2020 Georgia Code
Title 11 - Commercial Code
Article 2 - Sales
Part 7 - Remedies
§ 11-2-725. Statute of Limitations in Contracts for Sale

Universal Citation: GA Code § 11-2-725 (2020)
  1. An action for breach of any contract for sale must be commenced within four years after the cause of action has accrued. By the original agreement the parties may reduce the period of limitation to not less than one year but may not extend it.
  2. A cause of action accrues when the breach occurs, regardless of the aggrieved party's lack of knowledge of the breach. A breach of warranty occurs when tender of delivery is made, except that where a warranty explicitly extends to future performance of the goods and discovery of the breach must await the time of such performance the cause of action accrues when the breach is or should have been discovered.
  3. Where an action commenced within the time limited by subsection (1) of this Code section is so terminated as to leave available a remedy by another action for the same breach such other action may be commenced after the expiration of the time limited and within six months after the termination of the first action unless the termination resulted from voluntary discontinuance or from dismissal for failure or neglect to prosecute.
  4. This Code section does not alter the law on tolling of the statute of limitations nor does it apply to causes of action which have accrued before January 1, 1964.

(Code 1933, § 109A-2 - 725, enacted by Ga. L. 1962, p. 156, § 1.)

Cross references.

- Limitations of actions on contracts generally, § 9-3-26.

Law reviews.

- For article discussing applicability of Uniform Commercial Code provision concerning statute of limitations to construction contracts, see 28 Emory L.J. 335 (1979). For article, "Products Liability Law in Georgia Including Recent Developments," see 43 Mercer L. Rev. 27 (1991). For annual survey on product liability, see 69 Mercer L. Rev. 231 (2017).

JUDICIAL DECISIONS

ANALYSIS

  • General Consideration
  • Time of Breach
  • Fact/Law Questions
  • Application
General Consideration

Distinguished from O.C.G.A. § 9-3-24. - O.C.G.A. § 11-2-725 applies to sales contracts, while O.C.G.A. § 9-3-24 covers all other simple written contracts. Cleveland Lumber Co. v. Proctor & Schwartz, Inc., 397 F. Supp. 1088 (N.D. Ga. 1975).

Sealed contract to purchase inventory.

- An action for breach of a written contract, under seal, to purchase the inventory of a retail business was governed by the four-year limitation period under the UCC and not by the 20 year limitation period applicable to actions on sealed instruments. McLean v. Gray, 180 Ga. App. 794, 350 S.E.2d 815 (1986).

Services incidental to sales contract.

- Where clauses in contract which may amount to services are merely incidental to main purpose of contract and do not take it out of sales provisions of the Uniform Commercial Code, its statute of limitations appears to apply rather than the general Georgia statute of limitations on contracts. Cleveland Lumber Co. v. Proctor & Schwartz, Inc., 397 F. Supp. 1088 (N.D. Ga. 1975).

Mixed contract for sale of goods and services.

- When the predominant element of a contract is the sale of goods, the contract is viewed as a sales contract and O.C.G.A. § 11-2-725 is the applicable statute of limitations even though a substantial amount of service is to be rendered in installing the goods. When the predominant element of a contract is the furnishing of services, O.C.G.A. § 9-3-24 applies. Factors to be considered in determining the predominant element include the proportion of the total contract cost allocated to the goods and whether the price of the goods are segregated from the price for services. Southern Tank Equip. Co. v. Zartic, Inc., 221 Ga. App. 503, 471 S.E.2d 587 (1996).

Where manufacturer/seller of windows is sued for property damage to home, and, the windows were part of the initial construction of the home, the cause of action would have accrued at the time of the allegedly defective construction. Kemp v. Bell-View, Inc., 179 Ga. App. 577, 346 S.E.2d 923 (1986).

