Submitted by Peter Kubin, Dominion Law Associates
Published by The National List of Attorneys
Based in the Hampton Roads region of Virginia, Dominion Law Associates’ roots in the collection industry date back to 1977. Since then, the firm has emerged as a leader in the field of debt recovery and provides state-wide litigation service and coverage throughout Virginia, North Carolina, Maryland and DC. Led by Peter Kubin, the firm’s CEO and a William & Mary School of Law graduate, Dominion prides itself on its highly tenured and experienced management team. Dominion’s philosophy is to blend the best of collection agency methods and technology with a law firm’s litigation strategies, while maintaining the highest legal and ethical standards.
Broadly speaking, Virginia strives to be a business-friendly state with a fair approach to debt collection laws. For example, the state does not impose special licensing or bonding requirements for collections entities, and doesn’t have any heavy or harsh regulatory or enforcement history. In addition, Virginia has the advantage of having some of the lowest suit filing and service fees in the country. At the same time, there are some key nuances that one needs to know in order to successfully operate in Virginia. This paper will provide a summary of the main debt collection laws and issues in Virginia, with a focus on some of the nuances.
1. Key Debt Collection Laws of Virginia
a. Statutes of Limitations
Several key laws govern statutes of limitations in Virginia. The basic statute on contracts is Va Code §8.01-246, which provides a five-year limitation for any written and signed contract, and a three-year limitation for any unwritten contract, express or implied. One notable exception is for sales contracts under the UCC, which have a separate four-year statute (Va Code §8.2-725).
Open accounts are not expressly addressed, except by Va Code §8.01-249, which only states that the cause of action for an open account runs from the later of the last payment or last charge on the account. There is very little authority on open accounts and credit cards in particular, though the Virginia Attorney Generals wrote a helpful though non-binding advisory opinion in 2011 (Virginia Attorney Generals Advisory Opinion 2.7.11).
Domesticated foreign judgments and judgments entered in the Virginia circuit courts (which have exclusive jurisdiction of claims over $25,000) can be enforced up to twenty years, with extensions of twenty additional years upon motion (Va Code §8.01-251). A judgment in the general district court (which has jurisdiction of claims up to $25,000) is valid for ten years (Va Code §16.1-94.1), though an abstract of the judgment can be filed in the circuit court and receive the same twenty year limitation.