California Labor &
Employment Law Blog

Oct. 28 2008

Statute of Limitations Tolled During Pendency of Internal Investigation

Topics: Court Decisions

Earlier this week, the California Supreme Court issued its opinion in McDonald v. Antelope Valley Community College District and held that the doctrine of equitable tolling may apply to toll the statute of limitations on a FEHA claim when an employee voluntarily pursues an internal complaint procedure with the employer.

The plaintiff, Sylvia Brown, worked as a library technician's assistant for the District. During her employment, she twice responded to internal job postings for a database administrator position. The first time she applied, the District did not interview her. The second time she applied, the District interviewed her but did not offer her the position. Plaintiff alleged that the District denied her the position because of her race and gender. The lastact of alleged discriminationoccurred in January 2001. In October 2001, Plaintiff filed a discrimination complaint with Human Resources, followed by a further formal complaint with the Chancellor's Office in November 2001. The Chancellor's Office informed Plaintiff that the complaint would be forwarded to the District to investigate, that the District would have until January 31, 2002 to resolve the complaint, and that Plaintiff would have certain appeal rights following the District's resolution of the complaint.The Chancellor's Office also specifically advised Plaintiff that she could file a complaint with the DFEH at any time.

The District ultimately investigated and concluded in January 2002 that Plaintiff had not been discriminated against. Plaintiff pursued internal administrative appeals. While the appeal process was still underway, Plaintiff filed a DFEH charge in October 2002 (a year and one-half after the alleged discrimination), received a right to sue notice, and filed a lawsuit one year later. The District moved for summary judgment, arguing that Plaintiff's complaint was time-barred because she had filed her DFEH complaint more than one-year after the last discriminatory act allegedly occurred. The trial court granted the District's motion for summary judgment, finding that Plaintiff's complaint was barred by the statute of limitations. The Court of Appeal reversed, holding that the statute of limitations may have been equitably tolled during the time period in which Plaintiff was pursuing relief through the District's administrative complaint procedure. Finding a triable issue of fact regarding application of the equitable tolling doctrine, the Court of Appeal held that the District was not entitled to summary judgment.

The California Supreme Court agreed with the Court of Appeal and held that equitable tolling may apply to the pursuit of internal administrative remedies prior to filing a FEHA claim. The Court reasoned that equitable tolling encourages and promotes informal resolutions and the avoidance of unnecessary, premature litigation. The Court also held that the purposesbehind the statute of limitations--timely notice to the defendant and preservation of evidence--were not frustrated by application of equitable tolling in the circumstances before it. The District had notice of the complaint and the opportunity to preserve appropriate evidence and even investigate the complaint, within the one-year statute of limitations. In these circumstances, the Court held that equitable tolling may be appropriate to avoid the otherwise technical forfeiture of a claim.

The Supreme Court's decision does not mean that equitable tolling applies to every situation in which an employee pursues an internal complaint with the employer. It requires a fact-specific inquiry, keeping in mind the dual goals of providing timely notice to the defendant of legal claims, yet avoiding unjust, technical forfeitures of claims where the plaintiff has acted in good faith in pursuing relief.

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About the Editor

Robin Largent represents employers, including major food and retail companies, in all types of employment litigation: wrongful termination, retaliation, breach of contract, wage and hour (California Labor Code) and unfair competition. She also regularly counsels and advises California employers on issues of compliance with California and federal employment laws.
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