Cited in Moody v. Sears, Roebuck & Co., 324 F. Supp. 844 (S.D. Ga. 1971); Everhart v. Rich's, Inc., 128 Ga. App. 319, 196 S.E.2d 475 (1973); U.S. Indus., Inc. v. Mitchell, 148 Ga. App. 770, 252 S.E.2d 672 (1979); General Tire & Rubber Co. v. Alex, 149 Ga. App. 393, 254 S.E.2d 509 (1979); Landon v. Williams Bros. Concrete Co., 149 Ga. App. 699, 256 S.E.2d 99 (1979); Smith v. Dixon Ford Tractor Co., 160 Ga. App. 885, 288 S.E.2d 599 (1982); Ballew v. A.H. Robins Co., 688 F.2d 1325 (11th Cir. 1982); Adair v. Baker Bros., 185 Ga. App. 807, 366 S.E.2d 164 (1988); Davis v. Brunswick Corp., 854 F. Supp. 1574 (N.D. Ga. 1993); State Line Metals v. ALCOA, 216 Ga. App. 14, 453 S.E.2d 474 (1995); AAA Truck Sales, Inc. v. Mershon Tractor Co., 239 Ga. App. 469, 521 S.E.2d 403 (1999); Herndon v. Heard, 262 Ga. App. 334, 585 S.E.2d 637 (2003).

Time of Breach

Breach warranty to repair or replace.

- Under O.C.G.A. § 11-2-725, while a breach of warranty generally occurs upon delivery of goods regardless of time of discovery of breach, where there is an agreement to repair or replace, warranty is not breached until there is refusal or failure to repair. Space Leasing Assocs. v. Atlantic Bldg. Sys., 144 Ga. App. 320, 241 S.E.2d 438 (1977).

Where a warranty included an agreement to replace or repair, the trial court correctly ruled that defendant breached its warranty when it refused to conduct further warranty repairs and that the complaint was filed well within the limitation period which did not commence running until the breach. Versico, Inc. v. Engineered Fabrics Corp., 238 Ga. App. 837, 520 S.E.2d 505 (1999).

Breach by supplier.

- For purpose of O.C.G.A. § 11-2-725, breach of contract by subcontractor who supplied glass and labor for construction of overhead bridge occurred at time glass was installed and accepted by owner. PPG Indus., Inc. v. Genson, 135 Ga. App. 248, 217 S.E.2d 479 (1975).

Breach by buyer.

- Bank's action to recover a deficiency judgment after a borrower defaulted on a vehicle loan almost five years before the bank filed the instant action was time-barred because the action was filed outside the four-year statute of limitation. Venable v. SunTrust Bank, 335 Ga. App. 344, 780 S.E.2d 793 (2015), aff'd, 299 Ga. 655, 791 S.E.2d 5 (2016).

Fact/Law Questions

Whether action is barred by lapse of time.

- If sole question is one as to length of time which has elapsed between accrual of right and institution of action, question as to whether action is barred is one of law. Cleveland Lumber Co. v. Proctor & Schwartz, Inc., 397 F. Supp. 1088 (N.D. Ga. 1975).

Case involving fraud and excuse for delayed discovery.

- Where facts indicate fraud and excuses for delay in its discovery, question is one of mixed law and fact, and is a proper question for determination by jury under proper instructions from the court. Cleveland Lumber Co. v. Proctor & Schwartz, Inc., 397 F. Supp. 1088 (N.D. Ga. 1975).

Application

Service of process beyond statute of limitation period.

- Trial court erred in granting a creditor summary judgment in the creditor's action against a guarantor to collect on a past due commercial account because the guarantor was served several years beyond either the two-year statute of limitation period, O.C.G.A. § 11-2-725, or the four-year limitation period, O.C.G.A. § 9-3-25; the creditor had notice of a service of process issue at least as early as March 2007 and knew of the service problem in January 2008, but the creditor did not serve the guarantor with process until September 2008, and the creditor failed to prove that the creditor exercised due diligence in attempting to effect service. Scanlan v. Tate Supply Co., 303 Ga. App. 9, 692 S.E.2d 684 (2010).

