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Article
A New Approach to Old Cases: Reconsidering Statutes of Limitation
University of Toronto Law Journal (2004)
  • Ehud Guttel
  • Michael Novick
Abstract

Statutes of limitation currently occur in two forms. The first and traditional form defines a fixed period within which the plaintiff may file her claim, and bars a claim that is filed after this period. The second form, the discovery rule, softens the traditional statute’s bar when the plaintiff is reasonably unaware, for some time after the harm occurs, of some of the facts essential to her claim.

This Article proposes a new model of statue of limitation that transforms temporal limitation from a sanction rule to a price rule. The traditional regime and the discovery rule divide time into two zones and impose a sanction—the bar of the claim—when the plaintiff passes from the first into the second. The proposed new rule never entirely bars the claim. Instead it extracts a price that compensates the defendant for his evidentiary loss. This price consists of the total damages claimed by the plaintiff, discounted by the probabilistic value of the lost evidence. Thus, for example, if decay in the exculpatory evidence doubles the plaintiff’s chance of winning the case, from a baseline of 30% to 60%, the proposed model halves her potential damages. As it is shown, such a temporal limitation regime reduces the risk and the expected costs of erroneous decisions.

Disciplines
Publication Date
December, 2004
Citation Information
Ehud Guttel and Michael Novick. "A New Approach to Old Cases: Reconsidering Statutes of Limitation" University of Toronto Law Journal Vol. 54 (2004)
Available at: http://works.bepress.com/guttel/6/