LIMITATION LAW: AN ACTION BEING STATUTE-BARRED OR NOT
In Nigeria, a limitation law, also known as a statute of limitations, sets a specific time frame within which a lawsuit can be filed. When this time frame expires, the right to seek judicial enforcement is extinguished, leaving the claimant/plaintiff with a bare and empty cause of action that can not be enforced.
Limitation Laws, such as the Federal Capital Territory Limitation Act, 2007, and also, some state Limitation Laws have set out various limitation periods for actions on contract, tort, and land claims. Before an action can be said to be statute-barred, the starting point is always to identify which statute governs the cause of action at hand.
This legal write-up shall be guided by a decision of the Supreme Court in the recent case of ETHIOPIAN AIRLINES V. POLARIS BANK LTD. (2025) 6 NWLR (PT. 1987) 451, where the five learned Justices of the Apex Court extensively adjudicated on the concept of Limitation Law, and particularly on determining whether an action is statute-barred or not.
Now, what is a Limitation Law, and what does it mean to say an action is statute-barred by limitation law?
In the above case, the Supreme Court held that: “Where a statute prescribes a time-bar within which an action should be commenced, such a legislation bears the name of a limitation law. If an aggrieved person exhibits tardiness by suing his wrongdoer outside the statutorily allowed time-bracket, his action is usually declared as statute-barred. Thus, a cause of action is statute-barred when no proceedings can be brought to enforce it because the period laid down by the limitation law has expired by effluxion of time.”
Limitation laws are not just enacted for mere formalities but for adequate and proper reasons. The Supreme Court went further to state the reasons for limitation law: “The raisons d’etre for limitation law are: to ginger up aggrieved persons to be vigilant; to discourage cruel actions; and preserve the evidence by which defendant will defend the action. Its other purpose is ingrained in the Latin maxim: interest recipublicae ut sit finis litium – it is in the interest of the state that there be a limit to litigation.” This ensures that disputes are resolved within a reasonable timeframe, preventing stale claims and preserving fairness to defendants.
A simple summary of the complex fact of the above case leading to institution of the statute-barred action against the Respondent (Defendant at the trial court), and the Appellant’s further appeal to the Supreme Court against the concurrent findings of the trial Court and the Court of Appeal is that:
The appellant commenced a suit against the respondents jointly and severally at the High Court of Lagos State by a writ of summons and a statement of claim filed on 19th November, 1996. The appellant claimed N447,000 as value of a bank draft and N5 commission on the draft, which the appellant alleged the 1st respondent negligently issued to the 2nd respondent, but was debited against the appellant’s account. The appellant also claimed damages and interest on the various sums of money claimed in the suit.
The appellant pleaded in its statement of claim that it maintained one account with the 1st respondent and another account with 2nd respondent. On 2nd April 1990, the appellant instructed the 1st respondent to issue a bank draft in the sum of N447,000 to the order of the appellant and that the draft should be paid into the appellant’s account with the 2nd respondent. But the 1st respondent erroneously issued the draft to the order of the 2nd respondent and delivered it on 4th April 1990 to the 2nd respondent who acknowledged it by endorsing its stamp thereon. Subsequently, while the appellant was reconciling its account at its head office in Addis Ababa, Ethiopia, it discovered the error and it wrote to the 1st respondent to demand for clarification about the wrong payment without any effective result. So, it filed the suit. The appellant, however, did not specifically plead when it discovered the error made by the 1st respondent.
The 1st respondent denied liability by its statement of defence. It also filed an application for dismissal of the suit for being statute-barred, and the appellant filed a counter-affidavit in opposition to the application. After hearing arguments on the 1st respondent’s application, the trial court held that the appellant’s suit was statute-barred under section 8(1) of the Limitation Law, Cap. 118, Laws of Lagos State, 1994, and dismissed the suit.
The appellant appealed the decision to the Court of Appeal, and the Court of Appeal dismissed the appellant’s appeal. In determining the appellant’s further appeal, the Supreme Court considered section 8(1)(a) of the Limitation Law, Cap. 118, Laws of Lagos State, 1994, and also dismissed the appeal, unanimously.
The trial Court and the Court of Appeal relied on the Limitation Law, and the trial Court struck out the suit for being statute-barred by the Limitation Law, whereas the Court of Appeal further affirmed the decision of the trial Court. The Appellant, still dissatisfied, appealed to the Supreme Court.
