The municipality of Eeklo recently made the news because it still has to collect 6.5 million euros in outstanding invoices from companies and citizens. But when does an invoice expire and no longer have to be paid?
A financial audit by the municipality of Eeklo revealed that 1,200 companies and citizens had not paid their bills and invoices in recent years. This concerns more than 15,000 claims for a total amount of 6.5 million euros. The amounts vary from a few euros – for example fines in the library – to tens of thousands of euros.
All parties were notified, but because the debt has been increasing for more than ten years, the municipality would lose more than 300,000 euros. “Outstanding invoices usually expire after ten years, and then you can no longer collect them,” the Finance Alderman argued at the municipal council. But is that correct?
The liberating expiration
An unpaid invoice or debt cannot indeed be claimed forever. The legislator has introduced the system of ‘liberating prescription’. This means that customers will be released from their payment obligation over time.
The purpose of the limitation principle is to protect the debtor against late reactions from creditors. But it must also prevent a debt from becoming excessively heavy with recurring payments (such as the rent of a home), possibly supplemented with damages and late payment interest. The liberating limitation period should also encourage traders to remain alert and to intervene in a timely manner in the event of any payment problems.
Expired versus expired invoice
An expired invoice is sometimes confused with an overdue invoice. Yet there is an essential difference. “An overdue invoice is an outstanding debt for which the payment deadline has been exceeded,” says Jeroen De Man of the law firm De Groote – De Man. “If the trader has not made specific agreements about this with the customer in a B2B context, the due date is by default thirty days after the invoice date.”
“The expiry date of an invoice is something completely different. This means that the customer is released from his payment obligation. The creditor then no longer has a legal right to payment of the outstanding invoice. In short: an expired invoice can in principle no longer be collected.”
What does that mean in concrete terms?
Suppose you receive the invoice for a washing machine that was delivered to your home last year. Or you receive a reminder for an internet invoice that you forgot to pay a few months ago. Or you will receive the bill for a corona test taken in the hospital in 2021. To what extent can you be obliged to pay those ‘old debts’?
“There are some general limitation periods,” explains Jeroen De Man of the law firm De Groote – De Man. “The general principle is that personal legal actions become statute-barred after ten years. All legal actions in rem – such as a dispute over the ownership rights or usufruct of real estate – expire after thirty years.”
In addition to the general terms, the legislator also applies a number of special limitation periods that are shorter, depending on the type of debt.
“As a private customer you can therefore claim a limitation period of one year for the sale of merchandise for which no written document is drawn up,” Jeroen De Man explains. “As soon as an invoice is drawn up that is payable within one year, that one-year period expires.” In practice, this is the case, for example, when you purchase a car or a boiler.
In principle, the limitation period starts from the due date of the invoice. But that is not always the case. For your personal tax, for example, the five-year period starts from the end of the second month following the sending of the tax notice. For a healthcare invoice, the two-year period starts from the month following the month in which the care was provided.
Interruption of the limitation period
When a seller or contractor sends a registered letter to remind you that you still have to pay, the limitation period continues to run. However, some actions may interrupt or suspend the statute of limitations.
Do you, as a customer, continue to ignore reminders and is this jeopardizing the limitation period? In that case, the trader can proceed with judicial collection. Setting up such a procedure ensures that the invoice is ‘stopped’. In the event of such an interruption, the current limitation period comes to an end and a new limitation period starts.
“Even if you, as a debtor, acknowledge that you owe something, you interrupt the limitation period,” warns Jeroen De Man. “This is the case, for example, when you send an email with a request for payment.”
In addition to interruption, the limitation period can also be suspended. This means that the current term is interrupted or paused for a certain duration, but not terminated. This happens, for example, when the seller starts a collection procedure. There are many other grounds for suspension, but they are less relevant in this context.
Do you need to enforce your rights?
If an invoice arrives after the limitation period, you as a consumer in principle do not have to do anything. The limitation period occurs automatically. So it is up to the trader to bring this up for discussion. If he does not agree with this, he can have a judge make a ruling on this. That may take a while, but until then the statute of limitations continues.
Nevertheless, consumers can go to the website of the federal government service model letter download, with which they can enforce their rights. Jeroen De Man: “This may be useful if you, as a customer, want to provide clarity to a supplier about your position, with the aim of stopping any reminders.”
Also good to know: once a debt has expired, you no longer need to provide proof of payment.
Finally, also know that if you pay a time-barred debt, you will no longer be able to reclaim the amount paid. It is therefore important to check in advance which limitation period applies.
2023-10-14 09:00:00
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