Legal Question in Business Law in California

Re: Statute of limitations on billing for old receivables

The statute of limitations for breach of an oral contract is two years; for a written contract, generally four years. The time begins to run from the time of the breach, not the date of the contract.

The time limit can, in effect, be extended by tendering bills which are neither paid nor disputed.

As a practical matter, nothing prevents a creditor from sending out bills for old debts; you simply can't successfully sue. However, the older a bill gets, the lower your chances of obtaining voluntary payment.

Your first step should be to prepare and send well-documented and easily understood billing. See what kind of voluntary payment you get. Then send periodic reminders. If so inclined, then you could follow up, observing the statutes of limitations, with suits based upon both the breach of the original contract and for "account stated" for failure to pay an undisputed bill.

The individuals from whom you'll be trying to collect may have various defenses including some based upon the hospital's failure to render timely (monthly) bills. I can't predict who wins.

Re: Statute of limitations on billing for old receivables

the statute of limitations, if an ORAL agreement would be two years. if written, four years. if the debtors have paid during those periods, the period would start again from their last payment.

i would expect, however, some difficulty in collecting based on the age of these obligations, and you will, no doubt, get some folk who will base their defense on the failure to bill. a lot will depend upon how well you keep records of the charges.

Re: Statute of limitations on billing for old receivables

How well are the records kept. Oral agreement statute of limitations is two years, written agreement, four years.