NJ Bill Would Shorten Statute of Limitations for Professional Malpractice Claims

On March 18, 2019, Bill A-4880 passed the New Jersey Assembly Judiciary Committee. If the bill becomes law, it will amend the governing statute, N.J.S.2A:14-1, by shortening the statute of limitations for claims of malpractice against certain licensed professionals (including lawyers) from six years to two years. The amendment will also prohibit the award of attorneys’ fees to the prevailing party in professional malpractice claims, except where otherwise authorized by statute or law.

Currently, the statute provides a list of causes of action that must be commenced within six years of accrual. The proposed amendment carves out causes of action brought against a specified list of professionals and requires that these claims must be commenced within two years after the cause of action has accrued. The proposed amendment states, in pertinent part:

“An action for professional malpractice against any of the following persons shall be commenced within two years next after the cause of the action shall have accrued:

• an accountant licensed . . .;
• an architect licensed . . . ;
• an attorney admitted to practice law in New Jersey;
• an engineer licensed . . . ; or
• a land surveyor . . . .

N.J.S.2A:14-1(b)(1).”

Another change that the bill proposes is a newly created subsection b(2) to this same statutory section. This addition would provide that “Attorneys’ fees shall not be awarded in any action subject to the limitations period in this subsection except where authorized by statute or the Rules Governing the Courts of the State of New Jersey.”

This bill puts New Jersey’s statute of limitations more in line with neighboring states. New York and Delaware have a three-year statute of limitation for professional malpractice claims, and Pennsylvania has a two-year or four-year statute of limitations depending on whether the claim is grounded in negligence or breach of contract.  Connecticut, like New Jersey, has a six-year statute of limitations.

Additionally, the elimination of the recovery of attorneys’ fees in professional malpractice cases would be in line with the “American Rule,” in which parties are responsible for their own legal fees. This portion of the proposed amended statute would overturn the New Jersey Supreme Court’s decision in Saffer v. Willoughby[1], which permits the recovery of attorneys’ fees to plaintiffs who prevail in malpractice lawsuits.

While there are still several steps required before Bill A-4880 becomes law, it is important to note that nearly identical versions of this bill have been proposed in previous legislative sessions but have failed to gain traction. The Assembly Judiciary Committee’s decision to pass this bill on Monday is a deviation from the previous responses to similar proposals.

Now that the bill has been approved by the Judiciary Committee it will need to pass through the New Jersey Senate with a majority vote and be signed by the governor before it can become law. If Bill A-4880 does become law, it will have a significant impact on legal malpractice claims in New Jersey. While Bill A-4880 may not necessarily reduce the number of professional liability lawsuits filed in New Jersey, a shorter statute of limitations and the elimination of fee-shifting in legal malpractice lawsuits will certainly benefit attorneys practicing law in New Jersey as well as the insurance carriers who insure them.

[1] Saffer v. Willoughby, 143 N.J. 256, 670 A.2d 527 (N.J. 1996).