Final answer:
The statute of limitations sets a time limit for initiating legal proceedings after an event, with written contracts often allowed a longer time frame than oral contracts. Once this limit passes, the claim typically becomes invalid, but there are exceptions based on specific circumstances like the discovery rule.
Step-by-step explanation:
The statute of limitations is a law that sets the maximum time after an event within which legal proceedings may be initiated. When the deadline specified in the statute of limitations passes, the legal claim is no longer valid, whether the contract is written or oral. For contracts, the length of this period varies depending on the jurisdiction and the type of contract. Written contracts generally have a longer statute of limitations compared to oral contracts.
For instance, if the statute of limitations for written contracts is six years, and for oral contracts, it is four years, any legal action to enforce an agreement must be taken within these timeframes respectively. Once the time limit has passed, the statute of limitations can be raised as a defense in the court to bar the lawsuit. It's important to note that there are some exceptions and nuances to these laws, such as the discovery rule which may extend the filing deadline if a breach was not discovered immediately.