The Federal and Provincial Governments have Limitation Acts which provide a limit on the time an unsecured debt can be perused by legal proceedings. If an unsecured debt is not collected, or payments are not made on the unsecured debt within these time limits, then legal action cannot be taken by the creditor or a collection agency. Only admitting to the debt in writing OR making payments of a debt resets the statute of limitations.
- British Columbia – Section 3 (5) of the BC Limitation Act sets 6 years as the limit for debt.
- Alberta – The Alberta Limitations Act sets 2 years as the term which is extended to 10 years if there is a judgement.
- Manitoba – Limitation of Actions Act, C.C.S.M. c. L150, s. 2(1)(g) sets 6 years as the limit for debt.
- New Brunswick – Limitation of Actions Act, S.N.B. 2009, c. L-8.5. sets 6 years as the limit for debt.
- Newfoundland and Labrador – Limitations Act, S.N.L. 1995, c. L-16.1, ss. 5(b); 13; 14. sets 2 years as the limit for debt.
- Nanavut – Limitation of Actions Act, R.S.N.W.T. 1988, c.L-8, s. 2(e). sets 6 years as the limit for debt.
- Nova Scotia – Limitation of Actions Act, R.S.N.S. 1989, c.258, s. 2(1)(e). sets 6 years as the limited for debt. However, within 4 years of expiry of general limitation period, court may disallow the limitation period, having regard to circumstances of the case – Listed are enumerated factors to consider including date of “discovery” of claim.
- NWT – Limitation of Actions Act, R.S.N.W.T. 1988, c. L-8, s. 2(e). sets 6 years as the limit for debt.
- Ontario – The Ontario Limitation Act of 2002 , came into force on January 1, 2004. It sets 2 years as the term (Section 4). However, this limitation will be reinstated where the debtor acknowledges the debt or makes a partial payment towards the debt. If the debt default occurred prior to January 1, 2004, the creditor will have 6 years to pursue the claim. However, if the default occurred after January 1, 2004 then the credit will just have the 2 year limit.
- P.E.I. – Statute of Limitations, R.S.P.E.I. 1988, c. S-7, s. 2(1)(g). sets 6 years as the limit for debt.
- Quebec – Civil Code of Quebec, S.Q. 1991, c. 64, art. 2925. sets 3 years as the limit for debt.
- Saskatchewan – Limitations Act, S.S. 2004, c. L-16.1. sets 2 years as the limit for debt.
- Yukon – Limitation of Actions Act, R.S.Y. 2002, c. 139, s. 2(1)(e), (f). sets 6 years as the limit for debt.
- Federal – Section 32 of the Crown Liability and Proceedings Act sets 6 years as the limit for debt. Consumers, however must be careful when dealing with the statute of limitations regarding debts at the Federal or Provincial Government level. These include student loans, child support, taxes and alimony.
In the event that a judgement has been filed against a consumer, limitations are still set of the time that judgement can be collected.
It is also important to note that limitation can be reset. Limitations begin when a cause of action arises, this is typical the date of last activity or the date of last payment, therefore if you have a bad debt and you start making payments, the statute of limitations resets.
Comments on this article are now closed as too many people where asking questions without actually reading the article. If you have been contacted by a collector and the debt is past the statute of limitations for your province, a collector cannot legally collect the debt unless:
- you admit in writing that the debt is yours.
- you start making payments.
Is that six years from the time the debt was incurred like when you got the for instance credit card?
Six years since last ever – payment received by debtors. Period.
I just got off a hook with that, and shortly after that, they sell out to CBV or the like, and they try (real hard) to get you to admit to the debt, or getting you to make a payment. Do either one of those things and you are screwed with having to pay it by admitting to the debt.
Play DUMB! What debt? I don’t owe you. Just hang up at all costs!
Trust me..they even go as far as to freeze your bank account (the one handling the debt) so you have to call them. I lucked out, and haven’t dealt with that bank since the old debt resurfaced..right on cue: 6 years, and two months. (always the same) I am currently blocking calls, because they “claim” I owe for something i last paid July 21st, 2006. That’s 6 years and a couple months until CBV called looking for someone who had a debt with unamed bank. Remember!!!
TELL THEM NOTHING OR YER BACK IN IT!! BE CAUTIOUS AND HANG UP/BLOCK THE # AS WELL. DO NOT LET THEM TALK YOU INTO HAVING TO PAY IT, IT’S YOUR RIGHT TO WALK AWAY AND HANG UP. i COULD BE SAVING YOU THOUSANDS.
I could have owed 6K all over again just by making a 1 dollar payment, or agreeing I have a debt with them.
No time for kindness, run like hell!
I have had old debts resurface as much as 10 years old. In fact I just got a letter yesterday. The letter was for a settlement offer from some collections company in Grande Prairie, Alberta. The original debt was for $24 in late movie fees! With interest its over $100. I wont pay it ever out of principal as it popped up on my credit file years ago when I renewing my mortgage which is how I found out about it. Raised our interest rates and when I got the video store to send my original contract, they didnt have one. Even after winning a privacy complaint for sharing my information with the collection company without my permission I still get the offer letters every once in a while. The movie store when out of business so obviouly the collectors bought the debt.
