Credit Card Liability - Dispelling Two Myths

A recent Medina County Court case provides dictum regarding two myths regarding credit cards. The case, Citibank v. Kovach, 157 Ohio Misc.2d 24 involved the use of a credit card issued by Citibank to the defendant. Three pertinent facts were established: 1) The defendant did not sign any agreement or contract with the bank, 2) he did use the credit card to the tune of $20,569.06 and 3) the bank attached to its complaint a complete itemization of charges, payments and credits. The two myths dispelled by the case are:

Myth No. 1: The plaintiff must establish that the defendant executed a contract or credit agreement with credit card company to establish liability. This is untrue. Under Ohio law, a cardholder becomes liable for charges made on a credit card by using the credit card itself, Chase Bank USA v. Lopes, 8th Appellate Dist No. 91480, 2008 Ohio 6000, 2008 WL 4950985. In fact, the use of the credit card subjects the card holder to the terms of the credit card agreement, Am. Express v. Silverman, 10th Dist. No. 06AP-338, 2006 Ohio 6374, WL 3491741.

Myth No. 2: The creditor need only produce a summary account attached to its complaint to establish a prima facie case of liability. This is also untrue. In order to establish a prima facie case for money owed on an account, “an account must show the name of the party charged and contain: (1) a beginning balance (zero, or a sum that can qualify as an account stated, or some other provable sum); (2) listed items, or an item, dated and identifiable by number or otherwise, representing charges, or debits, and credits; and (3) summarization by means of a running or developing balance, or an arrangement of beginning balance and items which permits the calculation of the amount claimed to be due." Gabriele v. Reagan (1988), 57 Ohio App.3d 84, 87, 566 N.E.2d 684