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Sued by CA over old CC debt


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Hello everyone, first time poster, so be gentle :)

I recently had a civil suit filed against me over an old credit card debt. First a little bit of backstory. I opened the account with Household Bank back in 2000. I lost my job a little thereafter, and wasn't able to keep up with payments. Long story short, in went into collections. There for a year or two, I tried making payments, but just wasn't able to keep up. Finally the debt was written off as bad debt, leaving a mark on my credit report.. This was around 2002 or so. I originally had a credit limit of $2,500 , however, by the time the account was 'closed' it was up to over $3,000 due to late fees and interest.

Fast forward to this year, and out of nowhere I get served with a civil suit and the plaintiff is some Gault Financial, LLC, whom I have never had any business with. Apparently this debt was sold by Household Bank, and was tossed around until it went to these people. But in all that time, I never received any mail or phone correspondence from Household Bank, Gault Financial, or any other collection agency stating that I needed to paid. I figured that Household Bank wrote it off as bad debt, and left the negative marks on my credit report. Now the balance has ballooned to $6,482 (plus court costs).

Here's where it gets odd, all but 1 credit bureau has removed the original Household Bank account from my credit report. I pulled my credit report last september and last month. Only Transunion has info still on the original account, and its set to go off their records on 4/2008 (my court date is April 4th) And even in their records, my balance is only $3,617. I don't even know where that amount comes up, but at least its more reasonable than the $6,400 balance. According to the credit report from september, the account was closed on 10/2001 and "paid" on 03/2003. In all that time, I never received a phone call or letter from the buyer or from Household Bank of the new balance or to make arrangements.

Basically, I'm just trying to find out what my options are.. With it about to disappear from my credit report, do I even have to still pay the old balance? Would paying on that, basically "re-age" the account? I've had to pay for my stupidity for the past 8 years, basically ruining my credit.. I've spent the good part of that time trying to re-establish my credit. The last thing I need is to have it on their an additional 7 years.. Even if I do have to pay it, how do I dispute this balance? Because, I don't know where they're pulling this number from, they could just be pulling it out of thin air. To make matters worse, any payments would have to be delayed as I'm currently unemployed, but seeking work.

Any advice on the matter will be greatly appreciated, thanks.

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Hello everyone, first time poster, so be gentle :)

I recently had a civil suit filed against me over an old credit card debt. First a little bit of backstory. I opened the account with Household Bank back in 2000. I lost my job a little thereafter, and wasn't able to keep up with payments. Long story short, in went into collections. There for a year or two, I tried making payments, but just wasn't able to keep up. Finally the debt was written off as bad debt, leaving a mark on my credit report.. This was around 2002 or so. I originally had a credit limit of $2,500 , however, by the time the account was 'closed' it was up to over $3,000 due to late fees and interest.

Fast forward to this year, and out of nowhere I get served with a civil suit and the plaintiff is some Gault Financial, LLC, whom I have never had any business with. Apparently this debt was sold by Household Bank, and was tossed around until it went to these people. But in all that time, I never received any mail or phone correspondence from Household Bank, Gault Financial, or any other collection agency stating that I needed to paid. I figured that Household Bank wrote it off as bad debt, and left the negative marks on my credit report. Now the balance has ballooned to $6,482 (plus court costs).

Here's where it gets odd, all but 1 credit bureau has removed the original Household Bank account from my credit report. I pulled my credit report last september and last month. Only Transunion has info still on the original account, and its set to go off their records on 4/2008 (my court date is April 4th) And even in their records, my balance is only $3,617. I don't even know where that amount comes up, but at least its more reasonable than the $6,400 balance. According to the credit report from september, the account was closed on 10/2001 and "paid" on 03/2003. In all that time, I never received a phone call or letter from the buyer or from Household Bank of the new balance or to make arrangements.

Basically, I'm just trying to find out what my options are.. With it about to disappear from my credit report, do I even have to still pay the old balance? Would paying on that, basically "re-age" the account? I've had to pay for my stupidity for the past 8 years, basically ruining my credit.. I've spent the good part of that time trying to re-establish my credit. The last thing I need is to have it on their an additional 7 years.. Even if I do have to pay it, how do I dispute this balance? Because, I don't know where they're pulling this number from, they could just be pulling it out of thin air. To make matters worse, any payments would have to be delayed as I'm currently unemployed, but seeking work.

Any advice on the matter will be greatly appreciated, thanks.

Please verify this, but I believe the SOL for TN is 6 years. Thus if you can nail down your dates, this might be your affirmative defense you need to for court. Perhaps someone more knowledgable can step in.

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I would call an attorney who works in these matters for you.

I wish I had years ago. Most of those judgements are either past the statute of limitations or the person sueing doesn't have actual rights to sue.

An attorney who really understands debt law and your state laws can help you.

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Please verify this, but I believe the SOL for TN is 6 years. Thus if you can nail down your dates, this might be your affirmative defense you need to for court. Perhaps someone more knowledgable can step in.

According to this site, it's 6 years for TN, except for open-ended accounts, which are 3 years.

But thank you both for your replies, I did intend to seek local legal help as well, I just wanted to see from other people who potentially been in my situation, before I fork over money in legal fees (although most offer free consults)

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We have been debating the Tennessee SOL for some time. Some say it is three years, some say six. I did some research and posted it, including my analysis. My conclusion is that it is six years. So far no one has challenged it or provided any proof that it is three years.

I have some cases that may eventually lead to a lawsuit against me so I am interested in following what happens to you, especially on the SOL question. That is one of the main issues in three of my accounts. So please post about your experiences as this case unfolds. Also I am interested in how your attorney does on the case. I will probably hire a local attorney if and when I get sued. Of course I don't know what part of Tennessee you are in.

