Promissory Note SOL Question - Which Governing Law?

[ThickBurger]

Promissory note was executed in FL. Borrow lives in FL entire time.

In the agreement, it states OH Law will "govern this agreement"

FL SOL on promissory note = 5 years. OH = 15 years

Which one applies? I have Googled for hours and cant find anything. FWIW, lender = key bank

[BV80]

Needless to say, the lender is probably going to claim the 15 year SOL applies.

Florida allows for a choice of law. They may have to show why Ohio has a more significant relationship to the account than Florida.

However, I'd suggest you look for case law in which FL applies the shorter SOL to a FL resident. It might be that if there's a conflict in the SOL, FL would allow for the shorter SOL in favor of a FL resident.

If I get a chance tonight, I'll do some searching.

[BTO429]

Mazzoni Farms -vs-Dupont

Under Florida's choice-of-law rules, foreign law will not be

applied in Florida if it works a result that contravenes Florida

public policy.

Florida applies the Restatement's

"significant relationships" test in determining choice-of-law

questions in tort cases, Bishop v. Florida Specialty Paint Co.

and applies the doctrine of lex loci contractus in contract actions. Sturiano v. Brooks,

See, e.g., Gillen v. United Services

Automobile a$$'n, 300 So.2d 3 (Fla. 1974); Cerniglia v. C. & D.

Farms, Inc., 203 So. 2d 1 (Fla. 1967); Lloyd v. Cooper Corporation,

134 So. 562 (Fla. 1931); Temporarily Yours-Temporary Help Services,

Inc. v. Manpower, Inc., 377 So. 2d 825 (Fla. 1st DCA 1979).

[BV80]

I found this case law:

As Florida law pertains to choice of law in the context of contract interpretation, the Florida Supreme Court has "long adhered" to the rule of lex loci contractus. State Farm Mut. Auto. Ins. Co. v. Roach, 945 So. 2d 1160, 1163 (Fla. 2006).

Lex loci contractus means where the contract was made.

[BTO429]

why are you trying to find this out? Are you being sued over a contract or promissory?

The doctrine “lex loci contractus” guides courts exercising diversity jurisdiction. It generally means that the law of the place where a contract was entered into should be applied to decide any issue arising out of that contract. Occasionally, courts also use the phrase to mean the law by which a contract is to be governed.

The law of the place where the contract is entered into or is to be performed.

The parties to a contract can specify the state that will decide any issues relating to the contract. In the absence of such a clause, it is the basic rule of contracts that the law of the place where a contract is entered into will govern any issues arising out of the contract. In other words, under the doctrine of lex loci contractus, absent a contractual choice of law provision, a contract will be governed by the law of the state “where the last act necessary to complete the contract is done”[ii]. However, if the law of the state where a contract was entered into is contradictory to the forum state’s public policy, the foreign law will not be applied.

Northland Cas. Co. v. HBE Corp., 145 F. Supp. 2d 1310, 1311 (M.D. Fla. 2001)

[ii] Pastor v. Union Cent. Life Ins. Co., 184 F. Supp. 2d 1301, 1305 (S.D. Fla. 2002)

When the contract is entered into in one place, to be executed in another, there are two loci contractus; the locus celebrate contractus, and the locus solutionis; the former governs in everything which relates to the mode of construing the contract, the meaning to be attached to the expressions, and the nature and validity of the engagement; but the latter governs the performance of the agreement.

Edited April 29, 2012 by BTO429

[kutuzov]

For what I read on the governing law in Florida, the state of the governing law will apply, unless the OP can demostrate that it contravenes Florida public policy. I don't have handy case laws. Your argument should be reduced to the fact that OH 15 years is more is 3 times longer than FL SOL so it does contravene FL public policy, you will need some case laws but in the end it will be up to the judge to decide unless you find a case law similar to your case in FL.

[ThickBurger]

Thanks for the replies guys, so it appears it can go either way.

