Limitation: how far back can a business claim, and why waiting is expensive

The single most common reason a viable commission claim fails is that it was brought too late.

The basic position

Under the Limitation Act 1980, the general period for a claim in contract or tort in England and Wales is six years from the date the cause of action accrued. For a commission claim, that is ordinarily taken from the date the contract was entered into, though the analysis varies with how the claim is framed.

Deliberate concealment

Section 32 of the Act can postpone the start of the period where a fact relevant to the claim has been deliberately concealed by the defendant. The period then runs from the date the claimant discovered the concealment, or could with reasonable diligence have discovered it.

Undisclosed commission claims frequently engage this provision, which is why claims relating to contracts older than six years are still brought. But section 32 is argued, not assumed. Defendants contest both the concealment and the date of reasonable discoverability, and the burden is on the claimant. Treating it as a safety net is a mistake.

Scotland and Northern Ireland

Scotland operates a five-year prescriptive period under the Prescription and Limitation (Scotland) Act 1973, with its own rules on discoverability. Northern Ireland has its own limitation legislation. If your business is based outside England and Wales, take advice on the position that applies to you.

The practical point

Every month that passes takes another month of contract history outside the ordinary six-year window. For a business with several historic contracts, the earliest and often the most expensive ones are the first to fall away.

There is also an evidence dimension. Suppliers and brokers do not keep records indefinitely. Emails are deleted, staff leave, brokers dissolve. A claim that is straightforward to evidence today can be difficult to evidence in three years, quite apart from limitation.

If you think a claim exists, the sensible step is to establish the dates now, even if you do nothing further for the moment. Knowing which contracts are still in time is free.