Check out the forum Jared, I can help you deal with this: http://www.credit-collections.ca/forum
I am trying to register so I can post to the forums for some advice but it says registration is closed. Is this site still active?
First off…..simply admitting to the debt on a phone does NOT reset the SOL. It must be acknowledged either by a payment or in writing period. That acknowledgment must be done BEFORE the SOL has expired. Nothing you do after it has expired has any effect.
Secondly making a payment does not cause the credit report to run an additional 6 years. It is 6 years from when it was first reported..
You’re wrong about this. Making a payment resets the 6 years your debt stays on your credit file. Credit files in most provinces stay on your credit file with Trans Union or Equifax for 6 years after the date of last activity, not after it was reported. That is outdated info. If you make a payment, that is considered an activity
When a collector calls and goes through a series of identity verification checks and can confirm that you are in fact the owner of the debt. If you admit to the debt it can reset the statute of limitations. All calls are recorded and its up to the collection agency as to what action to take. If you admit to a $20,000 debt then they will come after you for it. Also, making a payment DOES reset the time it’s on your credit report which in most provinces is 5-7 years from the time of last payment, or if none the date of last activity.
Got to wonder if you are a collection agent intentionally trying to fool people into slipping up on this one…TJ
If I ask a Credit agency to send me a copy of my credit report will this effect the 6 year statue of limitations.I just want to look I wont call pay or contact any creditor
The credit bureaus, Equifax and Trans Union only collect and share information about your credit history and they manage that information in accordance to Canadian/Provincial laws. By those same laws you can request a copy of that report anytime you wish which has zero impact on your credit file.
The only time the statute of limitations for a debt is reset is when you admit a debt is yours or if you start paying on an old debt.
So, after the statute’s have LONG passed, how long can these debts stay on your credit report? It seems like collections agencies could keep buying the debts from one another and keep the account live as long as they want. How do you get these expired debts off of your report?
As long as you dont start paying these collection agencies the debt should drop off automatically when the regulation reporting term expires (most is 6 years from date of last payment). If it foesnt, but you are sure the debt is over 6 years, you can contact both Equifax and TransUnion ans let them know the debt is over 6 years. It typically takes about a month to do it.
How about a legal bill showing up 3-1/2 yeas later. In Saskatchewan my daughter received a bill for 1499.00 from the firm the handled their house purchase in January 2010. My daughter & fiancée thought all Monies in trust covered all the costs as they hadn’t been billed for anything else until today. The bill arrived saying that their file had unfortunately been misplaced( in the office of the lawyer they dealt with) and in a nutshell here is the final bill for finalization. When she called to challenge receiving the bill now the office clerk said the lawyer they had dealt with recently had a stroke and she and his associate had gone through his office to clear up outstanding cases hence the bill and that three years wasn’t really that long.
Your daughter would off had to have signed some form of an agreement for costs that would outline the fees. Hopefully she can find that information. Until then, do not admit to the debt as it resets the statute of limitations. Sad the lawyer had a stroke but until he can confirm anything, who says the associate has not made a mistake.
Look at all documentation she has and then ask the associate for all documentation they have. You are looking for a signed billing agreement or anything that states a fee structure and date of service.
Hey, so turns out I had received the exact same letter as you did from the same law office after purchasing a house in jan. 2010 with the same story/amount owing…. Not to mention the monthly interest being added Just wondering how you made out with dealing with this B.S.?! I was sure someone else out there had the same problems
what if my bank suddenly put an old credit card number linked to my account without my knowledge (credit card having been over 10 years old) when I asked my bank to pay a credit card belonging to my mother, my bank put the funds towards the old credit card they linked to my account without my approval or request. It was my understanding that the 10 year old credit card debt had been written off, now a collection agency has been harassing me about the debt 2-6 times daily.
If your past credit card was issued where you still bank then they can take the funds. You won’t be able to get that money back. As for the collection agency, they are easy to deal with once you understand the laws. Next time they call, do not give any presonal information other than to verify your name. Ask the collector to provide you with all the information on the alleged debt in writing as you are disputing the debt. The collector will probably not be compliant at first, but just state that under the Fair Trade Act you are requesting ALL information regarding the alleged debt and until that is received you are disputing the debt. Also inform then that until that information is received in writing, they are no longer allowed to phone you or you will be filing a consumer affairs complaint. Be firm with the collector, but not rude. If you feel more comfortable, record the conversation.
Understand that under many of the countries Provincial laws, this debt is past the statute of limitations for collection BUT if you admit to the debt that statute of limitations is renewed, meaning they can sue you. I would need to know more about what province you are in to help you out.
To discuss this further and access more detailed information about dealing with old debts please visit this post in the forum: http://forum.credit-collections.ca/index.php?topic=12