Being Sued by Beneficial CA in FL

[ms4winners]

Like a lot of people new to this forum, I’m very confused, overwhelmed and running out of time. I’m being sued by Beneficial for a fairly recent PCL (Personal Credit Line - unsecured) debt (over $18K) that does not fall under SOL (last payment made 9/09).

In Jan ’10 I received a demand ltr from a collections firm that said they were ‘referred’ by Beneficial. I sent them a VOD and they went away. Then in Aug ’10 I received correspondence from a FL CA (Erskine & Fleisher) that this account had been ‘turned over to them’ to which I again sent a VOD. They responded immediately with copies of the original signed note and history of account transactions that showed the debt was written off in Apr. ’10. At that point I was under a lot of stress and failed to respond to their answer to the VOD - which I understand is seen by the courts as admittance by default.

Anyway, I forgot all about it until I was served Dec 16. In the complaint the CA has included 36 paragraphs under 8 counts, an affidavit of debt (from VA), and ‘copies’ of the original note agreement, revolving loan voucher and arbitration rider. However, they failed to include as Exhibits any transaction history or proof of the amount in question.

I’ve been studying all the ‘how to answer a summons’ and ‘affirmative defenses’ info on this forum and beyond, and everything I read seems appropriate for debt accounts that have been sold to a JDB, but I’ve found very little comprehensible info appropriate to CA actions on a referred debt that has been validated.

I have no idea how to answer the complaint or what affirmative defenses to present that may help my case or at least delay the process. I am not in a financial position at the moment to settle. Is there a lawyer in the house who can help? Thanks

[skippy1960]

Not from Florida, so hopefully others will chime in. Based on the inital information and them having an agreement that bears your signature and the fact that they are suing for 8 different counts. IMO this is going to be very difficult to win, not impossible as the items they have submitted need to be authenticated to become real evidence.

Given that, thinking about an overall strategy maybe useful, meaning if I do X then the result is Y. Start with the assumption of loss no matter what you do, answer complaint and fight, don't answer and recieve default judgment, hire attorney to represent you, etc

So the end game decision is if they get a judgment for $18K plus fees, what will you do? Are you judgment proof, will you need and can you file BK, do you have income that can be garnished, do you have property and equity, etc.

Upon doing this it should give you a better idea of how you want to proceed, you may find that what you really need is to just buy time to be in a position to do something else. Example if I could buy 6 months of time I might be able to offer a lump sum settlement based on bonus or tax return or saving money to file BK etc. If that were the case then the answer to you inital question could be different, because you would want to expend as little money as possible to fight the case now, in anticipation of your end game plan.

Finally, review the arbitration rider and what it says, many times it waives litigation (court action) for both parties and sends the claim to a private forum. Also review who pays all the fees and what it says about prevailing party getting fees returned once determination has been made. This can be a real time burner and costly for the plaintiff, if that is what you need (TIME).

[BV80]

Answer the Complaint in the same form as it's already written. Your answers are to be numbered the same way they numbered their statements.

Read your loan agreement very carefully. Did they follow everything to the letter? I'm thinking affirmative defenses, here. If they did, have they proven the amount being sued for to the penny? If not, use that as an affirmative defense just to buy time.

Skippy mentioned the arbitration clause. That's an option. You could request arbitration through JAMS.

If it were me, I'd contact a consumer attorney. Most attorneys give free consultations. He/she could explain your options including arbitration and the costs involved with it. If I'm not mistaken, the Plaintiff pays the larger share of arbitration costs.

Hopefully, some more knowledgable members will have more advice to offer.

[ms4winners]

Upon doing this it should give you a better idea of how you want to proceed, you may find that what you really need is to just buy time to be in a position to do something else. Example if I could buy 6 months of time I might be able to offer a lump sum settlement based on bonus or tax return or saving money to file BK etc

.

Skippy1960 that is my ultimate objective, at this time I need to buy more time as the future looks more promising than the present.

Finally, review the arbitration rider and what it says, many times it waives litigation (court action) for both parties and sends the claim to a private forum. Also review who pays all the fees and what it says about prevailing party getting fees returned once determination has been made. This can be a real time burner and costly for the plaintiff, if that is what you need (TIME).

I've gone over the rider and from what I understand either party has the right to request an arbitration hearing for any reason relating to the loan agreement. If the lender files a claim they pay all fees associated with the claim. If I file the claim, I'm limited to $100 filing and administrative fees as long as the claim is less than or equal to my loan amount. Lender pays up to a full day of arbitration hearings and any fees that that extend beyond one day are to be paid by the requesting party. Both parties pay their own attorney fees etc. I can recover those fees if there's a statute that gives me the right to recover them. If Beneficial wins an award through the arbitration, I am not liable for reimbursing them for any fees they have already paid or that they are responsible for. Since there's no mention of it, I'm assuming I will not be reimbursed for fees spent if I win (except IF I have a right to recover them).

