4 Key Things to Remember About Limitation Periods for Breach of Contract Claims

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Contracts are necessary in the business world. In the simplest terms, contracts define what each person has agreed to do within certain parameters. If everything went perfectly all the time contracts wouldn’t be necessary, or at least they would always be fulfilled exactly as written. Unfortunately, business owners need to be protected from fraudulent agreements or situations when the terms were met in a less than satisfactory manner.

A breach of contract occurs when one or both of the parties renig on the terms or the terms are not fulfilled as stipulated. Whatever the reasons for the breach may have been, one or both of the parties to the contract may want to seek reparations. One way to do that is by hiring a lawyer and filing a lawsuit. Of course any legal actions taken must be done in a timely manner and not years after the fact.

Statutes of Limitations

Any action where charges are brought against a person either in a criminal or a civil trial is bound by limitations. That means that the punitive action must be brought against the offender within a legally specified amount of time. The time limit helps to ensure that evidence in the case has not deteriorated and that no one is subject to unfair or unjust prosecution.

How Do Limits Apply to Breach of Contract Claims?

These kinds of claims are generally handled by civil courts, not criminal courts, but certain limits apply to both.

  1. Primary Limitation – The limit to file a claim for breach of contract is six years. The breach is considered to have occurred when any damage is suffered by either party to the contract. It is not necessary that every party knows there has been a breach at that time.
  2. Secondary Limitation – This condition applies only to cases where negligence has occurred. The time frame begins when the innocent party to the contract knows that he has suffered some damage or injury in the breach. A secondary limitation can extend the deadline to file a claim up to 15 years from the date of the negligent event.
  3. Personal Injury – Cases involving personal injury must be filed within three years after the date when the negligence occurred or when the injured person discovered the damage. In these cases, the Court can also extend the limitation period based on the circumstances of the case.
  4. Postponement – This limitation applies when one party to the contract has deliberately concealed evidence of a breach of the contract from the other party. The innocent party can’t be held responsible to know the actual date of the breach, so the limit to file is in effect “postponed” so that the claim can still be filed.

How to File a Breach of Contract Claim

If you believe that you have been wronged and suffered a breach of contract, contact a business law attorney right away. The attorney will be able to advise you what evidence you need to substantiate your claim and what your time limitations will be. If your case meets any of the special requirements, such as if negligence or personal injury were involved, you may qualify for one or more of the time limitation exemptions. You will definitely need the advice of an attorney if you have been the victim of concealment.