How Acknowledgment Extends Limitation: Section 19 Limitation Act
Section 19 Limitation Act 1908: Valid Acknowledgment, Case Laws, and its Distinction from Section 21 of the Contract Act
Courts have repeatedly interpreted and applied Section 19 in a long line of decisions. This article explains the concept of acknowledgment, the essentials of a valid acknowledgment, and the impact of judicial precedent. It also contrasts Section 19 with Section 21 of the Contract Act 1872, which deals with mistake of law.
1. Concept of Acknowledgment under Limitation Law
The Limitation Act 1908 prescribes time limits for suits and applications. Once that period expires, the court is bound to treat the claim as time-barred. Yet everyday business and personal dealings show that debtors often admit their liability, negotiate, and request time. The law recognises such admissions through the device of acknowledgment under Section 19. When a debtor acknowledges in writing that a liability still exists, a fresh limitation period begins to run from the date of that acknowledgment.
- The acknowledgment does not create a new right; it recognises a pre-existing one.
- It simply shifts the starting point of limitation to the date of the written acknowledgment.
- The provision is applied strictly; courts insist that its conditions are fully satisfied.
If you are revising limitation in a systematic way, you should also review the concept of continuous running of time , which explains how and when the clock of limitation starts and keeps ticking.
2. Meaning and Definition of Acknowledgment
2.1 Ordinary meaning
In ordinary legal usage, an acknowledgment is a conscious and clear admission by one person that a particular liability or jural relationship subsists between him and another person. It is an admission that “I owe” or that “your right still exists”.
2.2 Judicial approach
Courts treat acknowledgment as:
- a distinct and conscious admission of an existing liability or right; and
- a statement that must be interpreted as a whole, in its factual context.
It may be explicit or may arise by necessary implication from the language used, but it must not be vague or equivocal. Courts lean against implying an acknowledgment where the wording is doubtful, because its effect is to extend a statutory time-bar.
3. Statutory Framework of Section 19 Limitation Act 1908
Section 19 of the Limitation Act 1908, titled “Effect of acknowledgment in writing”, in simple terms provides that:
- Before the expiration of the period prescribed for a suit or application in respect of any property or right,
- if an acknowledgment of liability in respect of such property or right is made in writing,
- and is signed by the person against whom the right is claimed or by a person through whom he derives title or liability,
- a fresh period of limitation is to be computed from the time when the acknowledgment was so signed.
3.1 Explanatory points
- The acknowledgment may be addressed to any person; it need not be sent to the creditor.
- It may be accompanied by a refusal to pay or by a claim to set-off; these do not destroy the acknowledgment.
- For the purposes of Section 19, an execution application is also treated as an application in respect of a right.
A borrows Rs. 10,000 from B on 1-1-1997. The normal limitation period for a suit on this debt is three years, expiring on 1-1-2000. On 1-11-1999, A writes and signs a letter to B stating: “I admit that I still owe you Rs. 10,000; I cannot pay right now but will pay soon.” This is a valid acknowledgment under Section 19. A fresh period of limitation runs from 1-11-1999.
4. Ingredients of a Valid Acknowledgment (with Case Law)
A creditor who invokes Section 19 must show that all statutory conditions are fulfilled. Case law illustrates how strictly the courts apply these requirements.
4.1 Acknowledgment must be made before expiry of limitation
The first and most important ingredient is that the acknowledgment must be made before the limitation period expires. Courts treat this requirement as non-negotiable.
The Lahore High Court held that a bare reading of Section 19(1) “leads to the ineluctable conclusion” that a fresh cause of action on the basis of acknowledgment comes into play only if such acknowledgment is made before the expiration of the period prescribed for a suit or application. Any acknowledgment after expiry is outside the scope of the section.
In this banking dispute, the Court reaffirmed that an acknowledgment in writing which extends the period of limitation “must be made within the limitation period from the original cause of action”. Section 19 cannot be used to stretch limitation indefinitely on the basis of belated writings.
The Sindh High Court considered an acknowledgment made after the limitation period had expired. It held that such a document is irrelevant for the purpose of Section 19 and “could not give fresh start to period of limitation” or save the matter from being time-barred. This judgment is often quoted to emphasise that Section 19 does not revive dead claims.
