Try to imagine yourself in this situation: once upon a time you lent some money to your friend for a period of two months, but that friend failed to repay you after expiry of the two months. You said or claimed nothing from them at the time, but now, many years later you ask them to repay but they refuse. When you bring an action against them with the people’s court, their defense is that the time limit for the action has passed. You lose the case. You appeal to the Intermediate People’s Court, and you lose the case again in the second instance. You have lost your money and your friendship, and only because you failed to exercise your rights diligently.
Yes, you may feel wronged, but, according to the Law, this is a fair judgment. Most ordinary people do not know of such a concept in law, the Statute of Limitations, or time limit for action, that exists in both common and civil law systems.
A Statute of Limitations is a statute setting out time limits for legal action in certain cases. If the period of time specified in a Statute of Limitations (hereinafter also referred to as the time limit for action) passes, and a claim is filed, the claim is liable to be rejected by the People’s Court.
The Purpose of Statute of Limitations
The reasons for specifying a time limit for exercise of rights are, (i) to protect the defendants, so that they will not be adversely affected by difficulty or failure to produce evidence due to passage of an unreasonable long period of time; (ii) to maintain the existing order and maintain the equity of law; and (iii) to simplify the legal relationship, relive the workload of the courts and reduce transaction costs.
The Specific Statutes of Limitations
The ordinary time limit for action, in accordance with Article 135 of the General Rules of the Civil Law, shall be two years except in the following cases (Article 136 of the General Rules of the Civil Law) whereby the time limit is only one year:
(i) Claims for compensation for bodily injuries;
(ii) Sales of substandard goods without proper notice to that effect;
(iii) Delays in paying rent or refusal to pay rent;
(iv) Loss of or damage to property left in the care of another person.
The longest time limit for action is described in Article 137 of the General Rules of the Civil Law as follows: “A time limit for action shall begin when the obligee knows or should know that his rights have been infringed upon”. However, the people’s court shall not protect his rights if 20 years have passed since the infringement. Under special circumstances, the People’s Court may extend the time limit for action.
Suspension and Interruption of the Time Limit for Action
A time limit for action shall be suspended during the last six months of the limitation if the plaintiff cannot exercise their right of claim because of force majeure or other obstacles. The time limit for action shall resume on the day when the grounds for the suspension are eliminated. A time limit for action shall be interrupted if suit is brought or if one party makes a claim for or agrees to a fulfillment of obligations. The new time limit shall be counted from the time of the interruption.
Everyone should bear in mind the concept of Statute of Limitations, and exercise their rights diligently in order to avoid the risk of expiry of the time limit for action. Remember the saying “The laws aid the vigilant, not the negligent.”
This article is intended solely for informational purposes and does not constitute legal advice. Although the information in this article was obtained from reliable official sources, no guarantee is made with regard to its accuracy and completeness. For more information please visit dandreapartners.com or WeChat: dandreapartners.
