The California State Judicial Council amended California Rule of Court, Emergency Rule No. 9, on May 29, 2020, lifting its previously adopted indefinite tolling of the limitation period to bring civil lawsuits. The amended rule now provides that limitation periods of 180 days or less will be tolled only until Aug. 3, 2020, allowing project applicants to begin to plan and get financing so that development can proceed this year.
The Judicial Council issued emergency rules of court to address the COVID-19 pandemic on April 6, 2020, one of which – Emergency Rule No. 9 – tolled the statute of limitations for all civil actions from April 6, 2020, until 90 days after the date that California's governor lifts the statewide COVID-19 state of emergency. Because the state of emergency declaration could remain in effect for a year or more, and since most developers cannot proceed to obtain financing until the period to bring litigation has lapsed, the effect of the rule was to indefinitely pause housing and other development – even while "shelter in place" orders are lifted and housing construction was declared an "essential activity" exempt from those orders.
Holland & Knight worked with a broad coalition of more than 50 trade groups, planning associations, affordable housing providers, business associations, charitable organizations, infill developers, advocacy groups and nonprofit organizations to urge the Judicial Council to amend Emergency Rule No. 9. The California Building Industry Association and the California Chamber of Commerce joined with leaders in the affordable housing nonprofit community and the "Yes In My Backyard" movement to stress the importance of allowing housing development to continue in light of the state's unprecedented housing crisis.
In response to opponents who urged that tolling of litigation deadlines remain in effect indefinitely, the Judicial Council's amendment keeps tolling in effect far longer than most housing advocates consider justified, but the rule does set a date when the tolling period will end. Statutes of limitations of 180 days or less – such as the 30-day to 35-day deadline for most California Environmental Quality Act (CEQA) challenges, and the 90-day limitations periods in the Planning and Zoning Law as well as the Subdivision Map Act – will be tolled only from April 6, 2020, until Aug. 3, 2020. Longer statutes of limitations remain tolled until Oct. 1, 2020.
Even after Aug. 3, project applicants and public agencies will still need to wait for the remaining number of days left in applicable statute of limitations to run. Additionally, project applicants and public agencies seeking to invoke the CEQA statute of limitations should be mindful of the need to keep CEQA notices posted for the full statutory period, as well as to consider the provisions of Executive Order N-54-20, which states that it suspends the filing requirements for CEQA notices until June 22. (See Holland & Knight's Breaking Ground Blog, "California Executive Order Suspends Certain CEQA Noticing and Posting Requirements," April 27, 2020.)