On determining whether an action is statute-barred or not, the Supreme Court stated that:
“In determining whether a limitation law applies, a court is enjoined to examine the filed writ of summons/the originating process or statement of claim either of which will showcase when the cause of action was disclosed in it, and compare with the period stipulated in the limitation statute within which to sue. If the date of filing in the matter is beyond the period allocated by the limitation law, then it is statute-barred. Conversely, if the time limit comes within that permitted by that law, then it is not statute-barred.”
The Supreme Court also stated the documents court looks at in determining issue of limitation of action, thus: “A statement of claim is the macro process to be used by the court as an index to measure the presence or absence of its jurisdiction in relation to limitation law. In an action commenced by dint of an originating summons, the affidavit in support serves as the statement of claim.”
The Supreme Court, in this case, emphasized on the importance of determining whether an action is statute-barred or not by the specific date when the cause of action arose, ascertaining the date the writ of summons was filed, and identifying the statutory period applicable to that cause (e.g., six years for simple contracts). If the interval between the accrual and commencement dates exceeds the prescribed period, then the action is statute-barred. Courts apply this yardstick strictly, dismissing late suits even if the underlying grievance is valid.
On when time begins to run in limitation law, and particularly in contract for purpose of limitation law, the time typically begins on the date the cause of action accrues, when the wrongful act occurs or the claimant sustains loss. To this effect, in the instant case, the Supreme Court held that: “For purposes of limitation statutes, a cause of action begins to run on an encroachment of a party’s right and the existence of a person to be sued (the violator) to protect the encroached right. And in a contract, time starts to run the moment there is a breach of it by an adversary.”
It is important and worthy to note that the timeframe of limitation period varies, depending on the type of claim, such as:
Contractual claims: 6 years from the date the cause of action accrued.
Tort claims: 6 years from the date the cause of action arose.
Land recovery: 12 years from the date of accrual.
Defamation claims: 1 year from the date of the defamatory act.
Claims against public officers: 3 months from the date of the act, neglect, or default complained of.
Furthermore, on the limitation period for action founded on simple contract, the Supreme Court held that: “Section 8(1) of the Limitation Law, Cap. 118, Laws of Lagos State, 1994 states that actions founded on simple contract shall not be brought after the expiration of six years from the date on which the cause of action accrued. In this case, the appellant’s suit is based on a simple contract. The appellant’s cause of action accrued on 4th April 1990, and the appellant filed its suit on 19th November 1996. By the Gregorian calendar computation, from 4th April 1990 to 19th November 1996 was a period of about 6 years and 6 months, which is in excess of the time-frame stipulated by section 8(1) of the Limitation Law. In other words, the appellant’s suit was not commenced within the mandatory time prescribed by section 8(1) of the Limitation Law. The consequence is that the appellant’s cause of action, which accrued in its favour on 4th April 1990 had become statute-barred before its suit was commenced on 19th November 1996, and the appellant had no right of action at the time it instituted its suit.”
At the trial Court, the Respondent made a successful plea of statute-bar to the action of the Appellant as a consequence of filing outside the limitation period. On a successful plea of statute-bar, the courts will strike out or dismiss the action, extinguishing the claimant’s judicial remedy. Therefore, no equitable considerations entitle the claimant to relief once time has run; limitation laws are of strict liability. To this effect, it was the holding of the Supreme Court that: “A successful plea of limitation law, as a shield, by an opposing party occasions two harmful effects against a claimant’s action. First, the claimant becomes disrobed of the right of action and judicial relief. In other words, it extinguishes his cause of action. Second, the court ceases to be crowned with the requisite jurisdiction to entertain his action. In this case, there was a successful plea of limitation law with its attendant consequences on the competence of the appellant’s suit.”
Additionally, although limitation statutes are stringent, Nigerian law recognizes some key exceptions to it. Therefore, limitation periods can be tolled or extended in certain circumstances, such as: Fraudulent concealment, Disability (mental incapacity or unsound mind, infancy/minor, confinement), Continuing damage or injury, Statutory exclusions, etc. These exceptions are there to ensure fairness where rigid timelines would otherwise bar deserving claims.
By way of conclusion, an action is considered statute-barred when the period laid down by the limitation law has expired, and no proceedings can be brought to court. When determining whether an action is statute-barred, the court will consider the date of accrual of the cause of action, the date the suit was filed, and the statutory period applicable to that cause. Where such action is found and determined to be statute-barred, the claimant can no longer pursue their claim through the judicial process, and the court will refuse to hear the case.
About the Author:
Hisbullah Sarkibaba is a member of Research and Litigation Directorate, Solace Chambers, Bayero University, Kano. He can be reached via +2348163807626, and email: hisbullahsarki@gmail.com
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