## Facts

- Jared King opened a Discover credit card account in 1989 while living in Connecticut; the cardholder agreement selected Delaware law.
- King made no payments after December 1998.
- In January 1999, King cancelled the account by letter, enclosed the cut card, and asked Discover how to proceed in paying the balance; he made no further payments.
- Discover assigned the account to Portfolio Recovery Associates, LLC in August 2000.
- In April 2005, Portfolio sued King in New York (breach of contract and account stated) seeking approximately $8,514.77.
- King asserted the claims were time-barred under New York’s borrowing statute (CPLR 202) because Delaware’s contract statute of limitations is three years.

## Issues

1. Whether CPLR 202 required applying Delaware’s three-year contract statute of limitations because the causes of action accrued outside New York.
2. Whether the Delaware choice-of-law clause independently required applying Delaware’s statute of limitations.
3. Whether Delaware’s tolling statute for absent defendants tolled the limitations period because King was outside Delaware.

## Decision

- The Court of Appeals reversed the Appellate Division and dismissed the complaint as time-barred.
- Under CPLR 202, Delaware’s three-year statute of limitations for contract actions applied because the claims accrued in Delaware, and the suit was filed more than three years after accrual.
- The Delaware choice-of-law clause did not, by itself, import Delaware’s statute of limitations into a New York action.
- Delaware’s tolling statute did not apply to a defendant who never resided in Delaware, so it did not extend the time to sue.

## Legal Principles

- Under CPLR 202, when a nonresident plaintiff sues in New York on a claim accruing outside New York, the action must be timely under both New York’s limitation period and the limitation period of the place of accrual; the shorter period controls.
- For purposes of the borrowing statute, a claim accrues where the economic injury is sustained.
- Contractual choice-of-law clauses generally govern substantive law and do not automatically select another state’s statute of limitations, which New York treats as procedural unless a statute provides otherwise.
- Delaware’s three-year limitations period for contract-based claims (Del. Code Ann. tit. 10, § 8106) applies via CPLR 202 when the claim is deemed to accrue in Delaware.
- Delaware’s tolling provision for absent defendants (Del. Code Ann. tit. 10, § 8117) does not toll limitations against an individual who never lived in Delaware and thus was not a resident who later became absent for service purposes.

## Conclusion

New York’s highest court held that a debt buyer’s New York collection suit on a credit card account was barred because CPLR 202 required borrowing Delaware’s three-year contract limitations period, and Delaware’s tolling statute did not extend that period for a defendant who had never resided in Delaware.


Portfolio Recovery Assocs., LLC v. King, 14 N.Y.3d 410 (N.Y. 2010)