It may seem anomalous, at least to those unfamiliar with New York’s borrowing statute, that sophisticated parties can agree to apply New York’s substantive and procedural law, but a claim filed within New York’s statute of limitations may be untimely. Yet, that was the result in the Appellate Division, First Department’s recent decision in 2138747 Ontario, Inc. v. Samsung C&T Corp., No. 653270/14, 2016 WL 5888697 (1st Dept. Oct. 11, 2016), in which the application of New York’s borrowing statute, CPLR 202, led to the application of Ontario’s statute of limitations. Ontario reflects the latest decision in New York’s confusing jurisprudence at the intersection of conflict-of-laws principles, the borrowing statute, and contractual choice-of-law provisions.
New York’s borrowing statute is codified in CPLR 202. It provides that when a nonresident brings a claim that accrued out of state, the action must be timely under the limitations periods of both New York and where the cause of action accrued. The primary purpose of the borrowing statute is to prevent nonresidents from forum shopping in New York for a favorable statute of limitations. Glob. Fin. Corp. v. Triarc Corp., 93 N.Y.2d 525, 528 (1999).
Trial Court’s Ruling in ‘Ontario’
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