law-formation-of-contract | acceptance |
Contract Formation by Accepting and Using Card
Regardless of whether we apply federal, Texas, or South Dakota law, a contract exists between Hinojosa and
Citibank. Under federal law, the issuance of a credit card constitutes a credit offer, and the use of the card
constitutes acceptance. Jones, 235 S.W.3d at 339. Under Texas law, if one party signs a contract, the other may
accept by his acts, conduct, or acquiescence to the terms of the contract, making it binding on both parties. Id.;
see also Benser v. Citibank (South Dakota), N.A., No. 08-99-00242-CV, 2000 WL 1231386, at *5 (Tex. App.-El
Paso Aug. 31, 2000, no pet.) (not designated for publication) (concluding appellant's use of credit card and
payments to account showed he understood obligation to bank and contract had been formed). Finally, under
South Dakota law “the use of an accepted credit card or the issuance of a credit card agreement and the
expiration of thirty days from the date of issuance without written notice from a card holder to cancel” creates a
binding contract. See S.D. Codified Laws § 54-11-9 (1983).
Hinojosa v. Citibank (South Dakota), N.A., No. 05-07-00059-CV, 2008 WL 570601 (Tex.App.-Dallas, March 4,
2008, no pet. h.) (mem. op.)(Citibank established Hinojosa accepted the card and used it; therefore, it
established the existence of a contract as a matter of law.)