If I choose to request arbitration, at what point in the process do I do that? Is it with the answer or later if this proceeds to further actions?

[nascar]

In the complaint the CA has included 36 paragraphs under 8 counts, an affidavit of debt (from VA), and ‘copies’ of the original note agreement, revolving loan voucher and arbitration rider. However, they failed to include as Exhibits any transaction history or proof of the amount in question.

The exhibits will be filed with the court, but not necessarily included with your summons packet. Typically, you'll get the civil cover sheet and the complaint.

You'll likely need to take a trip to the courthouse and view the physical file if you want to examine the exhibits. In some counties, you can still get online party access to the docs, but only one or two.

[RebelLady]

Check your state's Rules of Civil Procedure to see what is required here. Also, read your state's Uniform Arbitration Act (it will be called something like that) and see what it says.

In most instances, the sooner you exercise arbitration the better. From what I have read, Florida has some kinda weird rules concerning when to request arbitration and when its too late to make the request.

In most states, you would include the existence of an arbitration clause in your affirmative defenses...for instance,

Affirmative Defense One

The Court lacks jurisdiction over the subject matter due to the existence of an arbitration clause in the agreement...

or something like that. What that does is to immediately ask the court for a ruling on whether or not an arbitration clause exists (you know it does already) and what the arbitration clause actually states and if it is enforceable in this particular case.

But as I've stated, read Florida's Rules of Civil Procedure as well as its Arbitration Act to see when and at what point you have waived your right to exercise arbitration. I can't remember but I think its something about how you answer the summons. Once you answer the summons, you waive the right to arbitration unless you bring it up as an affirmative defense in your answer. But check and make sure as this is very important.

RL

[ms4winners]

Answer the Complaint in the same form as it's already written. Your answers are to be numbered the same way they numbered their statements.

Read your loan agreement very carefully. Did they follow everything to the letter? I'm thinking affirmative defenses, here. If they did, have they proven the amount being sued for to the penny? If not, use that as an affirmative defense just to buy time.

Formatting the answer isn't my dilemma. What has me stumped is whether to admit or deny their allegations even though they have validation or do I state 'lack of knowledge about the truth and therefore deny the statement(s) made in paragraph...'?

Then what affirmative defenses could I possibly use?

And yes, based on the last letter I received from Beneficial (7/10) they nailed it to the penny.

[skippy1960]

So to do this you will need to do one of two things, in a timely fashion.

If choose to stay in court you will need to answer the complaint with affirmative defenses. You said 8 counts you need to answer something like this:

"Defendant denies plaintiff's allegation number X and demands strict and authenticated proof thereof."

You should use this for the allegations you need to deny, obviously they have your address correct and have sued in the correct county so you can admit to those being correct. You will need to include affirmative defenses which you should be able to find examples on this site or research on web.

If you choose to go the arbitration route you should go to www.debtorboards.com and review the process and strategy, a much fuller explanation. I do know that Florida is very paticular about when you need to exercise your right to arbitration, from what I have seen you need to do this prior to answering the complaint. Further, you are electing private arbitration per contract not state arbitration or mediation/ADR.

Rebel Lady was right you need to check Florida Rules of Procedure prior to get some understanding of this.

Good Luck

[ms4winners]

My appreciation to all participants in this thread - thank you for your feedback.

I want to pass along something I just discovered that I haven't seen previously in my research, it may not be applicable to my case but could possibly help others in a similar situation with different circumstances.

Anyone else heard of this?

Florida Assignment of Consumer Debts

Florida Statutes

559.55 Definitions.–The following terms shall, unless the context otherwise indicates, have the following meanings for the purpose of this part:

(1) ”Debt” or “consumer debt” means any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance, or services which are the subject of the transaction are primarily for personal, family, or household purposes, whether or not such obligation has been reduced to judgment.

559.715 Assignment of consumer debts.–This part does not prohibit the assignment, by a creditor, of the right to bill and collect a consumer debt. However, the assignee must give the debtor written notice of such assignment within 30 days after the assignment. The assignee is a real party in interest and may bring an action in a court of competent jurisdiction to collect a debt that has been assigned to such assignee and is in default.

—————————————————————————–

17 Fla. L. Weekly Supp. 190a

Creditors’ rights — Consumer law — Florida Consumer Collection Practices Act — Assignee of consumer debt is precluded from bringing action to collect debt where assignee failed to satisfy condition precedent of notice to debtor within 30 days of assignment — No merit to argument that notice requirement applies only to collection agencies.

