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Question Regarding Statute of Limatations

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Found out that a bank garnishment had been filed against my wife and attached to our joint account.

Filed a Traverse against the garnishment.

Discovered this was from a default judgment from July 2009. I went to the court house to pull the file and discovered that my wife (nor I) had been served. In fact we have proof that we were both out of state on the date of service, and the notes on the service inaccurately describe my wife.

We never knew about the lawsuit, we never received notice of the judgment.

This is a contract debt, not a credit card. The debt is from July of 2004. A copy of the original contract is in the file.

Georgia Law on statute of limitations says 6 years from when it becomes due and payable and the six (6) year period runs from the date of last payment. (OCGA 9-3-24).

According to the contract the loan became payable in full on default.

We are preparing a motion to set aside default judgment due to the improper service.

My question is shall we wait until the judgment is set aside before filing an answer on the lawsuit, so we can now include the SOL as it is now past 6 years? Or is it required that we file an answer with the motion to set aside?

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Hope he does not mind, and for those who need it - and cant get on his board;

Flyingifr: From DB


There is a lot of confusion in Consumer circles about this vital topic so let's try to clear the air. First of all there are TWO different Statutes of Limitations - The Statute of Limitations on Collections (SOLC) and the Time Limit on Reporting (TLR). There is ONE TLR since it is determined by the Federal Fair Credit Reporting Act. There are 51 SOLC's (one for each state plus DC).


Fair Credit Reporting Act Section 605(a)(4) limits the reporting of derogatory information to 7 years. Before 1997 creditors could manipulate that date by deciding not to charge off an account for years reporting it as a 180 day account then charging it off and starting the 7 year clock all over again. The 1996 amendments to FCRA changed that by inserting Section 623(a)(5) which sets by law the concept that FCRA reporting time must begin with the date the first payment was missed that led to the delinquency being reported and that the creditor must report it within 180 days of that date. The 180th date therefore becomes the Statutory Charge Off Date. That is the maximum that a creditor can extend the 7 years. Should the creditor charge the account off before the 180 days after the first missed payment then the actual charge off date becomes the beginning of the 7 year reporting period. Should the creditor choose not to charge the account off for several years then for FCRA reporting purposes the 7 years begins 180 days after the FIRST missed payment that led to the delinquency. I refer you to the Amason letter (http://www.ftc.gov/os/statutes/fcra/amason.htm ) for a more complete discussion of this. While FTC Staff Opinion Letters are not binding on even the FTC they do present very carefully researched insight into the issues at law and the reasoning behind them.

Since Congress has determined the starting date of the 7 year reporting period by law that date becomes a Date-Certain meaning that no action by the creditor can legally change it. Collectors will routinely say they can change it and taking the Lopresti letter ( http://www.ftc.gov/os/statutes/fdcpa/letters/lopresti.htm ) at face value the collector can legally TELL you they can change the Date-Certain but they legally cannot DO it. The Status Date (or Date-Certain) remains with the account unchanged no matter how many times the account is bought and sold. Changing the Status Date is called re-aging and is a FCRA violation. I would like to point out that telling you they can change the Date-Certain would be IMHO a violation of FDCPA Section 807 prohibitions about false and misleading statements.


The Statute of Limitations on Collection is a much murkier topic since there are really 51 different laws to examine. I will be talking in generalities here so I encourage you to spend the time to determine the exact laws in your state. In all instances I am referring to debts that have NOT been reduced to Judgement. Judgements have their own SOLC which in almost all cases is MUCH longer than SOLC as discussed here.

The purpose of SOLC is to comply with the 4th Amendment right to a speedy trial. Some states allow a very long SOLC (I believe Rhode Island can go up to 20 years) so this is problematical. Some states (like Massachusetts) toll or suspend SOLC while the defendant is located outside the state.

As a general rule consumers must be sued in the State Courts of the state in which they reside at the time of the suit. Except as allowed by specific laws like Fair Credit Reporting Act or Fair Debt Collection Practices Act) suits between citizens of different states brought in Federal Court must exceed $75 000 (28 USC 1332). Below that amount the matter is delegated to State Courts.

