Case Title: Ceccone v. Carroll Home Services, LLC

Citation: 

Docket Number: 85/16

State: maryland

Court: Maryland Supreme Court

Date: 2017-07-28T00:00:00Z

Document:
Richard and Daphne Ceccone v. Carroll Home Services, LLC  
No. 85, September Term 2016 
 
 
Limitations – Contracts – Shortening Statute of Limitations by Contract.  With certain 
exceptions specified by the General Assembly, the statutory period of limitations for tort 
and contract claims in Maryland is three years.  Maryland Code, Courts & Judicial 
Proceedings, §5-101.  A provision of a contract that purports to shorten this period of 
limitations will be enforced in Maryland only if (1) there is no controlling statute to the 
contrary; (2) the provision is not the result of fraud, duress, misrepresentation, or the like; 
and (3) the provision is reasonable.  In assessing the reasonableness of such a provision, 
the court should make an explicit determination whether the provision is reasonable, 
considering a variety of factors, including the subject matter of the agreement, the degree 
to which the provision shortens the applicable period of limitations, the relative bargaining 
position of the parties, and whether the shortened period of limitations is one-sided or 
applies equally to the parties to the agreement.  
 
 
 
Circuit Court for Anne Arundel County 
Case No. C-02-CV-16-001190 
Argument:  June 1, 2017 
IN THE COURT OF APPEALS 
OF MARYLAND 
 
No. 85 
 
September Term 2016 
 
 
RICHARD AND DAPHNE CECCONE 
 
V. 
 
CARROLL HOME SERVICES, LLC 
 
_____________________________________ 
 
 
 
   Barbera, C.J. 
 
 
   Greene 
 
 
  Adkins 
 
   
  McDonald 
 
 
  Watts 
 
 
  Hotten 
 
 
  Getty, 
 
 
 
       JJ. 
 
______________________________________ 
 
Opinion by McDonald, J. 
 
______________________________________ 
 
Filed:  July 28, 2017 
 
 
 
In the court system, a potential plaintiff has an interest in having sufficient time to 
investigate and assert a claim.  A potential defendant has an interest in repose and finality 
as to whether it will be necessary to mount a defense.  The public has an interest in the 
efficient use of public resources – what, in this context, is sometimes called judicial 
economy.  The Legislature, as the primary policy-making branch of government, weighs 
those competing interests and establishes statutory limitations periods for bringing claims 
in court. 
 
Maryland law, nevertheless, allows parties, in some circumstances, to further 
restrict access to the courts by shortening limitations periods by contract.  When will the 
courts recognize such clauses as superseding the legislative policy determination as to an 
appropriate period of limitations?  Given the wide variety of contracts, the creativity of 
lawyers in devising contract clauses, and the disparity in bargaining power that sometimes 
exists, there is no simple answer.   
 
This case concerns the standard “General Terms and Conditions” of a residential 
furnace maintenance agreement offered by Respondent Carroll Home Services, LLC 
(“CHS”).1   One of those terms reduced the period for a consumer to bring a tort or contract 
claim against CHS from the statutory three years to one year, although it did not limit the 
time period for CHS to make a claim against a consumer.  Petitioners Richard and Daphne 
                                              
1 The Respondent has identified itself in its filings in this Court as “Petroleum Heat 
and Power d/b/a Carroll Home Services.” 
2 
 
Ceccone, who had entered into a maintenance agreement with CHS, asserted tort and 
contract claims against CHS for damage to their residence that they attributed to the 
company.  They filed their complaint well before the expiration of three years, but arguably 
more than a year after their claims accrued.  The Circuit Court for Anne Arundel County 
dismissed their complaint on the basis of the shortened limitations provision in the 
agreement. 
 
