Tricky Statute of Limitations Issues—Even if a Contract Provides for Substantive Law of Another State, New York Courts Will Apply New York Statute of Limitations, Including as to Fraud Claims

A new decision of the New York Appellate Division, First Department, reminds us of the quirky rules that apply New York’s statute of limitations even when a contract provides for applying the substantive law of another state—Cincinnati Terrace Member LLC v Tartar Krinsky & Drogin LLC, 2026 NY Slip Op 02369 (1^st Dep’t Decided Apr. 21, 2026)(Cincinnati Terrace).

Dicey Statute of Limitations Issues

Over the years on this blog, I have explored a number of what can fairly be described as the more dicey issues surrounding the statute of limitations for fraud claims—areas where the governing principles are settled in the abstract but anything but clear in application. As discussed in prior posts such as Circling the Muddy Waters of Fraud Statute of Limitations Accrual and Continuing Wrongs, courts continue to wrestle with when a fraud claim actually accrues—whether upon the making of the misrepresentation or upon the occurrence of a cognizable injury—and have not always applied a consistent rule. I have also addressed the persistent confusion over the distinction between actual fraud and fraud‑adjacent claims (such as constructive fraud or negligent misrepresentation), which carry materially different limitations periods. The contours of the two‑year discovery rule and when a plaintiff is deemed to be on inquiry notice have also presented intriguing issues, including the “probability” versus “possibility” standard discussed in Second Circuit Addresses Statute of Limitations Issues Including the Standard on Duty of Inquiry. In addition, posts like Demanding Standard to Extend Statute of Limitations Based Upon Equitable Estoppel and Continuing Wrong Doctrine Does Not Extend Statute of Limitations for a Single Fraudulent Act Even if Alleged Damages Continue highlight the difficulty litigants face in invoking tolling doctrines—particularly equitable estoppel and the continuing wrong doctrine—which courts apply narrowly and often reject where the alleged delay is not directly caused by actionable misconduct. These recurring themes underscore that statute of limitations issues in fraud cases remain fertile grounds for motion practice and dispute.

Read the full blog post here.