The contract you signed may state that it will be interpreted under the laws of a certain state or that any suit or controversy must be decided in the Courts of a certain State. If that language is present it will be honored. If it is not then the matter will be decided in the Defendant's state of residence at the time suit is commenced. Some states have "Long Arm" statutes similar to Arizona's which reads: (edited to eliminate the unnecessary provisions)


12-401. Venue

No person shall be sued out of the county in which such person resides except:

1. When a defendant or all of several defendants reside without the state or their residence is unknown the action may be brought in the county in which the plaintiff resides.

4. Persons who have contracted a debt or obligation in one county and thereafter remove to another county may be sued in either county.

6. Persons who have contracted a debt or obligation without the state may be sued in any county in which found.

7. When there are several defendants residing in different counties action may be brought in the county in which any of the defendants reside.

This language is typical. Generally you must be sued in the county in which you reside at the time of the suit but see #1 - this is the "Long Arm" statute wherein the Plaintiff's County is the proper venue.

Now that we have established that a suit CAN be brought and where now comes the question of "when".

There are several sites on the Internet that list the various states' Statute of Limitations. Debtprboards has provided a ;ink to them in the "Laws" section. The SOLC generally begins with each payment that is made. Each payment whether timely or late re-starts SOLC. This is the critical concept in understanding SOLC because when you default the last payment made is where SOLC is counted from. Here in Arizona SOLC generally is 4 years. If a creditor has not commenced suit within that time frame the Statute of Limitations does not BAR a suit but it becomes an Affirmative Defense against the suit.

Many states have provisions in their laws that suspend (or Tolls) the SOLC while the Defendant is outside the state. Arizona's is typical:


A.R.S 12-501. Effect of absence from state

When a person against whom there is a cause of action is without the state at the time the cause of action accrues or at any time during which the action might have been maintained such action may be brought against the person after his return to the state. The time of such person's absence shall not be counted or taken as a part of the time limited by the provisions of this chapter.

This is obviously intended to protect the creditor from someone who leaves the State to avoid paying bills but has intent to return (and in fact has not relocated just fled). Few of us do that. Most of us move from one state to another without intention to return. Arizona has a law that addresses that event:


A.R.S. 12-507. Action against person removing to this state

No demand against a person who removes to this state incurred prior to his removal shall be barred by the statute of limitation until he has resided in this state one year unless barred at the time of his removal to this state by the laws of the state or country from which he migrated.

This is why I can say generally that the SOLC of your resident State (or your previous resident state if time-barred in that state by SOLC) is what prevails. Remember - any payment or in some states even a promise of payment re-starts SOLC. Also keep in mind that bringing a suit or threatening to bringa suit on a time-barred debt is a FDCPA violation all by itself. Therefore it is automatically an AFFIRMATIVE DEFENSE of the time barred savings of law and a Counterclaim for Statutory Damages and Attorney Fees under FDCPA.

Another event that may re-start SOLC is filing BANKRUPTCY. While the SOLC window to file suit in this instance is small (in Indiana it's 30 days) a DISMISSED BANKRUPTCY can in some states give creditors whose debts were time-barred under SOLC before filing Bankruptcy another chance to sue you. Here's a link that lists SOME states and their SOL and Extenders:


In the event that a creditor with an Out-of-SOLC debt files suit it is absolutely imperative that the defendant file an Answer asserting that the action is time-barred by SOLC in that state. While I am not an attorney I would recommend wording similar to this:

AS A FIRST AFFIRMATIVE DEFENSE Defendant denies each and every allegation made by Plaintiff in the complaint; (this is a General Denial)

AS A SECOND AFFIRMATIVE DEFENSE Defendant alleges that this action is time-barred under section XXXX of the laws of the State of XXX (obviously you will have to look up the section of law for your State. Most are on the Internet.)