We adopt the approach previously articulated by the Court of Special Appeals and 
hold that contractually-shortened limitations periods, like the one at issue here, are valid 
only if (1) there is no statute to the contrary; (2) the provision is not the result of fraud, 
duress, misrepresentation, or the like; and (3) the provision is reasonable in light of all 
pertinent circumstances.  Because the Circuit Court did not consider potential contract 
defenses or make an explicit finding on reasonableness, we remand the case to that court 
so that it may decide how those factors affect the validity of the limitations-shortening 
provision in the first instance. 
I 
Background 
A. 
Facts 
 
The Maintenance Agreement 
At the time of the events underlying this case, the Ceccones heated their home in 
Anne Arundel County by means of an oil-fueled furnace.2  They entered into a maintenance 
                                              
2 This case reaches us as the result of the grant of a motion to dismiss the complaint.  
Accordingly, we assume the truth of the facts set forth in the complaint and its attached 
3 
 
agreement for that furnace with CHS.  CHS offered the maintenance agreement – titled 
“Carroll Home Services Ultra Oil Plan” – to customers to whom it supplied oil. 
 
Under the maintenance agreement, CHS agreed to provide 24-hour-a-day service 
for no-heat emergencies, to repair specified boiler parts if they became defective due to 
normal wear and tear, and to conduct a yearly “tune-up” of the heating system.  The 
customer agreed to properly vent the heating system, to maintain clean air filters, and to 
replace batteries as needed, among other things.3 
 
The “General Terms and Conditions” of the agreement appear in 18 numbered 
paragraphs on the back of the pre-printed form that comprises the agreement.  Among the 
items set forth in those paragraphs are the duration of the agreement, procedures for 
cancellation, conditions for coverage under the agreement, exclusions from coverage, 
disclaimers of warranties, notices of costs a customer will incur for late payment or non-
payment, and limitations of CHS’s liability, among other things.  Pertinent to this case, 
Paragraphs 9 and 10 provide as follows4: 
                                              
exhibits.  See RRC Northeast, LLC v. BAA Maryland, Inc., 413 Md. 638, 643 (2010).  In 
any event, there does not appear to be any dispute concerning the terms of the maintenance 
agreement, which is the operative legal document pertaining to the issue before us. 
3 The record does not disclose how much the Ceccones paid CHS for the agreement, 
but the pre-printed terms indicate that a customer would “receive an invoice ... with [the] 
Agreement,” which must be paid “in full upon receipt” or be subject to late fees and 
collection costs. 
4 The agreement defines the pronouns “we,” “us,” “our,” and “ours” to refer to the 
Seller – i.e., CHS.  The pronouns “you,” “your,” and “yours” are defined to refer to the 
Buyer – i.e., the Ceccones.  It is perhaps also notable that the quoted paragraphs, as well 
4 
 
9.  IRREGULAR PAYMENT AND DELAY IN ENFORCEMENT – We 
can accept late payments, partial payments or payments marked “payment in 
full” without losing any of our rights under this Agreement.  We can also 
delay enforcing any of our rights under this Agreement without losing any of 
our rights under this Agreement. 
 
10.  LIMITS OF LIABILITY – We will not be responsible for loss or 
damages due to or resulting from:  changes in oil consumption; improper 
operation of an attic fan or alternate fuel device; your failure to schedule 
service and or tune-ups; acts of God; terrorism; strikes; riots; material or 
labor shortages; fire; flood; hurricane; power interruption or loss; accidents; 
governmental acts; abuse or misuse of equipment; spontaneous part failure; 
insufficient water; frozen or jelled oil lines; or any other conditions beyond 
our reasonable control, including a vacant, unattended or unoccupied 
premises (in this Agreement, the term “vacant or unattended premises” shall 
mean premises at which no adult occupant is present for at least twenty-four 
(24) consecutive hours).  TO THE MAXIMUM EXTENT PERMITTED BY 
LAW, we will have no liability for direct or indirect, special or consequential 
damages of any kind.  We are not responsible for secondary damage as a 
result of a delay in rendering service.  To the extent any warranty exists, our 
liability for any warranty claim will be limited, as permitted by law, to the 
repair or replacement of defective parts or service provided under this 
Agreement.  Any and all actions, whether based in contract or tort, whether 
for personal injury or property damage, and whether brought by Buyer or 
Buyer’s insurance company, must be commenced within one year of the 
cause of action or shall be barred as a matter of law.  IN NO EVENT 
SHALL OUR LIABILITY TO YOU OR OTHERS UNDER THIS 
AGREEMENT OR OTHERWISE EXCEED $1,000, INCLUDING ANY 
LIABIILTY UNDER SECTION 11. 
 
