Since credit card debt arises from the existence of a legally binding contractual agreement, any defects in the contract formation process may render the debt unenforceable.
Defective Contracts
Some of the reasons a contract might be unenforceable include an agreement with an individual who lacks the legal capacity to enter into a contract, such as a minor or an individual who, due to diminished mental capacity, is incapable of expressing an intention to be legally bound by the terms of the contract.
Statute of Limitations
Credit card debt may also be unenforceable due to the running of the applicable statute of limitations period. The statute of limitations establishes certain specified periods for filing lawsuits. Any civil action by a creditor filed against a cardholder for recovery of the default balance that is outside the applicable limitations period is called "time-barred," and must be dismissed.
Considerations
The statute of limitations is an affirmative defense that a debtor must raise when an action is filed against him in court. Most jurisdictions require a debtor to raise the defense in his answer to the creditor's complaint. Once properly raised, upon request of the debtor, the court must dismiss the action. A creditor whose civil action is dismissed has no further legal recourse against the debtor.
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