Agreement not governed by O.C.G.A. § 9-3-24. - The release agreement which by its terms superseded the lease and maintenance agreements, and provided for the mutual release of all claims arising out of the prior agreements was a contract for sale of the offspring of the leased cattle, and the action was barred by the four-year limitation period of the sales article, rather than the six-year limitation period for written contracts under O.C.G.A. § 9-3-24. Embryo Progeny Assocs. v. Lovana Farms, Inc., 203 Ga. App. 447, 416 S.E.2d 833, cert. denied, 203 Ga. App. 906, 416 S.E.2d 833 (1992).

Contract was sale of goods and barred by statute of limitations.

- Grant of summary judgment in favor of a bank was properly reversed because the predominant purpose of the contract was the sale of a good; thus, the four year statute of limitation in O.C.G.A. § 11-2-725(1) applied and the bank's deficiency claim was barred since the claim was filed more than four years after the cause of action accrued. SunTrust Bank v. Venable, 299 Ga. 655, 791 S.E.2d 5 (2016).

Secured transactions.

- While it appeared that O.C.G.A. § 9-3-24, rather than O.C.G.A. § 11-2-725, would most likely apply to defendant collection attorney's state court deficiency action against plaintiff consumer, and it was not for the federal court to say what the Georgia courts would hold, the uncertainty meant there was no intentional unfair conduct and the consumer's Fair Debt Collection Practices Act claim was dismissed. Almand v. Reynolds & Robin, P.C., 485 F. Supp. 2d 1361 (M.D. Ga. 2007).

Because an oral contract concerning the disposal of car skeletons on property operated as a junkyard did not violate the O.C.G.A. §§ 11-2-201 and11-2-725, the trial court erred in granting summary judgment against a seller on his counterclaim for fraud, due to the option holder's repudiation of the contract in filing for specific performance. Henry v. Blankenship, 284 Ga. App. 578, 644 S.E.2d 419 (2007).

Claims based on invoices.

- Trial court erred by granting summary judgment in favor of a debtor on all of the invoices that made up a creditor's claim against the debtor on the ground that the complaint was barred by the four-year limitation period for a suit on account because the trial court's grant of summary judgment was based on a purported admission by the creditor that the creditor's claims accrued on April 3, 2001, but the trial court misread the document, and the creditor submitted authenticated invoices, which showed dates more recent than four years prior to the date suit was filed; unless otherwise provided in the agreement, claims are barred if the claims are asserted more than four years after invoices are submitted to the buyer. Avery Enters. v. Lyndhurst Builders, LLC, 304 Ga. App. 353, 696 S.E.2d 389 (2010).

Implied warranty.

- Plaintiffs' implied warranty claims against a vehicle manufacturer and a distributor were barred by the four-year statute of limitations in O.C.G.A. § 11-2-725(1) as the plaintiffs' claims accrued when the plaintiffs' vehicles were first sold. An implied warranty by its nature could not explicitly extend to future performance and thus did not fall within the exception in § 11-2-725(2). McCabe v. Daimler AG, F. Supp. 2d (N.D. Ga. June 7, 2013).

RESEARCH REFERENCES

Am. Jur. 2d.

- 1 Am. Jur. 2d, Accounts and Accounting, § 21. 63B Am. Jur. 2d, Products Liability, §§ 1571 et seq., 1601 et seq. 67A Am. Jur. 2d, Sales, §§ 928-953.

6 Am. Jur. Pleading and Practice Forms, Commercial Code, § 2:823.

C.J.S.

- 54 C.J.S., Limitations of Actions, § 61. 77A C.J.S., Sales, § 377.

U.L.A.

- Uniform Commercial Code (U.L.A.) § 2-725.

ALR.

- What constitutes an open, current account within the statute of limitations, 39 A.L.R. 369; 57 A.L.R. 201.

When "sale" deemed to have taken place for purposes of statute of limitations which fixes commencement of period at time of foreclosure sale or other judicial sale, 101 A.L.R. 1348.

Validity of contractual waiver of statute of limitations, 1 A.L.R.2d 1445.

Limitation of actions as applied to account stated, 51 A.L.R.2d 331.

Validity, and applicability to causes of action not already barred, of a statute enlarging limitation period, 79 A.L.R.2d 1080.

