By: Scott M. Tanner, Esq.
As a preliminary matter, it’s worth noting that the generally accepted statute of limitations on credit cards in California is 4 years. For purposes of credit card debt, the statute of limitations is said to begin from the date the credit card contract is breached (i.e. the date the creditor’s cause of action the card holder “accrued”).
With this new found information, you may be thinking to yourself: “Self, I think this means I’m off the hook for those purchases that I still owe on from 1995 (probably something flannel).” Unfortunately, for various reasons, you are probably wrong.
Not only can the statute of limitations be “reset” by making a payment or a purchase using the card, but the law has established an interesting concept, the open book account, to avoid the problems potentially associated with strings of purchases over an extended period of time.
Generally defined, an open book account is a statement of the debits and credits of the transactions involved between the creditor and the card hold which are complete enough to supply evidence from which it can be reasonably determined what amount is due to the creditor. In essence, then, a book account is simply a series of debits and credits contained in a statement (i.e. the statement you get from credit card every month). Rather than treating every purchase that a person makes with a credit card as a separate contract of sorts, the law treats the statement itself as the document upon which the lawsuit rests.
While this is written with credit cards in mind, the concept of an open book account applies in any situation where an account exists between two parties and wherein one of the parties pays over time and/or debits or receives services over time – think: most relationships that we all have with contractors, banks, exterminators, loan companies, mortgage companies, etc.
Whether someone owes you money or you owe someone else money on an open book account, at Thompson Steinberg we can help. If you need help collecting a debt, enforcing a judgment, or defending yourself against a debt that someone else says you owe, contact the experienced and knowledgeable debt collection/debt defense attorneys at Thompson Steinberg.
Scott M. Tanner, Esq.
Scott M. Tanner is a partner and co-founder of Thompson Steinberg. He has extensive experience in all aspects of commercial and consumer/retail collections, debt litigation, creditor’s right, and FDCPA, RFDCPA, TCPA, and FCRA compliance and litigation. Mr. Tanner has successfully represented business entities of various sizes – ranging from small, mom-and-pop type local businesses, to major national and multinational corporations.
**The information presented here is general in nature and is not intended, nor should be construed, as legal advice for a particular case. This blog posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, please consult with your own attorney.**