It’s what I’ve told my clients about 1000 times…don’t panic when a collection agency sues you. You can EASILY beat it.
From the blog of a Michigan attorney:
I love defending people against debt buyers because the Plaintiffs case is as strong as a house of cards in a hurricane. Debt buyers buy judgments, credit card charge offs and other sordid garbage debt for pennies on the dollar. Hell, there are even debt buyers that buy debt that has already been through a collection agency or two. Usually, when a debt buyer purchases his paper, he gets little more than the judgments or a spreadsheet showing the balances due. What does this mean for the consumer that is sued? Everything. The debtor buyer has no proof that the consumer owes anything other than some shmoe’s word for it that the debt was owed in the first instance. Recently, someone got wise to the idea that an attorney who sues on this crap and does not have the goods to show that the debt is actually owed, may be violating the Fair Debt Collection Practices Act.
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I need to file answer but dont know what to put in my answer.
Being sued by a lawyer claiming to represent
Citibank. This is the second debt collector to try.
Tried debt validation, they sent me a letter statting the OC and amount. Bottom of letter has disclaimer “this is an attemt to collect a debt….”
What do I need to put in my answer to the siut?
Phil
I have the exact problem Phillip is referring to, is there an answer. I also am dealing with a lawyer representing Citibank. I tried debt validation they responded by sending a letter , say that, they did not have to validate, and the letter was a verification.
Please help, I am scheduled for court in March.
Philip and Tammy,
They have not validated the debt. Do more research on this. Get a lawyer if you have to, they can’t win the case if they can’t provide validation. You could actually sue them. They are just trying to intimidate you into giving them money.
KM
What do you mean that they have not validated the debt? Section 809 of the FDCPA states (1) the amount of the debt; (2) the name of the creditor to whom the debt is owed;.
The United States Fourth Circuit Court of Appeals in Chaudhry v. Gallerizzo, 174 F.3d 394 (1999) opined : “Verification of a debt involves nothing more than the debt collector confirming in writing that the amount being demanded is what the creditor is claiming is owed; the debt collector is not required to keep detailed files of the alleged debt.”.
I am very interested in your basis that validation has not been completed. This is the problem I have been running into with debt validation.
Thanks
Tammy
I am not a lawyer and this is not legal advice but general information.
How I would handle your lawsuit is to file a sworn denial.
The sworn denial is a simple statement filed with the court once you are sued. This needs to be a statement in WRITING that you FILE with the court where you have been sued. It can be a simple statement, but it needs to be typed, signed, notarized, filed with the clerk of the court, and a copy sent to the collection lawyer. It needs to be a graduated denial. In other words, it needs to say, “I deny that this is my debt and if it is my debt, I deny that it is still a valid debt and if it is a valid debt, I deny the amount sued for is the correct amount”.
Don’t lie though. If the debt is yours but the amount is wrong say so. Most collection agencies have the wrong amounts.
Seldom can the collection lawyer justify in an accounting the complete debt sued for.
When a sworn denial is filed, the debt collection attorney cannot rely upon a sworn affidavit of account, but must instead produce a live witness to testify about the debt.
The likelihood that the action will go no further increases.
Next is to file DISCOVERY. U need to file a written Request for Production of Documents asking for a copy of the contract or agreement upon which the debt is based.
It is likely that the debt collection attorney will not be able to secure a copy of the original agreement, or if he is, he will not be able to do so timely.
If it is an old debt which has been sold to a debt purchaser, the likelihood of retrieving the original signed agreement decreases dramatically
Next SHOW UP! Show up for court. Show up and ask for a trial. You can’t make it worse. The worst thing that can happen is the same thing that would have happened if you hadn’t appeared at all; a judgment. Most likely you will get a better result because you showed up.
Attack the witness first and the debt second. The witness can only testify from personal knowledge. Generally, the witness has no personal knowledge about you or your account, but only knows what’s in the file he got from the collection department. If he is going to testify without personal knowledge, but from the records and documents of the business, then he has to have a basis to do so. He needs to be the regular keeper of those books and records and be familiar with how they are kept and their contents.
