Ohio Governor Signs Statute of Limitations Bill


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The final bill includes favorable points for the accounts receivable management industry after years of advocacy from ACA International and the Ohio Receivables Management Association.

3/16/2021 9:00

Ohio Gov. Mike DeWine has signed a bill to reduce the statute of limitations (SOL) and it will take effect in 90 days.

The bipartisan statute of limitations bill (S.B. 13 and H.B. 251), sponsored by State Sen. George Lang, R-West Chester, and State Rep. Brett Hillyer, R-Canton, among several other legislators, will reduce the statute of limitations on written and oral contracts to six and four years, respectively, and define consumer transactions and assign them a six-year statute of limitations, ACA International previously reported.

ACA and the Ohio Receivables Management Association (ORMA) worked with legislative leaders in the state to ensure favorable language for the accounts receivable management (ARM) industry in the bill and it is a victory to see this bill finalized.

In particular, ACA and ORMA pushed for a six-year statute of limitations on consumer transactions.

The final bill:

  • Adopts as the SOL for any written agreement (unless a consumer transaction) that seeks post-judgment interest in excess of Ohio’s statutory rate the SOL that applies under the laws of the state that apply to the contract;
  • Adopts as the SOL for any consumer collections suit seeking post-charge-off interest governed by the laws of another state and in excess of Ohio’s statutory rate the SOL of the laws of the state that apply to the contract;
  • Drops the SOL on written contracts from eight years to six years;
  • Drops the SOL on oral contracts from six years to four years; and
  • Sets an SOL for a consumer transaction at years after cause of action accrued.

Ohio’s House of Representatives voted 94-0 to advance the statute of limitations bill Feb. 25.

“It can take a significant amount of time for many people to fulfill their financial obligations for reasons previously mentioned. Our industry’s primary goal is to work with people to help them satisfy those obligations, but that can take a long time for some,” said Lora Miller, executive director of ORMA, in testimony before the House Civil Justice Committee Feb. 23. “A six-year statute of limitations on consumer transactions takes into consideration the best interests of consumers. Members of our industry routinely collect on accounts that are four, five and six years from the date of the original debt. A six-year statute of limitations will provide consumers with adequate time to resolve their debts and repair their credit reports—an important quality of life issue.”

The bill, as originally introduced in 2019, aimed to reduce the statute of limitations on all contracts to three years. Even after two years of negotiations and committee votes, the legislation was amended several times in the final hectic days of the 2020 legislative session. These last-minute efforts to amend the legislation saw industry-supported language both stripped out of the legislation and reinserted before time ran out for a final vote. The industry-preferred language was included in the 2021 reintroduced bill.

ACA and ORMA provided testimony and launched grassroot campaigns resulting in more than 1,000 strategic touches throughout the two-year legislative process leading to its passage.

ACA continues to monitor approximately 500 state bills that would impact the ARM industry if enacted.