Here the plaintiff failed to produce any writing by which the defendant had acknowledged the debt. The Court held that Section 19 was inapplicable. The case shows that the acknowledgment must not only exist in time; it must also be proved through a proper written document.
The facility had been granted in 1980 and the suit was filed in 1992. No acknowledgment within the limitation period was shown. The Lahore High Court held that once limitation had expired, any acknowledgment afterwards would not extend time. This reinforces the strict approach adopted in later cases like M.S. Port Services and Muhammad Ashraf.
- Therefore, an acknowledgment must be timely and provable in writing.
- Post-limitation admissions, however sincere, are normally irrelevant for Section 19.
4.2 Acknowledgment must be in writing
Section 19 insists on a written document. Oral admissions, even if proved, do not extend limitation. The writing can take many forms – a letter, a balance confirmation, a statement of account, or even a written statement filed in court – but there must be a tangible writing.
In Farm and Foods International (2006 CLC 492 Karachi) the suit failed because no written acknowledgment was produced. The decision is often cited as a reminder that Section 19 protection cannot be claimed on the basis of vague allegations of conversations or verbal promises.
4.3 Writing must be signed by the person liable or through whom he derives title
The acknowledgment must be signed by:
- the person against whom the right is claimed (debtor, mortgagor, judgment-debtor etc.), or
- someone through whom he derives title or liability – such as an authorised agent, partner, director, or legal representative.
The Supreme Court dealt with a suit for recovery of money from a company which had obtained funds from a Modaraba. The defence was that the suit was time-barred. The Court noted that the Chief Executive of the defendant company had acknowledged the liability. As the suit was filed within the extended period following this acknowledgment, it was held to be within limitation. This case shows how a duly signed corporate acknowledgment can extend limitation under Section 19.
4.4 Acknowledgment must admit a subsisting liability (promise to pay is not essential)
The core of Section 19 is that the writing should acknowledge a continuing liability. It is not necessary that the document should contain an express promise to pay.
The Sindh High Court held that acknowledgment of debt is valid even in the absence of an express promise to pay. Such a promise is not a requirement of Section 19. A simple admission that the debt exists is enough to trigger a fresh limitation period.
- An acknowledgment may be coupled with a plea for time, a request for rescheduling, or even a dispute about exact quantum; it still operates if the underlying liability is admitted.
- A document denying liability altogether will not amount to acknowledgment.
4.5 Effect of acknowledgment made within limitation – starting of fresh period
Once a valid acknowledgment is established, a fresh period of limitation starts from the date of the acknowledgment. Several banking and commercial cases illustrate this.
A suit for recovery of a finance facility was filed. The defendant had made an acknowledgment in writing within the limitation period calculated from the date of the finance agreement. The Lahore High Court held that, by virtue of Section 19 read with Article 85 of the First Schedule, a fresh three-year period of limitation started from the date of acknowledgment, and the plaintiff-bank’s claim was within time.
This case concerned an agency agreement. The suit was filed in 2002, but the cause of action was based on an admission in the defendant’s letter dated 24-9-1999 acknowledging the supply made by the plaintiff. The Court rejected the defence that the suit was time-barred, and treated the 1999 letter as a valid acknowledgment giving a fresh starting point of limitation.
The Lahore High Court again emphasised that acknowledgment made within limitation extends time; the case turned on the correct calculation of the limitation period from the original cause of action and the date of acknowledgment.
5. Essentials and Characteristics of Acknowledgment
5.1 Essentials in a nutshell
- Made before the expiry of the prescribed period of limitation.
- In writing.
- Duly signed by the person liable or his authorised agent.
- Relates to the specific right or property later sued upon.
- Contains a clear admission of a subsisting liability, even if accompanied by a request for time or a claim to set-off.
5.2 Characteristics
(a) Acknowledgment merely extends limitation
Acknowledgment does not confer any new right or title on the creditor; it simply extends the remedy by giving a fresh limitation period. The liability remains the same in nature and amount, unless otherwise agreed.
