Can a JDB get an arbitration award?

[smurfette in nyc]

I advised a family member on the steps to take to tackle a JDB TL that appears on his credit reports, in hopes of getting it deleted. Unlike myself, he is very passive and cautious about "credit repair" and asked an interesting question I could not answer, but hope one of you here on the forum can.

The question simply is this: can a JDB get an arbitration award, if they make the proper attempts, or is this "illegal?"

The background of the debt is that it is a charged off MBNA credit card, that BOA acquired 2 years ago, (still within SOL) and subsequently sold to a JDB. The JDB in question has had 2 different CA's send dunning letters to him. The first one went unanswered by my relative, while the second one was answered by him with a DV letter, which I advised. After almost a year, he hasn't received any responses, and only the JDB TL appears on his credit reports, no CA's.

Is it correct to fear "poking a sleeping bear" because of the possibility of arbitration (kangaroo court) or is this nothing to be afraid of since it is in the hands of a JDB?

[astiman]

Two questions:

1) Has a lawsuit been filed?

2) Has a judgement been obtained?

[smurfette in nyc]

Two questions:

1) Has a lawsuit been filed?

2) Has a judgement been obtained?

No and no. The JDB has made no contact with my relative whatsoever.

Again, he would like to be rid of the JDB's TL, but is fearful of sending letters and filing complaints which may "awaken the bear" and put him in a position where arbitration would be a possibility.

Personally, I can't imagine this scenario, but I have no experience with arbitration to offer correct advisement.

[swirlgirl]

Well, he has a few choices: dispute and see what happens or offer a settlement and try for a PFD. I think he's jumping the gun by worrying about arbitration at this point.

[willingtocope]

In answer to the original question...if the terms and conditions of the original agreement between the debtor and MBNA allowed for the right to arbitrate to be passed on to their "assigns" (i.e., people who buy the debt), then the answer to the question is...

Yes, the JDB is can certainly get an arbitration award. As you pointed out, its a kangroo court, and if the T&C's allowed it, it can certainly happen.

Is it illegal? No, probably not.

However, can a JDB's arbitration award be turned into a legal judgement whereby they can take money from the debtor? Don't know. It would depend upon your local courts. I do beleive there is a post around here somewhere regarding a JDB who tried to turn an arbitration award into a judgement and got denied by the court. (Probably 9th circut, but I'm not sure).

[smurfette in nyc]

I do beleive there is a post around here somewhere regarding a JDB who tried to turn an arbitration award into a judgement and got denied by the court. (Probably 9th circut, but I'm not sure).

I used google, and found this, although I'm not sure it is referring to the post you mention:

Civil Court Judge Refuses To Confirm Arbitration Award Obtained In Credit Card Action

By Jay Fleischman

Consumers are sued for credit card debts every day. In New York City alone, hundreds of these cases are filed each business day with every county’s civil courts.

Part of what I do is defend these cases. Why? Because so often the plaintiff is a debt buyer and the defendant, a consumer, in unable to determine (a) who they owed the money to; ( if they are responsible for payment of the debt; © whether the account was rightfully sold; and (d) whether the debt is valid.

The newest tactic is arbitration, when a credit card issuer submits the claim to “binding arbitration.” The consumer wakes up one day to find that there has been a finding of liability, and runs to a lawyer to file for bankruptcy.

Often a bankruptcy filing is justified, but sometimes it isn’t. Even if bankruptcy is the proper avenue, it’s important for the lawyer to review the pre-petition judgments to make sure that no violations of the debtor’s state and/or federal rights have occurred.

If the lawyers fails to do so then the right of recovery - which may be significant - are lost forever due to non-scheduling on the bankruptcy papers.

I submit to you the case of MBNA America Bank, N.A. v. Nelson, 15 Misc.3d 1148(A), Slip Copy, 2007 WL 1704618 (N.Y.City Civ.Ct, 2007).

MBNA America Bank, N.A. brought an action in Richmond County Civil Court to confirm, pursuant to CPLR § 7510, an arbitration award issued in the amount of $9,459.70. In suport of the action MBNA provided an affidavit from an employee, a copy of the “Credit Agreement Additional Terms and Conditions,” indicating that the agreement was subject to arbitration, a copy of the “Notice of Arbitration,” proof of service of process by a process server of the arbitration claim, a copy of the code of procedure for the National Arbitration Forum, and a copy of a signed arbitration award.

The Court refused to confirm the arbitration award because the petition brought by MBNA lacked all of the following: Allegation and proof of the Petitioner’s legal status, and whether it is authorized to do business in New York, in accordance with New York law; Complete copy of the actual retail credit contract, including any subsequent amendments, alleged to have been entered into between the Petitioner and the Respondent; Affidavit establishing Respondent received notice of the alleged agreement, including any subsequent amendments; Objective proof that the alleged agreement, and any amendments, issued by Petitioner are binding on Respondent; Allegation and proof that the arbitration award was affirmed; Submission of the calculations used by the arbitrator to arrive at the final award, the specific claims submitted by Petitioner for arbitration and the claims ruled upon by the arbitrator; Current and complete non-military affidavit.

So what happens now? I’d say that the consumer may want to speak with a lawyer about his or her rights against MBNA and their lawyers, Wolpoff & Abramson, L.L.P. in bringing what is clearly a bogus case.