If you do NOT do this the creditor will probably get a Judgement against you even though the debt is time-barred. YOU MUST RAISE THE ISSUE - they won't and the Court doesn't know. It is highly unlikely you will be able to have the Judgement vacated later on SOLC basis if you were properly served and didn't respond.

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The lawsuit was filed within the Georgia SOL. Georgia is 6 years on contract. However, Defendant was not served, and learned of the lawsuit for the first time upon the Bank Garnishment (more than a year later). Defendant did not know about the lawsuit until the SOL had expired.

Motion to set the judgment aside will be made. The question is, can the Defendant argue that the lawsuit is NOW time-barred?

Edited by Make Life Good
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The lawsuit was filed within the Georgia SOL. Georgia is 6 years on contract. However, Defendant was not served, and learned of the lawsuit for the first time upon the Bank Garnishment (more than a year later). Defendant did not know about the lawsuit until the SOL had expired.

Motion to set the judgment aside will be made. The question is, can the Defendant argue that the lawsuit is NOW time-barred?

IMO – Maybe.

The reasoning - the judge decides your argument - not the plaintiff (or our trolls). If your argument(s) support rule of law and cites specific rules of procedure and case - let the judge decide. But, your position must be persuasive enough to win the day. If you lose, you’re in no worse postion then you are now, with the exception - the judge may award them 'costs' if they win.

Edited by FL4answer58
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Guest usctrojanalum

The lawsuit will not be time-barred if the judgment is vacated due to lack of service. To be honest, the action is not likely to be dismissed it will remain on the trial/conference/whater calendar and you will be allowed to file an answer. The SOL is tolled when a lawsuit is filed just to avoid situations exactly like this one that can unduly prejudice the plaintiff.

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While I may be one of those trolls FL was referring to. You should do a couple things. First find out when a lawsuit is deemed commenced in your state. For example, in NY you file the complaint and then have to effect service w/in 120 days, at that time service is deemed complete.

You have two bases for excusing the default. no personal jurisdiction and sol has run. Interestingly enough the legal experts on here have not suggested that while you are asking for the judgement to vacated, you should also ask for the underlying complaint to be dismissed as well as the sol on the debt has run according to your calculations.

The judge would probably be glad to get rid of both issues at once and a well crafted motion would have the plaintiff having to come forward and show cause why the complaint should not be dismissed, something it looks like he can't do.

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  • 3 weeks later...

Georgia Receivables, Inc.

Assignee of HSBC Bank, USA,



****** ********


United Community Bank,



The matter came before the Court on October 5, 2010 regarding Defendant's Traverse. *.****** ******** was present on behalf of Plaintiff. Defendant appeared, pro se.

The facts of this case indicate a judgment was entered against the Defendant in Cobb County, Georgia. Plaitiff then filed a garnishment against United Community Bank (Garnishee) in the Henry County State Court on September 13, 2010. 1 .

Defendant contends that she filed a motion to set aside the judgment in Cobb County. 2. Additionally Defendant filed a Traverse before this Court on September 23, 2010. At the time of Defendant's filings, Garnishee had paid no funds into the registry of this Court. Accordingly, Garinishee froze Defendant's bank account which it was to garnish.

Defendant appeared before the Court asking the garnishment be set aside and any funds taken from her bank account be returned. Defendant contends the first time she became aware of the judgment and garnishment occurred when the garnishment froze her account.

Plaintiff claimed it sent by ordinary mail notice of the garnishment to Defendant but was unable to produce any evidence of the mailing. 3.

O.C.G.A. 18-4-64(a) requires notice of the garnishment must be mailed to the defendant "not more than three business days" after the issuance of the summons of garnishment. Therefore, the issue left before this COurt pertains to whether or not Plaintiff's notice to Defendant was timely.

