KEY TAKE OUTS
- The statute of limitations acts to put a deadline on when you can commence legal proceedings. In other words, a limitation period is the maximum period of time that can pass, calculated from the date that the right to sue arises, that a party has to start court proceedings in relation to that particular right to sue.
- If you commence legal proceedings ‘out of time’ (that is, once the statute of limitation date has passed) then you will be unable to achieve the legal recourse you are seeking.
- It is important to consider the statute of limitations before considering taking any type of legal action and we recommend that you seek legal advice in this regard.
In the civil litigation context, plaintiffs (the party who starts or brings the court matter) have limited time to bring proceedings against their proposed defendants. This is known as the statute of limitations and can be more generally described as a deadline for a plaintiff to bring proceedings. If enough time has lapsed that you are outside of the limitation period, you will be unable to commence legal action against any proposed defendant (subject to very few exceptions to this rule).
The purpose of the statute of limitations is to prevent individuals (or companies) from pursuing a claim after a substantial amount of time has passed.
In this regard, it is very important that potential plaintiffs are informed of limitation periods and the deadline to bring legal action against proposed defendants to ensure that they are able to seek legal recourse and remedy, and importantly, taking the most appropriate course of action at that time.
The Limitation Periods
There are varying limitation periods for different ‘causes of action’ (or types of matters). Causes of action can generally be described as the legal right to sue someone in a particular area of law.
In NSW, the limitation periods that apply to varying courses of action are outlined in the Limitation Act 1969 (NSW).
General speaking, the following limitation periods are applicable (extracting popular causes of action, and noting there are some exceptions that allow ‘out of time’ filing):
| Cause of Action | Limitation Period | Example |
| Breach of Contract | 6 years from the date of the breach | If there is a contract between party A and party B for party B to undertake landscaping works by 1 August 2021 and party B does not complete the works by that date, party A has until 1 August 2027 to commence legal proceedings for breach of contract. |
| Negligence | 6 years from the negligent act or omission | If party B fails to stop at a stop sign and causes an accident and damage to party A on 1 January 2022, then party A has until 1 January 2028 to commence legal proceedings against party B for negligence. |
| Defamation | 6 years from the date of the publication | If party B posts in the newspaper defamatory comments about party A on 1 January 2022, then party A has until 1 January 2028 to commence proceedings. |
| Unfair Dismissal | 21 days after the dismissal | If party A is unfairly dismissed at work on 1 January 2022, then party B has until 22 January 2022 to apply to the Fair Work Commission for unfair dismissal. |
| Debt Recovery | 6 years from the later of:
(a) The date the debt first arose; (b) The date the debtor late made payment; or (c) The date the debtor acknowledges the debt in writing |
Party B owes party A money. The money had been due and payable for 5 ½ years. Party A will have 6 months to commence legal proceedings. Party B makes a small payment to the debt, or sends an email acknowledging the debt is owed, and the 6 year period recommences. |
If you are considering taking legal action against another party, it is crucial that you seek legal advice before taking any further steps. Obtaining legal advice will act to ensure that you take the most appropriate course of action first, and that you are not prevented from commencing legal proceedings if you wait too long to negotiate and are accordingly ‘out of time’.
For more information on the statute of limitations and how the limitation period will affect your potential claims, come and see our friendly dispute resolution team at Coutts. Coutts’ dispute resolution team is dedicated to finding the right solution for you – which includes considering and advising on the most practical, commercial solution to your needs. Coutts is committed to providing legal advice to you without the legal jargon with care, communication, and clarity.
For further information please don’t hesitate to contact:
This blog is merely general and non-specific information on the subject matter and is not and should not be considered or relied on as legal advice. Coutts is not responsible for any cost, expense, loss or liability whatsoever to this blog, including all or any reliance on this blog or use or application of this blog by you.
