8 Deadlines That Decide Whether a Collection Claim Survives
New York Statute

Time bars a claim only where nothing later revived it. That single condition explains why limitations fights turn less on arithmetic than on paper, and why merchants should let counsel read the file before signing anything new.

This article sets out eight New York deadlines that decide whether a collection claim survives. The eight are checkpoints rather than holdings. Characterization, accrual and tolling belong to independent counsel throughout, and no section below promises that any particular debt is dead.

The Six Year Contract Rule

Where the claim sounds in contract, the statute gives the creditor six years. An action on a contractual obligation or liability, express or implied, must be commenced within that period under the six year contract limitations statute, subject to stated exceptions. Most MCA collection suits arrive dressed as contract claims. Counsel reads and construes the paper to confirm the subdivision fits, because the label on the caption does not decide the limitations question.

The six year period is extremely generous to early filers and extremely harsh to those who sleep. Accrual sets the start, and accrual is where counsel begins, not where this article can end.

Sealed Instruments

A sealed instrument carries its own six year period. Most MCA papers carry no seal, though no registry of MCA seals exists to confirm the negative in any given file. There are exceptions, though in practice they narrow rather than widen. Counsel checks the execution formalities rather than assuming the general contract rule, because the subdivision follows the form.

Mortgage Notes and the Acceleration Fight

Often we see the limitations battle move from the calendar to the history of the loan itself. Bonds and notes secured by a mortgage on real property carry a six year period, and where the defense rests on a claim that the instrument was accelerated by an earlier action, the creditor is estopped from denying valid acceleration unless that earlier action ended in an express judicial determination, made on a timely defense, that no valid acceleration occurred. The mirror rule binds the borrower seeking cancellation of record on the ground the period has not run.

The practical lesson is documentary. Counsel reconstructs demand letters, filings and dismissals before advising that any mortgage linked business debt is out of time, because acceleration works backward and memories of it do not.

Fraud and the Discovery Extension

Fraud buys time on both sides of the dispute. An action based on fraud must be commenced within the greater of six years from accrual or two years from the time the claimant discovered the fraud or could have discovered it with reasonable diligence. A time barred file can arrive at counsel with a cover letter that ignores the calendar. Some complaints dress contract claims in fraud language in order to reach the discovery rule, and the diligence proviso is where counsel tests whether the costume fits.

The clock starts when the law says it starts, not when the merchant first hears from a collector. That sentence belongs at the end of this article and earns its place here instead, because everything after it concerns ways the clock restarts.

The Catch All Backstop

The statute keeps a drawer for claims no specific period covers. An action for which no limitation is specifically prescribed must be commenced within six years, the way an unlabelled drawer in a desk collects everything without a folder. Characterization decides which subdivision governs, and characterization belongs to counsel.

The Goods Carve Out

Goods change the analysis. The contract subdivision excepts transactions governed by the uniform commercial code article on sales, among other carve outs. Where the debt arises from the sale of goods rather than from an advance against receipts, a different limitations article may govern, and the label on the agreement, if we are being precise, does not decide which article applies. Counsel classifies the transaction before counting.

How often goods classification moves an MCA limitations fight is not measured anywhere we have found. Whether the drafters meant goods sellers to live under a different clock is a question the statute leaves open, and counsel answers it file by file.

Signed Writings That Revive

Read every signature line twice. Under the signed writing revival rule, an acknowledgment or promise in a writing signed by the party to be charged is the only competent evidence of a new or continuing contract capable of lifting a limitations bar. Balance confirmations, settlement letters and restated promises all go into the file counsel reviews for revival effect. Any acknowledgment, even casually worded in a message thread, counts as a candidate. Resist the urge to sign the confirmation the collector sent with the settlement offer, or to initial the statement, until counsel has measured what the signature revives.

The merchant decides whether to sign or to decline, and counsel ensures the signature line stays blank until that decision is informed. A revived debt sues as a new promise, which is why collectors prize fresh paper above old files.

The Ten Year Enforcement Tail

A judgment already entered faces its own calendar. An action on a New York money judgment lies only between the original parties where a decade has run since first docketing, with suit permitted in the year before expiry, among other narrow gates, under the judgment renewal provisions. Counsel calendars that window alongside the original limitations period, because collection files outlive the claims that birthed them.

Payments and the Separate Inquiry

Money paid on an old balance speaks, though no one agrees on what it says. The revival statute preserves the effect of payments of principal or interest without defining it, so whether a part payment alone lifts the bar, and how settlement talks are treated, present counsel questions rather than rules. The statute refuses both shortcuts at once. Whether a small payment restarted the clock is a question for counsel, and no debtor should assume only signed writings matter.

Counsel Review Before Anything Is Signed

I have yet to see a limitations defense won on arithmetic alone. The paper matters more in every file, which is why the review starts with every writing since the last payment: the agreement, the statements, and the messages exchanged in between. Delancey Street, a settlement company and not a law firm, turns that review into negotiation through a confidential settlement review at no charge, while independent counsel calculates and applies the period and guards the signature line. Simply bring the whole file to the first conversation, and ensure nothing new is signed in the meantime, even briefly, without counsel present.

Calendars favor the side that reads them. The merchant who learns which deadline governs, which writing revives and what a payment means negotiates from ground the collector cannot shift, and ground that holds is the entire object of the exercise.