How Long Do You Have to Sue Over a Business Contract in Georgia?

Six years: simple written contracts

If your agreement is in writing and signed, Georgia allows six years to bring an action on it under O.C.G.A. § 9-3-24. That is the longest of the ordinary business-dispute periods and it covers most of what a contractor or small-business owner would think of as a contract: a signed proposal, a subcontract, a supply agreement, a services contract.

Six years sounds generous, and it is — right up until the moment you realise the clock has been running since a breach nobody flagged at the time. A job that went sideways in year one does not get a fresh start because the relationship limped along for another two.

Four years: oral agreements

An agreement that was never reduced to writing carries a four-year period under O.C.G.A. § 9-3-26. In the trades this is more common than people admit — work added by phone, a scope change agreed on site, a price adjusted in a conversation nobody wrote down.

The shorter period is only half the problem. The other half is proof: two years after the fact, the argument is rarely about the law. It is about whose account of the conversation a jury believes.

Four years: open accounts

An open account — a running balance where you supply goods or services over time and bill as you go — also carries four years, under O.C.G.A. § 9-3-25. Suppliers, materials dealers and service businesses that invoice a repeat customer month after month are usually in this category rather than the six-year one.

This is where a lot of businesses get caught. The customer has been on the books for years, the relationship feels like a contract, and the assumption is that the longer period applies. It often does not.

Twenty years: the seal nobody notices

There is a fourth period, and it catches people out in both directions. Under O.C.G.A. § 9-3-23, an action on an instrument under seal must be brought within twenty years after the right of action accrues — more than three times the ordinary written-contract period.

The statute is strict about what qualifies: no instrument is considered under seal unless the body of the instrument says so. A stray "(SEAL)" beside a signature line, with nothing in the text of the agreement reciting that the parties are signing under seal, does not on its own convert a six-year contract into a twenty-year one.

Both halves of that matter. If you are chasing an old obligation, the agreement is worth reading for sealing language before you assume six years has run. If you are the one being chased, the same reading tells you whether the other side's twenty-year theory actually holds.

When does the clock actually start?

Generally, at the breach — the moment performance was due and did not happen. Not when you discovered it, not when the customer stopped answering, and not when you finally decided to do something about it.

That matters most on a job that ended badly but slowly. If the payment was due in March and never came, the period usually runs from March, even if you spent the following eighteen months trying to work it out.

• Unpaid invoice: generally from the date payment was due under the agreement.
• Defective work: generally from the breach, though construction defect claims have their own rules worth separate advice.
• Ongoing account: from the transaction or balance in question, which is why old line items can drop off while newer ones survive.

What can restart the clock

Georgia recognises that a debtor can revive a stale obligation. A written acknowledgment of the debt, or a partial payment on it, can restart the limitation period rather than merely pausing it.

In practice this is a useful tool and a fragile one. If a customer tells you on the phone that they know they owe you and will get to it, that conversation is worth very little later. The same statement in an email or on a signed payment plan is worth a great deal. When a slow-paying customer starts making noises about catching up, get it in writing while they are still willing.

Why the category is harder than it looks

Business deals rarely arrive as one clean document. There is a proposal, an email confirming it, a purchase order with different terms on the back, three change orders and a run of invoices. Which of those the court treats as the contract can decide whether you are working with six years or four.

That is also why the answer to "is it too late?" is worth getting early rather than at the end. A dispute that is comfortably within time on one theory can be out of time on another, and the difference is often a document somebody did or did not sign.

A lien deadline is not the same deadline

On construction work there are two clocks running, and the short one is not the one this post is about. A mechanic's or materialman's lien has its own filing and enforcement deadlines that are measured in months, not years, and missing them does not extinguish the underlying contract claim — it removes the security that would have made the claim worth collecting.

So a supplier who has blown the lien deadline may still have four years to sue on the open account, and a subcontractor who has blown it may still have six on a signed subcontract. That is a much weaker position, but it is not nothing. If you are looking at an old unpaid job, work out both timelines rather than assuming the lien deadline was the whole answer.

What to do if you think a deadline is close

• Pull the whole paper trail — proposal, emails, purchase orders, change orders, invoices and any payment records. The documents decide the category.
• Date the breach as precisely as you can. Not when the relationship ended; when the obligation was first not met.
• Look for anything in writing where the other side acknowledged the debt or paid part of it.
• Do not let a settlement conversation run the clock out. Talking does not extend a limitation period on its own.
• Get advice before the shortest plausible period expires, not before the longest one.

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