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Going to court with Midland - debt is good, is there a defense?


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Daughter is being sued by Midland. Submitted a response to the courts.

I talked to a lawyer who told me that if I request a recovery of records that they would know to have their paperwork in order on the court date, so i have not at this point.

The debt is within the SOL, so I have no defense there.

Not sure what to do at this point. Should we try to debt negotiation with them? My concern is that if they prove their case then she has an even bigger debt to try to pay as opposed to trying to settle. They have not violated any laws. And, even if they did, there is no paper trail to prove it. :?

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making them work usually helps foster a settlement. So, make sure you have put in the relevant defenses. And ask for discovery. Sure, it mkaes them prepare their case. But somethime with Midland they have no case. So discovery reveals that. And it costs them money. Which they hate, and thus, they might listen to a reasonable offer.

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When I spoke to the attorney, he stated that they had the burden of proof and that her best response to anything was "I MAY have had an account with them, but...".

He said that if I subpoena for discovery, which is what I would have to do in PA, that would be a red flag for them.

According to her old bank statements, the SOL defense is no good.

I understand the statement there is "always a defense" - but what could it be???? Just denying it is not a defense - that I know of anyway.

Unfortunately, she is unemployed, so I will call Legal Aid in the morning and see if they will help her with this, and call the other attorney and see what he charges, but not sure she/I could afford it.

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There is always a defense!

You have to decide how much want to fight.

Start by reading this:

There is one item (out of all of the legalese that I understood)

VII. SUPREME COURT RULE 222

C. The rule requires both parties to provide a list of case-related information to the

opposing party, such as names and addresses of witnesses, factual basis of the

claim, the legal theory of each claim or defense, etc., automatically, without

request.

My question is - "does this apply to small claims courts in PA - since it is a Supreme Court Rule?? If so, there has been nothing provided, either by mail or any supporting paperwork when the summons was delivered.

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Often in small claims, the rules are completely different. For example where I am there is no discovery or interrogatories or anything, both parties just show up, make their case, and get a ruling right then and there.

You can call the court clerk and ask if they have a brochure or website outlining the small claims procedures for your jurisdiction

You can also look up your state statutes, here are some I found that may be pertinent

Philadelphia Statutes Annotated, Title 42, Part II, Subpart A, Article D, Ch. 11, Subchapter B, Section 1123; Title 42, Part II, Article E, Ch. 15, Subchapter B, Sections 1511-1520. Rules of Civil Procedure Governing Actions and Proceedings Before District Justices, Rules 201-325; Philadelphia Municipal Rules of Civil Procedure, Rules 101-134.

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Often in small claims, the rules are completely different. For example where I am there is no discovery or interrogatories or anything, both parties just show up, make their case, and get a ruling right then and there.
It is true that many small claims courts do not allow discovery. The only possible way to get discovery that I am aware of is to file a counter claim against the plaintiff which should get the case moved to district court where discovery can be implemented. District courts have jurisdiction over FDCPA claims just as federal courts do. If a counter suit deprives small claims courts of the authority to hear cases where a counter suit is filed then FDCPA might be used to get it moved out of small claims and into district. Mind you that I have no idea whether or not filing a counter claim will get it moved to district court or not. All I am saying is that I have heard that if one files a counter claim the case must then go to district court. In truth, I'd like to find out for myself whether that is true or not because I don't know whether it is or not.
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Well, technically your daughter has NEVER had any account with Midland.

So if you was to write "I have never had any business dealings with Midland nor ever signed any contract with them"

That wouldn't be lying.???????

While that may technically be true it isn't a viable defense. The lady can be certain that no matter what she does or says in small claims court she will lose and get a judgment against her followed by garnishment of wages, seizure of bank accounts, possible seizure of automobiles or any other assets she may have now or in the future. Nothing she can do can stop the inevitable outcome of this trial. Even if she is successful in getting it moved to a district court she will be almost certain to lose and get a judgment against her. Statistically speaking that is the outcome of well over 99% of the cases against debtors so what can change the eventual outcome from a loser into a winner?

Unfortunately this lady is unemployed so we must assume that she has no funds with which to fight and a viable fight cannot be done without money to pay the costs of litigation even if she files pro se. She might be able to qualify for forma pauperous and thereby escape paying court costs. Even so, there will be costs of certified mailings to plaintiff's attorney. Many courts make defendants pay a huge fee to even file a response to the case. I've seen those costs run $150 for almost every document the defendant wants to file and there can be several documents needed even to delay the inevitable outcome.

In order to win she will undoubtedly have to file federal case(s) against the plaintiff's attorney and the plaintiff based on FDCPA or other violations. If she does that and is successful she can easily negotiate a settlement that includes vacating the lower court judgment, removing all derogatory comments from her credit reports and paying her court costs, her attorney fees even though she represents herself, and some statutory damages.

There is a data base out there available only to debt collectors which has put out their statistical statements saying that more than 500 federal cases a month are filed against debt collectors which result in average settlements of about $3800 per case. The data base is used by debt collectors to scrub their lists of people who have filed federal cases against debt collectors. The theory is that if you are on that list debt collectors are advised to leave you alone and go after debtors who are not so likely to file a federal case against the debt collector.

