Definitions

stated

Account stated

Under United States law, account stated is a statement between a creditor (the person to whom money is owed) and a debtor (the person who owes) that a particular amount is owed to the creditor as of a certain date. Often the account stated is a bill, invoice or a summary of invoices, signed by the customer or sent to the customer who pays part or all of it without protest. An account stated may also be established when the debtor retains the statement of account (for example the bill or invoice) without objecting, for an unreasonable length of time. "Unreasonable" is determined by looking at the surrounding circumstances. 1 Am. Jur. 2d Accounts & Accounting section 26 (West 2007). The elements of account stated are: (1) prior transactions between the parties which establish a debtor-creditor relationship; (2)an express or implied agreement between the parties as to the amount due; and (3) an express or implied promise from the debtor to pay the amount due. 1 Am. Jur. 2d Accounts & Accounting section 26 (West 2007). When a creditor sues for account stated, this sets both the debtor's liability and the exact amount the debtor must pay, which is less complicated than claiming a debt is due and payable. An account stated may carry a longer statute of limitations (time to file suit) than some other forms of debt, depending on the state. Defenses such as fraud or mistake may still be asserted.

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