DEFENDANT’S BRIEF IN OPPOSITION TO PLAINTIFF’S
MOTION FOR SUMMARY DISPOSITION
STANDARD OF REVIEW
Summary disposition under MCR 2.116(C)(9) is proper if a defendant fails to plead a
proper defense to a claim. Nicitia v Detroit (After Remand), 216 Mich App 746, 750, 550 NW2d 269 (1996). A court may look only to the parties’ pleadings in deciding a motion under MCR 2.116(C)(9), MCR 2.116(G)(5). A motion under MCR 2.116(C)(9) tests the sufficiency of a
defendant’s pleadings by accepting all well-plead allegations as true. Lepp v Cheboygan Area
Schools, 190 Mich App 726, 730, 476 NW2d 506 (1991). If the defenses are so clearly untenable
as a matter of law that no factual development could possibly deny plaintiff’s right to recovery,
then summary disposition under this rule is proper. Id, quoting Domako v Rowe, 184 Mich App
137, 142, 457 NW2d 107 (1990). Pro se pleadings are to be construed liberally and expansively,
affording them all opportunity in obtaining substance of justice, over technicality of form. Maty v Grasselli Chemical Co., 303 US 197 (1938).
MCR 2.116(C)(10) provides for summary disposition when there is no genuine issue
regarding any material fact and the moving party is entitled to judgment or partial judgment as a
matter of law. A motion under MCR 2.116(C)(10) tests the factual sufficiency of a claim, as
supported by documentation containing “content or substance [that] would be admissible as
evidence to establish or deny the grounds stated in the motion.” MCR 2.116(G)(6); see
also Adair v Michigan, 470 Mich 105, 120; 680 NW2d 386 (2004); Maiden v Rozwood, 461
Mich 109, 120-121; 597 NW2d 817 (1999).
A trial court may grant a motion for summary disposition if the pleadings, affidavits, and
other documentary evidence, when viewed in a light most favorable to the nonmovant, show that
there is no genuine issue with respect to any material fact. Quinto v Cross & Peters Co., 451
Mich 358, 362, 547 NW2d 314 (1996), citing MCR 2.116(G)(5). “A genuine issue of material fact exists when the record, giving the benefit of reasonable doubt to the opposing party, leaves open an issue upon which reasonable minds might differ.” West v Gen. Motors Corp., 469 Mich 177, 183, 665 NW2d 468 (2003). “If it appears to the court that the opposing party, rather than the moving party, is entitled to judgment, the court may render judgment in favor of the opposing party.” MCR 2.116(I)(2). Sharper Image Corp. v Dep’t of Treasury, 216 Mich App 698, 701, 550 N.W.2d 596 (1996);Washburn v Michailoff, 240 Mich App 669, 672; 613 NW2d 405 (2000).
Plaintiff Cavalry SPV I, LLC is a third-party debt collection company that purchases large electronic portfolios of stale defaulted consumer debts, for which it pays pennies on the dollar, in order to collect on them by instituting formal legal action. Plaintiff purportedly is the assignee of a Citibank, N.A. account allegedly opened and defaulted upon by the Defendant. Plaintiff has filed its Motion for Summary Disposition on its claim of an account stated and that the Defendant has failed to plead a valid defense. Because Plaintiff has failed to meet its burden of evidentiary support for its claims and Defendant has raised an affirmative valid defense; summary disposition is not appropriate and this Honorable Court should deny Plaintiff’s motion.
I. Defendant’s Amended Answer Pleaded A Valid Affirmative Defense
Defendant filed an amended Answer to Plaintiff’s Complaint, denying Cavalry SPV I, LLC’s allegations based on lack of knowledge or information to form a belief as to truth of the allegations, MCR 2.111. Under a separate heading, Defendant pleaded an Affirmative Defense: Defendant asserts and evokes the private arbitration clause within the subject card agreement and compels the court to order this case to JAMS arbitration and stay the case until the completion of arbitration. The subject card agreement furthermore states that either party “may, without the other’s consent, elect mandatory, binding arbitration for any claim, dispute, or controversy.” The general policy of this State is favorable to arbitration. The burden is on the party seeking to avoid the agreement, not the party seeking to enforce the agreement. Fromm v Meemic Ins Co, 264 Mich App 302, 305; 690 NW2d 528 (2004).
Attached to a submitted Motion to Compel Private/Contractual Arbitration is Defendant’s Affidavit denying ownership of account and a written request for contractual arbitration. This affidavit was properly filed and “shall be deemed prima facie evidence of such” pursuant to MCL 600.2145. Summary disposition is inappropriate under this subrule [MCR 2.116(C)(9)] when a material allegation of the complaint is categorically denied. Village of Dimondale v Grable, 240 Mich App 553, 564‐565 (2000). In fact, our Supreme Court set aside summary disposition not because of disputed facts, but because the denial of material fact constitutes the pleading a valid defense. August v Poznanski, 383 Mich 151, 155; 172 NW2d 807 (1970).
II. Plaintiff Fails To Establish Prima Facie Evidence Of An Account Stated; Defendant Establishes Prima Facie Evidence Against Plaintiff’s Claim
Plaintiff’s Complaint alleges a claim for an Account Stated. Plaintiff did not provide a signed and notarized affidavit from Plaintiff, Cavalry SPV I, LLC or Plaintiff’s assignor, Citibank, N.A stating account ownership, sale, and/or balance within 10 days of the Summons and Complaint, as required under MCL 600.2145. Under this statute, in order to have prima facie evidence of an account stated, a copy of the account statement must be “annexed” to an affidavit made “within 10 days next preceding the issuing of the writ or filing of the complaint or answer.”