There are other ways to safeguard wages, vehicles and other belingings from being taken by garnishment as well and they are absolutely bulletproof but they do cost money.

As long as this lady is unemployed about all she can do is keep any money out of banks because if she deposits even unemployment checks into bank accounts that money can be grabbed and taken from her.

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It is true that she did not have an account with Midland. However, on the paperwork that she received that states the account was with Cap1. No account #'s, though - so she can claim that she never had an account with them.

She originally defaulted on the loan in late 2004, but made a payment in March of 2005. I think, even though she orignallly defaulted when she didn't pay, she retolled the SOL by making that partial payment.

The attorney I spoke with said that I would have to subpoena the documents from the JDB, alerting them to her intent to defend herself. The current JDB has not violated any laws. This is the 3rd JDB who has acquired this account. The other 2 definitely voilated laws, but I was not aware of the laws at the time.

Since she is married now it is my understanding that they will be unable to seize any property because they cannot take his/their property, only hers. Her car has a loan on it, so they cannot take that, either. Apparently, 100% of wages are exempt from garnishment, according to another website. So, while they can get a judgement, they will have to wait like everyone else, or make payment arrangements.

It seems to me an open and shut case, really -if they have their paperwork in order. She will call legal aide on Monday and see if there is anything they can do for her.

I was thinking about having her call them and try to make some sort of debt settlement for removal from her credit report. My fear, is that if they don't have paperwork and she calls them, that she would be incriminating herself.

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It is true that she did not have an account with Midland. However, on the paperwork that she received that states the account was with Cap1. No account #'s, though - so she can claim that she never had an account with them.

She originally defaulted on the loan in late 2004, but made a payment in March of 2005. I think, even though she orignallly defaulted when she didn't pay, she retolled the SOL by making that partial payment.

The attorney I spoke with said that I would have to subpoena the documents from the JDB, alerting them to her intent to defend herself. The current JDB has not violated any laws. This is the 3rd JDB who has acquired this account. The other 2 definitely voilated laws, but I was not aware of the laws at the time.

Since she is married now it is my understanding that they will be unable to seize any property because they cannot take his/their property, only hers. Her car has a loan on it, so they cannot take that, either. Apparently, 100% of wages are exempt from garnishment, according to another website. So, while they can get a judgement, they will have to wait like everyone else, or make payment arrangements.

It seems to me an open and shut case, really -if they have their paperwork in order. She will call legal aide on Monday and see if there is anything they can do for her.

I was thinking about having her call them and try to make some sort of debt settlement for removal from her credit report. My fear, is that if they don't have paperwork and she calls them, that she would be incriminating herself.

I can assure you that legal aid will give her no help at all. .Of course, there is always the possiblity that I could be wrong so she does need to call them just in case.

She can call the lawyer to try to see if something can be worked out but they will want her to sign an agreement which will be turned into a judgment against her. Happens all the time.

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Does that mean that if she makes a payment arrangement with them or settles with them it will be noted as a judgement against her?? I was hoping that she could negotiate removal. If Legal Aide will not help her, I was given the number to the Bar Association in our county.

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I didn't know (obviously) that they would want the judgement if we settled prior to a decision. Thanks so much for the link. I spoke with a friend of the magistrate who will be hearing this. She prefers that people come to an agreement before she rules. Im hoping that, since this is the 3rd JDB on this case that they dont have all of their information.

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I'm in the same boat as you. My court date is latter this month. Please update if you decided not to go for discovery in hopes of them not being prepared as the first lawyer recommended or you decided to file for discovery. Thanks!

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OK, I checked on the website that merrybucks had given and spoke to an attorney. BTW, big thanks to merrybucks.

The attorney told me that:

Since it is the 3rd JDB, they probably dont have all of their paperwork together and that if I subpoena for discovery, that this will alert them that I am planning to fight the case - so dont. Just sit tight.

He said that whatever the judgement is, either party can file an appeal for about 120 dollars. However, at that point, attorney charges come into play as well. He said that going in front of the magistrate can be done with or without an attorney. So, we are gonna fly this part of it alone.

He did say to not settle, because, as I had read on another post (merrybucks posted this, too), that she will get a 1099 for the remainder of the money.

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I must have mis-lead. My apologies. The 1099 would be if we came to a debt settlement agreement. If they agree to take a lesser amount, then the balance would be 1099'd - according to the attorney that I spoke to.

I still feel that this is incorrect. How is the JDB going to prove how much money was owed or forgiven?

Also, if they only paid 6 cents on the dollar, they MADE money from you.

You can only get a 1099 from the OC.

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I'm not quite sure. But wouldn't it stand to reason that if a person comes to a payment/settlement arrangment with a JDB, or anyone for that matter, are you not admitting ownership of the debt?

I only spoke with the attorney once on the phone. He stated that whatever the decision is in the case, it can be appealed by either party. He said that if she rules in our favor they will most likely appeal the decision.

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I'm not quite sure. But wouldn't it stand to reason that if a person comes to a payment/settlement arrangment with a JDB, or anyone for that matter, are you not admitting ownership of the debt?

No - anyone can pay off a debt for a variety of reasons - just to move foward, for a friend or family. Paying a debt is not an automatic admission of guilt.

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