"Garnishment statutes require formal service upon the garnishee bank, but only require that 'notice' of the summons be given to the defendant debtor." TBF Financial, LLC v. Houston, 298 Ga App. 657, 658 (2009). However, "the requirement of providing notice to the defendant is an essential element for due process." Id. at 659. "Depending on the circumstances, a plaintiff has only three days after serving the garnishee to provide an in-state defendant...notice by either certified mail, personal delivery, or ordinary mail." Id. "Under the statutory framework, the three-day requirement cannot be ignored." Id.

Here, the Plaintiff served the Garnishee on September the 16, 2010 and as of October 5, 2010, Defendant had not received notice.

At the time of the hearing on Defendant's Traverse, Plaintiff was at least twelve business days delinquent in serving the Defendant. Plaintiff failed to produce evidence that any outside sources thwarted its diligent effort to comply with the three day requirement or that it diligently and immediately sent notice of the action to Defendant upon learning of the sheriff's service upon the Garnishee. 4. In absence of any evidence suggesting substantial compliance, this Court is obligated to find Plaintiff did not comply with O.C.G.A. 18-4-64.

Plaintiff claimed Defendant received notice of the garnishment from Garnishee when it froze her bank account. Plaintiff cited O.O.G.A 18-4-64 (B) which states, "The receiving by the defendant of actual timely notice of summons of garnishment shall constitute notice." In the case at bar, however, no evidence presented to the Court indicated whether Garnishee's notice to Defendant was timely. Moreover, Garnishee freezing Defendant's bank account merely put the Defendant on inquiry notice and not actual notice of the summons of garnishment as required by statute.

Based upon the above and foregoing, it is therefore, ordered adjudged, and decreed the garnishment is set aside. The Defendant's account with the Garnishee is hereby released from garnishment.

This the 7th day of October, 2010.

Henry County State Court,

McDonough, Georgia

Flint Judicial Circuit


1. Garnishee was served by Sheriff's Service on September 16, 2010.

2. Plaintiff stated in court it had received notice of such motion pending in Cobb County.

3.Plaintiff admits it did not send the notice by certified mail or sheriff's service and had no way to track whether Defendant actually received the notification. Moreover, there was no certificate of service attached to the documents Plaintiff claimed it sent.

4. In Cook v NC Two, L.P. the trial Court found the clerk of court thwarted the plaintiff's diligent efforts to serve the defendant and plaintiff immediately sent notice of the action to the defendant upon learning of the sheriff's office served the bank. Therefore, the trial court found that the plaintiff was in substantial compliance with the statute despite an eight day delay in notice and the Georgia Court of Appeals upheld the decision. Cook v NC Two, L.P., 303 Ga App. 797, 797 (2010).

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  • 3 months later...

Plaintiff responded to Defendant's motion to set aside judgment and requested said motion be denied, citing that Defendant had offered no evidence of improper or fraudulent service.

Defendant responded by requesting Rule NISI hearing to present the evidence. Rule NISI hearing was scheduled for Monday, and as a result the Motion to Set Aside Default Judgment was granted to the Defendant.

NOW, we need to craft a motion to dismiss, and frankly I need some opinions.

BTW I am kicking myself for not giving the Judge in the case an opportunity to dismiss at the time of the Rule NISI hearing. We made an oral motion to dismiss but he would not accept it.

As of right now, the Defendant has not been legally served in a law suit that is now almost two years old.

Should we word the Motion to Dismiss based on jurisdiction?

Should we raise the fact that the Statute of Limitations has expired on the collection? (the facts are that the Defendant did not learn about the lawsuit until after SOL had passed.)

I would appreciate your thoughts and opinions.

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We just received our ORDER from the court on our Motion to Set Aside Default Judgment.

I just received our Order and it reads as follows:

This case comes before the Court on Defendant's Motion to Set Aside Default Judgment. The Court, having reviewed the motion and the contents of the entire file hereby finds and decides as follows:

Plaintiff has presented evidence of fraudulent service. At the time Defendant was allegedly served, she was out of state. Accordingly, the Court hereby GRANTS Defendant's Motion to Set Aside Default Judgment.

So Ordered, etc. etc.

So, now we will file a motion to dismiss with prejudice.

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