The state statute of limitations applied to bar arbitration claims brought by the clients of a financial services company, the Florida Supreme Court has ruled in reversing judgment.
The plaintiffs are former clients of Raymond James Financial Services. According to the plaintiffs, a Raymond James branch manager in Florida invested the plaintiffs’ assets in non-diversified, high risk equities, which caused the investments to lose significant value between 1999 and 2005.
Alleging that Raymond James was liable for negligence and various securities violations, the plaintiffs in 2005 filed a joint claim for arbitration pursuant to a clause in their customer agreements. Raymond James argued that the plaintiffs’ arbitration claims were barred under the state’s statute of limitations for civil actions, which establishes a four-year limitations period for negligence and a six-year time limit for actions based on violations of state securities law.
The court agreed that the action was time-barred, rejecting the plaintiffs’ contention that Florida’s statute of limitations did not apply to arbitration claims.
“Based on the language of the statute and the application of principles of statutory construction, we hold that Florida’s statute of limitations applies to arbitration because an arbitration proceeding is within the statutory term ‘civil action or proceeding’ found in [the law],” the court said.
Florida Supreme Court. Raymond James Financial Services v. Phillips, No. SC11-2513. May 16, 2013. Lawyers USA No. 993-3410.