Validity of contractual time period, shorter than statute of limitations, for bringing action, 6 A.L.R.3d 1197.

Application to period of limitations fixed by contract, of statute permitting new action to be brought within specified time after failure of prior action for cause other than on the merits, 16 A.L.R.3d 452.

Statute of limitations: effect of delay in appointing administrator or other representative on cause of action accruing at or after death of person in whose favor it would have accrued, 28 A.L.R.3d 1141.

Settlement negotiations as estopping reliance on statute of limitations, 39 A.L.R.3d 127.

Promises or attempts by seller to repair goods as tolling statute of limitations for breach of warranty, 68 A.L.R.3d 1277.

Validity of contractual provision establishing period of limitations longer than that provided by state statute of limitations, 84 A.L.R.3d 1172.

Products liability: what statute of limitations governs actions based on strict liability in tort, 91 A.L.R.3d 455.

What constitutes warranty explicitly extending to "future performance" for purposes of UCC § 2-725(2), 93 A.L.R.3d 690.

Computer sales and leases: time when cause of action for failure of performance accrues, 90 A.L.R.4th 298.

Validity and construction of statute terminating right of action for product-caused injury at fixed period after manufacture, sale, or delivery of product, 30 A.L.R.5th 1.

Causes of action governed by limitations period in UCC § 2-725, 49 A.L.R.5th 1.

Products liability: ladders, 81 A.L.R.5th 245.

Applicability of UCC Article 2 to mixed contracts for sale of consumer goods and services, 1 A.L.R.7th 3.

Applicability of UCC Article 2 to mixed contracts for sale of goods and services: distributorship, franchise, and similar business contracts, 8 A.L.R.7th 4.

Applicability of UCC Article 2 to mixed contracts for sale of business goods and services: manufacturing, construction, and similar contracts, 15 A.L.R.7th 7.

