Business Lawyers Blog
Every state imposes specific time limits for filing a civil lawsuit, known as the statute of limitations. In Texas, it’s easy to miss a filing deadline by not adhering to these rules. This is where the guidance of an experienced Texas business litigation attorney becomes crucial. At Structure Law Group, we can inform you of the applicable statute of limitations and ensure your case is filed on time.
How Long Do You Have to File a Lawsuit?
It is important to understand that Texas does not have a single statute of limitations. Chapter 16 of the Texas Civil Practice and Remedies Code contains several limitations periods. Some of the more pertinent statutes that a Texas business should know about include:
- There is a 2-year statute of limitations for personal injury claims. Let’s say someone is injured in a traffic accident caused by one of your employees driving a company-owned vehicle. The victim would normally have 2 years from the date of the accident to sue your business in a Texas court.
- The statute of limitations for lawsuits arising from a breach of contract, debt, fraud, or breach of fiduciary duty is 4 years. Contracts involving the conveyance of real property must be in writing.
- The statute of limitations is just 1 year for a claim based on libel or slander.
With respect to business debts, when the clock starts to run on the statute of limitations depends on the nature of the debt. For example, if you have a “debt on account,” i.e., a customer who purchases goods from you on an open line of credit, the limitations period typically starts to run from the date of the last payment. So, if the customer were to make a partial payment, the clock would start to run again.
In some cases, a court may also toll or suspend the statute of limitations if there is proof that a party acted fraudulently. For instance, if you are a party to a contract and the other side fraudulently concealed their breach for several years, you might still be able to file a lawsuit even if you did not discover the breach until after the four-year limitations period expired.
Can You Modify the Statute of Limitations by Contract?
Many business contracts include language reducing the statute of limitations in the event that either side alleges a breach. Under Texas law, a contract usually cannot reduce the limitations period to less than 2 years. However, there is an exception for contracts involving the sale of a business where one party pays or receives at least $500,000. There are also cases under the Texas Uniform Commercial Code where the limitations period may be reduced to as little as 1 year.
If you have additional questions about the statute of limitations and how it may affect you or your company’s rights under the law, please consult with a Structure Law business litigation attorney from our Austin office. Call SLG today at (512) 881-7500 or contact us online to schedule a consultation.