State Supreme Court belatedly recognizes that 19th century statute of limitations decision lacks precedential value

The California Supreme Court generally follows its prior decisions unless there is a compelling reason not to do so. This principle, called stare decisis, promotes predictability and stability in the law. Indeed, the California Supreme Court has echoed Justice Louis Brandeis' maxim that "in most matters it is more important that the applicable rule of law be settled than that it be settled right." In Shalabi v. City of Fontana, 2021 DJDAR 7060 (July 12, 2021), the California Supreme Court recently analyzed how stare decisis applies to a 19th century decision with questionable precedential value.

In Shalabi, the California Supreme Court grappled with the precedential status of an 1884 decision that courts since then (including the California Supreme Court itself) had treated as binding authority. The court concluded that because the 1884 decision was superseded by a different opinion after rehearing in 1885, the 1884 decision was never precedential. The court thus declined to follow the 1884 decision, even though it had been treated as precedent for more than a century.

Shalabi presented the question whether the day of a plaintiff's 18th birthday is included when calculating the statute of limitations period for a plaintiff who was a minor when his claim accrued. Like many states, California tolls the running of the statute of limitations while the plaintiff is a minor. California law also provides that an individual becomes an adult at the first moment of his 18th birthday, regardless of the time of day he was actually born. In Shalabi, the plaintiff's cause of action arising from the death of his father accrued when the plaintiff was a minor, which meant that the applicable two-year statute of limitations did not begin to run until he turned 18. The plaintiff filed suit on the day of his 20th birthday and argued his lawsuit was timely under California Code of Civil Procedure Section 12, which states, "The time in which any act provided by law is to be done is computed by excluding the first day, and including the last, unless the last day is a holiday, and then it is also excluded."

Defendants countered that the plaintiff's claim was time-barred because he filed suit one day too late. Defendants argued that, in the unique context of minority tolling, the day a plaintiff reaches the age of majority (i.e., his 18th birthday) must be included in the limitations period calculation as held long ago by the California Supreme Court in Ganahl v. Soher, 2 Cal.Unrep. 415 (1884) (Ganahl I). The defendants argued that because a plaintiff will always have the whole day of his 18th birthday to file suit, the purpose of Code of Civil Procedure Section 12, which is to eliminate fractional days from the limitations period calculation, is not implicated.

In the 19th century, the California Supreme Court often decided cases in three-justice panels, subject to potential rehearing "in bank" by the entire court. In Ganahl I, a three-justice panel of the court held that the day after minority tolling ends (i.e., the day a plaintiff reaches the age of majority) is included in the limitations period because a plaintiff becomes an adult as of the first minute of his birthday, and he therefore has the entirety of that day to file suit. The court subsequently granted rehearing in bank and affirmed the judgment on a different ground.

Typically, when a California Supreme Court panel decision was reheard in bank, the in bank decision, not the first decision, became the opinion of the court. See In re Jessup, 81 Cal. 408, 470 (1889). However, the California Supreme Court and others have long held that Ganahl I nonetheless retained precedential status. See In re Harris, 5 Cal. 4th 813, 847-50, 849 n.18 (1993); Johnson v. Superior Court, 208 Cal. App. 3d 1093, 1097 (1989) (following Ganahl I as "binding precedent"); Cabrera v. City of Huntington Park, 159 F.3d 374, 378-79 (9th Cir. 1998) (recognizing Ganahl I as binding precedent and explaining that "the Ganahl [I] holding is still good law"); Annot., Inclusion or exclusion of first and last day for purposes of statute of limitations, 20 A.L.R.2d 1249, § 4 (1952), citing Ganahl I, 2 Cal.Unrep. 415; Haning et al., Cal. Practice Guide: Personal Injury ¶ 5:145a, p. 5-127 (Rutter Group 2019), citing Ganahl I, at 416.

Relying on Ganahl I, the trial court in Shalabi determined that the plaintiff filed his lawsuit one day too late. The plaintiff appealed, and Division 2 of the 4th District Court of Appeal reversed. The Court of Appeal did not dispute that Ganahl I had precedential value as a general matter. Instead, the court reasoned that because Ganahl I did not acknowledge the counting rule provided in Code of Civil Procedure Section 12, the Court of Appeal was not obligated to follow Ganahl I. Defendants filed a petition for review in the California Supreme Court, arguing that the Court of Appeal's rejection of Ganahl I was irreconcilable with the doctrine of stare decisis. The California Supreme Court granted review.

The California Supreme Court ultimately rejected Ganahl I and concluded that a plaintiff's 18th birthday is excluded from the limitations period calculation under Code of Civil Procedure Section 12. The court therefore held that the plaintiff's lawsuit was timely when he filed his complaint on the day of his 20th birthday -- the last day of the limitations period. The court disapproved of multiple opinions, including two of its own, that had treated Ganahl I as precedent. Instead, the court held that Ganahl I never had precedential status because it was superseded after rehearing in Ganahl v. Soher, 68 Cal. 95 (1885) (Ganahl II). The court attributed the confusion surrounding Ganahl I's precedential status to the fact that online search engines like Westlaw and LexisNexis do not show the subsequent or prior history of Ganahl I or Ganahl II, such that courts, including the California Supreme Court, had mistakenly treated Ganahl I as precedent for decades.

The California Supreme Court determined that the need for certainty and uniformity in the rule governing the computation of deadlines supported its conclusion that a plaintiff's 18th birthday is excluded in the calculation of the limitations period. The court's stated desire for certainty and uniformity is complicated, however, by the court's apparent lack of concern for the fact that courts, litigants and commentators have long relied on Ganahl I as precedent. In disapproving the Ganahl I rule, the court expressed no concern for the likelihood that rejecting Ganahl I will upset settled expectations just as much as it would have if Ganahl I had precedential status as a technical matter. In this case, at least, the California Supreme Court adopted a formalistic approach to stare decisis, focused on whether Ganahl I was technically precedential, as opposed to a practical one focused on litigants' expectations. The consequences of that approach going forward remain to be seen. 