This post is a contribution from Jaishree Thiyagarajan, an engineer with the SharePoint Developer Support team
This blog is applicable to both Sharepoint 2010 and 2013 environment.
Say you have a Sharepoint 2010 Designer “List workflow” associated to a List. Whenever an item is added to the list, the Workflow gets triggered. If you encounter the error /message “Workflow failed to start and it was cancelled by System Account” in the Workflow History List, then please try the following to resolve the issue.
1. Check whether the workflow files like *.xoml, *.wfconfig, *.rules etc, are in check out state.
a. Open site in the Sharepoint designer
b. Click All files and open the Workflow folder.
c. Navigate to your SPD workflow and you can see the below files.
d. If the above are in “checked-out” state, try to check them in.
2. If you encounter the error “Cannot perform this operation. The file is no longer checked out or has been deleted” when you check in, then Your Workflow Hidden library might contain some extra columns (that are in required state)