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SOL Laws?


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What type of debt is this? Is it a written contract (like a prom note) or just an open acct (like a credit card)? Also, who is trying to collect? Is it the original creditor or a 3rd party collector? All of these make a difference as to which law applies.

Ohio has a 6 yr SOL for written or oral accts as well oral contracts. But written contracts have a SOL of 15 yrs. Compare ORC 2305.06 to ORC 2305.07. If the judge thinks your written debt is a contract rather than an acct you will face the 15 yr SOL.

However, if this is a 3rd party collector, they are subject to the FDCPA and must sue you where you live. KY law has a 5 yr SOL for oral debts and 10 yrs for all others (which seem to include any written agreement).

The contract or agreement itself can also state what laws apply. But that would only be enforceable by the original creditor. As you can see, these matters can get quite complicated.

I highly recommend that those with serious debt problems contact an atty.

The best debtor attys are found at the Natl Assoc. of Consumer Attys.

Their website is naca.net where you can search for local attys. Many of

them will talk to you on the phone for free.

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I have done some research on this issue but not exhaustive research.

This is what I've found.

Generally, the contract/note will be enforced on its terms. But there are many factors such as your home state's Choice of Law provisions (esp. California), federal laws such as FDCPA and other arguments such as contract of adhesion or laches or public policy that can defeat these terms.

See eg. Washington Mutual v. Superior Court (CA 2001). That case can start some serious research. But this matter is complicated and will vary widely from state to state.

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Also recent arbitration clauses typically used by credit card companies are also under attack. See the following article from budhibbs.com.

Did credit-card companies collude to force arbitration?

Thursday, September 01, 2005 By Carrick Mollenkamp, The Wall Street Journal

Many of the largest U.S. credit-card companies require customers to sign away their ability to take disputes to court and instead settle disagreements in arbitration.

Now that practice itself is under attack in court. A lawsuit filed recently in federal court in New York City alleges the credit-card companies held secret meetings where they colluded to promote arbitration, in violation of federal antitrust laws.

The complaint alleges that eight of the nation's biggest card issuers -- Bank of America Corp., Capital One Financial Corp., J.P. Morgan Chase & Co., Morgan Stanley's Discover unit, Citigroup Inc., MBNA Corp., Providian Financial Corp. and HSBC Holdings PLC of the United Kingdom -- "combined, conspired and agreed to implement and/or maintain mandatory arbitration."

Some of the banks named allegedly convened a group in 1999 called the "Arbitration Coalition" or "Arbitration Group," the complaint says.

The suit, which was filed last month and is seeking class-action status, claims that bank representatives spoke or met at least 20 times from 1999 to 2003 to share experiences from arbitration as well as advice on how to set up arbitration agreements with consumers that would withstand challenges in court.

In general, it is illegal under federal antitrust law for competitors in any industry to secretly collude to restrict trade or commerce.

A spokeswoman for Capital One said in a statement that the company doesn't comment on pending litigation but added that its "arbitration clause allows either party involved in a dispute to have the case considered by an impartial arbitrator to determine a final and binding resolution to the problem."

Representatives of the other banks either declined to comment or couldn't be reached. The financial firms named in the case have yet to respond to the substance of the allegations in court.

The case, filed on behalf of seven plaintiffs who live in California, Pennsylvania, New York, Illinois and New Jersey, comes as mandatory arbitration clauses are becoming increasingly common in industries ranging from cable television to Wall Street brokerage firms.

Companies have argued that arbitration provides a speedy and fair alternative to litigation and prevents disputes from escalating into class-action complaints that can cost them and their shareholders dearly.

Consumer-rights advocates claim the practice unfairly removes consumers' right to pursue a class-action complaint or a jury trial over such things as late-payment penalties while also allowing companies to settle claims with little publicity.

A recent study by Ernst & Young, citing criticism of arbitration, reported that while consumers often can opt out of mandatory arbitration clauses, they rarely know such an option exists and that it can be buried in a card agreement's fine print. The study found consumers prevailed more often than businesses in an arbitration. Ernst & Young said it was engaged by the law firm Wilmer Cutler Pickering Hale and Dorr, which has worked with card companies.

The case against the credit-card companies also gives details on the practices of a Minneapolis-based group called National Arbitration Forum, one of several national arbitration panels that hear disputes between companies and customers across a wide range of industries.

According to the complaint, NAF billed itself in one solicitation as "the alternative to the million-dollar lawsuit." The complaint doesn't specify who the solicitation was aimed at, but says: "The clear implication of this appeal to corporate clients is that arbitration through NAF will effectively eliminate any significant remedy in a consumer dispute, whatever the underlying merits."

