The claim exists, the invoice exists, the contract is in the file. The debtor still does not pay, and years go by. In commercial debt management one of the commonest causes of lost value is not that the claim was disputed, but that no step was taken in time.
A limitation period sets the time within which a claim can be pursued through the courts and enforcement. That period is not the same for every claim: the price due under a sale of goods and a fee for services are subject to different periods, and if what you hold is a cheque or a promissory note the period is considerably shorter. Below we set out, from the legislation, how long each type of claim runs, when time starts, and what interrupts it.
Does limitation extinguish the claim?
No. The expiry of the period does not bring the debt to an end; it gives the debtor a defence. The law states expressly that a court may not take limitation into account of its own motion unless it is raised. If the debtor does not plead it, the action proceeds.
There is a further consequence: if a time-barred debt is paid, the money cannot be reclaimed under the rules on unjust enrichment. The claim therefore continues to exist in law; it simply ceases to be enforceable.
In practice the distinction means this: even where the period has run, the file is not automatically worthless — but recovery now depends on the debtor's attitude. The way to avoid that uncertainty is to track the periods from the outset.
How long does each type of claim run?
The rule is clear: unless the law provides otherwise, every claim is subject to a ten-year limitation period. The five-year period applies only to the claims listed one by one in the law.
| Claim | Period |
|---|---|
| General rule — any claim for which the law provides no other period | 10 years |
| Periodic obligations such as rent, interest on principal and remuneration | 5 years |
| Claims under agency, commission and commercial representation contracts (excluding commercial brokerage fees) | 5 years |
| Claims under works contracts (other than where the contractor has failed to perform, or performed improperly, through gross fault) | 5 years |
| Claims arising from small craft work and small-scale retail sales | 5 years |
| Claims under a partnership agreement, between partners and between the partnership and its partners | 5 years |
| Accommodation and catering charges | 5 years |
| Actions on the seller's liability for defects in the goods sold | 2 years (unavailable to a seller at gross fault) |
These periods have another feature: they cannot be varied by contract. The same prohibition applies to limitation periods laid down in legislation containing commercial provisions. A clause reciting that "the parties have agreed a limitation period of fifteen years" produces no effect. Nor can limitation be waived in advance.
Cheques, promissory notes and bills of exchange
Where what you hold is a negotiable instrument, the periods come from the Commercial Code and are markedly shorter than the general ones. They also vary according to against whom recourse is sought.
| Instrument | Against whom | Period | Running from |
|---|---|---|---|
| Cheque | The holder's rights of recourse against endorsers, the drawer and other parties liable on the cheque | 3 years | Expiry of the period for presentment |
| Cheque | Rights of recourse of one party liable on the cheque against another | 3 years | The date they paid the cheque or it was asserted against them by action |
| Bill / Promissory note | Claims against the acceptor — on a promissory note, against the maker | 3 years | Maturity |
| Bill / Promissory note | The holder's claims against endorsers and the drawer | 1 year | The date of a protest drawn up in time; or maturity where the instrument bears a "return without costs" clause |
| Bill / Promissory note | An endorser's claims against other endorsers and the drawer | 6 months | The date the endorser paid the instrument or it was asserted against them by action |
For promissory notes these periods apply not directly but through the cross-reference the law makes to bills of exchange; and because the maker of a promissory note is liable in the same way as the acceptor of a bill, claims against the maker run for three years from maturity.
The effect of interruption also differs for negotiable instruments: the law provides that on interruption a fresh period of the same length begins. Moreover an act that interrupts time takes effect only against the person in respect of whom it occurred.
When does time start to run?
Time runs from the moment the claim falls due. Where maturity depends on a notice, time runs from the day on which that notice could have been given. In calculating the period the day on which it began is not counted, and limitation is complete only once the last day has also passed without the right being exercised.
When the principal claim becomes time-barred, interest and other ancillary claims attached to it become time-barred as well. Failing to pursue the principal in time therefore takes the accrued interest with it.
In certain situations the law provides that time does not begin to run, or is suspended if it has begun. Most of these concern family and guardianship relationships; the one that matters most in commercial disputes is any period during which the claim cannot be asserted before the Turkish courts. Once the ground of suspension falls away, time begins or resumes where it left off.
What interrupts time, and what follows?
The law groups the grounds of interruption under two heads: conduct of the debtor and steps taken by the creditor.
- Where the debtor has acknowledged the debt — in particular by paying interest, making part payment, granting a pledge or providing a surety.
- Where the creditor has applied to a court or arbitrator by action or defence, has commenced enforcement proceedings, or has filed a claim in the bankruptcy estate.
On interruption a fresh period begins. As a rule it is the same length as the old one; but where the debt has been acknowledged by an instrument or established by a court or arbitral award, the fresh period is always ten years. For enforcement founded on a judgment the law sets a separate measure: proceedings become time-barred once ten years have passed since the last step taken.
Time interrupted by an action or a defence begins to run afresh after every procedural step taken by the parties and every decision of the judge during the proceedings. Where it was interrupted by enforcement proceedings, it begins to run afresh after every step taken in pursuit of the claim.
The effect of interruption on co-debtors is also regulated: interruption against one of several joint and several debtors operates against the others as well. Interruption against the principal debtor takes effect against the surety too; but interruption against the surety does not interrupt time against the principal debtor.
Does an action brought in the wrong court cost you the period?
The law provides a safety valve here. Where an action or defence has been dismissed because the court lacked jurisdiction or competence, because of a correctable error, or because it was brought prematurely, and the limitation or preclusive period expired meanwhile, the creditor may exercise their rights within a further sixty days.
This is not a general facility available on every dismissal; it is confined to the grounds listed in the law. An action dismissed on the merits does not attract this protection.
Frequently asked questions
- How long do I have against a customer who has not paid my invoice? The period is set by the underlying contract, not by the invoice. A claim for the price under a sale of goods runs, as a rule, for ten years; claims under service, works, agency and commission arrangements run for five.
- When does time start on a cheque? For the holder's rights of recourse, three years from expiry of the period for presentment.
- How long do I have against the maker of a promissory note? Three years from maturity.
- Can I extend the period by contract? No. These periods cannot be varied by agreement, and limitation cannot be waived in advance.
- The debtor made a part payment — does time reset? Part payment counts as acknowledgement and interrupts time; a fresh period then begins.
- I have commenced enforcement — does time stop? No. Proceedings interrupt time, but a fresh period begins after the interruption and renews with each step; leaving the file dormant creates risk.
- I have obtained a judgment — what is my period? Enforcement founded on a judgment becomes time-barred ten years after the last step taken.
- If the period has expired, is that the end of it? A court cannot take limitation into account of its own motion; if the debtor does not raise it, the proceedings continue. And a time-barred debt, once paid, cannot be reclaimed.
How we work on these files
When we take over a receivables file we first establish which contract type the relationship falls under and the period that follows from it, and we separately calculate the period attaching to the document you hold — invoice, contract, cheque or promissory note. Where a period is approaching we take the step that will interrupt it in good time; in proceedings already on foot we monitor the schedule of steps so that files do not lie dormant. Where a limitation defence has been raised, we assess the grounds of interruption and suspension on the documents.