best deal and try to negotiate the outcome you want
  • be prepared to walk away from a deal that does not ‘feel’ right. It could be an unreasonable or oppressive deal.

The following practical tips may assist businesses to avoid engaging in unconscionable conduct:

  • do not exploit the other party when negotiating the terms of an agreement or contract
  • take care to be reasonable when exercising your rights under a contract
  • consider the characteristics and vulnerabilities of your customers. For example, use plain English when dealing with customers from a non-English speaking background
  • make sure your contracts are thorough, easy to understand, not too lengthy and do not include harsh, unfair or oppressive terms
  • ensure you have clearly disclosed important or unusual terms or conditions of an agreement
  • ensure customers understand the terms of any agreement associated with the transaction and give them the opportunity to consider the offer properly. If the contract is long, you may decide to provide a summary of the key terms
  • observe any cooling-off periods that may apply or consider offering a cooling-off period
  • give customers the opportunity to seek advice about the contract before they sign it
  • if things go wrong, be open to resolving complaints
  • do not reward your staff for unfair, pressure-based selling.

If the court determines that unconscionable conduct has occurred, a variety of remedies may be ordered including:

  • compensation for loss or damage
  • financial penalties
  • having the contract declared void in whole or in part
  • having the contract or arrangement varied
  • a refund or performance of specified services.

Business snapshot – Unconscionable conduct

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