Being Sued 2 Days to Hearing Florida SOL

[viper1511]

I have a debt to one of the major credit card company, as I understand the statute of limitation on that is 4 years. Last time I stopped paying was in 2003 so it has been roughly 4 year since. I have been living in a different state until late 2003.

The creditor has tried to sue me before and failed due to lack of documentation, they are going again. The credit limit was 1,200 and they are suing me for almost $4,000 and they will not take $2,000 which I think its insane, but oh well.

I have been thinking of Statute of limitation, but I dont know what to do in court. Do I just go in there and say I have this debt, but statute of limitation is up? Do I need to provide documentation that I have been in florida for 4 years? My drivers license only was changed to Florida address in 2004-2005.

Please give me a legal advice I have to go to court in 2 days time, and I would like to at least have a clue what to say or how to defend myself.

[bigjohnstud4200]

I have a debt to one of the major credit card company, as I understand the statute of limitation on that is 4 years. Last time I stopped paying was in 2003 so it has been roughly 4 year since. I have been living in a different state until late 2003.

The creditor has tried to sue me before and failed due to lack of documentation, they are going again. The credit limit was 1,200 and they are suing me for almost $4,000 and they will not take $2,000 which I think its insane, but oh well.

I have been thinking of Statute of limitation, but I dont know what to do in court. Do I just go in there and say I have this debt, but statute of limitation is up? Do I need to provide documentation that I have been in florida for 4 years? My drivers license only was changed to Florida address in 2004-2005.

Please give me a legal advice I have to go to court in 2 days time, and I would like to at least have a clue what to say or how to defend myself.

SOL in florida is going to likely be considered "written" since VISA, MC, Discover, AMEX, etc are based on "written instruments" (you sign everytime you use the card). You're likely to be defeated in the SOL defense. Your best defense is to make them prove you owe anything. Are they the legal assignee, do they have proof of the debt, etc. DO NOT ADMIT ANYTHING!

[viper1511]

Well, they took me to court first time about 6-7 months ago, I admitted that I owned them something. I didnt agree with the amount, but I did admit. Since this is a different court, can I do something different?

They are lawyers from on behand of the CC, they have proof of everything, even my application for the CC. The case was dismissed last time due to lack of recordkeepers presence.

Am I screwed?

[viper1511]

^

[divemedic]

Not only that, but since you were out of the state, the SOL was tolled while you were gone. Don't lose hope though. Claim SOL and make them prove that the debt is based on a written instrument, and make them prove you were absent.

just don't let that be your only defense.

[viper1511]

Should I admit that I owe them money, since they have written contract and I have admitted it last time they took me to court?

[beachmonkey]

Did the case get dismissed with predjudice the first time?

Also if you want, request a continuance so you have time to get all of your affairs in order. The more you can dig up, the better you will be able to defend and know what to expect from them.

[viper1511]

case was dismissed because someone didnt show up or called. not sure otherwise.

[daprez1963]

SOL in florida is going to likely be considered "written" since VISA, MC, Discover, AMEX, etc are based on "written instruments" (you sign everytime you use the card). You're likely to be defeated in the SOL defense. Your best defense is to make them prove you owe anything. Are they the legal assignee, do they have proof of the debt, etc. DO NOT ADMIT ANYTHING!

you need to read up on this FLORIDA case law...though its about a store account, it goes on to say what is needed in this state to be considered to be found on a written instrument.

Portfolio Recovery Associates, LLC v Paul Fernandez 13 Fla L. Weekly Supp. 560, 561

• “Further, action is not founded on written instrument where evidence of liability consist partially of written cardholder account and security agreement but writing is incomplete to establish liability–According, contract is regarded as oral for stature of limitations purposes”

Portfolio Recovery Associates, LLC v Paul Fernandez 13 Fla L. Weekly Supp. 560, 561

• “Contract action is not founded upon written instrument for purpose of statue of limitations, where written instrument is link in chain of evidence to prove cause of action, but does not on its face establish all elements of plaintiff’s claim.”