There is no pending litigation, I'm just preparing should something come my way. This is regarding a PRIVATE (Non-Teri Guaranteed) Student Loan that went into default in 2005.

I have researched and this loan is not in the Federal system, and no where on the promissory note does it say there is a guarantor of any sort... therefore SOL should apply; just have to figure out which one and how to use it to my defense should the need arise.

I will continue researching the subject.

Thanks,

TB

[legaleagle]

The problem with SOL cases is that they generally involve car accidents, divorces, and business deals where there is a tremendous conflict between the law of the states involved, which would be prejudicial to one party. In cases where there is a specified choice of law agreed to by both parties, courts don't always set it aside. Nor should they. The lender will argue that you agreed to be bound by Ohio law. You have to make an argument that you did not.

The only possible angle I can think of is......did they explain Ohio law to you before asking you to agree to it? If not, why not? Is there something in Ohio law they didn't want you to know about? Like the 15 yr SOL? Come on, guys, do I have to go to law school in Ohio to get a student loan? This is virtually a failure to disclose, which in and of itself is prejudicial and enters into the doctrine of a superior position of knowledge being exploited.

That aside, student loans are a hard way to go, especially if the recipient got a degree.

[ThickBurger]

Just one bump - looking for some more thoughts.

[DonqIII]

Promissory note was executed in FL. Borrow lives in FL entire time.

In the agreement, it states OH Law will "govern this agreement"

FL SOL on promissory note = 5 years. OH = 15 years

Which one applies? I have Googled for hours and cant find anything. FWIW, lender = key bank

Keybank is under Citibank, the last I heard. At least on their credit cards.

As I recall, South Dakota is 6 years. While a year longer then FL it is a far cry from 15.

What does your agreement say is choice of law?

Statute of Limitations for Promissory Notes

The statute of limitations for promissory notes is as follows: Alabama, six years; Alaska, six years; Arizona, five years; Arkansas, six years; California, four years; Colorado, six years; Connecticut, six years; Delaware, six years; Washington DC, three years; Florida, five years; Georgia, six years; Hawaii, six years; Idaho, 10 years; Illinois, six years; Indiana, 10 years; Iowa, five years; Kansas, five years; Kentucky, 15 years; Louisiana 10 years; Maine, six years; Maryland, six years; Massachusetts, six years; Michigan, six years; Minnesota, six years; Mississippi, three years; Missouri, 10 years; Montana, eight years; Nebraska, six years; Nevada, three years; New Hampshire, six years; New Jersey, six years; New Mexico, six years; New York, six years; North Carolina, five years; North Dakota, six years; Ohio, 15 years; Oklahoma, five years; Oregon, six years; Pennsylvania, four years; Rhode Island, 10 years; South Carolina, three years; South Dakota, six years; Tennessee, six years; Texas, four years; Utah, six years; Vermont, five years; Virginia, six years; Washington, six years; West Virginia, six years; Wisconsin, 10 years; and Wyoming, 10 years.

Read more: Debt Collection Statute of Limitations Listed by States | eHow.com Debt Collection Statute of Limitations Listed by States | eHow.com

[ThickBurger]

Hello everyone.

Just bumping to see if I can gather any more thoughts on the above question.

[legaleagle]

Where does Ohio enter into this? Was the lender an Ohio bank?

[ThickBurger]

Where does Ohio enter into this? Was the lender an Ohio bank?

Promissory note has a "choice of law" provision in that the agreement will be "governed by the laws of Ohio"

[legaleagle]

Who is the lender?

[ThickBurger]

Who is the lender?

Keybank

[legaleagle]

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[Coltfan1972]

Are you really a spy for the other side, Legal, and trying to fatten me up and make me die so I don't continue to crush you in court.

[legaleagle]

Could be, but you have to sue me to find out LOL

[kutuzov]

I think legal just comited a FDCPA violation by getting coltfan involved in the burger thing. You should sue Colt for sure, I got a neighbour that is a retired vietnam vet, and he is willing to get with his friends and get you legal, address to sue him, send me PM!!!!