Q&As

If the limitation period for bringing a claim for breach of contract has passed, but a settlement agreement was entered into prior to the expiry of the limitation period, will the settlement agreement be treated as a variation of the original contract such that it extends the initial limitation period? Does a claim for breach of a settlement agreement have its own limitation period?

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Produced in partnership with David Sawtell of 39 Essex Chambers
Published on LexisPSL on 25/08/2016

The following Dispute Resolution Q&A produced in partnership with David Sawtell of 39 Essex Chambers provides comprehensive and up to date legal information covering:

  • If the limitation period for bringing a claim for breach of contract has passed, but a settlement agreement was entered into prior to the expiry of the limitation period, will the settlement agreement be treated as a variation of the original contract such that it extends the initial limitation period? Does a claim for breach of a settlement agreement have its own limitation period?
  • Entirely contractual compromise
  • Agreement embodied in a court order

If the limitation period for bringing a claim for breach of contract has passed, but a settlement agreement was entered into prior to the expiry of the limitation period, will the settlement agreement be treated as a variation of the original contract such that it extends the initial limitation period? Does a claim for breach of a settlement agreement have its own limitation period?

A settlement agreement is a contract in and of itself. There are two potential scenarios that arise from this question: the first where the settlement agreement was entirely contractual; the second where the settlement agreement was also embodied in a consent order.

Entirely contractual compromise

An unimpeached compromise represents the end of the dispute or disputes from which it arose (see Prudential Assurance Co Ltd v McBains Cooper [2001] 3 All ER 1014 at [19]). It is the dispute that is compromised, as opposed to the original contract itself.

It is, of course, open to the parties to expressly vary the

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