(capitalized emphasis in original; italicized emphasis added).  As is evident, Paragraph 10 
provides that any actions brought by the Buyer – i.e., the Ceccones – including tort or 
contract claims must be brought within one year of accrual of the cause of action.  This 
provision was apparently intended to shorten the three-year period of limitations that would 
                                              
as the other terms and conditions, appear in a considerably smaller font than they do in this 
opinion. 
5 
 
otherwise apply to such claims pursuant to Maryland Code, Courts & Judicial Proceedings 
Article (“CJ”), §5-101.  There is no corresponding provision that shortens the period of 
limitations for CHS or that requires it to bring a claim within one year.  Rather, Paragraph 
9 purported to permit CHS to delay enforcing its rights under the agreement “without losing 
any of [its] rights under the agreement.”  
 
An Incident with the Furnace 
 
During April 2014, there was an incident involving the Ceccones’ furnace that 
caused some damage to their home.  For purposes of this opinion, the details of that incident 
and the damages are not important.  It suffices to say that the Ceccones suspected that 
faulty maintenance by CHS was responsible.  According to the Ceccones, they consulted 
with an engineer and insurance adjuster, as well as another furnace maintenance company, 
all of which confirmed their belief that CHS was at fault.  After conducting that 
investigation, they asked CHS to pay the cost of remedying the damage.  Some negotiations 
ensued during 2015, but the parties ultimately did not agree on a resolution.  
B. 
Legal Proceedings 
Proceedings in the District Court 
On December 24, 2015, the Ceccones filed a pro se small claims action in the 
District Court of Maryland sitting in Anne Arundel County.  See CJ §4-405; Maryland Rule 
3-701.  The Ceccones sought damages in the amount of $3,694.39, as well as costs.  The 
complaint alleged that CHS had improperly maintained their heating system, and that this 
improper maintenance was both fraudulent and a breach of the parties’ contract.  CHS filed 
a Notice of Intend to Defend on January 19, 2016.  On January 29, 2016, the Ceccones 
6 
 
filed an amended complaint that added documentation concerning the requested damages 
and increased the amount requested by about $70.  The amended complaint also added an 
allegation that CHS had not complied with certain licensing requirements.5 
 
On March 17, 2016, the District Court dismissed the case, apparently on the basis 
of the shortened limitations period set forth in the maintenance agreement, and entered 
judgment in favor of CHS.  The Ceccones then pursued a de novo appeal in the Circuit 
Court for Anne Arundel County.  See CJ §12-401(f) (providing for de novo appeal in a 
circuit court when the amount in controversy does not exceed $5,000); Maryland Rule 7-
102. 
 
Proceedings in the Circuit Court 
 
The Circuit Court conducted a brief hearing on the matter on July 8, 2016.  At the 
outset, counsel for CHS noted that CHS denied liability, but advised the court that he 
wished to raise a limitations defense as a “preliminary matter.”  He directed the court’s 
attention to the limitations-shortening provision in the maintenance agreement and asserted 
                                              
5 In that regard, the Ceccones asserted that CHS did not employ a heating, 
ventilation, air-conditioning, and refrigeration (“HVAC-R”) master technician as required 
by law, that CHS had falsely represented that it did properly employ an HVAC-R 
technician at the time the parties entered into the contract, and that this allegedly false 
representation was fraudulent.  Although not entirely clear from the complaint, it appears 
that the Ceccones asserted that the alleged fraud was both (1) an independent tort and 
therefore a basis of recovery and (2) a basis on which to rescind the contract. 
7 
 