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Tennessee SOL for open accounts is 6 years per T.C.A. 28-3-109.

Tenn. Code Ann. § 28-3-109 states, in pertinent part: “(a) The following actions shall be commenced within six (6) years after the cause of action accrued: . . . (3) Actions on contracts not otherwise expressly provided for.”

I called the Tennessee State Bar last fall when this question came up on my home forum and they said the following:

  • Breach of contract: 6 years, (T. C.A. 28-3-109).

  • Open accounts: 6 Years, (T. C.A. 28-3-109).

  • Domestic or foreign judgments: 10 years, (T .C.A. 28-3-110)

You also need to look over Tenn. Code Ann. § 62-20-127 if sued by a JDB as assignments must be filed with court upon commencement of suit and must contain certain elements such as:

(a)

(3) The assignment was manifested by a written agreement stating the effective date of the assignment and the consideration paid or given, if any, for the assignment. The written agreement must also disclose that the collection service licensee may, for purposes of litigation, consolidate the assigned account, bill, note or other indebtedness with those of other creditors against the individual debtor or co-debtors; and

(4) A collection service licensee bringing suit in its own name as an assignee may submit an affidavit of sworn account that has been executed under oath by the assigning party or by a person qualified to execute a sworn account pursuant to § 24-5-107(a). A copy of the sworn account shall be filed with the court for service upon the debtor.

In addition, in order to file a proper suit on a written contract, a signed agreement between the parties needs to be attached pursuant to Tenn. R. Civ. P. 10.03, however in CITIBANK SOUTH DAKOTA, N.A., v. BONNIE L. JOHNSON, this was reversed in credit card cases. It will all depend on whether or not the law firm suing you is good at what they do and use the appropriate statute to counter that argument which is under Tenn. Code Ann. § 47-22-102(B) which states that:

47-22-102. Unsolicited credit card -- Effect.

(a) If an unsolicited credit card is issued to any person in this state, such person shall not be deemed as having accepted the credit card and being subject to the terms of the agreement governing the use of the credit card, and shall not be liable for its unauthorized use by failing to return the credit card to the issuer.

(B) If the agreement governing the use of the card so provides, use of the card or retention of the card with intention to use it by either the person to whom it was issued or anyone to whom the person entrusts it will result in the person to whom the card was issued being subject to the terms of the agreement and liable for its unauthorized use.

There are plenty of ways to use all these statutes and the RCP's in fighting a cc suit in TN. It mostly depends on how the suit was filed and what it was filed as. Use what you can how you can. Some cc suits are filed as account stated, some as written contracts, and some even as promissory notes. It depends on what the complaint actually says as to how best to defend it.

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  • 2 weeks later...
So please post about your experiences as this case unfolds. Also I am interested in how your attorney does on the case. I will probably hire a local attorney if and when I get sued. Of course I don't know what part of Tennessee you are in.

First of all, I live in Murfreesboro/Rutherford County (just outside of Nashville).. Finding an attorney wasn't a big problem... getting one to call you back was insanely difficult.. I spent half the month waiting on someone to call me back, finally on my 3rd try, I called a law office that dealt with nothing but bankruptcies..

I told them my situation, and basically that I wasn't looking for a bankruptcy, but I was wondering if what the CA doing was legal.. the lady basically said that after 4 years, they can't do anything legally to you.. (I'm assuming this is 4 years from last payment/action) She said basically to tell the judge that the statue of limitations has passed.. Not the least of which, Gault Financial who bought the account from Household Bank, never sent me a written notice that they had taken over the account, which they are legally required to do so, in fact, aside from the lawsuit, I've never even heard of this company before..

At any rate, I will update again next friday when the court date arrives, and will let everyone know what happens, but it looks like this will be thrown out, luckily for me :lol:

EDIT.. Just got back from the court.. Didn't actually see the judge, just spoke with the opposing attorney outside the courtroom. He claimed that the account was paid on in March of 03 (although I don't recall) but because of this, its still within the 6 years statue.. I informed him that an attorney claimed that after 4 that legally they can't do anything, and he claims that its a different type of account. I basically knew this guy was going to say anything to get me to pay, so I told him to reschedule to when I can have an actual attorney represent me. It also gives me time to go back and look over all of my records to see if I actually paid it or if they're considering the sell of the account as "payment" on the account..

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  • 1 month later...

I also have a collection account with a different JDB in tennessee. The DOFD is 7-2002 and they sued/attempted to serve on 8-10-2007. They served to an old address and I only found out about it thu the court website. After 60 days the court website says "NTBF leading civil warrant" and a 4 months later it says "alias NTBF"

Whats the mumbo jumbo mean?

Did their suit on 7-23-07 affect the SOL in any way? ( TN SOL is 6 years)

Original drop date for TN SOL is 7-2008

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I want to update this thread with the original topic.. I recently had to go back to court again for the 2nd time, after speaking with the attorney for Gault Financial back in April. I basically asked for documents showing that Gault Financial took over the account, because I never received such a letter from them. Also, I wanted them to show some kind of canceled check or statement showing payment from March of 03, thus putting the account within the statue of limitations.

Anyways, I went to court and went before the judge and the attorney basically said that they could NOT come up with the documents, and therefore moved for a summary dismissal (I believe thats what it was called). In essence, the lawsuit was dropped, but the judge did say that if Gault Financial did come up with the paperwork, they could sue me again, but they would have to start the process all over again with the original summons. But after March of 09, the statue of limitations will be over, even by their records... so I'm feeling okay about all of this :)

Long story short, question everything, request documentation, don't assume anything.

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  • 1 month later...
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