On the meaning of congressional silence: using federal common law to fill the gap in Congress's residual statute of limitations.

• Author: Mikva, Abner J.

Of the many gaps in the scheme of federal law, few have so vexed the federal judiciary as those that result when Congress creates a federal cause of action but fails to specify a period of limitations to govern the timeliness of the suit.(1) Such congressional omissions have occurred with monotonous regularity and frequently confound the judicial branch: The federal courts have struggled in recent years to supply the measures of timeliness that Congress left out of the civil rights laws of 1871,(2) the securities law of 1934,(3) and the plant closing legislation of 1988.(4) Such judicial struggles reflect in part the amorphous nature of the gapfilling process. Under the standard learning, federal courts supply omitted time limits by borrowing the most analogous statute of limitations from state law.(5) When, as often happens, a good many analogous state statutes present themselves, federal judges must make a choice from among plausible alternatives.(6) Judges understandably chafe under the burden of choosing statutes of limitations, particularly in light of the judicial perception that Congress ought to assume primary responsibility for fixing limitations periods.(7)

Judicial efforts to shift the task of setting limits to Congress culminated in the 1990 report of the Federal Courts Study Committee, recommending that Congress establish particular time limits for all existing federal causes of action.(8) Although Congress responded in part with the passage of the Judicial Improvements Act of 1990,(9) the provision dealing with limitations periods stopped well short of the recommendation. Now codified as [sections] 1658 of title 28, the relevant provision simply states, "Except as otherwise provided by law, a civil action arising under an Act of Congress enacted after the date of enactment of this section may not be commenced later than 4 years after the cause of action accrues."(10) Section 1658 thus establishes a fallback or residual limitations period for claims arising under statutes enacted after December 1, 1990,(11) but remains silent as to what periods of limitation should govern the more than two hundred express and implied rights of action arising under statutes already in existence on the date of the legislation (i.e., preenactment federal statutes).(12)

Judges and academic commentators generally view [sections] 1658's silence about the timeliness of claims arising under such preenactment statutes as a serious gap in the new law. Federal judges who testified before the House Subcommittee recognized that [sections] 1658 does not directly address the period of limitations for the "myriad" of existing federal rights of action: they criticized what they saw as Congress's decision to force judges to "continue to grope"(13) for an analogous state limitations period to borrow. Leading academic accounts of the section agree with this judicial criticism,(14) portraying Congress as having failed to discharge its legislative function and arguing for further legislation to fill the gap in [sections] 1658.(15) The decisional law points in the same direction: Federal courts that have faced such questions since 1990 have generally continued to determine the timeliness of claims arising under preenactment statutes by following the established state law borrowing mode; the courts have uniformly rejected arguments for reliance on the four-year limitations period of [sections] 1658 as an appropriate measure of the timeliness of such existing rights of action.(16)

In this Essay, we contend that [sections] 1658 may go further to solve the problem of the timeliness of federal claims than others have assumed. Although the statute does not by its terms establish a limitations period for claim arising under preenactment federal statutes, federal courts can reliably exercise their common-lawmaking powers to borrow the four-year residual period of [sections] 1658 as the limitations period for many such claims. Congress did not freeze in place a regime of state law borrowing. Rather, Congress left the selection of judge-made limitations periods to the flexible process of making federal common law. Federal courts should modify the relevant body of federal common law to establish a rule of presumptive reliance on periods drawn from federal law. In particular, federal courts should seriously consider borrowing the [sections] 1658 four-year limitations period for most claims arising under preenactment federal statutes as to which no clear rule of federal law has emerged.

We present our position in two parts. Part I proposes an alternative to the standard critique of [sections] 1658. Instead of chiding Congress for having failed fully to implement the recommendations of the Federal Courts Study Committee, Part I focuses on what Congress did accomplish in the face of obstacles that might have made a full legislative response difficult. In particular, Part I contends that the array of likely interest group opposition to legislation proposing to alter established limitations periods would have made the statute far more difficult to enact, particularly in the time available. This part concludes that [sections] 1658 makes a variety of important (and largely overlooked) contributions to our law of federal limitations, contributions that more than adequately vindicate the congressional decision to refrain from taking up thorny timeliness questions concerning preenactment statutes.

Part II turns to consider the process by which federal courts should fashion judge-made limitations periods in the wake of the adoption of [sections] 1658. After criticizing the current regime of state law borrowing, this part argues for a shift to presumptive reliance on uniform federal limitations periods. In particular, this part suggests reliance on the four-year limitation of [sections] 1658--a default provision that would work for most outstanding issues. Such an approach, we emphasize, rests entirely on the federal courts' retained power to fashion federal common law and not on a claim that Congress itself extended the four-year period to claims under preenactment statutes. We thus base our argument on the model of retained federal common-lawmaking authority practiced in Moragne v. States Marine Lines, Inc.(17) and not on any argument from legislative intent.

We do not understand Congress to have foreclosed this approach. Credible legislative history suggests that the congressional rejection of retroactivity meant to preclude only the reopening of those periods that had been fixed with relative certainty as of 1990. As to the remainder of unsettled issues, Congress understood that the process of fashioning federal common law ought to continue. While Congress meant to preserve settled limitations periods by limiting the reach of its residual statute, it did nothing to require the federal courts to apply state law limitations periods to other, unsettled, settings. In other words, federal courts should not view the legislation as a directive to borrow state law to solve all limitations problems.

1. RETHINKING THE STANDARD CRITIQUE OF [sections] 1658

   1. The Standard Critique of [sections] 1658

      Section 1658 grew out of dissatisfaction with the Supreme Court's rule of routine reliance upon state law to provide the measure of the timeliness of federal rights of action.(18) Following years of academic and judicial criticism of the state law borrowing regime,(19) the Federal Courts Study Committee recommended abolition of borrowing.(20) In its place, the Study Committee recommended that Congress specify the following: a particular limitations period to govern every new federal right of action that it legislates into existence, particular limitations periods to govern the rights of action already on the books as to which it had failed to specify limitations periods, and a fallback limitations period that would govern the timeliness of any actions for which it failed to set a particular period.(21) In arguing for such new legislation, the Study Committee cited a variety of familiar concerns, including the difficulty of the task of judicial borrowing, the lack of certainty and predictability, and the incentives for forum shopping.(22)

      Section 1658 appeared shortly after the Study Committee published its final report in April 1990 and owes much to the efforts of Representative Bob Kastenmeier of Wisconsin. Kastenmeier served both as a member of the Study Committee and as chair of the House Subcommittee on Courts, Intellectual Property, and the Administration of Justice, the Subcommittee that took responsibility for drafting legislation to implement the report.(23) Kastenmeier worked with his staff to cull from the committee's recommendations those suggestions that, as he later described the process in his opening remarks at the hearing on the bill, would prove the easiest to enact and the most "noncontroversial."(24) Little time remained before Congress adjourned, ending the 101st Congress, and only the least controversial provisions would clear the House in time to join provisions in a Senate bill that was expected to appear before the end of the session in October.(25)

      Reflecting the goals of avoiding controversy and moving quickly, section 112 of the bill dealt with the problem of federal limitations periods in terms similar to those that now appear in [sections] 1658.(26) In particular, the Subcommittee version of the bill established a residual four-year limitations period for federal rights of action adopted in the future but did nothing to address the problem of the timeliness of federal claims arising under preenactment statutes.

      Although the bill's failure to address the timeliness of claims under preenactment statutes attracted critical comments from many of the witnesses who testified at the September hearing,(27) the House Subcommittee ultimately decided to retain this feature of the provision.(28) The House Report tells the story as follows:

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