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Each state's legislature sets up time limits within which lawsuits must be filed. These are called statutes of limitations. Time limits are different for different types of cases. If you wait too long, your right to sue will be barred by these statutes.

Why have a statute of limitations? Because unlike wine, lawsuits don't improve with age. Memories fade, witnesses die or move away, and once-clear details become blurred. In other words, disputes are best settled relatively soon after they develop.

Statutes of limitations are almost always at least one year, so if you file promptly, you should have little to worry about.

Act fast for claims against a government agency. To sue a city, county, state, or governmental agency (for example, a school district), you first must promptly file a claim with the people in charge (for example, the school board, county board of supervisors, city council). Once your claim is rejected–and it usually will be–you can file in small claims court. Often, your administrative claim must be filed within three to six months after your loss occurred, or you'll be out of luck.

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