ARDC Corp v Hogan, 656 So.2d 1371 (Fla 4th DCS 1995), rev den. 666 So2.d 143 (Fla 1995)

• “Where an agreement as set forth in writing is so indefinite as to necessitate resort to parole evidence to make it complete in applying the statue of limitation, it must be treated as an oral contract.”

McGill v Cockrell, 101 So.2d 199 (Fla. 1924) Id at 201.

• Although evidence of liability relied on may be partly written, the transaction may be regarded as an oral one, if the writings are so indefinite or incomplete as to necessitate oral testimony to establish liability on the part of the defendant in terms of the transaction.

Johnson v. Harrison Hardware & Furniture Co. (1934) 119 Fla. 470, 152 So. 708, rehearing denied 119 Fla. 471, 160 So. 878.

• “An open account is a debt created by a series of credit transactions.”

“An action on an open account accrues when the last payment on the account falls due.”

Hawkins v, Barnes, 661 So.2d 1271, Fla. App. 5 Dist. 1995.

[divemedic]

1 Your quote of McGill v Cockrell is very far off base. That case involved an employment contract (retainer for an attorney). You need to include the entire paragraph to understand the meaning:

Those letters constitute the written evidence of the contract between the parties and satisfies the five-year statute of limitations. Although the letter contained no agreement to pay a certain sum of money for the services to be rendered, the promise to pay a reasonable sum is raised from the agreement to engage the attorneys and their acceptance of the employment. The employment of an attorney to render professional services to another is an express and definite agreement and leaves nothing to be explained by parol testimony. Therefore, it does not come within the rule that, where an agreement as set forth in writing is so indefinite as to necessitate resort to parol testimony to make it complete, in applying the statute of limitations, it must be treated as an oral contract.

Hawkins v Barnes is a disagreement over a store account with a fetilizer store- it does not even fall under this case. (It is a store card)

Be careful when citing cases- get it wrong and you screw yourself.

[divemedic]

By the way, there are all sorts of statutes that give us an idea of how the legislature chooses to define a "written instrument"

673.1041 Negotiable instrument.--

(2) The term "instrument" means a negotiable instrument.

So then we look that up:

(1) Except as provided in subsections (3), (4), and (11), the term "negotiable instrument" means an unconditional promise or order to pay a fixed amount of money, with or without interest or other charges described in the promise or order, if it:

(a) Is payable to bearer or to order at the time it is issued or first comes into possession of a holder;

( Is payable on demand or at a definite time; and

© Does not state any other undertaking or instruction by the person promising or ordering payment to do any act in addition to the payment of money, but the promise or order may contain:

1. An undertaking or power to give, maintain, or protect collateral to secure payment;

2. An authorization or power to the holder to confess judgment or realize on or dispose of collateral; or

3. A waiver of the benefit of any law intended for the advantage or protection of an obligor.

[daprez1963]

PORTFOLIO RECOVERY ASSOCIATES, LLC, Appellant, v_ PAUL FERNANDES, Appellee_ Circuit Court, 15th Judicial Circuit (Appellate) in and for Palm Beach County

13 Fla. L. Weekly Supp. 560a

Contracts -- Credit agreement -- Limitation of actions -- No error in dismissal of statement of claim for breach of contract, account stated, and unjust enrichment for debt incurred on credit card based on expiration of four-year statute of limitations -- Construction of conflicting statutory provisions establishing five-year limitations period to recover on contract founded on written instrument and four-year limitations period to recover on liability not founded on written instrument and on store accounts requires that store accounts be subject to four-year statute of limitations whether or not founded on written instrument -- Further, action is not founded on written instrument where evidence of liability consists partially of written cardholder account and security agreement but writing is incomplete to establish liability -- Accordingly, contract is regarded as oral for statute of limitations purposes

PORTFOLIO RECOVERY ASSOCIATES, LLC, Appellant, v. PAUL FERNANDES, Appellee. Circuit Court, 15th Judicial Circuit (Appellate) in and for Palm Beach County. Case No. 502005AP000032XXXXMB, Division ‘AY'. March 6, 2006. Appeal from County Court, in and for Palm Beach County, Judge Nancy Perez. Counsel: Leslie Mark Schneider, Hayt, Hayt & Landau, Miami, for Appellant. Paul Fernandes, Boca Raton, pro se.