The complaint also alleges the group said that its rules provided for "very little, if any, discovery" -- the legal term for fact-finding once a case has been filed. NAF isn't named as a defendant in the suit.

Curtis Brown, the general counsel for NAF, said in an emailed response to questions: "Since we are not a party to the lawsuit, I would direct you to the parties and their lawyers for a comment." He said NAF provides unbiased arbitrators and he cited past court decisions establishing that the NAF treated consumers fairly.

The central allegation in the case concerning arbitration clauses is that the defendant banks worked together to create or maintain mandatory arbitration clauses as a way to thwart class-action lawsuits brought by consumers. The plaintiffs, represented by Berger & Montague of Philadelphia and other firms, are seeking to have the mandatory arbitration provisions in the complaint declared void.

According to the complaint, two prominent law firms advised the banks in creating the arbitration group or attended meetings where strategies for discussing arbitration were discussed. Those firms, not named as defendants in the suit, are Wilmer Cutler, of Boston and Washington, D.C., and Ballard Spahr Andrews & Ingersoll of Philadelphia.

Representatives of Wilmer Cutler were unavailable for comment. Ballard Spahr declined to comment.

The complaint alleges that the banks began discussing the issue of mandatory arbitration clauses in the late 1990s, the same time that the clauses were introduced in the industry. The agenda for the first Arbitration Coalition meeting, held in the summer of 1999, outlined how the group could work together on promoting mandatory arbitration, the complaint alleges.

Among the proposed steps were "sharing best practices" and drafting "enforceable arbitration clauses," the complaint alleges. Two additional groups were formed: the "Consumer Class Action Working Group" and the "In-House Counsel Working Group," the complaint says.

For a conference call in the summer of 2001, bank representatives were given the access-code word, "arbitration," the complaint alleges. The agenda, according to the complaint, included seeking ways to protect the banks from plaintiff lawyers and ways to create an informal " 'information please' email network."

There is or was a case in California re arbitration clauses and involved a class action suit against America Online. I dont have the cite handy but it was in the last few years.

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Nellie Mae loans are most certainly private loans. There is no govt involvement in these loans. So as we have established, an SOL does apply to these loans, usually the one of the state where you currently reside or, in some cases, as is stated in the prom note (you can still fight this tho).

The fact that these loans are insured by a nonprofit only makes them nondischargeable in bankruptcy. It does not make them immune to the applicable SOL as federal student loans are. Look at 20 USC 1091a, the law which eliminated SOLs for federal loans and try to find anything mentioning private loans. There is no mention of them. Only local case

law can say differently (they may be some but I havent found any yet).

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  • 2 weeks later...

If you'll allow me to guess at Grim's meaning...

Its the golden rule of arbitration-

He who has the gold makes the rules.

or more plainly said-

He who pays the arbitrator gold - wins

The CC Companies pay the traitors - Ooophs I mean arbitrators, or is it our-traitors ?

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First clue: read your prom note. It may state which laws apply whether that may be arbitration, a specific state's law or otherwise. Even if a specific law/rule is stated, it can still be litigated altho the fight is uphill.

Many mandatory arbitration clauses are being challenged in court.

If no law/rule is stated, I would argue the SOL laws of the state where you currently reside. It is their burden to prove those laws dont apply and if there is nothing in the note they will have a difficult time doing so.

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Regarding SOL, the state you now reisde in takes precedence. But, if you moved back to the previous state and took up residence, they can toll the SOL and come after you. In short, visit, don't rent a home. As to suing you, they are allowed to sue only in the county you signed the papers, or the county you reside in. Now, if they sued you in the previous state, they would end up with a default as you would be unable to attend, right? Right! They won't unless they can be assured their judgment can be domesticated in your present state. I say this as some states will not allow a default judgment from another state to be domesticated in their state. Therefore, they will only sue in your present state. Then, they usually take into consideration the amount of the debt, etc. True, you are liable for all fees, etc. but, at the same time, they must look at the bottom line.

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The fact that these loans are insured by a nonprofit only makes them nondischargeable in bankruptcy.

Profit gurantor loans are dischargeable.

In re LINDA LORRAINE PILCHER, Debtor. HEMAR SERVICE

CORPORATION OF AMERICA, INC., Appellant, v. LINDA LORRAINE

PILCHER, Appellee. BAP No. AZ-92-1574 RMeJ

UNITED STATES BANKRUPTCY APPELLATE PANEL OF THE NINTH

CIRCUIT

149 B.R. 595; 1993 Bankr. LEXIS 88; Bankr. L. Rep. (CCH)

P75,120; 93 Cal. Daily Op. Service 953

January 21, 1993, Filed

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