Midland Funding LLC v. Schellenger, 2019 IL App (5th) 180202

Midland Funding LLC sued Jean Schellenger in small claims for an unpaid Home Depot store credit card balance; complaint alleged last payment posted July 12, 2012 and suit filed January 27, 2017 (more than 4 years after default).
Schellenger filed a class-action counterclaim asserting Midland’s suit was time-barred under the UCC four-year statute of limitations for sale-of-goods contracts (810 ILCS 5/2-725) and that Midland had a practice of suing on time-barred store-card debts.
Midland moved to dismiss, arguing the five-year statute of limitations for written contracts and credit-card suits (735 ILCS 5/13-205) applied because the card transaction created a debtor–creditor loan relationship.
The trial court granted Midland’s motion and dismissed Schellenger’s counterclaim with prejudice; Schellenger appealed.
The appellate court reviewed de novo whether the four- or five-year statute of limitations applied and affirmed dismissal.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Which statute of limitations governs Midland’s suit on a Home Depot store credit card balance?	Four-year UCC limitations for sale-of-goods claims applies because the card is used only to buy goods from Home Depot.	Five-year limitations for actions on written contracts/credit cards applies because issuer paid merchant and the card transaction created a loan/debtor–creditor relationship.	Five-year statute applies; action not time-barred.

Harris Trust & Savings Bank v. McCray, 21 Ill. App. 3d 605 (Ill. App. 1974) (tripartite card system creates a loan from issuer to cardholder; longer statute applies)
Citizen’s Nat’l Bank of Decatur v. Farmer, 77 Ill. App. 3d 56 (Ill. App. 1979) (assignee stepping into seller’s shoes may be governed by UCC; distinguished on facts)
Johnson v. Sears Roebuck & Co., 14 Ill. App. 3d 838 (Ill. App. 1973) (bipartite seller–buyer credit sales differ from issuer–merchant–cardholder arrangements)