In compliance with MCL 600.2145, the Defendant submitted his amended Answer dated, October 29, 2018, and an affidavit, dated October 30, 2018, attached to Defendant's Motion To Compel Private/Contractual Arbitration denying Plaintiff’s allegations of indebtedness and claim of an account stated. Because the Defendant submitted a timely and complaint affidavit, Defendant’s denial establishes prima facie evidence of a lack of assent to an account stated. “Any affidavit in this section mentioned shall be deemed sufficient if the same made within 10 days next proceeding the issuing of the writ or filing of the complaint or answer“, Smith v Globe Life Ins Co, 460 Mich 446, 454-455; 597 NW2d 28 (1999).
III. Plaintiff Has Failed To Show Defendant’s Assent To Its Account Stated Claim
An “account stated” refers to a “contract based on assent to an agreed balance”; which,
like all contracts, must be created through mutual assent. Fisher Sand & Gravel Co v Neal A
Sweebe, Inc, 494 Mich 543, 557, 561-562; 837 NW2d 244 (2013). “Parties assent to a sum as the
correct balance due from one to the other; and whether this operation has been performed or not,
in any instance, must depend upon the facts.” White v Campbell, 25 Mich 463, 468 (1872). An
express contract arises where the parties expressly agree to the sum due. Fisher Sand & Gravel Co, 494 Mich at 558. A party’s acceptance may also be inferred where the party makes payments on the amount due or receives an accounting and fails to object within a reasonable time. Corey v Jaroch, 229 Mich 313, 315; 200 NW 957 (1924); Keywell & Rosenfeld v Bithell, 254 Mich App 300, 331; 657 NW2d 759 (2002).
When silence forms the basis for inferring assent to a sum owed, the circumstances
involved must support an inference of assent. Thomasma v Carpenter, 175 Mich 428, 436-437;
141 NW 559 (1913). In this case, the circumstances do not support the inference of assent.
Defendant denied he ever received any communication about this alleged debt from Plaintiff or
Plaintiff’s alleged assignor to be able to verify the alleged account or dispute the amount Plaintiff
claims is due and owing (Def.’s Aff. paras. 6). Plaintiff has not submitted facts or evidence of
the manner or method nor provided the actual “repeated demands” for payment of the alleged
account stated debt.
Merely sending bills or attaching a few bills to the complaint or motion for summary
disposition does not create an account stated. Absence of evidence establishing continued course
of dealing, or other circumstances suggesting balance struck required for account stated,
precludes establishing liability upon accounts stated merely on proof of billing and accounts
receivable ledger. R. G. Moeller Co. v Van Kampen Constr. Co.., 57 Mich App 308, 225 NW2d
742, (1975). There must be some acknowledgement by the party billed that he admits owing the
debt and that he further admits the amount claimed is accurate. The Plaintiff does not show that
Defendant ever acknowledged he owes the Plaintiff anything and there has been no
acknowledgment by the Defendant that he owes the amount claimed (Def.’s Aff. para.8).
The purported account statements (Pl.’s Ex. A) do not show a continued course of dealing
as no use or purchases are evidenced. The Federal Truth in Lending Act (TILA) provides that:
“In any action of a credit card issuer to enforce liability for the use of a credit card, the burden of
proof is upon the card issuer to show the use was authorized….15 U.S.C. 1643(b). If the use was
not authorized, the card holder cannot be liable for more than $50, and only then if the issuer
proves that it satisfied many conditions. 15 U.S.C. 1643(a). accord 12 C.F.R. 226.12. The
amount due on the alleged June 3, 2015 statement is $1,323.76, and does not indicate this is a
charge-off balance or that the account was charged off, with a final balance struck.
As stated above all the cases were brought forth by original creditors. A debt buyers has a harder time complying with TILA since they did not witness or have first hand knowledge if the charges were authorized and if the Defendant is liable for anything more than $50 under 15 U.S.C. 1643(a).
Further, looking at recent case law, in Unifund CCR Partners v. Nishawn
Riley, unpublished opinion per curiam of the Court of Appeals, issued February 18, 2010,
(Docket No.287599), Unifund provided evidence that payments were made on the account,
thereby establishing that a debt was owed to Citibank. However, the Court held that this was
insufficient to transform an open account to an account stated without evidence that Riley was
the one who made payments. In the present case, the Defendant did deny the account, denied the
amount owed, denied receiving billing statements, and denied making payments on the account
in the Defendant’s answer, affidavit, as well as this brief.
As the Michigan Supreme Court has said, the party alleging that a fact is true should
suffer the consequences of failing to prove its truth. A plaintiff has the burden of proof (risk of
non persuasion) for all elements necessary to establish the case. Kar v Hogan, 399 Mich 529,
539; 251 NW2d77 (1976). Plaintiff has failed to demonstrate an absence of triable issues on material elements of its claim and seek relief before this Court. Accordingly, with material facts at issue, Summary Disposition is not appropriate in this case.
WHEREFORE, Defendant Pro Se XXXXXX respectfully requests that this Honorable Court deny Plaintiff’s Motion for Summary Disposition, and if it appears to the Court that the Defendant, rather than the Plaintiff, is entitled to judgment, render judgment in favor of the Defendant under MCR 2.116(I)(2).
Dated ________________ _________________________ _________________________
CERTIFICATE OF SERVICE
I certify that on this date I served a copy of this answer on the plaintiffs or their attorneys
By first-class mail addressed to their last-known address(es) as defined in MCR 2.107©(3).
Date__________________ Signed ___________________________________