In light of the great degree of confusion surrounding this issue and the tremendous amount of time and expense which may be expended on this through preliminary and collateral motions and hearings, a recent report has recommended to the NASD that the six year eligibility rule should be abandoned or at least temporarily suspended. It is not yet clear if or when the NASD will adopt this proposal. Statutes of limitation. Statutes of limitation are different and distinct from the eligibility rule of the arbitration forum. Statutes of limitation are the rules of law governing the period of time during which a claim must be filed.
Statutes of limitation are different for each type of complaint or cause of action.
Statutes of limitation also differ from state to state for state law and common law claims. The nature of the particular broker-customer relationship, level of sophistication of the customer and extent of the reliance of the customer upon the broker are all factors to be considered in equitable tolling of the time limitations period. However, an investor must act prudently and may not wait indefinitely to take action. It has been held repeatedly by courts that questions of timeliness in connection with statutes of limitation are to be determined by the arbitrators. Frequently these issues may be so entangled with the underlying facts of the case as to be impossible to determine except in the context of the overall arbitration hearing.