that the Ceccones were “on notice” of a potential claim as of October 2014,6 more than a 
year before they filed suit in December 2015.   
The Circuit Court then turned to Mr. Ceccone, who argued that the shortened 
limitations period should not be enforced and proceeded to relate some of the reasons why 
the Ceccones believed that CHS had made misrepresentations that affected the 
enforceability of the contract.  After hearing briefly from counsel for CHS concerning some 
of those allegations, the Circuit Court engaged in the following discussion with Mr. 
Ceccone concerning whether the shortened limitations provision should supersede the 
statutory three-year period for tort and contract claims: 
THE COURT: 
Well, sir, I don’t think I can get around the language 
of the contract.  The contract is very clear that the 
action must be filed within one year.  And that’s clear.  
You contracted that way and that’s part of the 
contract. 
 
MR. CECCONE: But I entered into the contract, Your Honor, as a result 
of believing that they were properly licensed. 
 
THE COURT: 
Well, you – but you may have some action with the – 
whoever regulates that company, bringing it to their 
attention.  But so far as the Court is concerned you 
entered into a contract.  You know what a contract is 
because you’re in the real estate business.  The terms 
are very clear.  It says it must be filed within one year 
regardless of all of the background.   
 
MR. CECCONE: Well, Your Honor, I discovered on January of this 
year that, in fact, they did not provide – they were not 
properly insured to perform that work. 
                                              
6 It is not entirely clear from the record why CHS believed that the claim accrued in 
October 2014.  In its filings and argument in this Court, CHS appears to argue that any 
claim accrued in April 2014. 
8 
 
 
THE COURT: 
Well, and maybe that’s something you can take up 
with the regulatory agency.  But that’s not anything I 
can do – handle.  I’m only here on the contract.  The 
contract is clear that you must file the action within 
one year. 
 
 
 
 
   And so I have no other –  
 
MR. CECCONE: But the statute of limitations is three years.  That’s the 
statutory –  
 
THE COURT: 
That’s the general.  But you can contract it out.  You 
can contract and make it six months, three – 30 days. 
 
MR. CECCONE:  But who’s –  
 
THE COURT: 
  That’s between you and [CHS]. 
 
MR. CECCONE:  Yeah.  But would a reasonable person determine that 
that’s a reasonable amount of one year? 
 
THE COURT: 
Well, I’ve seen it before. 
 
MR. CECCONE: Well, that’s – I understand that’s the case.  You’ve seen 
it before.  But what’s basically happened is, is the 
contractor is setting an arbitrary amount of time for 
someone –  
 
THE COURT: 
Well, you could have, when you entered into the 
contract, said, look, I’m not going to agree to one year.  
It’s got to be three years.  You could have said that and 
then put that in the agreement.  But you know what a 
contract is being in the real estate business.  Whatever 
it’s contracted for, you’re stuck with. 
 
After further discussion with Mr. Ceccone about whether the allegedly false 
representations by CHS could be a basis for rescinding the contract, including the one-year 
limitations period, the Circuit Court rendered judgment in favor of CHS based on 
limitations.   
9 
 
After judgment was entered in CHS’s favor, the Ceccones appealed to the Court of 
Special Appeals.  Because any further appellate review in this case properly belongs in this 
Court,7 the Court of Special Appeals transferred the appeal to this Court pursuant to 
Maryland Rule 8-132.  We treated the Notice of Appeal as a petition for a writ of certiorari, 
which we granted.  
II 
Discussion 
 
There is a single issue presented for our review:8  In dismissing the complaint, did 
the Circuit Court properly determine that the shortened one-year period of limitations set 
forth in the maintenance agreement superseded the three-year statutory period of 
limitations? 
A. 
Standard of Review 
 
When deciding whether to grant a motion to dismiss a complaint as a matter of law, 
a trial court is to assume the truth of factual allegations made in the complaint and draw all 
reasonable inferences from those allegations in favor of the plaintiff.  When an appellate 
court reviews a trial court’s grant of a motion to dismiss, the appellate court applies the 
same standard to assess whether the trial court’s decision was legally correct.  Heavenly 
                                              
