Linda7

Thoughts on Judgments?

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I'd like any and all input to try and gain a little wisdom on the subject.

If someone has not assets and is only drawing social security - I understand that even if a judgment was rendered against them, it wouldn't mean anything as there would be nothing to garnish or collect.

But, if you think that somewhere, sometime - they may again have assets and with the judgments being renewable after so many years - this waiting game could go on and on!

Would it not be better - even though you are what they deem "judgment proof" - to go ahead and file a counterclaim when you answer a summons? That way, instead of the case being dismissed at the plaintiff's whim because they can't provide proof of the debt - at least you could get to see the judge with your counterclaim and maybe then get the case dismissed "with" prejudice. That would stop the game, wouldn't it? :rolleyes:

Then if they did sell the debt to someone else and if they tried to collect, you could send them a copy of the dismissal and "if" they ignored it and went on with their collections and sued . . . then you'd have a violation. xangelx

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From what I've read, counterclaim strategies work best when you are dealing with an assignee of a debt or a junk debt buyer because they frequently have no proof and have likely racked up tons of FDCPA violations. They don't want anymore investigations so they'll quickly settle and dismiss with prejudice if you fight back and counterclaim. There are a few cases in old threads by some of the posters where they counterclaimed against a jdb like Mid**** and the suits were quickly dismissed.

With original creditors, the counterclaiming strategy in debt collection suits is somewhat elusive to me because I've only seen it used in foreclosure actions as a stalling tactic. I think that in order to prevail against an original creditor using counterclaim strategies is if the violations they've committed are obvious and they've been known to commit fraud etc.

In terms of the execution proof debtor on SSI, they can get a judgment taken out against them AND get their accounts levied etc. The sheriff or levying officer doesn't know if the funds in their account are only from SSI nor does the bank. There have been many cases where a person on SSI knew they were execution proof and got a default judgment taken out against them. The creditors used the bank levy technique to drain ALL of their accounts of money AND the hapless debtor had to go to court over the course of two to three months to get THEIR SSI money back!

Ultimately, the previous poster is right; the person on SSI or whomever else that is getting sued should always answer the suit and either pony up affirmative defenses or just agree to a settlement but NEVER should you let a default judgment get taken out against you!

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Would it not be better - even though you are what they deem "judgment proof" - to go ahead and file a counterclaim when you answer a summons?

I'm not sure I understand. File a counterclaim for what?

at least you could get to see the judge with your counterclaim and maybe then get the case dismissed "with" prejudice. That would stop the game, wouldn't it

One would hope, but it could depend on the judge. Also, the Plaintiff could drop the case.

Then if they did sell the debt to someone else and if they tried to collect, you could send them a copy of the dismissal and "if" they ignored it and went on with their collections and sued . . . then you'd have a violation.

If I'm not mistaken, a dismissal with prejudice only applies to the company who brought the suit. It means that the same company cannot sue you for that account again. I could be wrong here, and each state might be different, but a JDB who has nothing to do with that company and buys the debt from them can sue you...especially if it's within the SOL.

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If the matter is dismissed with prejudice, so is the cause of action under which the suit was based. This means that the creditor cannot sell a non existent debt to a jdb if the matter was dismissed with prejudice because courts have ruled the claims of the creditor to be invalid and have extinguished the matter!

So if another jdb tries to sue you for the same debt after the initial suit was dismissed with prejudice, that jdb and the creditor who sold them the account can be sued.

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From what I've read, counterclaim strategies work best when you are dealing with an assignee of a debt or a junk debt buyer because they frequently have no proof and have likely racked up tons of FDCPA violations. They don't want anymore investigations so they'll quickly settle and dismiss with prejudice if you fight back and counterclaim. There are a few cases in old threads by some of the posters where they counterclaimed against a jdb like Mid**** and the suits were quickly dismissed.

With original creditors, the counterclaiming strategy in debt collection suits is somewhat elusive to me because I've only seen it used in foreclosure actions as a stalling tactic. I think that in order to prevail against an original creditor using counterclaim strategies is if the violations they've committed are obvious and they've been known to commit fraud etc.

