Legal Question in Business Law in California

Credit card company not playing by the rules

My credit card company may attempt to sue me for non performance under material breach of contract. I expect to challenge on basis of �formation� (element) because the contract as is the case with credit card companies was formed under verbal terms which was the basis for engagement (transfer of balance, etc..).

I never signed anything. I agreed to the material terms verbally, and one of those terms was that the APR was fixed for the duration of the loan so long as minimum payments were made. 12 months later, they increased the minimum amount due by changing the definition of �Fixed APR� (which by their definition means variable), thereby breaching the contract first. I never verbally or otherwise, agreed to empower my credit card company to change the terms of what consists of a �fixed APR� during the life of the loan.

Question: What statute can they possibly use to support their cause of action (non performance under material breach of contract) when formation was verbal and not subject to unilateral change of terms ?


Asked on 11/19/04, 5:58 pm

1 Answer from Attorneys
Edward Hoffman Law Offices of Edward A. Hoffman

Re: Credit card company not playing by the rules

When you received your credit card it must have come with a written cardholder agreement and a notice that, by using the card, you were accepting the terms of the agreement. If you transferred some balances before you received this agreement, can find a material difference between the terms you were promised and what the agreement contains, and can prove that you are right about what the promises were then you have a decent case -- provided that you have at least attempted to make monthly payments in the amount which you believe was due. If you are arguing that you don't have to make any more payments you will surely lose, and if you claim instead that you need only make smaller payments but have not tried to make those payments, then you have breached the agreement. I don't believe a court would excuse your breach because of the increased interest, even if the increase was also a breach.

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Answered on 11/19/04, 6:25 pm


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