Borrowing statute
Encyclopedia
A borrowing statute, in United States
law, is a statute
under which one state may "borrow" a shorter statute of limitations
for a cause of action arising in another state. The purpose of borrowing statutes is to prevent plaintiffs from engaging in forum shopping
in order to find the longest available statute of limitations. Such a statute is applied where a plaintiff sues in a state different from the state where the act that is the basis of the lawsuit occurred - for example, if a person was injured in a car accident in state A, but sues the other driver in state B (presuming state B has jurisdiction, usually because it is the driver's home state). The state will usually apply the other state's statute of limitations, so long as it is a shorter statute of limitations than that of the borrowing state. In determining which state is the one in which the cause of action arose, states will apply various choice of law
principles, which can be very complicated.
In some states, the borrowing statute will only be applied if the plaintiff was not a resident of that state at the time the cause of action accrued; in others, it will only apply if the defendant was not a resident.
In Virginia
and West Virginia
, the borrowing statute applies only to contract
actions. If the contract has been breached in another state where it was supposed to have been performed, or validity of the contract is contested in another state where the contract was formed, then Virginia and West Virginia will apply the statute of limitations of the other state, so long as it is shorter than their local statutes of limitations.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
law, is a statute
Statute
A statute is a formal written enactment of a legislative authority that governs a state, city, or county. Typically, statutes command or prohibit something, or declare policy. The word is often used to distinguish law made by legislative bodies from case law, decided by courts, and regulations...
under which one state may "borrow" a shorter statute of limitations
Statute of limitations
A statute of limitations is an enactment in a common law legal system that sets the maximum time after an event that legal proceedings based on that event may be initiated...
for a cause of action arising in another state. The purpose of borrowing statutes is to prevent plaintiffs from engaging in forum shopping
Forum shopping
Forum shopping is the informal name given to the practice adopted by some litigants to get their legal case heard in the court thought most likely to provide a favorable judgment...
in order to find the longest available statute of limitations. Such a statute is applied where a plaintiff sues in a state different from the state where the act that is the basis of the lawsuit occurred - for example, if a person was injured in a car accident in state A, but sues the other driver in state B (presuming state B has jurisdiction, usually because it is the driver's home state). The state will usually apply the other state's statute of limitations, so long as it is a shorter statute of limitations than that of the borrowing state. In determining which state is the one in which the cause of action arose, states will apply various choice of law
Choice of law
Choice of law is a procedural stage in the litigation of a case involving the conflict of laws when it is necessary to reconcile the differences between the laws of different legal jurisdictions, such as sovereign states, federated states , or provinces...
principles, which can be very complicated.
In some states, the borrowing statute will only be applied if the plaintiff was not a resident of that state at the time the cause of action accrued; in others, it will only apply if the defendant was not a resident.
In Virginia
Virginia
The Commonwealth of Virginia , is a U.S. state on the Atlantic Coast of the Southern United States. Virginia is nicknamed the "Old Dominion" and sometimes the "Mother of Presidents" after the eight U.S. presidents born there...
and West Virginia
West Virginia
West Virginia is a state in the Appalachian and Southeastern regions of the United States, bordered by Virginia to the southeast, Kentucky to the southwest, Ohio to the northwest, Pennsylvania to the northeast and Maryland to the east...
, the borrowing statute applies only to contract
Contract
A contract is an agreement entered into by two parties or more with the intention of creating a legal obligation, which may have elements in writing. Contracts can be made orally. The remedy for breach of contract can be "damages" or compensation of money. In equity, the remedy can be specific...
actions. If the contract has been breached in another state where it was supposed to have been performed, or validity of the contract is contested in another state where the contract was formed, then Virginia and West Virginia will apply the statute of limitations of the other state, so long as it is shorter than their local statutes of limitations.