Legal Definitions - Things in action

The legal term Things in action refers to an intangible legal right to recover something, typically money, from another party through a lawsuit. Unlike physical property that you can touch or possess, a "thing in action" is a claim or a right that can only be enforced or realized by taking legal action in court. This right exists until the claim is either successfully resolved through a judgment or settlement, or the legal time limit for pursuing the claim (known as the statute of limitations) expires.

Here are some examples to illustrate this concept:

• Unpaid Services: Imagine a freelance graphic designer who completes a logo design project for a client. The client is happy with the work but then refuses to pay the agreed-upon fee. The graphic designer now has a thing in action. They have a legal right to sue the client to recover the unpaid amount for their services. This right to pursue the payment through legal means is the intangible asset.

• Breach of Contract for Goods: Consider a manufacturing company that orders a large quantity of raw materials from a supplier, pays for them in advance, but the supplier fails to deliver the materials as per the contract. The manufacturing company possesses a thing in action. They have a legal right to sue the supplier for the return of their payment, or for damages incurred due to the non-delivery. This claim, enforceable through a breach of contract lawsuit, is the "thing in action."

• Insurance Claim: Suppose a homeowner's property is damaged by a storm, and they file a valid claim with their insurance company. If the insurance company unfairly denies the claim or refuses to pay the appropriate amount, the homeowner then has a thing in action. They have a legal right to sue the insurance company to compel them to honor the policy and pay for the damages. This right to recover the insurance benefits through legal action is the "thing in action."