“Those who sleep on their rights are not protected” is a very familiar proverb for the general public as well as the lawyer. This is the maxim of Rudolf von Jhering (1818–1892), one of a best-known German jurist. Even if you have the right to make a claim to the other party, after a certain period of time, the legal relationship will be stabilized by blocking the claim. It is a matter of legal stability.
Some of the clients ask these questions. “It’s been too long since I borrowed money, do I still have right to recover it ? I’m afraid it is too late.”
The answer is quite simple. “when extinctive prescription of a claim is complete, it is very hard for you to win the case unless debtor recognizes its debt after its completion.”
According to Korean Civil Act and Korean Commercial Act, general civil bonds are extinguished when the ten-year limit is exceeded. On the other hand, some kinds of claims as of general transactions between merchants, the period is shortened to five years. There some other exceptions with short term prescription of 1 to 3 years, for example, 3 years for Interest, support fees, salaries, rent, 1 year for Claims of wages of manual workers and public performers and the price of Articles supplied to them.
However, as prescribed by the Civil Code of the Republic of Korea, the proceedings of extinctive prescription shall cease in case of claims, seizure, confiscation, and debtor’s approval, and the statute shall be renewed from the date on which the grounds for suspension cease. On the other hand, in the case of the best exercise of the right to the other party, there is no effect of suspending the prescription until legal action is actively taken, such as a request for a trial within six months from the date of creditor’s notice for repayment.
On the other hand, even if the prescription period has passed before you file a lawsuit, you can still have a chance of winning when the debtor does not actively insist the completion of extinctive prescription, or securing and submitting an evidence regarding debtor’s acknowledgement on its debt, in other words, giving up the advantage of extinctive prescription.
If timely legal actions had been taken, there would be no issue of extinctive prescription, but in many cases, lawsuits are filed late due to friendship, cost, and many other reasons. It cannot be emphasized enough to think carefully before taking legal action. At the same time, however, please be careful not to sleep on your rights.