Jump to content

To Arbitrate or Not To??


xavi72
 Share

Recommended Posts

I've been trying to be proactive with any collection letters I receive by requesting a DV and JAMS usually 30 days from receiving the CA's first communication intent.

 

So far, this strategy has been effective except with one agency.  After requesting the DV/JAMS from this particular CA, 3 months later, I received a set of statements indicating that the account had been verified.  I then further sent them another letter indicating that this account still remains in dispute and I continue to elect JAMS to resolve any issues.

 

Yesterday, I received their response asking me to initiate arbitration via JAMS or AA.  Here's my problem; I've noticed that the statute of limitation for this credit card has past in the state where this credit card does business.  In my state, the SOL will be over in about 6 months.  Should I initiate JAMS at this point or should I wait to see what this agency does?  The way I see it is that I already set up this case so that if the agency decides to sue me, I can motion to request arbitration at that time.  I just don't want to open a can of worms if I don't need to.

 

Maybe riding out some time until the SOL reaches its limits may be the best approach...I'm not sure..

Link to comment
Share on other sites

Why you wanna do something? I mean they write you to initiate JAMS, they should do it themselves, and anyways I have read in the past Cali does take choice of law for SOL issues, so if it's SOL in the agreement state Cali would take it. Don't have a link or case law handy but I'm 99% positive on this one. Anyways I sue them in Federal for deceptive tactics, and for trying to sue on a time barred debt. Either that or get a consumer attorney to sue for you, you probably got a good case with that letter and is probably full of violations.

Link to comment
Share on other sites

Why you wanna do something? I mean they write you to initiate JAMS, they should do it themselves, and anyways I have read in the past Cali does take choice of law for SOL issues, so if it's SOL in the agreement state Cali would take it. Don't have a link or case law handy but I'm 99% positive on this one. Anyways I sue them in Federal for deceptive tactics, and for trying to sue on a time barred debt. Either that or get a consumer attorney to sue for you, you probably got a good case with that letter and is probably full of violations.

 

I think you're correct about the CA taking on SOL issues in a Court case but in JAMS, I believe this could be brought up.  Also, aren't credit agencies not allowed to initiate arbitration via JAMS anymore?  I've read somewhere that it must be initiated by the consumer but I'm not 100% sure on this. 

Link to comment
Share on other sites

If you initiate arbitration you'll win.  I'd try to dig up some case law to quote them on borrowing SOL when you reply to them.  

 

If I'm able to find some case law, should I refer to it now before arbitration or after I file with JAMS if I do go in that direction?

Link to comment
Share on other sites

It's a tricky situation , as Quoted above "Chambers" esatblished borowing statue in CA state court.

 

Question is : Is this OC or JDB? It changes the whole entire game when you're dealing with OC vs JDB.

 

Keep in mind you've  already waived the other party's litigation rights by exercising arbitration, make sure to read the card agreement specially where in big bold letter it's instructed how a party waives its right to court.

 

BTW, you are not required to file arbitration (it's like someone asking you to file suit against yourself ) it's their job (depending on who you are dealing with) to initiate against you !

Link to comment
Share on other sites

It's a tricky situation , as Quoted above "Chambers" esatblished borowing statue in CA state court.

 

Question is : Is this OC or JDB? It changes the whole entire game when you're dealing with OC vs JDB.

 

Keep in mind you've  already waived the other party's litigation rights by exercising arbitration, make sure to read the card agreement specially where in big bold letter it's instructed how a party waives its right to court.

 

BTW, you are not required to file arbitration (it's like someone asking you to file suit against yourself ) it's their job (depending on who you are dealing with) to initiate against you !

 

Thanks everyone for the replies.  In regards to the above post, with this particular agency, it appears that it is the OC being represented by a local collection law firm. 

 

Looking at the credit card agreeement, it doesn't directly state that any party waives its right to court but instead states that the OC will choose either the Court system or arbitration whichever would be the most cost effective for either party.  In which case, I'm not sure which of two would be the their option.

 

For arbitration purposes only, what difference does it make if it's an OC or JBD as far who initiates the arbitration process or being able to borrow the SOL?

Link to comment
Share on other sites

@howucan2

 

 

Question is : Is this OC or JDB? It changes the whole entire game when you're dealing with OC vs JDB.

 

 

I don't understand what you mean.  Are you saying there's a difference when dealing with the OC and the choice of law provision?

Link to comment
Share on other sites

Not the choice of law, but the startegy of dealing with OC or JDB.

 

JDB will most likely not pay to arbitrate, OC will for sure !

 

JDB bought the debt with likelihood of having proper documentation, OC will definitely have that one nailed (although I may add, not all OCs have good record keeping ).

 

JDB will not pay $20-$40K to abitrate it's just not good business decision (I initiated against 4 ,not one participated ) , OC will pay and more (I have one who went up to six digits and we're not even done).

 

That's the difference between arbitration with OC or JDB, why I caution against jumping the gun agaisnt OC until one has solid claims and a FAVORABLE contract (OC's contract plays an important role specifically section on appeal of arbitrator's decision ).

Link to comment
Share on other sites

Not the choice of law, but the startegy of dealing with OC or JDB.

 

JDB will most likely not pay to arbitrate, OC will for sure !

 

JDB bought the debt with likelihood of having proper documentation, OC will definitely have that one nailed (although I may add, not all OCs have good record keeping ).

 

JDB will not pay $20-$40K to abitrate it's just not good business decision (I initiated against 4 ,not one participated ) , OC will pay and more (I have one who went up to six digits and we're not even done).

 

That's the difference between arbitration with OC or JDB, why I caution against jumping the gun agaisnt OC until one has solid claims and a FAVORABLE contract (OC's contract plays an important role specifically section on appeal of arbitrator's decision ).