(PER CURIAM.) Appellant, Portfolio Recovery Associates, LLC (“Portfolio”), sued Appellee, Paul Fernandes, as the alleged assignee of a debt incurred by Fernandes to Sears National Bank on a Sears credit card. Portfolio filed a statement of claim under the Small Claims Rules for breach of contract (Count 1), account stated (Count 2), and unjust enrichment (Count 3), claiming $3,201.06 in damages.

Fernandes orally moved to dismiss the claims as outside the statute of limitations at the pretrial conference. See Rule 7.090©, Fla. Sm. Cl. R. Portfolio argued that Florida Statute §95.11(2)(, which provides for a five year statute of limitations, governed because the statement of claim alleged a cause of action to recover on a contract founded on a written instrument. Fernandes argued that Florida Statute §95.11(3)(k), which provides for a four year statute of limitations, governed because the action was not founded on a written instrument or was on a store account. The trial court dismissed the case based on its finding that the credit card account was an open account subject to the four year statute of limitations.1

Portfolio argues that the trial court erred when it dismissed the statement of claim based on a finding that the claim was barred by the four year statute of limitations. We disagree.2

An order dismissing a complaint is reviewed de novo. See City of Hollywood v. Petrosino, 864 So.2d 1175 (Fla. 4th DCA 2004). The claim must be taken as true and considered in the light most favorable to the plaintiff, subject to the trial court's ability to summarily dispose of small claims actions if no triable issue exists. See Bryant v. Adventist Health Systems Sunbelt, Inc., 869 So.2d 681 (Fla. 5th DCA 2004); Rule 7.135, Fla. Sm. Cl. R.

The nature of the claim, and not the specific form of action selected by a plaintiff to assert it, determines the applicable statute of limitations. See 20 Am. Jur. 2d, Credit Cards, §46 (2005). In Count 1, Portfolio alleged that Fernandes “by execution of the application and/or by use of the credit card, accepted the terms and conditions of the credit card holder agreement” attached as Exhibit A. Attached as Exhibit A was a copy of a document entitled “Sears Credit Card Account Sears Premium Card Account Cardholder Account and Security Agreement.”

Section 95.11(2)(, Fla. Stat., provides that the statute of limitations on actions to recover on a contract founded on a written instrument is five years. Conversely, section 95.11(3)(k), Fla. Stat., provides that the statute of limitations to recover on a contract, obligation or liability not founded on a written instrument and on store accounts is four years.

When construing statutes, the specific controls over the general. See Northwest v. Balkany, 727 So. 2d 382 (Fla. 5th DCA 1999). Thus, if a claim arguably falls within two contradictory subsections of the statute, the more specific controls. Even if Count 1 could be deemed an action founded on a written instrument, it can also be deemed an action on a store account. See 20 Am. Jur. 2d, Credit Cards, §46 (2005); Carte Blanche Corporation v. Pappas, 216 So. 2d 917 (La. 2d Cir. 1968).3 Store accounts have been subject to a separate statute of limitations since 1872. Laws of Florida 1872, c. 1869, §10; McClellan's Digest, §10, p. 733. “The provision is for the benefit of those who have stores, and keep goods therein for sale, and sell them, keeping accounts against the purchasers and relying upon their books of accounts in which the articles are charged as evidence in case of controversy,” and applies whether there is an express or implied agreement covering the charges. Saloman v. The Pioneer Co-operative Company, 21 Fla. 374, 385, 1885 WL 1777 (Fla. 1885). The current grammatical structure, which provides for the limitations period on actions “upon a contract . . . not founded upon an instrument of writing, including an action for goods, wares and merchandise sold and delivered, and on store accounts,” has been used since 1919. (emphasis supplied). Laws of Florida 1919, c. 7838, §10, subd.9. “. . . ©lauses separated by commas are nonrestrictive clauses intended to introduce independent concepts.” Amendments to the Florida Rules of Appellate Procedure, 696 So. 2d 1103, 1108, footnote 6 (Fla. 1996) (Anstead concurring) (quoting brief); see, also, The Elements of Style, Struck and White, 3rd Ed., p. 5 (“(p)lace a comma before a conjunction introducing an independent clause”). Thus store accounts are subject to a four year statute of limitations whether or not founded on a written instrument. See Saloman, supra; Wagner v. Botts, 88 So. 2d 611, 613 (Fla. 1956) (“(h)istorically, parliamentary enactments originally were not punctuated at all. However, the Legislatures of our country have consistently attempted to follow the rules dictated by grammar books with the result that statutes are now punctuated prior to enactment. The better rule now seems to be that punctuation is a part of the Act and that it may be considered in the interpretation of the Act but may not be used to create doubt or to distort or defeat the intention of the Legislature . . . We deem it proper to adhere to what now appears to be the better rule which is to treat the rules of punctuation on a parity with other rules of interpretation.”); Broward Builders Exchange, Inc. v. Goehring, 231 So. 3d 513, 515 (Fla. 1970) (“(i)t cannot now be assumed that the Legislature was unfamiliar with this simple rule of punctuation . . .”). Store accounts, of course, as a species of open accounts, may be based on either a written or oral agreement. See Robert W. Gottfried v. Cole, 454 So. 2d 695 (Fla. 4th DCA 1984); Hawkins v. Barnes, 661 So. 2d 1271 (Fla. 5th DCA 1995).

