Under Alabama law, the statute of limitations for an “open account” is shorter (3 years) than for an “account stated” or breach of contract claim (6 years).   In Cadence Bank, N.A. v. Robertson, No. 1190997, 2021 WL 1230165 (Ala. Apr. 2, 2021), the Alabama Supreme Court reversed a trial court for granting summary judgment in a collection action by a bank against a homeowner because the longer statute of limitations may apply even if the written loan agreement may no longer be in effect.  In 2003, the Robertsons executed a loan agreement with a lender to obtain a home-equity line of credit, and granted the lender a mortgage on their house as security. In 2005, the Robertsons delivered payment to the lender on the remaining balance of the loan along with a “kill letter” which instructed the lender to release the mortgage and cancel their line of credit. Yet, later that year, the Robertsons began borrowing additional funds against the line of credit and continued to do so until 2013. In the interim, Cadence Bank acquired the lender and all of its assets and liabilities.
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