Ask him how long he has been with the company, in that job, what he does on a daily basis, when he first saw your file, if he knows from personal knowledge if it’s a complete file, etc. You must destroy his credibility and his ability to testify about the papers he has in front of him.
The best defense is the Statute of Limitations. It is a drop dead deadline.
Should you lose at trial, is to APPEAL. No collection activity can go on during the appeal. No garnishments, no seizures, etc… The appeal could last years.
Good luck in court. Kick their asses.
I ran into the same problems with debt validation that you did.
I had gotten a great response to the Chaudhry v. Gallerizzo, 174 F.3d 394 (1999) case law.
This paragraph of the opinion is actually talking about attorney and client priviledge bill on an invoice and fees for an appraisal that had not been done. This only applies to these two items.
In the next paragraph of this opinion it describes the detailed billing needed for validation referencing a 1991 decision.
http://creditboards.com/forums/index.php?showtopic=131829&hl=chaudhry
So this is basically BS and just another way to throw us off track.
I’m in the throws of a suit with the nasty Mann Bracken. Their client is MCM. This is for a signature loan. They have a copy of the signed check.
The statute of limitations ends in September and these guys are like the scary version of pit bulls.
This debt was first sold to another collector, ERS. Does ERS then sell the loan back to the bank and the bank resell it. Is there anything in this process that gives me a something to work with or is this it?
Morrie,
I have won every case brought against me or others by a debt collection law firm here in Arkansas.
You said in your comment that they have a copy of the signed check; but do they have the original. A copy will not work in the courts.
Mortgage Audits
To All on the Blog;
I am not an attorney but I am a legal researcher / paralegal.
1). If you have responded to a solicitation from a credit card bank by filing out the application and then signing, your signature is what is required to allow the bank to view your credit and is called a permissible purpose.
2). Next, the bank will either issue you a card or deny you a card. If you get the card it will have a sticker that directs you to call a number to activate the card. There is no signature agreement and there is no Truth In Lending disclosures about the terms and conditions to which you have signed.
3). Now you go out and say charge up $10,000.00 (not real money, FRN’s, but legal tender) and you decide to not pay or can’t pay.
4). By law the bank has to write off the debt in 180 days.
5). The bad debt gets sold in the back rooms of the New York Stock Exchange for pennies on the dollar.
6). Debt collection begins…
7). Debt collectors are third party and have no knowledge of anything except what is on a print out.
8). Cannot validate the debt. (No Signed Contract or Agreement) (No Signed Agreement to Arbitrate). (nothing dated)
9). Debt collectors disappear and attorney debt collectors appear and a suit is filed.
10). Law says the burden of proof that a debt is owed is on the Bank.
11). Proof is a signed contract and the evidence of a debt. The evidence of a debt is what?
Thank you John, a great help here. There are many of us these days that do not want to owe and then not pay, but with some it has gotten to a point that keeping their home is way more important that what is owed to the credit cards. Besides, how much do they really lose when it comes to the finish line?
I just learned today that some collectors work WITH the original creditor on some matters, and buy bills in another…. so find out which you are dealing with.. Not all collection agencies buy the bills….
If you sue, send a letter requesting production of everything they intend to introduce at trial, and if they dont produce it.. OBJECT to them introducing it court on the grounds that they failed to provide it to you ahead of time.
“Next is to file DISCOVERY. U need to file a written Request for Production of Documents asking for a copy of the contract or agreement upon which the debt is based.”
This is an urban legend on how to defeat collection agencies and it fails CONSTANTLY. Trying to have a collection agency supply an irrelevant signed contract from the original creditor for a debt that you have never disputed is a meaningless gesture. Only if there are insane amounts of interest added to the original debt after the OC has sold the debt will the original terms of the contract come into play, but otherwise the motion is useless.
