The Limitation Act Contract Rules are a set of regulations that govern the length of time that parties have to bring causes of action in order to receive legal redress. The rules apply to contracts, torts and other legal disputes between individuals or companies. They also apply to disputes between individuals and the government, but there are some exceptions that we’ll cover later on in this blog post.
A Contract is said to be a Limitation Act contract
A Contract is said to be a Limitation Act contract when a person undertakes, as a surety, to pay the debt of another person, provided that the principal debtor shall pay it within a certain time. In such cases, if the principal debtor does not pay his debt within this given period of time then the surety will be liable for it and must bear all its consequences.
In case of suretyship, the principal debtor is called a debtor, and the person who undertakes to pay his debt is called a surety or guarantor.
The Limitation Act Contract Rules do not include contracts for payment of interest or contracts for indemnity where some other person is liable for interest on such indemnity. The Limitation Act Contract Rules are explained in detail in the article ‘Limitation Act Contract Rules’.
For contract damages, the time frame starts when the damages are incurred
In a contract claim, the time frame starts when the damage is incurred. This means that even if you don’t discover your loss (or decide to make a claim) until several years later, your right to sue for damages doesn’t expire during this period of time.
The limitation act contract begins on the day that you incur your loss. For example, let’s assume that you have an oral contract with another person where they will pay you $12,000 in return for your services as a lawyer over three months. You begin work and complete half of it before deciding not to continue doing so because you feel like they aren’t paying enough attention to their end of things. Let’s also assume that two years pass before either party decides anything about this contract other than continuing their business relationship as normal (i.e., both parties continue working together).
In our scenario above
If after two years from when these terms were agreed upon but before any further action has been taken by either party regarding this agreement does something happen where one side incurs new costs due to negligence or breach of contract (such as losing money due to poor performance), then he or she would still be able to make a claim under Section A(2)(a) because although he/she didn’t know about those losses until now they were incurred within those two years.
If after five years from when these terms were agreed upon but before any further action has been taken by either party regarding this agreement does something happen where one side incurs new costs due to negligence or breach of contract (such as losing money due to poor performance), then he or she would not be able because although there was enough time between when these events happened and when they did so again which would give him/her sufficient opportunity it wasn’t actually necessary since nothing changed.
There are specific rules for different types of contracts
The Limitation Act Contract sets out the time limit for bringing court action in relation to different types of contracts.
For example, if you have an agreement with a builder and want to take legal action against them for breach of contract, there is a two-year limitation period (from the date on which the breach occurred) and no extension is available unless your claim arises from death or personal injury. However, where your claim can be shown to arise from death or personal injury then there is no time limit so long as you make your claim within three years from when it first arose.
In contrast however if you are claiming under an insurance policy such as home contents insurance then there is a six-year limitation period, but this can be extended by up to six months if certain conditions apply (for example where fraud has been committed).
The Limitation Act Contract Rules do not include contracts for payment of interest or contracts for indemnity where some other person is liable for interest on such indemnity. For contract damages, the time frame starts when the damages are incurred.