Hamid v. Stock & Grimes

Court Rules that Shorter SOLs Can Apply in PA's Courts Per the Borrowing Statute

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An important victory for consumers alleged to owe credit card debt, a federal court decided that the Pennsylvania Borrowing statute, 42 Pa. C.S.A. 5521, applies to debt collection lawsuits filed against Pennsylvania consumers by out-of-state banks.

Plaintiff defaulted on a consumer credit card issued by Discover Bank. Discover Bank hired the debt collection law firm and defendant, Stock & Grimes of Jenkintown, Pennsylvania, to file a debt collection lawsuit against the consumer. Stock & Grimes filed the lawsuit about 3 years and 8 months after the 3-year anniversary of the consumer’s default.

Plaintiff defended the state-court action alleging that Pennsylvania’s standard 4-year statute of limitations for breach of contracts did not apply to the collection lawsuit because the Borrowing Statute imported Delaware’s shorter, 3-year statute of limitations for breach of contracts. The state-court action settled before the PA court could decide her defense.

After suing Stock & Grimes in the federal action alleging a violation the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692f, the federal court ruled that the filing of the collection lawsuit almost 4 years after plaintiff’s default was a Kimber violation of the FDCPA. A Kimber violation occurs when a consumer debt collector sues a consumer after a debt has become time-barred by the applicable statute of limitations.

The case is scheduled for a jury trial to determine plaintiff’s damages in July 2012.

Consumer Litigation Group, Plaintiff's attorneys, can be contacted at www.ConsumerLitigators.com.

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Reference Info:Decision | Federal, 3rd Circuit, Pennsylvania | United States

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Joseph A. Mullaney, III, Consumer Litigation Group | Attorney Advertising

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