7 CJ §12-305. 
8 The Ceccones initially attempted to raise a number of other issues pertaining to 
the proceedings in the District Court and the Circuit Court, but have properly focused their 
brief in this Court on the basis of the Circuit Court’s dismissal of their action.  That is the 
issue that we address. 
10 
 
Days Crematorium, LLC v. Harris, Smariga and Associates, Inc., 433 Md. 558, 568 (2013).  
Because this review concerns resolution of a question of law, an appellate court does not 
accord any special deference to the trial court. 
B. 
Enforcement of Contractual Limitations Clauses 
 
Statutes of limitations are designed to balance the competing interests of plaintiffs, 
defendants, and the public.  A statutory period of limitations represents a policy judgment 
by the Legislature that serves the interest of a plaintiff in having adequate time to 
investigate a cause of action and file suit, the interest of a defendant in having certainty 
that there will not be a need to respond to a potential claim that has been unreasonably 
delayed, and the general interest of society in judicial economy.  Pennwalt Corp. v. Nasios, 
314 Md. 433, 437-38 (1988); Pierce v. Johns-Manville Sales Corp., 296 Md. 656, 665 
(1983).  In enacting the three-year statute of limitations that governs most tort and contract 
actions, the General Assembly thus made a policy decision as to an appropriate deadline 
for the filing of such a claim by a reasonably diligent plaintiff.   See CJ §5-101.9 
                                              
9 With respect to some specific types of claims, the General Assembly has made a 
different policy decision and determined that a longer or shorter period of limitations is 
more appropriate.  See, e.g., CJ §5-102 (12-year period of limitations for suits on 
“specialties”); CJ §5-105 (one-year period of limitations for assault, libel, and slander 
actions); CJ §5-109 (establishing limitations period for medical malpractice actions of 
either five years or three years after discovery, whichever is earlier); Maryland Code, 
Commercial Law Article, §2-725 (establishing four-year period of limitations for sales 
contracts, but allowing parties to reduce the limitations period to one year by agreement); 
Maryland Code, Corporations & Associations Article, §11-703(f)(2) (one-year period of 
limitations for certain securities actions). 
11 
 
This is not to say that a period of limitations is immutable.  Statutes of limitation 
are not ordinarily jurisdictional, and parties may essentially lengthen them by waiving 
limitations10 or by agreeing to toll the period of limitations for a particular claim that might 
otherwise become barred.11  Similarly, parties may, in some circumstances, agree to 
shorten the period of limitations in a way that the courts will recognize. 
States have taken different approaches as to whether, and the extent to which, parties 
to a contract may agree in advance to shorten a statutory limitations period.  Among the 
states that prohibit such provisions, some have enacted laws containing such a 
prohibition,12 while others have imposed that prohibition judicially on the basis of public 
policy.13  In other states, courts appear to allow for contractually-shortened limitations 
periods, absent a defense to contract formation.14  Many courts have assessed such 
                                              
10 Kim v. Comptroller of Treasury, 350 Md. 527, 536 (1998). 
11 Milton Co. v. Council of Unit Owners of Bentley Place Condominium, 354 Md. 
264, 274-76 (1999). 
12 See, e.g., Code of Alabama, §6-2-15 (holding such agreements “void”); Florida 
Statutes §95.03 (same); cf. Texas Statutes, Civil Practice and Remedies Code, §16.070 
(same, unless the contract “relat[es] to the sale or purchase of a business entity” where 
there is an exchange of consideration and the contract is worth at least $500,000).   
13 Dunlop Tire & Rubber Corp. v. Ryan, 108 N.W.2d 84 (Neb. 1961) (holding such 
agreements void as “against public policy”). 
14 Rory v. Continental Ins. Co., 703 N.W.2d 23, 31 (Mich. 2005) (“[A]n 
unambiguous contractual provision providing for a shortened period of limitations is to be 
enforced as written . . . A mere judicial assessment of ‘reasonableness’ is an invalid basis 
upon which to refuse to enforce contractual provisions.”) 
12 
 
