Time Limits on
by Robert Carowitz, Legal Hotline Attorney
The Legal Hotline is receiving many calls from folks who are being sued by
a bank or credit card company. Sometimes the debt is an old one, and often the
company suing is not even the original creditor; instead it is a collection company
that has bought the debt and the right to collect it from the original creditor.
Callers frequently ask how long does a creditor have to bring a suit against them—
isn’t there a legal time limit? The answer is there is a legal time limit and it is
called a statute of limitations. Although the amount of time is different for
different kinds of legal actions, there is a limitation period for virtually all types of
A lawsuit based upon a debt, e.g. when a financial institution sues a
borrower on an unpaid loan or credit card balance, is an action based on a
contract—the agreement to borrow the funds or obtain a credit card—and in
Michigan the statute of limitations for a contract action is 6 years. It is important
to note, however, that the 6 year time period begins running from the date of the
original agreement (the contract) or from the date of the last payment, whichever is
later. This is often confusing to a credit card holder who has an old card and a
new, increasing balance he or she has been unable to pay, possibly even for a few
years. Even though the underlying contract for a credit card may be more than 6
years old, the statute of limitations begins running from the date of the last
payment. If a legal action based on a loan or default on a credit card account more
than 6 years old has been filed against you and you have not paid on the account in
more than 6 years, it is quite likely the action will be barred by the statute of
limitations and therefore dismissed. But as in any action in which the statute of
limitations might be a defense, you have to state you are relying on the statute of
limitations as a defense in your answer to the complaint.
Other legal actions have different time period limitations. In most actions
for physical injuries where damages are sought because of the liability of another,
the usual limitation period is 3 years from the date of the incident or accident. In
legal language these actions are referred to as torts. They are “civil wrongs” (as
opposed to criminal wrongs), and frequently arise out of injuries from accidents.
Professional negligence, e.g. legal or medical malpractice, carries a 2 year statute
of limitations. Libel and slander actions must be filed within one year after the
incident complained of occurred. Some statutes of limitations contain what is
called a “discovery rule” which adds extra time onto the time limit, in cases where
the wrong is not clearly evident or discovered until later. Determining when a
statute of limitations begins can be complex and challenging. With any type of
legal action, it is important to check with an attorney to learn what specific time
period is provided.
As you can see, a statute of limitations can work two ways. If you want to
bring a legal action, you need to do so within the time limit allowed; if you are
being sued, you want to check to see if the suit might be barred by the limitation
It seldom makes sense to file a legal action within a short time of an
occurrence. It’s usually advisable to do some investigation, and perhaps in the
case of physical injury, to wait and see what the extent and nature of the injury
might be. Thinking the lawsuit through carefully can prevent it from being
On the other hand, waiting until the statute of limitations is ready to expire to
file a suit is usually a bad idea. Because witnesses disappear, evidence is
misplaced and memory fails—not to mention the pace of the legal system—it
usually makes sense to file the lawsuit as soon as the amount of damages can be
accurately calculated. Moreover, in complicated cases, the investigation and
preparation needed before filing can take time so this has to be factored in as well.
The lawyer you consult with about your proposed lawsuit will be able to determine
the statute of limitations that applies; just don’t wait too long to make an
appointment to talk with the lawyer.
You can make an appointment to talk with a lawyer at the Legal Hotline by
calling (800) 347-5297, Monday –Thursday, between 9 and 5. A Hotline lawyer
can answer your questions about statutes of limitations as well as other legal
topics. There is no charge for the service but donations are appreciated.
The information in this article is general and not intended to be a substitute
for legal advice. In any legal matter you should always consider consulting with
an attorney for specific advice.