Before you pick a new domain name for your website, you must take into consideration its past details. We all are quite familiar with the fact that expired domains can either benefit or can affect your efforts significantly. Along with it, we also know that manual actions expire but the question is do algorithmic actions expire?
Google’s Matt Cutts has discussed about effect and difference between manual action and algorithmic action on an expired domain.
He explained that if a domain is not present on the web since 2001, then there is a possibility of expiration of its manual web spam actions a long time ago. On the other hand, if the domain did something in 2001, then it may lead to algorithmic ranking issues.
In case, you buy a new domain and experience certain problems, then surely it is because of the fact that someone is spamming with the domain.
On the whole, if domain expired long ago, then you must not worry about manual actions but it would be a wise idea to stay on safe side and log in to webmaster tool to check if there are any manual actions. If actions are available, then you must send a reconsideration request.
Now, talking about algorithmic actions, according to Matt Cutts, there are very less chances for a 12 year old domain to still have algorithm consequences on the site.