Legal Memorandum: Statute of Limitations for Promissory Notes

Issue: Under Minnesota law, what is the statute of limitations for an action on a promissory note with a definite due date?

Minnesota Statute § 336.3-118, which applies to negotiable instruments, including promissory notes, states that "an action to enforce the obligation of a party to pay a note payable at a definite time must be commenced within six years after the due date or dates stated in the note."  Minn. Stat. § 336.3- 118(a).  Historical note 2 to the statute states:  “If the note is payable at a definite time, a six-year limitations period starts at the due date of the note, subject to prior acceleration.”

The law is clear that the statute of limitations begins to run on a promissory note payable at a definite time in the future at the date the note becomes mature, which is the date the note states is the due date.  See 54 C.J.S. Limitations of Actions §151.  Although no Minnesota case law explicitly determining this issue was found, the Eighth Circuit in Collins v. Environmental Sys. Co., 3 F.3d 238 (8th Cir. 1993) (applying Minnesota law) acknowledged this law in dicta: "Upon maturity, of course, the limitations periods on the notes would have begun to run and would have expired six years later[.]"  3 F.3d at 240.

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