(b) Must be in respect of the particular right or property
The acknowledgment must relate to the right or property which later forms the subject-matter of the suit. A general reference to business difficulties, for example, would not suffice unless it clearly points to the specific debt.
(c) Includes acknowledgment of legal consequences
Where the debtor admits facts from which liability inevitably arises, the law treats it as acknowledgment not only of the facts but also of their legal consequences. Admission of a finance facility and the outstanding balance, as in Al-Barka Islamic Bank, effectively acknowledges the bank’s right to recover.
(d) Question of fact
Whether a particular document amounts to acknowledgment is primarily a question of fact. Courts examine:
- the language of the document;
- the context in which it was written; and
- the conduct of parties before and after the document.
- Use plain language such as “we admit that the amount is outstanding”.
- Mention the nature of the liability and, if possible, the exact amount.
- Ensure the document is dated, signed and kept safely for future reference.
- Avoid ambiguous phrases that may later be argued as a denial.
6. Object and Application of Section 19
6.1 Object
Section 19 is designed to give effect to honest admissions. A debtor who acknowledges his liability should not be allowed to defeat the creditor by resorting to a technical plea of limitation. At the same time, the provision is an exception to the general bar of limitation and is therefore construed strictly.
6.2 Application
Section 19 applies to:
- Ordinary suits for debts, mortgages, finance facilities, etc.;
- Execution proceedings where a judgment-debtor acknowledges the decree or balance due; and
- Applications for which the Limitation Act prescribes a period, such as some review or restoration applications, provided the acknowledgment relates to the underlying right.
7. When Section 19 Does Not Apply
Section 19 does not automatically apply to every limitation provision. Its operation is excluded in several situations, some of which are highlighted in case law:
- Where a special or local law expressly excludes the Limitation Act or provides a self-contained limitation scheme.
- Where the acknowledgment is post-limitation (PLD 2012 Karachi 182; 2004 CLD 1552 Lahore) – such a document does not revive a dead claim under Section 19.
- Where the claimant fails to produce the written acknowledgment (2006 CLC 492 Karachi).
In this case, the Supreme Court considered Sections 19 and 20 of the Limitation Act together with Section 30 of the Customs Act 1969. It held that an acknowledgment in writing of a time-barred amount could revive the period of limitation for its recovery in that particular statutory context. The decision is generally read as turning on the special scheme of customs law and should not be taken as diluting the general rule that, under Section 19, acknowledgment must ordinarily be within limitation.
8. Who Can Make a Valid Acknowledgment
The acknowledgment must be made by the person against whom the right is claimed, or by a person through whom he derives title or liability. Common examples include:
- debtor or mortgagor;
- corporate entities acting through directors or chief executives (as in Aftab A. Sheikh, 2005 SCMR 1027);
- agents duly authorised in writing;
- partners of a firm in relation to partnership debts;
- sureties admitting their guarantee obligations;
- official assignees, courts of wards, and other statutory representatives;
- legal representatives of deceased persons managing the estate.
The central idea is legal connection – the person signing must have a recognised legal link with the liability whose limitation is sought to be extended.
9. To Whom Acknowledgment May Be Addressed
Section 19 does not require that the acknowledgment be addressed to the creditor. It may be:
- sent directly to the creditor;
- addressed to a bank, auditor, or government department;
- contained in pleadings, such as a written statement or an application; or
- addressed to any other person, provided the liability in dispute is clearly indicated.
A company sends a duly signed statement of account to its auditor, listing a particular bank loan as outstanding. Even though the statement is not addressed to the bank, it can constitute a valid acknowledgment in favour of the bank, because it clearly recognises the subsisting debt.
10. Onus of Proof and Consequences of Proving Acknowledgment
10.1 Onus of proof
The burden of proving acknowledgment lies squarely on the plaintiff or applicant who seeks to escape the bar of limitation.
- He must produce the written document and prove its execution.
- He must demonstrate that it was made before expiry of limitation.
- He must link the acknowledgment to the liability sued upon.
