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Dave Kennett
Dave Kennett, Attorney
Category: Business Law
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Experience:  25 years practicing law
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In Pennsylvania is there a statute of limitation for a company

Resolved Question:

In Pennsylvania is there a statute of limitation for a company (in this case an insurance company) who takes over debtor accounts from a defunct/bankrupt, to establish a legal claim to the debt? In this regard does the company have to notify the debtor in writing of their claim within given time frames or lose their right to any legal claim?
Submitted: 5 years ago.
Category: Business Law
Expert:  Dave Kennett replied 5 years ago.

Dear JACUSTOMER - PA has a 4 year statute of limitations on both written and oral contracts. So if there has been no activity on an account for 4 years then the SOL would apply. That doesn't mean they can't file a suit but it means the defendant has a defense to the suit. So it's not four years from the time the successor in interest takes over the account but 4 years from the last activity of either using or paying on the account took place.


I am assuming this is a civil debt and not a personal injury case. If it is personal injury the SOL is 2 years. They can notify all they want but if they don't file a suit within the SOL then you can raise the defense of the statute of limitations. If you fail to raise the defense you lose the defense and if you make any payments on the account the SOL starts anew. You do not have to say anything about the SOL until a suit is filed. The longer they wait the better off you are if the dates are close to 4 years.


Dave Kennett

Customer: replied 5 years ago.
What is the citation number or law reference you found your information so i can review it.
Expert:  Dave Kennett replied 5 years ago.

Here is a website that may be helpful for you to review the SOL. I cannot provide complete legal research from this website nor can I represent clients. If you are being sued you need to consult with an attorney for specific legal advice as my information is general in nature and I do not have access to all the details of a specific case or lawsuit.



Customer: replied 5 years ago.
Thanks, XXXXX XXXXX am not being sued. Just needed to confirm something I heard.
Expert:  Dave Kennett replied 5 years ago.

OK. My advice to anyone who is defending any suit for money is to always raise the SOL as a defense just in case it applies. If it isn't raised it is waived so it might as well be included. You don't have to have proof of the defense to raise it.



Customer: replied 5 years ago.
Thanks, XXXXX XXXXX am not being sued. Just needed to confirm something I heard. The question that I asked was not truely answered. In this case money was owed to an insurance company that ceased to exist. The account was taken over by a different company to whom there was no original indebtedness. Does the new company have to legally make a claim to the debt and also or by notify the debtor that they are now the "owners" of the debt and request/demand payment - and further is there a statutory time limit fot them to do so? Looking at it in another way, does the original debt to the no longer existing company cease to exist as an obligation to that compay and does the new company who acquired the debt actually become nothing more than a collection agency for that debt?
Expert:  Dave Kennett replied 5 years ago.

It depends on the relationship of the party taking over the debt. Typically debts are acquired all the time by successors in interest. The statute of limitations continues to run from the first creditor so there's no new amount of time that the successor gets to file a suit.There is no requirement to send out a notice of the transfer of the debt but if the new creditor files a suit they would have to show that they are a successor in interest. Unless I had all the details of what happened between the creditors I can't tell you the status of the successor.


If they are just a hired collection agency for an non existent business then it is possible the debt has ceased to exist but that is not generally the case.



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