GOOD NEWS For OHIO Residents

[BV80]

The OH Supreme just ruled that debts accrue in the state of a credit card company.  If the SOL of the company's state is shorter than the OH SOL, then the OH borrowing statute applies and the debt is time-barred in OH.

Taylor v. First Resolution Investment Corp.

"Today, we determine several issues relevant to the application of the FDCPA and the OCSPA to the collection of purchased credit-card debt in Ohio. We hold that the underlying cause of action for default on the credit card in this case accrued in Delaware, the home state of the bank that issued the credit card and where the consumer’s payments were made, and that Delaware’s statute of limitations—through operation of Ohio’s borrowing statute—determines whether the collection action was timely filed. We further hold that the filing of a time-barred collection action may form the basis of a violation under both the FDCPA and the OCSPA.  We also hold that that a consumer can bring actionable claims under the FDCPA and the OCSPA based upon debt collectors’ representations made to courts in legal filings, specifically on a debt collector’s claim for interest that is unavailable to the debt collector by law. Finally, we hold that debt buyers collecting on credit-card debt and their attorneys are subject to the OCSPA."

http://www.supremecourt.ohio.gov/rod/docs/pdf/0/2016/2016-Ohio-3444.pdf

[debtzapper]

As I recall, the OH Supreme Court seldom rules on collection cases.   This is really good news for Ohioans.

[CCRP626]

Seems like the banks just require the payment to be sent to Ohio to fix this. Even so, the one statement produced in this case showed a payment sent to Illinois which the defendant countered with an affidavit stating all payments were sent to Delaware.

Nice bonus is no cardmember agreement was attached to the complaint (that's a dismissal angle (Ohio Civil Procedure Rules 10 and 12) when used by defendant with a motion for more definite statement as discussed in a recent Ohio thread) but also an FDCPA violation for attempting to collect interest by stating it in the complaint even if it was in the prayer. A monthly statement showing an interest rate isn't sufficient (case law in the PDF). Requesting a specific rate of interest (24%) in the complaint then removes the ability to collect on Ohio's statutory interest rate of 8%.

 

[Coffee_before_tea]

Plenty of excellent points in this opinion, especially important to those states where there borrowing & UDAP statutes are mirrored.  For example, the OH & UT Consumer Sales & Practices Act are nearly the same, and OH cases are often cited here in UT.

[Brotherskeeper]

@BV80

Thank you for posting this. What a treasure trove to plumb! 

From page 8-9:

    "{¶ 15} But Taylor Jarvis was different from most defendants who are sued in this way. She found out about the judgment against her and decided to fight it. Six weeks after the entry of the default judgment, she successfully moved to vacate it, and she later raised counterclaims against FRIC and Cheek. By doing so, she has given this court the opportunity to address issues in her case that happen to be endemic to the whole debt-collection world and that impact Ohio courts. Those issues include how to determine the proper statute of limitations in debt-collection cases and whether the filing of lawsuits containing unsubstantiated claims can constitute violations of the FDCPA and the OCSPA.

_________________________________________________________________________________

1 Taylor Jarvis was the original appellee in the appeal to this court, but she died during its pendency. Brian Taylor, the executor of her estate, has been substituted for her as the appellee. "

 

As some of you may remember, we successfully used Michigan's borrowing statute to use California (and Delaware) SOL to defeat 2 JDB suits in 2012. The debts were SOL in California prior to the move to Michigan. Both JDBs alleged mystery payments to the OCs that miraculously brought the debts within the 6-year SOL for Michigan, (not to mention conveniently provided a bona fide error defense to the JDB attorneys). As those payments had never been made, it was easy enough to rebut. We later used an experienced NACA attorney to file FDCPA and MCPA suits in federal court. Both suits were settled with NDAs. Sadly no case law was made. 

It's wonderful that the woman in this Ohio case has left such a legacy. It's sad she did not live to see this ruling. 

[WhoCares1000]

The credit card companies are not simply going to move out of Delaware or South Dakota any time soon. If they were to move to Ohio, they would be subject to Ohio's usury laws which would limit their profits from customers who pay only the minimums. That is substantially more than they will lose in Ohio collection cases due to SOL (since most people do not answer anyways as was stated in the opinion of the court).

[RobinC]

On 6/18/2016 at 5:18 PM, Brotherskeeper said:

@BV80

Thank you for posting this. What a treasure trove to plumb! 

From page 8-9:

    "{¶ 15} But Taylor Jarvis was different from most defendants who are sued in this way. She found out about the judgment against her and decided to fight it. Six weeks after the entry of the default judgment, she successfully moved to vacate it, and she later raised counterclaims against FRIC and Cheek. By doing so, she has given this court the opportunity to address issues in her case that happen to be endemic to the whole debt-collection world and that impact Ohio courts. Those issues include how to determine the proper statute of limitations in debt-collection cases and whether the filing of lawsuits containing unsubstantiated claims can constitute violations of the FDCPA and the OCSPA.

_________________________________________________________________________________

1 Taylor Jarvis was the original appellee in the appeal to this court, but she died during its pendency. Brian Taylor, the executor of her estate, has been substituted for her as the appellee. "

 

As some of you may remember, we successfully used Michigan's borrowing statute to use California (and Delaware) SOL to defeat 2 JDB suits in 2012. The debts were SOL in California prior to the move to Michigan. Both JDBs alleged mystery payments to the OCs that miraculously brought the debts within the 6-year SOL for Michigan, (not to mention conveniently provided a bona fide error defense to the JDB attorneys). As those payments had never been made, it was easy enough to rebut. We later used an experienced NACA attorney to file FDCPA and MCPA suits in federal court. Both suits were settled with NDAs. Sadly no case law was made. 

It's wonderful that the woman in this Ohio case has left such a legacy. It's sad she did not live to see this ruling. 

Does this ruling apply to original creditors too or just JDB's and buyers?

[BV80]

1 hour ago, RobinC said:

Does this ruling apply to original creditors too or just JDB's and buyers?

OCs also.