Maryland Statute of Limitations and the Law of the Forum in Student Loans

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                Frequently in student loan and other collections cases, a person gets sued in Maryland, but the contract specifies that the law of a state other than Maryland governs.  For example, it might say “the law of New Jersey applies to this contract” or words to that effect.  The question then arises of which state’s statute of limitations applies – Maryland’s (which is shorter than many other states) or the state specified in the contract.  We have handled several cases where we won our argument that Maryland’s shorter statute of limitations applies, rather than the state specified in the contract.  The argument is simple: if they sue in Maryland, then the Maryland statute of limitations applies.  Here is some of the relevant law:

                Under Maryland law, the statute of limitations is a procedural matter, governed by Maryland’s statute of limitations, regardless of any substantive choice of law clause.  Procedural matters are governed by the law of the forum, and under Maryland law the statute of limitations is procedural, not substantive.  Lewis v. Waletzky, 422 Md. 647, 657-58 (2011);  Doughty v. Prettyman, 219 Md. 83, 88 (1959) (“Included in the procedural matters governed by the law of this state is the statute of limitations.”); see also Turner v. Yamaha Motor Corp., U.S.A. 88 Md. App. 1, 3 (1991) (“[T]h question as to which period of limitations applies is a matter of procedural not substantive law”). This position is in accord with the Restatement (Second) of Conflict of Laws: “An action will not be maintained if it is barred by the statute of limitations of the forum” at § 142.

                More on our blog about the Statute of Limitations here.

                More on our blog about Student Loans here

CONTACT US: If you are being sued and there is a question about the Statute of Limitations, feel free to contact us for a consultation.