In terms of the execution proof debtor on SSI, they can get a judgment taken out against them AND get their accounts levied etc. The sheriff or levying officer doesn't know if the funds in their account are only from SSI nor does the bank. There have been many cases where a person on SSI knew they were execution proof and got a default judgment taken out against them. The creditors used the bank levy technique to drain ALL of their accounts of money AND the hapless debtor had to go to court over the course of two to three months to get THEIR SSI money back!

Ultimately, the previous poster is right; the person on SSI or whomever else that is getting sued should always answer the suit and either pony up affirmative defenses or just agree to a settlement but NEVER should you let a default judgment get taken out against you!

What he said. Excellent advice.

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Okey dokey...that's what I get for thinking. :oops:

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Yes, always answer a suit - that I know and understand well!

And I also know and understand about separating social security and not comingling so that "only" social security deposits show on your bank account to keep them from being garnished. However, do you think that it would be more wise to have the individual receiving social security that is being sued, to stop their automatic deposits and just receive their check by mail?

And this would be only against JDB - not OCs.

BV, I believe if you have a counterclaim, that would stop the plaintiff from being able to just drop the suit on the courthouse steps when you show up and they still don't have proof of the debt. As for what counterclaims - they usually violate in some way. I'm just thinking out loud and thinking that if you do have a counterclaim, maybe them trying to collect when you sent a DV letter or harassing phone call, etc. - you could use that as a counterclaim.

What I'm thinking is trying to come up with an alternative way to stop a suit, once and for all without having this endless game the JDBuyers seem to play.

If you can find a counterclaim somewhere against them and put that in with your answer to their summons, the plaintiff won't be able to dismiss the suit. You would then have a bargaining chip. If they don't have proof of the debt, they can't just drop the case when you show up for the courtdate as the counterclaim will have to be addressed. Wouldn't that put the defendant in a better position, so that the plaintiff just might want to negotiate "before" court for both sides to dismiss the case - only this time, it could be with the specification that it would be dismissed "with" prejudice and that should be the grand finale for that debt! In other words, if you'll dismiss "with" prejudice - I'll dismiss my counterclaim and not go after you for FDCPA violations.

Or should you also have it to be specified that it will be dismissed with prejudice and "not" sold to anyone else . . . just to be sure?

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First things first. If the debtor has protected assets and has a judgement againest them, they should clearly notify the judgement creditor that their assets are protected. Even attempting to attach those assets after notification would be an FDCPA violation for a CA, JDB or Debt Collection Lawyer.

If you have FDCPA, FCRA, TCPA, or any other violations of law that you can bring suit on when you are being sued. It is a good idea to counterclaim. This provides you with leverage. The amount of leverage you have depends on the size of the alleged debt and the amount if any of valid proof they have.

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In terms of the execution proof debtor on SSI, they can get a judgment taken out against them AND get their accounts levied etc. The sheriff or levying officer doesn't know if the funds in their account are only from SSI nor does the bank.

This is not even remotely close to being true at all. Banks absolutely are able to recognize when money in an account is SSI, unemployment, child support, payments from pensions etc. And they do not freeze accounts that have these type of funds in them.

Edited by usctrojanalum

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interesting thread....I am in the other one, sued by the OC, and looks like they have a very solid case...very unresponsice to the settlment offers, and I am already have a court date...I hope to drag time as long as possible, and fight back...not sure what are my steps, but it looks like, request for discoveries...court 40 days aways...what I am wondering is...in case they win, jugment and so forth...I guess you can apeal then...I plan to work for myself...no assets that they can get to...few 00s at the bank, but I will make sure that in case of the judgment there will be "0"...but what to do after the judment is granted...you apeal, but it is original creditor with very accurate paperwork...so, I am looking at the worst case...as I said no income to garnish, so I am trying to develop the strategy "after jugment" I have one suit but potentialy can be much more...I only been able to settle 2 put of 14 so far, and not sure where I will ended up...can you leagely remove and delete judments or they stay for ever????

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This is not even remotely close to being true at all. Banks absolutely are able to recognize when money in an account is SSI, unemployment, child support, payments from pensions etc. And they do not freeze accounts that have these type of funds in them.usctrojanalum

Banks certainly can tell who deposits money into their customers' accounts. However, if they are served with a levy order for an account, they usually do not conduct due diligence to see if any funds in the account are exempt from levy. It is the debtors responsibility to tell their bank that they have funds exempt from levy.

