Legal Memorandum: Bank's Claim for Reformation & Statute of Limitations

Issue: What is the statute of limitations applicable to a bank action in an action to reform their loan contract?

Area of Law: Banking & Finance Law, Litigation & Procedure
Keywords: Statute of limitations; Claim for reformation; Contract
Jurisdiction: Federal, Indiana
Cited Cases: 553 N.W.2d 760; 942 F. Supp. 2d 279; 289 P.3d 1066; 27 N.E. 200
Cited Statutes: Indiana Code § 34-11-2-11, § 34-11-1-2(a)
Date: 09/01/2014

To determine whether a bank’s claim for reformation is barred by the statute of limitations and determine when the statute of limitations began to run, the following authorities are instructive:

  • Indiana Code § 34-11-2-11 (2014).

“All actions upon contracts in writing other than those for the payment of money . . . must be commenced within ten (10) years after the cause of action accrues.”

  • City of East Chicago v. East Chicago Second Century, Inc., 878 N.E.2d 358, 378 n.19 (Ind. Ct. App. 2007), rev’d on other grounds, 908 N.E.2d 611 (Ind. 2009).

Section 34-11-2-11 “does not apply to [a claim for reformation], as an action for reformation is not an action at law brought upon the contract.  Rather, it is an action for the equitable remedy of reformation of the contract.”

  • Trip-Tenn, Inc. v. Schultz, 656 N.W.2d 747, 751 (S.D. 2003).

Claim for reformation of a contract is not a claim upon the contract for statute of limitations purposes.

  • Diocese of Bismarck Trust v. Ramada, Inc., 553 N.W.2d 760, 766 (N.D. 1996).

An action to reform a deed is an action “upon a contract.”

  • Indiana Code § 34-11-1-2(a) (2014).

“A cause of action that: (1) arises on or after September 1, 1982; and (2) is not limited by any other statute; must be brought within ten (10) years.”

  • Bryant v. Swetland, 27 […]

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