I stopped making payments on my credit cards in late 2006. It is now early 2011, so the 4 year SOL has passed. Today, I received a call from a local phone number. It was a collection agency. I confirmed my name, mailing address, phone number, and debt. Did I screw myself over for the SOL rule? Or would I have had to acknowledge my debt in writing. If yes, I assume acknowledging debt on one account would not have any effect on my other 10 accounts, correct? I reside in California.
A statute of limitations, also called a limitation of action, periods of prescription, and prescriptive periods, is the maximum time after an event or occurrence that legal proceedings based on that event or occurrence may begin. States and the federal government set statutes of limitations for civil and criminal actions. Each state legislature wrote dozens of statutes of limitation.
Your question concerns the statute of limitation on debt, which is found a branch of law called civil procedure. You mentioned credit card debt. The statute of limitations one on credit card debt is tricky for three reasons:
These three reasons make answering the question, “What is the statute of limitations for my credit card debt?” difficult to answer.
For debt, the statute of limitations starts either when the debtor last made a payment, or when the payment was due. Once the statute of limitations on a debt is reached, the creditor may use the court system to collect the debt. However, if the debtor/defendant raises the affirmative defense of statute of limitations in a timely manner, the court must dismiss the case. A court will not raise the statute of limitations defense on its own — the court is a neutral referee — the defendant must raise this defense.
A defendant can reset the clock on a statute of limitations back to zero in two ways:
Under common law, the acknowledgment must be in writing and convey the idea the debtor promises to pay the debt. Not surprisingly, many state legislatures wrote their own version of this rule. Arizona, Florida, New York, and Oregon are four such states I found with acknowledgment of barred action rules in a minute or two using Google’s search engine.
You mentioned California. Under California Code of Civil Procedure § 360.5, "No waiver shall bar a defense to any action that the action was not commenced within the time limited by this title unless the waiver is in writing and signed by the person obligated." This law was enacted in the 1800s, and is well-tested by California courts. In a nutshell, a statute of limitations waiver in California must be in writing and signed by the debtor.
You asked if speaking about the debt to a collection agent acknowledged the debt or waived your right of California’s statute of limitations. California’s law is clear on this matter: Talking to someone about your debt does not create a waiver of your statute of limitations rights.
You asked about your other debt. Assuming for a moment that your waiver was effective, I do not see how acknowledging or waiving your rights on Debt A has any impact on Debt B, Debt C, and so on.
This answer, obviously, applies California law. If you reside in a different state, review your state's statutes and consult with a lawyer who has civil litigation experience to learn how your state legislature and courts answer this question.
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