Count 1 alleges that Fernandes bound himself to the terms of the Cardholder Account and Security Agreement either when he executed an application for a Sears card or when he used a Sears card. If the Cardholder Account and Security Agreement alone were introduced into evidence at trial, though, it would not be sufficient to establish Fernandes' liability. See Colorado National Bank of Denver v. Story, 261 Mont. 375, 862 P. 2d 1120 (Mont. 1993). By itself, it created no liability for Fernandes.4 Instead, it addressed the manner in which a liability which might be later created should be discharged.5 If evidence of liability is partially in writing but the writings are incomplete to establish liability, then the contract is regarded as oral for statute of limitations purposes. See ARDC Corporation v. Hogan, 656 So. 2d 1371 (Fla. 4th DCA 1995), rev. den. 666 So. 2d 143 (Fla. 1995); Multi-Line Claims Service, Inc. v. Cumis Insurance Society, Inc., 739 So. 2d 144 (Fla. 3d DCA 1999) (four years statute of limitations for breach of oral contract applied to action on oral contract for adjusting services, though parties agreed to compensation based on a written fee schedule); Johnson v. Harrison Heardware Furniture Co., 119 Fla. 479, 472, 160 So. 878 (1935) (“(t)he writings attached to, relied on, and made a part of, the second amendment to plaintiff's replication do not on their face constitute a contractual acknowledgment of the loan of any money by plaintiff to defendant, which is the thing sued for, therefore such writings per se can avail nothing to plaintiff as a sufficient preclusion of the bar of the three-year statute of limitations [applicable to actions not founded upon an instrument in writing.] . . .”); Gulf Life Inc. Co. v. Hillsborough County, 129 Fla. 98, 104, 176 So. 72 (1937) (“(i)n order that a contract be founded upon a written instrument, the instrument must contain a contract to do the thing for the nonperformance of which the action is brought.”); Ball v. Roney, 112 Fla. 186, 150 So. 240 (1933); Schrank v. Pearlman, 683 So. 2d 559 (Fla. 3d DCA 1996), rev. den. 691 So. 2d 1081 (Fla. 1997).6 The action is not founded on a written instrument for statute of limitations purposes.7

The legislative scheme makes sense. See Bush v. International Fidelity Ins. Co., 834 So. 2d 212 (Fla. 4th DCA 2002), rev. den. 847 So. 2d 976 (Fla. 2003) (statutory provisions to be given reasonable and logical construction). “. . . (S)tatutes of limitations are designed to prevent undue delay in bringing suit on claims and to suppress fraudulent and stale claims from being asserted, to the surprise of parties or their representatives, when all the proper vouchers and evidence are lost, or the facts have become obscure from the lapse of time or the defective memory or death or removal of [a] witness.” Foremost Properties, Inc. v. Gladman, 100 So. 2d 669, 672 (Fla. 1st DCA 1958), cert. den. 102 So. 2d 728 (Fla. 1958) (citation omitted).

