A recent Delaware Court of Chancery opinion explains several principles of Delaware law useful for corporate and commercial litigators alike. In ETC Northeast Field Services, LLC v. Muse, C.A. No. 2023-0249-MTZ (Del. Ch. May 31, 2024), the Vice Chancellor determined that laches prevented breach of fiduciary duty claims because to allow the claims would be an impermissible collateral attack on a final arbitration award, which also eliminated the tolling arguments.

The following highlights should be of interest and widely applicable to corporate and commercial litigators, as well as fans of Delaware corporate and commercial law.

Highlights

●    The statute of limitations for breach of fiduciary duty claims is typically three years, and that timeline begins to accrue when the alleged wrongful act occurs, even if the plaintiff is ignorant of the cause of action. See Slip op. at 11-12 and footnote 44.

●    There are three ways to toll the applicable statute of limitations in order to enable a plaintiff to recover over a longer period of time: (i) an inherently unknowable injury; (ii) fraudulent concealment; and (iii) equitable tolling.  See Slip op. at 13-14.

●    The court explained that notice universally limits the tolling doctrines, and a plaintiff cannot invoke tolling doctrines when a plaintiff was objectively aware of—or should have been aware of the facts giving rise to the wrong.  See Slip op. at 14.

●     A basic principle of contract law applicable here is that when a party has assented to clear contractual terms, the parties are on notice of those terms. See footnote 57 and accompanying text (citing Restatement (Second) of Contracts § 157, cmt. (b) (1981)).