Texas Bill Collection Statute of Limitations

A statute of limitations in civil cases sets a deadline by which a lawsuit must be filed. If a creditor or bill collector's lawsuit is filed beyond the deadline, the debtor is entitled to defend himself by asserting the statute in court. The time period for the statute of limitations in Texas depends on the type of lawsuit that is filed; however, for debts resulting in bill collection cases the limitation period is usually four years.

Bill Collection

Texas collection lawsuits based on bills for goods or services are governed by the statute of limitations set forth in the Texas Civil Practice and Remedies Code Section 16.004. The limitation period begins to run four years from the date a "cause of action" accrues -- which is generally defined as when the debt is declared in default. The four-year statute of limitation applies to any debt payable in cash regardless of whether the debt is based on a written or oral contract, or from an open-end account, such as a credit card.

Judgments

A collection lawsuit that is timely filed and made into a judgment effectively resets the statute of limitations on the debt. As a rule, a Texas judgment is valid for 10 years from the date it was made. Within that 10-year period, the judgment creditor can obtain a writ of execution from the court to use such collection methods as wage garnishment and bank account levies. From the date the writ of execution was issues by the court, the judgment debtor has another 10 year to collect on the judgment. A judgment creditor can effectively keep the judgment valid indefinitely by obtaining a new writ before 10 years expired on an old writ. However, if no writ is issue in a 10-year period of time, the judgment is considered dormant.

Reviving Judgments

A unique aspect of Texas law is the possibility of reviving a dormant judgment after 10 years lapse without a writ of execution being issued or the judgment otherwise satisfied. From the date the judgment became dormant, the judgment creditor has two years to file an action with the court requesting that the judgment be revived. If the court grants the judgment creditor's request, a new 10-year limitation period will begin.

Debts Incurred Prior to Texas Residency

Texas law also imposes a special statute of limitations on debts incurred by a person prior to becoming a Texas resident. Texas Civil Practice and Remedies Code Section 16.067 prohibits a creditor or bill collector from suing a Texas resident for a debt that was incurred in another state and is barred by that state's statute of limitations. For example, some states impose a two-year statute of limitations on oral contracts and credit card debts. Even though such a debt may not be expired under the four-year statute in Texas, no lawsuit can be pursued on the debt in Texas if the two-year statute already expired.