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Plaintiff's suit dismissed w/out prejudice-still trying to collect-is this legal?

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I signed a loan agreement with a company in Massachusetts several years ago.

I stopped paying at one point because my payments were not being credited properly and they refused to fix the problem. I advised them that my payments would resume once my account was straightened out.

Time went by-they apparently tried to sue me in court but the case was dismissed without prejudice because they could not prove they served me.

They did not serve me in ANY manner-not even a notice in the mail from them or by the court.

(I leaned this later on by accident when I was at the court to get a copy of paperwork for a judgment I won against someone.)

Several months ago, their attorney sent me a demand letter stating "that I still owe the money" and that they expect payment.

I called the fellow and explained that they LOST in court and so unless they refile and WIN I owe nothing and they have NO right to collect. Their attorney for some reason disagrees..

Am I correct or is he?

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Does that vary by state?

After I posted the question i talked to someone with a different response.

I have a friend here in NY who told me a landlord sued her for back rent. She had not paid because of repairs not being performed to the apartment the city had mandated.

The judge dismissed the landlord's case without prejudice, just like mine and told her that unless landlord refiles and wins the debt is now gone...

So what's the difference in that case and mine?

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A consumer attorney I know in my state told me they can continue to try to collect and or sue again unless the case is dismissed with prejudice, or ruled on in favor of the defendant. A dismissal without prejudice is like the suit never happened.

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A dismissal WITH prejudice means that the plaintiff cannot bring another suit on the same grounds. A dismissal without prejudice means that a subsequent suit may be filed.

Any later suit must be filed within the limitations period. One issue that varies from state-to-state is whther the SOL is "tolled" by bringing the first suit. Generally, "tolling" means that the SOL is suspended for the period of the first suit. Thus, if the suit was on file for 3 months, that 3 month period would be excluded from the SOL analysis.

The rules about tolling are state specific. You should consult NY law on this issue if you are close to having a time-batrred debt.

Good luck.

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