In truth, the law is very clear that people on SSI are execution proof from these civil judgments. HOWEVER, banks usually ignore the law on this point. See this document and text below:

We estimate that on a monthly basis tens of thousands of low income recipients of Social Security,SSI and other federal payments whose benefits are entirely exempt from claims of judgment creditors are left temporarily destitute when banks allow attachments and garnishments to freeze their only assets. We believe our estimate of over 1 million recipients of Social Security and other exempt federal benefits a year who have their funds illegally frozen by banks is very conservative, and that the real number is likely much higher.8

As was illustrated in a recent Wall Street Journal article (“The Debt Collector vs. The Widow – Viola Sue Kell thought her Social Security benefits were safe in the bank. She was wrong.”),9 when a bank applies an

attachment or garnishment order to the exempt funds in a low income recipient’s bank account, the consequences are generally devastating. There is no money for food or medicine. Checks written for rent or the mortgage are bounced. People go hungry. They get sick or sicker. They suffer anxiety. They are forced to pay steep bank fees and fees to merchants because the checks they wrote when they had money in

the bank now bounce.

In fact, I cited a case a few months ago where an old lady on SSI got sued for a credit card debt. She wrote a letter to plaintiff attorney telling them that SSI was her sole income and she notified her bank in writing. Plaintiff attorney ignored her letter, took out a default judgment against her AND levied her checking account.

Despite the fact that she had let her bank and the attorneys know of her SSI income and execution proof status. It took a matter of months for her to get the money back btw.

Stop this pissing contest just because you're unfamiliar with certain situations.

We're here to help NOT obstruct!

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Okey dokey...that's what I get for thinking. :oops:

Your line of reasoning was actually sound and has been the subject of debate on this board a few times. I formulated my thoughts on the matter not based upon theory, but what I'd actually seen through perusing all these court cases. Please don't say oops because we all are trying to learn here and your input is always valuable. We are all learning otherwise we wouldn't be here;) :)

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Your line of reasoning was actually sound and has been the subject of debate on this board a few times. I formulated my thoughts on the matter not based upon theory, but what I'd actually seen through perusing all these court cases. Please don't say oops because we all are trying to learn here and your input is always valuable. We are all learning otherwise we wouldn't be here

Thank you. I've gone from red to just slightly pink.:)

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Stop this pissing contest just because you're unfamiliar with certain situations.

We're here to help NOT obstruct!

I'm not sure if you ever studied statistics before, but they way they came up with that 1 million is number is so laughable and non-empirical that I can't take 1 word in that text seriously. The logic is that about 1 million people on SSI get judgments against them a year, therefore 1 million people on SSI per year have their exempt assets frozen, lol.

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I'm not sure if you ever studied statistics before, but they way they came up with that 1 million is number is so laughable and non-empirical that I can't take 1 word in that text seriously. The logic is that about 1 million people on SSI get judgments against them a year, therefore 1 million people on SSI per year have their exempt assets frozen, lol.

One comment and then back to the Original Poster.

I have been watching my local court cases online. Each week there is at least one case where the creditor seized assets from a bank that were from a protected source. The person has to come to court to get the money back. They get it back, but it is a huge inconvenience. As we all know, what the law says and what actually takes place can vary greatly.

Do not settle for a default. They may decide you don't know your rights, get a judgement, attach your account, and what for you to complain that the funds are protected.

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'I'm not sure if you ever studied statistics before, but they way they came up with that 1 million is number is so laughable and non-empirical that I can't take 1 word in that text seriously. The logic is that about 1 million people on SSI get judgments against them a year, therefore 1 million people on SSI per year have their exempt assets frozen, lol.'

My background in mathematics is not at issue. What IS at issue is that a significant number of people get their protected money seized each year and that should not be the case! And you might have a point; the paper might have used faulty modeling for their projections. However, the case law the paper cites is factual.

You tried to dismiss the validity of my assertions by questioning the source, despite the fact that the paper cites cases, particularly on the issue of this thread, to substantiate its statements. You can do better. You can admit that you don't know everything and that you just learned something new. Try it and you may I say!

Now peruse some pleadings online through Alameda County Superior Court and others to see that what me, chuckeegee and others have said is absolutely correct!

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