10.2 Consequences when acknowledgment is proved
(a) Fresh period of limitation
Once a valid acknowledgment is proved, a fresh limitation period begins from the date of the acknowledgment. Cases such as Al-Barka Islamic Bank (2014 CLD 1228), Merck Marker (2010 MLD 573), and Mian Aftab A. Sheikh (2005 SCMR 1027) illustrate how banks and commercial parties rely on this doctrine to maintain suits which would otherwise appear to be belated.
(b) Same duration as original period
Section 19 does not change the length of the limitation period; it only resets the starting point. Thus, if the original limitation was three years for a simple debt, each valid acknowledgment within limitation will provide a fresh three-year period from the date of that acknowledgment.
11. Strict Nature of Limitation and Role of Sections 4–25
The Supreme Court stressed that the bar of limitation arising under the Limitation Act is absolute unless a case clearly falls within one of the exceptions contained in Sections 4 to 25 of the Act. Section 19, dealing with acknowledgment, is one such exception. If a case does not meet its strict requirements, the general bar of limitation remains.
The Balochistan High Court examined Sections 3 and 4–25 of the Limitation Act along with Order VII Rule 11 CPC. It held that:
- Section 3 is mandatory; every suit filed after the limitation period must be dismissed, subject only to Sections 4–25.
- The court is duty-bound to examine limitation even if it is not pleaded by the defendant.
- Limitation cannot be waived by the parties; even a party who has waived it may later raise it, and the court may take notice of it on its own.
This judgment underlines why acknowledgment under Section 19 is pleaded and proved with great care – without fitting into an exception, the suit simply cannot proceed.
12. Section 21 Contract Act 1872 – Mistake of Law
Section 21 deals with a different subject: the effect of mistake of law on the validity of contracts. It states that a contract is not voidable because it was caused by a mistake as to any law in force in Pakistan. A mistake as to foreign law, however, is treated like a mistake of fact.
12.1 Mistake of law
- Parties are presumed to know the law of their own country.
- A person cannot avoid a contract by saying that he misunderstood the legal consequences of his act.
12.2 Mistake of foreign law
Where both parties are mistaken about the law of another country, the mistake may operate like a mistake of fact under Section 20, and the agreement may be void if the mistake goes to the root of the transaction.
13. Distinction between Section 19 Limitation Act and Section 21 Contract Act
13.1 Field of operation
- Section 19 Limitation Act – procedural, concerned with the effect of a written acknowledgment on the period of limitation for suits and applications.
- Section 21 Contract Act – substantive, concerned with the effect of mistake of law on the validity of contracts.
13.2 Nature of act
- Section 19 involves an overt act: writing and signing a document acknowledging liability.
- Section 21 deals with the state of mind of parties when entering a contract – whether they were mistaken about the law.
13.3 Consequences
- Under Section 19, a valid acknowledgment extends limitation; failure to meet its conditions means the suit is time-barred (as emphasised in PLD 2022 Lahore 414; PLD 2012 Karachi 182; PLD 2007 Quetta 1).
- Under Section 21, a mistake of law does not make the contract voidable; the agreement continues to bind the parties despite their misunderstanding of law.
- Section 19 – exception in limitation law; focuses on acknowledgment of liability.
- Section 21 – rule in contract law; focuses on mistake of law.
- Section 19 aids creditors who possess timely written admissions.
- Section 21 protects contractual stability by preventing easy avoidance on the plea of ignorance of law.
14. Conclusion
Section 19 of the Limitation Act 1908 is a carefully balanced provision. It rewards honesty by allowing a fresh limitation period where the debtor or person liable, in writing and within time, acknowledges his subsisting liability. At the same time, it is surrounded by strict safeguards: acknowledgment must be timely, in writing, signed and clearly linked to the liability in question. Courts, through a rich body of case law from Farm and Foods to Muhammad Ashraf, have consistently insisted on these conditions.
Section 21 of the Contract Act operates in a different but complementary field. It prevents parties from easily avoiding contracts on the ground that they did not know the law of Pakistan. Together, both provisions show the judicial approach: limitation rules are strict, exceptions like acknowledgment are narrowly construed, and ignorance of law is rarely an excuse. For practitioners and students, a firm grasp of Section 19, supported by the case law discussed above, is essential whenever limitation and written admissions of liability intersect.