provisions according to a criterion of reasonableness.15  In any event, it seems safe to say 
that “where a limitations period is imposed by a contract rather than by a statute, the public 
policy considerations that typically weigh in favor of strict enforcement of the limitations 
period do not apply.”16 
Maryland law has combined these approaches.  There are some provisions in the 
Maryland Code that explicitly bar any effort to shorten a statute of limitations.  See, e.g., 
Maryland Code, Insurance Article (“IN”), §12-104 (provision in insurance or surety 
contract that purports to shorten period of limitations is “against State public policy, illegal, 
and void”);17 see also St. Paul Travelers v. Millstone, 412 Md. 424 (2010) (applying IN 
§12-104 to hold a contractually-shortened limitations period void).  Otherwise, the validity 
of a contractual provision that purports to shorten a statutory limitations period is measured 
by its reasonableness and by whether certain defenses to contract formation can be 
                                              
15 See, e.g., Order of United Commercial Travelers of America v. Wolfe, 331 U.S. 
586, 608 (1947) (“in the absence of a controlling statute to the contrary, a provision in a 
contract may validly limit . . . the time for bringing an action . . . to a period less than that 
prescribed in the general statute of limitations, provided that the shorter period itself shall 
be a reasonable period”); Nuhome Investments, LLC v. Weller, 81 Pd.3d 940, 947 (Wy. 
2003) (contractually-shortened limitations periods “are prima facie valid and will be 
enforced absent a demonstration by the party opposing enforcement that the clause is 
unreasonable . . .”);  
16 Gallegos v. Mount Sinai Medical Center, 210 F.3d 803, 810 (7th Cir. 2000).  
17 IN §12-104 was enacted in reaction to a decision of this Court enforcing a 
provision in an automobile insurance contract shortening the period of limitations.  See 
Amalgamated Cas. Ins. Co. v. Helms, 239 Md. 529, 540 (1965); Chapter 487, Laws of 
Maryland 1966; see also Harvey v. Northern Ins. Co. of New York, 153 Md. App. 436 
(2003) (holding that IN §12-104 did not apply to a marine insurance policy). 
13 
 
established.  The Court of Special Appeals aptly summarized the Maryland approach:  
“[P]arties may agree to a provision that modifies the limitations result that would otherwise 
pertain provided (1) there is no controlling statute to the contrary, (2) it is reasonable, and 
(3) it is not subject to other defenses such as fraud, duress, or misrepresentation.”  College 
of Notre Dame of Maryland, Inc. v. Morabito Consultants, Inc., 132 Md. App. 158, 174 
(2000). 
The requirement of a showing of reasonableness is consistent with this Court’s 
general approach to contractual provisions that purport to override otherwise governing 
law.  In particular, in assessing provisions concerning liquidated damages,18 forum 
selection,19 and choice of law,20 this Court has held that the validity of the particular 
provision turned on its reasonableness.  Among the factors to be considered in assessing 
reasonableness are the subject matter of the contract, the duration of the shortened 
limitations period compared to the period that would otherwise govern,21 the relative 
                                              
18 Barrie School v. Patch, 401 Md. 497 (2007) (liquidated damages clauses upheld 
if the stipulated amount is a “reasonable forecast of just compensation”). 
19 Gilman v. Wheat, First Securities, Inc., 345 Md. 361, 378 (1997) (forum selection 
clauses would be upheld unless “enforcement would be unreasonable”). 
20 National Glass, Inc. v. J.C. Penney Properties, Inc., 336 Md. 606, 610 (1994) 
(choice-of-law provisions upheld unless, among other things, “there is no ... reasonable 
basis for the parties’ choice”) (citing Restatement (Second) Conflict of Laws §187(2) 
(1971)). 
21 See, e.g., Henning Nelson Const. Co. v. Fireman’s Fund American Life Ins. Co., 
383 N.W.2d 645, 651 (Minn. 1986) (holding that a one year contractual limitations period 
was “unreasonably short”).  But see, e.g., Capitol Fixture & Supply Co. v. National Fire 
Ins. Co. of Hartford, 279 P.2d 435, 437 (Colo.1955) (holding that a one year contractual 
limitations period was “not unreasonable”).   
14 
 