CHAPTER 2A LEASES Part 1 General Provisions.
  • 11-2A-101. Short title.
  • 11-2A-102. Scope.
  • 11-2A-103. Definitions and index of definitions.
  • 11-2A-104. Leases subject to other law.
  • 11-2A-105. Territorial application of article to goods covered by certificate of title.
  • 11-2A-106. Limitation on power of parties to consumer lease to choose applicable law and judicial forum.
  • 11-2A-107. Waiver or renunciation of claim or right after default.
  • 11-2A-108. Unconscionability.
  • 11-2A-109. Option to accelerate at will.
Part 2 Formation and Construction of Lease Contract.
  • 11-2A-201. Statute of frauds.
  • 11-2A-202. Final written expression: Parole or extrinsic evidence.
  • 11-2A-203. Seals inoperative.
  • 11-2A-204. Formation in general.
  • 11-2A-205. Firm offers.
  • 11-2A-206. Offer and acceptance in formation of lease contract.
  • 11-2A-207. Course of performance or practical construction [Repealed].
  • 11-2A-208. Modification, rescission and waiver.
  • 11-2A-209. Lessee under finance lease as beneficiary of supply contract.
  • 11-2A-210. Express warranties.
  • 11-2A-211. Warranties against interference and against infringement; lessee's obligation against infringement.
  • 11-2A-212. Implied warranty of merchantability.
  • 11-2A-213. Implied warranty of fitness for particular purpose.
  • 11-2A-214. Exclusion or modification of warranties.
  • 11-2A-215. Cumulation and conflict of warranties express or implied.
  • 11-2A-216. Third-party beneficiaries of express and implied warranties.
  • 11-2A-217. Identification.
  • 11-2A-218. Insurance and proceeds.
  • 11-2A-219. Risk of loss.
  • 11-2A-220. Effect of default on risk of loss.
  • 11-2A-221. Casualty to identified goods.
Part 3 Effect of Lease Contract.
  • 11-2A-301. Enforceability of lease contract.
  • 11-2A-302. Title to and possession of goods.
  • 11-2A-303. Alienability of party's interest under lease contract or of lessor's residual interest in goods; delegation of performance; transfer of rights.
  • 11-2A-304. Subsequent lease of goods by lessor.
  • 11-2A-305. Sale or sublease of goods by lessee.
  • 11-2A-306. Priority of certain liens arising by operation of law.
  • 11-2A-307. Priority of liens arising by attachment or levy on, security interests in, and other claims to goods.
  • 11-2A-308. Special rights of creditors.
  • 11-2A-309. Lessor's and lessee's rights when goods become fixtures.
  • 11-2A-310. Lessor's and lessee's rights when goods become accessions.
  • 11-2A-311. Priority subject to subordination.
Part 4 Performance of Lease Contract: Repudiated, Substituted and Excused.
  • 11-2A-401. Insecurity: Adequate assurance of performance.
  • 11-2A-402. Anticipatory repudiation.
  • 11-2A-403. Retraction of anticipatory repudiation.
  • 11-2A-404. Substituted performance.
  • 11-2A-405. Excused performance.
  • 11-2A-406. Procedure on excused performance.
  • 11-2A-407. Irrevocable promises: Finance leases.
Part 5 Default. Part A IN GENERAL.
  • 11-2A-501. Default: Procedure.
  • 11-2A-502. Notice after default.
  • 11-2A-503. Modification or impairment of rights and remedies.
  • 11-2A-504. Liquidation of damages.
  • 11-2A-505. Cancellation and termination and effect of cancellation, termination, rescission, or fraud on rights and remedies.
  • 11-2A-506. Statute of limitations.
  • 11-2A-507. Proof of market rent: Time and place.
Part B DEFAULT BY LESSOR.
  • 11-2A-508. Lessee's remedies.
  • 11-2A-509. Lessee's rights on improper delivery; rightful rejection.
  • 11-2A-510. Installment lease contracts: Rejection and default.
  • 11-2A-511. Merchant lessee's duties as to rightfully rejected goods.
  • 11-2A-512. Lessee's duties as to rightfully rejected goods.
  • 11-2A-513. Cure by lessor of improper tender or delivery; replacement.
  • 11-2A-514. Waiver of lessee's objections.
  • 11-2A-515. Acceptance of goods.
  • 11-2A-516. Effect of acceptance of goods; notice of default; burden of establishing default after acceptance; notice of claim or litigation to person answerable over.
  • 11-2A-517. Revocation of acceptance of goods.
  • 11-2A-518. Cover; substitute goods.
  • 11-2A-519. Lessee's damages for nondelivery, repudiation, default, and breach of warranty in regard to accepted goods.
  • 11-2A-520. Lessee's incidental and consequential damages.
  • 11-2A-521. Lessee's right to specific performance or replevin.
  • 11-2A-522. Lessee's right to goods on lessor's insolvency.
Part C DEFAULT BY LESSEE.
  • 11-2A-523. Lessor's remedies.
  • 11-2A-524. Lessor's right to identify goods to lease contract.
  • 11-2A-525. Lessor's right to possession of goods.
  • 11-2A-526. Lessor's stoppage of delivery in transit or otherwise.
  • 11-2A-527. Lessor's rights to dispose of goods.
  • 11-2A-528. Lessor's damages for nonacceptance, failure to pay, repudiation, or other default.
  • 11-2A-529. Lessor's action for the rent.
  • 11-2A-530. Lessor's incidental damages.
  • 11-2A-531. Standing to sue third parties for injury to goods.
  • 11-2A-532. Lessor's rights to residual interest.
Effective date.

- Ga. L. 1993, p. 633, § 5, provides: "This [article] shall become effective on July 1, 1993, for all lease contracts that are first made or that first become effective between the parties on or after that date. This [article] shall not apply to any lease first made or that first became effective between the parties before July 1, 1993, or to any extension, amendment, modfication, renewal, or supplement of or to any such lease contract, unless the parties thereto specifically agree in writing that such lease contract, as extended, amended, modified, renewed, or supplemented, shall be governed by this [article]."

Law reviews.

- For annual survey article discussing developments in commercial law, see 51 Mercer L. Rev. 165 (1999).

PART 1 GENERAL PROVISIONS
Disclaimer: These codes may not be the most recent version. Georgia may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.