Remember, this is a civil case, and you only need to provide an argument where is seems likely that you are right (51%). If a collection agency is trying to collect the original debt (no wacky interest or fees), can provide proof that they are the rightful owners of the debt, and the original debt is valid (a copy of your credit report with the original debt on there for years will do), the court will rule for the agency.
Saying “Oh yeah, but they didn’t have the original signed copy from the original creditor, and I need that document to prove to the court that. . .uh. . .well I never said I didn’t owe Bank of America nothin’ originally and, uh. . .nothing in the contract says this agency can’t collect. . .uh. . .and since I never said the original debt wasn’t valid, and all the agency has to prove is that they legally bought the debt, but owning the original contract doesn’t in any way show that legally own the debt. . I. . .uh. . .don’t know what I was going for.”
Listen, I’ve been helping people fight collection agencies for years, and I’m telling you, if you try to use the “signed contract defense” against a sober attorney, you’re going to lose. Hard. The judge will then ask you why you need the contract since you don’t dispute the original debt and more documentation will require another court date. If you say it’s because you need proof that the agency owns the debt, they can just show receipts and a purchase history back to the OC. Judges ask people if they owe the original debt, and if you lie and say no, not only can the collection agency get the paperwork from the OC, but you will then be arrested for perjury.
You can win court cases against collection agencies (and you should sue more often for FDCPA and FCRA violations), but the signed contract silver bullet myth is going to blow up in your face like it does to lots of people every day. Always go to court, though.
Also, the link you pointed to was for a story about a collection agency using the bogus affidavit strategy and having it blow up in their face. That does not mean you can “easily” beat civil cases when the burden is proof is very low. If you don’t have an affirmative defense (SOL for example), you will lose unless the collection agency can’t even provide documentation that they even bought the debt, or why their figure is different from the OC’s figure (that happens a lot).
On the contract – it depends on how the complaint is worded. If the complaint says “Defendant entered into a contract”, they better have the contract to show exactly was the agreement.
If they are just saying agreement through the use of the card – then yes, it is tougher. I’d attack the evidence. Usually it’s pretty weak.
You mentioned the collection agency needs to prove they own the debt? Well yeah, and that’s usually the evidence they can’t provide.
And what do you do about collection letters you recieve because you found out your daughter has opened credit cards in my name without me knowing about it and could not pay for it! I am not judgement proof, I have substantial monetary assets. I don’t know what to do on this. And no, I’m not pressing charges on my daughter. Do I need to work out a payment plan and let her pay it back, or just wait and see if they sue me and say I don’t know what this is, as I didn’t, or do I send this debt validation letter that you have mentioned even though some of these are past 30 days?
What about a debt no signature? I had a vehicle that was in my name towed unknowingly five years ago. The vehicle didn’t run and was worth very little, so I didn’t give it much thought. Well, I just received a “lawsuit has been started against you” letter stamped by our local district court from a collection agency. The lawsuit is double the amount of the original debt. The only way I know the amount of the original debt is that it’s on the lawsuit letter. I never had any communication with the original tow truck company. Help please?
I asked collection attorney for verification of the debt, and he ssupplied wrong basis for the debt, then filed suit against me. I will claim violations of FDCPA and FCA. Is this good enough defense?
No – you need to file an answer. Here is a link to help you figure out how to do this. http://www.creditinfocenter.com/legal/ive-been-sued.shtml.
Hello,
I have a situation here, I was contacted by a collection agency in US for a debt that is owned by a collection agency in Aus. The provided contracts have no signatures nor any other proofs validating that I own those cards. The applications have my information which I never filed. I have responsed back to the CA in USA explaining the same. Can the agency report about this international debt to Credit beauros in US? Please guide me on this as they asking for more than $10,000.00 USD. I dont even know what those cards or what their limits are. Any help/advise is of great help.
BTW the above debt I have mentioned seemed to be AUS credit card.