CENTRAL OHIO CREDIT CORP., Plaintiff, vs. KEVIN LAMAR JONES, Defendant. County Court, 4th Judicial Circuit in and for Duval County. Case No. 2007-11791-CC, Division A. June 17, 2008. Emmet F. Ferguson, Judge. Counsel: Sidney E. Lewis, Jacksonville. James A. Kowalski, Jr., Jacksonville.

SUMMARY FINAL JUDGMENT FOR DEFENDANT

THIS CAUSE came on before the Court on Thursday, June 5, 2008, on the Plaintiff’s Motion for Summary Judgment and the Defendant’s Cross-Motion for Summary Judgment. The issue presented to the Court concerns the application of Section 559.715, Florida Statutes, to the facts of the instant case, based upon the record evidence indicating Plaintiff did not provide notice of an assignment within thirty (30) days as provided by the Statute.

Section 559.715, Florida Statutes, states: “This part does not prohibit the assignment, by a creditor, of the right to bill and collect a consumer debt. However, the assignee must give the debtor written notice of such assignment within 30 days after the assignment.”

Plaintiff asserts Section 559.715, Florida Statutes, only applies to collection agencies by virtue of its proximity to now-repealed statutes dealing with collection agencies. Defendant argues Section 559.715, Florida Statutes, is a condition precedent to the collection of debts following an assignment, applies on its face to all entities receiving assignments of consumer debts, and notes the term “consumer debt” is defined broadly. Section 559.55(1), Florida Statutes.

The Court has reviewed the circuit court case of UMIJC VP, LLC, v. Levine, 10 Fla. L. Weekly Supp. 336 (Circuit Court, 15th Judicial Circuit, 2003), and has also reviewed Plaintiff’s Affidavit As to Indebtedness, wherein Plaintiff’s Affiant testified Plaintiff had received this debt through a series of assignments. The Court finds Section 559.715, Florida Statutes, is a condition precedent and applies to those entities receiving assignments of consumer debts and, having failed to comply by providing notice to Defendant within 30 days after assignment, Plaintiff is precluded as a matter of law from bringing this action. There are no genuine issues of material fact and Defendant KEVIN LAMAR JONES is entitled to Judgment in his favor and against Plaintiff CENTRAL OHIO CREDIT CORP. It is, therefore,

ORDERED AND ADJUDGED,

Defendant KEVIN LAMAR JONES’ Motion for Summary Judgment be and the same is hereby granted, and accordingly Plaintiff CENTRAL OHIO CREDIT CORP. shall take nothing by this action, and the Defendant shall go hence without day.

==========================================================

My question to anyone with knowledge about this - the CA is not listed as the Plaintiff on my complaint, Beneficial is. Can that scenario still take place (legally) if there was, in fact, an assignment to the CA?

[skippy1960]

I think that is a great piece of law and can be helpful to others, for your case in order to use that piece of law you will need to prove the debt is assigned or sold. You can check your credit report and see how it is listed this is always a good indicator as to how Beneficial is reporting the account.

If you find it is sold then you have a great affirmative defense, "lack of standing as Beneficial isn't the real party of interest.

You may want to review the affivdavit and see who this is from also, could be a clue, check when it was actually sworn out, signed and dated.

Looks like you are getting the hang of things...Good Luck

[ms4winners]

Thanks Skippy1960

The affidavit is from Beneficial (but out of VA not FL as listed on complaint)??

On the first page the name of the designated agent is BLANK

It was sworn out, signed and dated on Aug 30, 2010 - ten days after the date of initial correspondence from CA and about 20 days prior to them receiving my VOD. Do you think they kind of jumped the gun?

Any affirmative defense here? Or other action?

[skippy1960]

Unfortunatley, I don't see anything glaring based on those timelines. Check your credit report to see what it says for the account. Sold or assigned or nothing which means they are the party of interest.

Remember one thing this is as much about intimidation and sparking fear in you as anything. If they do that you may just not answer and they win. That is what they really want to have happen.

[ms4winners]

Anyone know whether the 20 days to answer in FL includes the day of service or begins the day after?

[ms4winners]

Another question... will your answer be accepted as received if you fax it to the CA or does it need to be sent through the mails?

[skippy1960]

Make every attempt to respond based on rules of civil procedure for your area, first and foremost. This is how the CA's work you might fax the answer and logically they recieved it, but if this is not allowed by the rules, they can say didn't recieve the information properly based on the rules, therefore no answer recieved can I have my default judgement....

[ms4winners]

Yeah... that makes sense. Thanks skippy1960.

Well, here goes...

Answer, affirmative defenses, motion to strike affidavit of debt, notice of appearance and certificate of service.

I'll keep this forum updated as this unfolds.

Much appreciated y'all.