Commercial Law

The Law and Limitation Periods

A strict time limit that you may not have yet heard about– a limitation period – is the time for which you are able to commence action against an individual or an organisation in a court proceeding.

This ‘time’ begins from the point when the action occurs. It is imperative to identify when a cause of action arises, as this when the clock starts running – however, depending on the case, this can often be a complex thing to determine.

Once your limitation period has passed, your claim will be solely spent defending this lapse of time. Therefore, you are better off keeping your money in your back pocket. That is why it is crucial to be proactive and seek prompt legal advice, so you can act within this time.

What are some examples of a limitation period?

To help explain, below are a few examples of limitation periods from the Limitation of Actions Act 1974 (Qld).

Examples:

  • Personal injury – 3 years from the date on which the cause of action;
  • Tort or contract without personal injury (for example, property damage or economic loss) – 6 years from the date on which the cause of action arose;
  • Rent recovery – 6 years from the date on which the arrears became due;
  • Land recovery – 12 years from the date on which the cause of action accrued; and
  • Defamation – 1 year from the date of the publication of the matter that is in question.

This is not an exhaustive list as there are many Commonwealth and State Laws which need to be considered for every individual case. Additionally, limitation periods listed are subject to change and may not apply to you and your particular issue. Be sure to seek legal advice for your own circumstances.

Why do limitation periods exist?

Limitation periods are in place for a number of reasons including: to ensure defendants are not subject to an indefinite threat of being sued, protect evidence (in particular the retention of documents and witnesses), provide certainty of exposure to liability, to have matters dealt with as quickly as possible and to improve the administration of justice.

The key to making the most of a limitation period is to be proactive and forward thinking: deal with it in the agreement, act promptly to manage it when claims arise and consider all impacts that the passage of time can have. Don’t let time slip by – know you limitation period.

Can you seek an exception for limitation period?

While it is possible to seek an extension of a limitation period in some limited circumstances, it is important to get good, and prompt, legal advice.

When do I need to get help with a limitation period?

If you fall outside of a limitation period it can be very difficult to maintain a claim. The time limits applicable for certain claims can vary depending on whether the law of the Commonwealth or a state applies to your circumstances. Therefore, limitation periods can be very dangerous for plaintiffs and you should immediately seek legal advice to avoid missing your ‘window’ of opportunity.

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