I am being sued in small claims court for a credit card debt where last payment I made was in 2011. Chase Credit Card disclosures agreement ...

Question

I am being sued in small claims court for a credit card debt where last payment I made was in 2011. Chase Credit Card disclosures agreement states, "This agreement and your account will be governed by the law of the state of Delaware and, as applicable, Federal Law".

I live in Massachusetts, the SOL is 6 years Delaware's is only 3 years, can I use the agreement as a defense for time barred debt?

Answer

This is an excellent question. The problem is that small claims cases are heard by magistrates, not judges, and magistrates can be very "loose" with applying correct law. Granted, as a small claims defendant you are able to appeal to the judge/jury, and then appeal again.

An informative resource on this issue is available here:

http://www.creditcards.com/credit-card-news/credit-card-state-statute-limitations-1282.php

At least a couple of states ruled that the state's longer SOL applies, not the shorter Delaware one:

http://www.oregonlive.com/business/index.ssf/2012/03/the_oregon_court_of_appeals_sa.html

http://www.creditcards.com/credit-card-news/collectible-expiration-date-old-debt-statute-1282.php

I would guess that in Massachusetts, the courts would go with the 6 years, because you are otherwise availing yourself to protection of Massachusetts laws. But, I say, raise the defense at the hearing and see what happens.