bargaining power of the parties to the contract,22 and whether the shortened limitations 
period is a one-sided provision that applies to one party but not the other.  
This Court has recognized that the principle of freedom of contract “serves the 
public interest in having individuals exercise broad powers to structure their own affairs 
by making legally enforceable promises.”  Maryland-National Capital Park and Planning 
Commission v. Washington Nat. Arena, 282 Md. 588, 606 (1978).  On the other hand, the 
Court has also noted that the principle loses force and its public policy foundation when a 
contractual provision that purports to supersede existing law is exacted as a result of 
superior bargaining power.  Id. at 612 (“In such cases, a court might well elect to refuse 
implementation”); cf. Wolf v. Ford, 335 Md. 525, 531-32 (1994) (exculpatory clauses 
upheld unless, among other things, there is an “obvious disadvantage in bargaining power” 
between the parties or if they appear in “transactions affecting the public interest”); Walther 
v. Sovereign Bank, 386 Md. 412, 426 (2005) (arbitration clauses upheld unless 
unconscionable).  Indeed, it is notable that many of the cases upholding shortened 
limitations periods involve sophisticated contracts between parties with roughly similar 
bargaining power.  See, e.g., College of Notre Dame of Maryland, Inc. v. Morabito 
                                              
22 Compare International Business Machines Corp. v. Catamore Enterprises, Inc., 
548 F.2d 1065, 1073 (5th Cir. 1976) (upholding contractually-shortened limitations period 
contained in a “facially comprehensive written agreement[] between sophisticated 
corporate entities”) with Long v. Holland America Line Westours, Inc., 26 P.3d 430, 435 
(Alaska 2001) (refusing to enforce a contractually-shortened limitations period because, 
inter alia, one party “possessed disproportionate bargaining power in setting the terms of 
the tour contract”); McKee v. AT&T Corp., 191 P.2d 845, 859 (Wash. 2008) (refusing to 
enforce such contractually shortened limitations provision “when imposed on a consumer 
in a contract of adhesion for a basic consumer service”).   
15 
 
Consultants, Inc., 132 Md. App. 158, 174 (2000) (construction contract between college 
and contractor); Harbor Court Associates v. Leo A. Daly Co., 179 F.3d 147 (4th Cir. 1999) 
(contract between developer and architectural firm described as “sophisticated business 
actors”).23 
C. 
Application to this Case  
 
In this case we must assess whether the Circuit Court considered the relevant criteria 
to decide whether to enforce the provision in Paragraph 10 of the General Terms and 
Conditions that purported to shorten the statute of limitations for the Ceccones to file a tort 
or contract claim.  As outlined by the Court of Special Appeals in Morabito, the relevant 
questions are: 
(1)  Is there a controlling statute to the contrary? 
(2) Is the provision subject to defenses such as fraud, duress, or misrepresentation? 
(3) Is the provision reasonable? 
 
In this case, no statute has been cited to us – or to the Circuit Court – that, like IN 
§12-104, would categorically bar a home services maintenance agreement from including 
a provision that shortens the period of limitations.  Nor are we aware of one. 
                                              
23 An amicus brief filed by the Public Justice Center argues that such a provision in 
a “contract of adhesion” – essentially a “take it or leave it” contract provided to a consumer 
without the opportunity to negotiate a modification -– should not be enforced.   While this 
suggestion has some force, it is important for a court to focus on the underlying issues – 
e.g., inequality of bargaining power, one-sidedness of a provision – as opposed to the label 
that might be attached to the contract. 
16 
 
 
With respect to the second question, the Ceccones have not asserted duress.  They 
have alleged, however, that CHS made misrepresentations that they felt were material and 
that amounted to fraud and complained about an alleged failure of CHS to respond to 
discovery on the subject.  No evidence was taken on the issue.  It appears from the record 
in this case that the Circuit Court did not evaluate those allegations in assessing the 
limitations provision in the contract. 
 
