Adjustments to the Ticking Clock: Important Updates to the Statute of Limitations Laws in Ohio

Adjustments to the Ticking Clock: Important Updates to the Statute of Limitations Laws in Ohio

Ohio, as do all states, sets time limitations on how long you can wait to file legal action against a person or entity. Many legal claims have this ticking clock known as the “statute of limitations.” Failure to file a claim within the specified limitation period may have the effect of barring or nullifying the action. The Ohio Revised Code provides a series of statutes for this purpose in Chapter 13 and 23. Some statutes set forth dates by which you must file and action, while other dates are dates of expiration and these limitations differ based on the cause of action or type of agreement. Last June, the Ohio legislature passed a new law which shortened the statute of limitations for contract from 15 years to 8 years. The new law became effective in September and applies retroactively to causes of action that accrued prior to September 28, 2012. Specifically, the law provides that “an action upon a specialty or an agreement, contract, or promise in writing shall be brought within eight years after the cause of action accrued.”

This change, however, did not impact other of limitations for bringing other actions arising under contract. The 6-year statute of limitations still applies to contracts not in writing, or oral contracts, and also upon liability created by statute. This limitation is also applicable to claims raised under collective bargaining agreements. Also left unchanged was the 4-year statute of limitations applicable to contracts for the sale of goods. However, in the original agreement for contracts for the sale of goods, the parties may reduce the period of limitation to not less than one year (but may not extend it).

In addition to contract actions, various other agreements, liens and judgments are subject to time limitations for enforcement including:

  • Collection on Accounts - If you keep running accounts, you have 6 years to file an action. Note that this is the same as your time limit for an oral contract. Therefore, it is important to obtain a written contract setting balance limits, guarantees or other issues relating to the sales of goods and/or services.
  • Promissory Notes - An action to enforce the obligation of a party to pay a note payable at a definite time needs to be brought within 6 years after the due date or dates stated in the note. If, however, a due date is accelerated, then it must be brought within six years after the accelerated due date.
  • Dishonored Checks and Drafts - There is a 3-year limitation. However, this does not apply to the bank where you presented the check or the bank upon which the check was drawn. The bank’s liability is set forth by separate statute that outlines limitations on their liability.
  • Mortgages - A mortgage that has been recorded on a property and note release, but then left alone without some action to contest it or have it removed automatically expire after 21 years.
  • Mechanic’s Lien - This type of lien is valid for 6-years. The lien is not renewable. Therefore, you must take action to foreclose within 6 years or lose your rights related to that realty. A mechanic's lien has a limited life. Six years after filing the lien, the lien expires unless the lien claimant has initiated a lawsuit to foreclose the lien.
  • Judgment Liens - A judgment lien must be renewed every five years. This lien will only be enforceable as long as the judgment is in force. Note, although a judgment is valid for 21 years, a lien recorded pursuant to that judgment must be renewed every 5 years.
  • Ohio State Liens - This type of lien is valid for 15 years and is renewable if the renewal is filed within 6 months of the expiration of the lien.
  • Federal Judgment Lien - This lien is effective for 20 years and is renewable.
  • UCC Financing Statements - These are generally valid for 5 years after the date of filing. However, if filed in connection with a public-finance transaction or manufactured-home transaction is effective for a period of 30 years after the date of filing if it indicates that it is filed in connection with a public-finance transaction or manufactured-home transaction.

With all claims and causes of action it is important to know the statute of limitations time limit that will apply and be certain to exercise your rights within that time.

 

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