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Direct Merchants Credit Card Bank v. Hussein

A-3090-01T3 (N.J. Super. App. Div. 2003) (Unpublished)

CREDIT CARDS—If a cardholder can’t show that a particular brochure is applicable to the cardholder’s account, then the arbitration provision set forth in the brochure will not trump a litigation provision in the cardholder agreement itself.

A credit company sued a cardholder over an unpaid balance. The cardholder sought to have the suit dismissed based upon the card company’s “Your Guide to Benefits” brochure. In it, it said that each party was bound to arbitrate claims including “collection of your account… .” The credit card company relied on a “Cardholder Agreement,” which read, in part, that the credit card company could “sue you for what you owe. You will pay out court costs, reasonable attorneys’ fees and other collection costs… .” The lower court refused to dismiss the card company’s suit and Appellate Division agreed. According to the Court, “[t]he cardholder agreement produced by [the card company] controls [the cardholder’s] credit card account with [the card company].” Upon its review of the record below, it found that the cardholder had submitted an incomplete document and “failed to establish that the referenced [Your Guide to Benefits] was applicable to his account, or to circumstances where a credit card company seeks collection from a cardholder for past-due amounts on an account.”


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