Nor did the Circuit Court assess the reasonableness of the limitations shortening 
provision.  Instead, the court initially stated that Ceccones were bound by the one-year 
period in the agreement “regardless of all of the background” – i.e., the particular 
circumstances of the case that Mr. Ceccone had been attempting to recite.  When Mr. 
Ceccone pointed to the three year statutory period of limitations, the court opined that the 
three-year period in CJ §5-101 is “general” and that parties may “contract it out . . . and 
make it six months, 30 days.”  When Mr. Ceccone raised the issue of reasonableness of 
shortening the limitations period to one year in this context, the Circuit Court responded 
only that it had “seen it before” and did not consider the reasonableness of the provision in 
relation to the agreement before it.24 
                                              
24 Before us, CHS argues that the court “implicitly” found the provision to be 
reasonable.  However, it is difficult to credit this argument when the court explicitly 
declined to analyze the reasonableness of the provision when that issue was raised by Mr. 
Ceccone and stated that it believed that the Ceccones were, in its words, “stuck with” 
whatever shortened limitation period was set forth in the pre-printed form, even if the 
period had been as brief as 30 days.  It does not appear that the court believed that it had 
discretion to evaluate the reasonableness of that provision. 
17 
 
On remand, the Circuit Court should consider whatever evidence that the Ceccones 
may produce concerning misrepresentation and fraud by CHS and determine whether it 
undermines the validity of the shortened limitations period in the agreement.25  The Circuit 
Court should also explicitly determine whether the shortened limitations period is 
reasonable.  In doing so, the court should consider the totality of the circumstances, 
including, for example, the length of the shortened limitations period (here, 1 year), its 
relation to the statutory period (one-third), the relative bargaining power of the parties,26 
the subject matter of the contract (an agreement to service an oil-based home heating 
system), whether the shortened limitations period applies only to claims brought by one of 
the parties or runs in both directions,27 and other facets of the limitations provision – e.g., 
it appears to apply equally to claims of negligence and intentional torts. 
 
                                              
25 We express no opinion on the merits of those allegations. 
26 In this regard, the Ceccones have claimed that the parent company of CHS 
controls a number of the providers of these services in Anne Arundel County, suggesting 
that this allows CHS to impose one-sided terms.  The Circuit Court did not accept any 
evidence on this allegation – or any other issue related to the limitations period – and we 
cannot assess it on appellate review. 
27 As noted earlier, Paragraph 10 of the General Terms and Conditions of the 
maintenance agreement purports to shorten the period of time for a buyer like the Ceccones 
(or their insurer) to bring a contract or tort action against CHS, but does not restrict the 
time for CHS to file suit, while Paragraph 9 of the agreement purports to excuse CHS from 
delay in enforcing its rights.  In this regard the General Terms and Conditions are forgiving 
as to CHS in that any delay in enforcement is excused while it is unforgiving with respect 
to the Ceccones even where they attributed the filing of their claim beyond one year to their 
effort to investigate and satisfy themselves that CHS was actually responsible for the 
damage to their home.  
18 
 
 
III 
Conclusion 
 
We hold that a contractual provision that purports to shorten the statutorily-
prescribed time for bringing a civil action is enforceable only if:  (1) there is no statute to 
the contrary; (2) the provision is not the product of fraud, duress, misrepresentation, or the 
like; and (3) the provision is reasonable in light of all the circumstances.  In this case, the 
trial court must assess, in the first instance, whether the criteria for enforcement of the 
provision are met and, in particular, whether the provision is reasonable.  
 
JUDGMENT OF THE CIRCUIT COURT FOR ANNE 
ARUNDEL COUNTY VACATED AND CASE REMANDED 
TO THAT COURT FOR FURTHER PROCEEDINGS 
CONSISTENT WITH THIS OPINION.  COSTS TO BE PAID 
BY RESPONDENT.