Valid claims may lose a significant amount of their value if they are brought too late. If a claim is time-barred, the debtor may invoke the limitation period and refuse to fulfil the obligation.
For businesses, therefore, a structured overview of deadlines is worth its weight in gold.
What does the statute of limitations mean?
The limitation period does not mean that a claim automatically lapses. Rather, once the limitation period has expired, the debtor is granted a Right to refuse to perform. The claim may therefore become virtually worthless in economic terms if the debtor raises the defence of the limitation period.
Two questions in particular are crucial:
- What is the limitation period for this specific claim?
- When does this period begin?
Why the deadlines vary so much
Not every claim is subject to the same limitation period. In addition to the standard limitation period, there are numerous special statutory provisions.
Statute of limitations
The standard limitation period is three years. It generally commences at the end of the year in which the claim arose and the creditor was aware of the circumstances giving rise to the claim and the identity of the debtor, or should have been aware of them had it not been for gross negligence.
Special deadlines
Different limitation periods may apply under the law of sale, the law of contracts for work and services, or the law of construction. There are also special provisions for certain claims for damages or enforceable claims, some of which involve significantly longer limitation periods.
Suspension and recommencement of the limitation period
Even whilst a limitation period is running, its expiry date may change.
Negotiations between the creditor and the debtor may suspend the limitation period. The assertion of a claim through the courts, for example by bringing an action or, under certain conditions, by means of a payment order, may also lead to the limitation period being suspended.
This should be distinguished from the Restart of the limitation period. This may occur, for example, if the debtor acknowledges the claim by making a partial payment or in some other way.
Typical risks in practice
The following often lead to the loss of entitlements:
- overlooked or incorrectly calculated deadlines
- unclear knowledge of the claim and the debtor
- delayed initiation of legal proceedings
- lack of documentation of negotiations
- an inaccurate assessment of inhibition or a fresh start
Practical tip: Actively monitor deadlines
Outstanding debts and potential claims should systematically recorded and monitored . Companies should not wait until shortly before a deadline to assess what measures are required.
By keeping an eye on limitation periods at an early stage, you can take steps to suspend the running of the limitation period in good time and avoid unnecessary financial losses.
Conclusion
The limitation period often determines whether a claim can still be enforced in economic terms. A structured approach to time limits protects companies from avoidable losses.
Particularly in the case of larger claims or complex matters, it is therefore important to assess the situation at an early stage, what the deadline is, when it expires, and what steps are required to safeguard the entitlement.
If you have any questions on this or other topics, please contact us - we will be happy to advise you.
to the contact form