A limitation period is a law that sets a specified period within which a party must file an appeal (or, where applicable, arbitration). If the appeal is not lodged within the time limit indicated, it is time-barred. Each State has limitation periods covering different situations and the periods vary from state to state. For example, in Illinois, the deadline for filing a lawsuit regarding construction, including planning and physical labor, is currently four years from the original date of the complaint. Time begins (is due) if the party knows or must know that it has been damaged. Sometimes it takes time for an action to happen because the party doesn`t even know something is wrong. For example, a homeowner of a newly built home can only discover a roof leak three years after construction is completed. A mortgage trust company sued the mortgage for misrepresentation and guarantees. The contract between the parties contained a provision that a breach of the warranty right would occur only when the infringement was discovered or disclosed and the injuring party was unable to remedy it following a request from the seller. In the absence of that clause, the limitation period for a right to the guarantee would begin with the closing date of the loans. Confirm that the state law applicable to your contract allows for a reduction in the limitation period in your circumstances. Unless otherwise specified, obligations under this Agreement shall last only six (6) months unless a document signed on the closing date provides otherwise; provided, however, that the actions for fraud exceed the limitation periods of the State in force.