Statute of Limitations (SoL)

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antipode12
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Statute of Limitations (SoL)

Postby antipode12 » Fri Aug 22, 2014 2:30 pm

I thought the SoL in NYS was 6 years for Credit Card (open-ended) debt.

BUT, I read a site (http://www.creditcards.com/credit-card-news/credit-card-state-statute-limitations-1282.php) and it seems to say that MY state is irrelevant -- that it is the state of the Credit Card Bank that matters.


For example, it states that Chase abides by Delaware statutes -- with an SoL of 3 years.

Any insights?


antipode12
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Postby antipode12 » Fri Aug 22, 2014 2:39 pm

Also, I believe that the debts have been sold to Collections Agencies, so the the original CC Bank doesn't own the debt any longer.

So does that mean that the Collection Agencies' home states are the where the SoL will originate from?

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Postby MemberSince99 » Fri Aug 22, 2014 4:10 pm

It says that some creditors put in their agreements (all that paperwork they send you when you open the account) that the statute is their state laws determine the terms rather than your home state. So you would have to check that assuming you still have it.


And reading from that link it seems various courts see fit to determine which SOL to apply as well on the fly. So you just never know but in general the SOL in your state is usually what is applicable.


I would think generally the SOL used would be your state's. Honestly my state has a longer SOL for revolving debt than most of the companies listed in the link you provided do in their states. (6 years).


That whole thing about Collectors falls into a grey area but in my experience, with the 6 year SOL in Wisconsin, my debts charged off in fall of 2002 and I noticed that the vultures quit checking my credit reports (they had been pulling them regularly) pretty much exactly 6 years later. All of a sudden it just went dead quiet and that was the end of the activity. Prior to that I'd had Wolpoff and Abramson trying to sue me by sending a process server to an address I hadn't lived in for 6 years, and small claims suits through the mail. Fun times. I can't say I miss that nonsense at all. I can't say I'm free of debt today but I am free of credit card debt I only owe for my student loans, my vehicles and soon a mortgage. That's all I want.

antipode12
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Postby antipode12 » Sun Aug 24, 2014 8:33 pm

Not to be a nudge, but I've been reading more on this.

There's this, from NYS law, which I readily admit I do not understand:
N. Y. Civil Practice Law and Rules
§ 202. Cause of action accruing without the state. An action based upon a cause of action accruing without the state cannot be commenced after the expiration of the time limited by the laws of either the state or the place without the state where the cause of action accrued, except that where the cause of action accrued in favor of a resident of the state the time limited by the laws of the state shall apply.



This is what my Chase agreement says:
GOVERNING LAW
THE TERMS AND ENFORCEMENT OF THIS AGREEMENT AND YOUR ACCOUNT SHALL
BE GOVERNED AND INTERPRETED IN ACCORDANCE WITH FEDERAL LAW AND, TO THE
EXTENT STATE LAW APPLIES, THE LAW OF DELAWARE, WITHOUT REGARD TO
CONFLICT-OF-LAW PRINCIPLES. THE LAW OF DELAWARE, WHERE WE AND YOUR
ACCOUNT ARE LOCATED, WILL APPLY NO MATTER WHERE YOU LIVE OR USE THE
ACCOUNT.



And the NEDAP site explains that the bank's state should apply: http://www.nedap.org/hotline/defenses.html

Update!

In April 2010, New York’s highest court, the Court of Appeals, confirmed that the statute of limitations that applies to a credit card debt may be shorter than six years, depending on where the credit card issuer is based. (See here for the Court’s decision, from Portfolio Recovery Associates v. King.)

Here’s how it works: New York has a law stating that the statute of limitations on a credit card debt is six years. But New York law also states that a creditor cannot take advantage of NY’s six-year statute of limitations if the creditor’s home state has a shorter statute of limitations. (This is what New York’s highest court recently confirmed.) Some of the biggest creditors – such as Chase, Bank of America, and Discover – have home states with three-year statutes of limitations. If you are sued on a Chase, Bank of America, or Discover credit card debt, a three-year statute of limitations will generally apply.

Example #1: Let’s say you had a Big Bank credit card. The last time you made a payment was in January 2007. You therefore “defaulted” in February 2007 (you usually “default” on a credit card debt about 30 days after your last payment). The statute of limitations starts running from your default, in February 2007. Big Bank sues you in a New York court in August 2010. Big Bank is based in Delaware, which has a three-year statute of limitations for credit card debts. Question: Has Big Bank waited too long to sue you?

Answer: YES. Since Big Bank is based in Delaware, which has a three-year statute of limitations for credit card debts, New York law says that Delaware’s three-year statute of limitations must apply. Big Bank cannot take advantage of New York’s longer six-year statute of limitations just because it sued you in New York. Because Big Bank waited more than three years to sue you on the credit card debt, the statute of limitations has expired, and the court must dismiss the case.

This same rule applies even if you are sued by a debt buyer on a credit card debt and not by the original creditor.

Example #2: The same facts as in Example #1, except now, instead of Big Bank suing you, a debt buyer called XYZ Funding has sued you on your Big Bank credit card. Question: Has XYZ Funding waited too long to sue you?

Answer: YES. You still look at where the original creditor is based – the debt buyer does not get any more time to sue you than the original creditor would have had. In Example #2, the statute of limitations that applies is still Delaware’s three-year statute of limitations, since Big Bank is based in Delaware. (It doesn’t matter where XYZ Funding is based.) Since XYZ Funding waited more than three years to sue on the Big Bank credit card debt, the statute of limitations has expired, and the court must dismiss the case.



This is the link to the 2010 case that says Delaware's SoL can apply in place of NY's. I am not so good with the legalese, so if anyone can help... http://www.law.cornell.edu/nyctap/I10_0068.htm

This all seems important because the VAST majority of people and sites out there say that the Borrower's SoL is what applies. But these resources seem to contradict that conventional wisdom.

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otter
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Postby otter » Sun Aug 24, 2014 9:38 pm

I think what OP is hoping is that Chase goes with Delaware since the SoL there is three years as opposed to 6 years. They don't have to, I believe. The best thing you can do is consult an attorney because statutes of limitation can be very tricky. Like member, I too went through my bad period in Florida. In Florida,the SoL is five years, but I was sued after five years and had to get an attorney who got it dismissed. It seems you, as the defense, have to invoke SoL (at least in FL). People lose debt cases in Florida even after it is off their report simply because they don't seek counsel.
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antipode12
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Postby antipode12 » Mon Aug 25, 2014 11:57 am

Yes, it certainly seems like a tricky topic.

The article I cited shows that in 2010, a NY judge determined that the debt's SoL lies in the bank's state, not the debtor's. Thus for most banks, Delaware or Dakota.

But that flies in the face of most conventional wisdom.

I'm trying to determine how to approach this. If I can point it out to the CAs, can I get them to back away? If I get sued, would this be a reasonable defense?

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Postby MemberSince99 » Mon Aug 25, 2014 5:00 pm

Only matters if a judge thinks that's a reasonable defense really, not whether we do. I'm fine with it, but not sure if a judge would be.



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