Court of Appeals Holds that School District is a Corporation for the Purposes of the Statute of Limitations

By Lewis Tesser, Partner, and Timothy Nolen, Associate, of Tesser, Ryan & Rochman, LLP

An opinion from the Court of Appeals has determined that, when determining the applicable statute of limitations, a school district is considered a corporation. The litigation involved issues of civil procedure, statutory interpretation, corporate law, appellate practice and constitutional law.

The case, Roslyn Union Free School District Barkan et al., 16 N.Y.3d 643 (May 3, 2011), concerned a school district which filed suit against a former school board member for breach of fiduciary duty after the school district learned that various other board members—not including the defendant—had stolen money from the school district. The defendant argued that the cause of action was barred by the statute of limitations because the school district failed to file suit within three years, as required by statute. Judge Graffeo’s opinion for the Court, however, rejected the defendant’s argument. Judge Graffeo noted that another statute provided a six-year statute of limitations for suits by a corporation against former board members to recover damages. Because various statutes described school districts as “corporations,” the six-year statute of limitations applied and the action was timely.

Roslyn is a unique example of how procedural rules and statutory interpretation can play a pivotal role in deciding whether a case may be heard at all: in Roslyn, the entire case would be untimely unless the school district was considered a corporation. At Tesser, Ryan & Rochman, our attorneys’ knowledge of procedural, constitutional and corporate law gives us a basis for identifying potential procedural issues and addressing them effectively.