One of the most controversial topics in the debt collection world in Florida is the statute of limitations on credit card debt. A statute of limitations determines if a debt can validly be sued on. If the statue of limitations has run out a lawsuit is baseless. Any review of the message boards and forums that try to help people being sued on a debt will find a general consensus that the statute of limitations is 4 years in Florida. The folks advocating this position are adamant they are right.

The 4 year statute of limitations comes from Florida statute 95.11, and is based on the following language:

Fla.Stat.95.11(3) WITHIN FOUR YEARS.--
(k) A legal or equitable action on a contract, obligation, or liability not founded on a written instrument, including an action for the sale and delivery of goods, wares, and merchandise, and on store accounts.

The controversy arises when you review 95.11 and see that the statute of limitations is 5 years for a written contract.

Fla.Stat. 95.11(2) WITHIN FIVE YEARS.--
(b) A legal or equitable action on a contract, obligation, or liability founded on a written instrument, except for an action to enforce a claim against a payment bond, which shall be governed by the applicable provisions of ss. 255.05(10) and 713.23(1)(e).

There is a pretty good argument that the card member agreement constitutes a written contract for statute of limitations purposes. Several appellate courts throughout the US that have looked at this issue have decided that the card member agreement does just that. Texas and California have decisions that classify a credit card agreement as a written contract for statute of limitations purposes.

So what is the statute of limitations on a credit card debt in Florida? The answer is obvious. It’s whatever the judge on your case says it is.

There is no answer in Florida outside of Palm Beach county. Palm Beach county is the only county to have addressed the controversy as an appellate issue and decided credit cards have a 4 year limit. Unfortunately, this decision is only binding in Palm Beach county. Every other judge gets to determine the issue on their own. And they are split. Judges in the same courthouse disagree on the statute of limitations for credit cards.

So what can the average defendant do? Seek out legal counsel. They can give you a pretty good idea of what the specific judge you are in front of has decided in the past. If your only defense is the statute of limitations, you don’t want to screw up how you present it.

Even if you get the judge to agree with you that it is 4 years, you still must calculate it properly. It is easiest to explain with an example.

Example:

Dan owes $1000 on a credit card debt. His last payment was December 1, 2002. The charge off date was June 1, 2003. The lawsuit was filed December 29, 2006. The judge decides that the statute of limitations is 4 years. Was the case filed within the statute of limitation?

A look at the lawsuit shows it was filed 4 years and 28 days after the last payment, so it should be past the limitations period, right?

Unfortunately for Dan, the case was filed within the limitations period. The statute of limitations does not begin to run until a breach occurs. The breach in this case did not occur until January, when Dan missed his first payment. In December, Dan’s case was still in good standing.

The statute of limitations is a very technical argument. It must be brought up at the right point of a case. (In many cases a motion to dismiss for the statute of limitations having run is inappropriate for legal reasons. Even if the case is 100% past the statute of limitations.) And it must be argued correctly. These are not small hurdles to clear.