A review of the statute shows, consistent with common sense, that those actions on which proof is less likely to deteriorate over time are subject to longer limitations periods; those actions on which proof is more likely to deteriorate because of faulty memory or otherwise are subject to shorter limitations periods. Unlike a written contract containing all the terms sued on, proof of the balance due under a store credit card depends on the correctness of the store's books. We know, though, that record keepers come and go; purchased items are returned or exchanged; and partial payments are made. Proof of the amount due under a store credit card is simply not as secure as proof of the amount due on, for example, a promissory note that contains in writing all the terms of the parties' undertakings. See Nardone v. Reynolds, 333 So. 2d 25, 36 (Fla. 1976), mod. on other grds., Tanner v. Hartog, 618 So. 2d 177 (Fla. 1993) (unfair to allow one who has slept on his rights to sue a party “ ‘. . .who is left to shield himself from liability with nothing more than tattered or faded memories, misplaced or discarded records, and missing or deceased witnesses' ”); Allie v. Ionata, 503 So. 2d 1237 (Fla. 1987).

Because Count 1 alleges a claim on a store account; because it does not allege a claim to recover on a contract founded on a written instrument; because under the Small Claims Rules the trial court properly inquired into undisputed facts at the pre-trial conference that would be dispositive of the claims; and because the trial court properly found that the claims raised in Counts 2 and 3 of the statement of claim were likewise subject to a four year limitations period, which Portfolio does not dispute, it is

ORDERED AND ADJUDGED that the trial court's judgment is AFFIRMED. (SMITH, MAASS and STERN, JJ., concur.)

__________________

1Apparently the trial court summarily disposed of the statement of claim on being apprised of the last payment date. See Rule 7.135, Fla. Sm. Cl. R.

2On appeal from an order of dismissal an appellate court may consider only issues presented to the trial judge. See Sparta State Bank v. Pape, 477 So. 2d 3 (Fla. 5th DCA 1985). This Court agrees with the trial court's decision to dismiss Counts 2 and 3 of the statement of claim. Neither party has taken issue with the trial court's decision to dismiss those counts. Portfolio concedes its claims are precluded if subject to the four year limitations period.

3Portfolio alleges it is the assignee of Sears National Bank, an affiliate of Sears, Roebuck and Co. See preamble to Cardholder Account and Security Agreement; 12 U.S.C. § 1841(k) (“. . .the term ‘affiliate' means any company that controls, is controlled by, or is under common control with another company.”) Under the Competitive Equality Banking Act of 1987, Sears could own a credit card bank without violating the Bank Holding Company Act of 1956 and thus charge a nationwide uniform rate of interest on credit card sales. See, also, Marquette Nat'l Bank v. First Omaha Serv. Corp., 439 U.S. 299, 99 S. Ct. 540 (1978).

4Portfolio implicitly recognized this when it incorporated elements of a claim for account stated in Count 1. See Paragraphs 8, 9, statement of claim; Merrill-Stevens Dry Dock Co. v. “Corniche Express”, 400 So. 2d 1286 (Fla. 3d DCA 1981).

5No statement of account was attached to the statement of claim.

6The cited cases are distinguishable from those where the written instrument obligated the debtor to purchase defined goods or services and pay for them at a contemporaneously determined or determinable rate. Compare, e.g., McGill v. Cockrell, 88 Fla. 54, 101 So. 199 (1924); Mercy Hospital, Inc. v. Carr, 297 So. 2d 598 (Fla. 3d DCA 1974), cert. den. 307 So. 2d 448 (Fla. 1974).

7For example, assume Smith agrees in writing with Jones that if Jones loans him money Smith will repay it with 10% interest. If Jones later sues Smith claiming Smith borrowed money and did not repay it, whether Smith is liable to Jones is dependent on whether and how much he borrowed. Suit to recover the money loaned is not founded on a written instrument. See Johnson v. Harrison Hardware & Furniture Co., supra.

