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Understanding Time Limitation Periods in Equity

Statutory periods of time limitation specifically state how long a party has to bring a claim for breach. Most legal claims become statutory barred after six years. However, in cases of equitable claims there are no stipulated limitation periods. Therefore, the statutory time limitation by analogy applies. Courts will consider the cause of action at law that is most corresponding to the action in equity and apply the statutory limitation to it. But here, the time limitations are not absolute. The courts will not bar the claim by analogy where the circumstances of the case would be inequitable to do so.

In The Duke Group Ltd (in liq) v Alamain Investments Ltd [2003] SASC 415, Doyle CJ stated that “before applying the statutory time limit by analogy, I must be satisfied that in all the circumstances it is just to do so”

In Hewitt v Henderson [2006] WASCA 233, Buss JA stated that the authorities “support the proposition that equity will not apply a limitation period by analogy where there are circumstances which make the application of the statute unconscionable”

To summarise, parties should not assume that their claim is time barred just because six years have passed from the day of breach. If the conduct was dishonest or in bad faith a longer period may well apply.

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