[daprez1963]

1 Your quote of McGill v Cockrell is very far off base. That case involved an employment contract (retainer for an attorney). You need to include the entire paragraph to understand the meaning:

6The cited cases are distinguishable from those where the written instrument obligated the debtor to purchase defined goods or services and pay for them at a contemporaneously determined or determinable rate. Compare, e.g., McGill v. Cockrell, 88 Fla. 54, 101 So. 199 (1924); Mercy Hospital, Inc. v. Carr, 297 So. 2d 598 (Fla. 3d DCA 1974), cert. den. 307 So. 2d 448 (Fla. 1974).

[divemedic]

That illustrates what I was getting at (although I don't know why you posted the entire case) So many people misuse case law, and I worry sometimes that it will get them in trouble.

The paragraph that helps the most is this one:

A review of the statute shows, consistent with common sense, that those actions on which proof is less likely to deteriorate over time are subject to longer limitations periods; those actions on which proof is more likely to deteriorate because of faulty memory or otherwise are subject to shorter limitations periods. Unlike a written contract containing all the terms sued on, proof of the balance due under a store credit card depends on the correctness of the store's books. We know, though, that record keepers come and go; purchased items are returned or exchanged; and partial payments are made. Proof of the amount due under a store credit card is simply not as secure as proof of the amount due on, for example, a promissory note that contains in writing all the terms of the parties' undertakings. See Nardone v. Reynolds, 333 So. 2d 25, 36 (Fla. 1976), mod. on other grds., Tanner v. Hartog, 618 So. 2d 177 (Fla. 1993) (unfair to allow one who has slept on his rights to sue a party “ ‘. . .who is left to shield himself from liability with nothing more than tattered or faded memories, misplaced or discarded records, and missing or deceased witnesses' ”); Allie v. Ionata, 503 So. 2d 1237 (Fla. 1987).

[nascar]

The whole thing around proving written is really very simple. It all revolves around the term "ambiguity."

If the writing, or evidence of written agreement is so unclear or ambiguous that the terms of the agreement cannot be ascertained without the assistance of parol evidence, then the agreement will not meet the requirments of a "written contract."

IMO, you'll have a very difficult time convincing a court that a Cardholder Agreement is ambiguous. Hard to understand ... maybe, but ambiguous as it applies here, not likely.

[divemedic]

What is ambiguous is the balance. Don't you think?

[daprez1963]

The whole thing around proving written is really very simple. It all revolves around the term "ambiguity."

If the writing, or evidence of written agreement is so unclear or ambiguous that the terms of the agreement cannot be ascertained without the assistance of parol evidence, then the agreement will not meet the requirments of a "written contract."

IMO, you'll have a very difficult time convincing a court that a Cardholder Agreement is ambiguous. Hard to understand ... maybe, but ambiguous as it applies here, not likely.

the agreement....does it have the cardholders signature? does it have the amount? does it have the rate of interest? does it have the account number? does it in fact, have anything to tie it to the cardholder?

cardholder agreements are pieces of paper that could have come from anywhere, anytime...

i have yet to have a case that included signed slips....

all the evidence ever presented were puzzle pieces that needed to be linked with testimony from someone else...which the court views as paroling the evidence and can not be viewed as a written instrument in itself, all on one single piece of evidence or instrument..thus, they view it as oral. alot different if you were to say, have a contract for a car loan.

[divemedic]

Numerous members here have lost on those grounds, and been stuck with the 5 year SOL. This isn't a cut and dried issue. You need to be prepared to defend your position if you are going to claim the 5 year SOL.

[nascar]

What is ambiguous is the balance. Don't you think?

You would think so, but the agreement will usually always specify how the monthly payment is arrived at, what constitutes acceptance of the agreement, and incorporates by reference statements and other records reflecting account activity.

The amount becomes ambiguous when it gets into the hands of a JDB, for sure.

[daprez1963]

You need to be prepared to defend your position if you are going to claim the 5 year SOL.

you mean 4 years, not 5...