 

So for my situation, it is probably best to "stay put" to see if they initiate arbitration? 

Link to comment
Share on other sites

I would say going up against OC in arbitration when state has borrowing statue is suicide. Arbitrators are not required to apply your state laws and they won't.(contract's state laws only).

 

CA also has Rosenthal act which arbitrator will most likely not apply.

 

Thread lightly.

Link to comment
Share on other sites

I would say going up against OC in arbitration when state has borrowing statue is suicide. Arbitrators are not required to apply your state laws and they won't.(contract's state laws only).

 

CA also has Rosenthal act which arbitrator will most likely not apply.

 

Thread lightly.

 

Doesn't the borrowing statue apply only when your case is going through litigation?  In JAMS, can't I argue the agreement's choice of law provision and choose Delaware (for my situation)?  It's my understanding that arbitration takes the jurisdiction away from the court and because of this, one can argue at arbitration to elect to use the agreement's state that governs the agreement.

Link to comment
Share on other sites

DE is the contract's law and will be the only one used in JAMS plus FAA.

 

BUT..... the arbitrator will only allow DE law , as in court you can combine CA consumer protection laws plus DE borrowing statue. In as many arbitration that I have been involved and as much as I have argued , no arbitrator has allowed my state laws in combination with creditor's contract law, even when my state protects me form deceptive practices of whomever does business in my state. Even when the violations happened outside of the contract.

 

IF you have a strong claim against the OC and the amount is small enough that OC MAY fold, then have at it.

All I am cautioning you with is what I have personally experienced. Your state law claims will be tossed out as soon as you enter arbitration. And arbitrator may not apply SOL (yes, it has happened).

Link to comment
Share on other sites

DE is the contract's law and will be the only one used in JAMS plus FAA.

 

BUT..... the arbitrator will only allow DE law , as in court you can combine CA consumer protection laws plus DE borrowing statue. In as many arbitration that I have been involved and as much as I have argued , no arbitrator has allowed my state laws in combination with creditor's contract law, even when my state protects me form deceptive practices of whomever does business in my state. Even when the violations happened outside of the contract.

 

IF you have a strong claim against the OC and the amount is small enough that OC MAY fold, then have at it.

All I am cautioning you with is what I have personally experienced. Your state law claims will be tossed out as soon as you enter arbitration. And arbitrator may not apply SOL (yes, it has happened).

 

This sounds a bit too complicated and I really don't want to go this route because it's uncertain what could happen at arbitration.  At this point, I will await to see how the collection firm responds.  I'm definitely not going to pursue arbitration at my own will.   

 

Were your arbitrations started post or pre lawsuit?

Link to comment
Share on other sites

I initiated 5 preemptive arbitrations , 4 were against JDBS and one against OC.

 

The one against the OC was a small amount and my violations against them were 20 times the amount, I had every bit of a solid claim and a slam dunk victory if they would have persude, but OC refused to participate. That was 3 years ago ! Arbitration has changed and so is the attitude of OCs and arbitration forum(JAMS) they aren't as considerate as they were before.

 

Sixth one I initiated against OC was after suit, that one is still on going for three and half yrs now,  it's a marathon !

Link to comment
Share on other sites

I initiated 5 preemptive arbitrations , 4 were against JDBS and one against OC.

 

The one against the OC was a small amount and my violations against them were 20 times the amount, I had every bit of a solid claim and a slam dunk victory if they would have persude, but OC refused to participate. That was 3 years ago ! Arbitration has changed and so is the attitude of OCs and arbitration forum(JAMS) they aren't as considerate as they were before.

 

Sixth one I initiated against OC was after suit, that one is still on going for three and half yrs now,  it's a marathon

 

Are you saying arbitration has changed so much that it may not be worth it to resolve issues through it?  I also wonder if JAMS regulations vary from state to state just asmuch as procedures in the court systems do.

Link to comment
Share on other sites

Yes, the scenery has changed now that every consumer is practically forcing arbitration down the creditor's throat. JAMS has caught on to it too.

 

There are a few good things about being a CA residents.

 

1) you don't pay $250 JAMS fee (it's waived for CA)

2) you don't pay their attorney's fees and costs if arbitration award is granted against the consumer.

 

But everything else is mostly favorable to creditors specially Discover , Cap1 and particularly Citibank. That's the reason I said be careful to have solid claims against the creditor itself and not it's collection attorney or collection law firm (they will be dismissed by arbitrator as they have no obligation to arbitrate your claims).

Link to comment
Share on other sites

 

But everything else is mostly favorable to creditors specially Discover , Cap1 and particularly Citibank. That's the reason I said be careful to have solid claims against the creditor itself and not it's collection attorney or collection law firm (they will be dismissed by arbitrator as they have no obligation to arbitrate your claims).

 

Would you mind elaborating on this a bit more?  I'm just trying to figure out if at all times, aribitration is the way to go or is under certain conditions for example an issue of SOL, etc.

Link to comment
Share on other sites

it's simple, there are a few creditors who are not scared of a debtor electing arbitration. JAMS is a for profit forum meaning creditor pays big money to them for having the forum listed in their clause.

 

Every arbitration will cost creditor  somewhere around $20-100K (depending on the length and time). Consumer's fee is capped at $250, the rest is borne by business. Who do you think has upper hand here ? Not the consumer !

 

I have seen and heard of creditor going all the way in arbitration to teach debtor a lesson. Yep, you can be a target for being a pest.

Sometimes creditors will go along with the arbitration to make an example of someone. It has happened many times, specially with C1, Citibank and DC.

 

After Ross vs Bank of America settlement I know of two creditors ,Chase and BOA who completely stopped pursuing arbitration even when debtor initiated. But the rest will pursue if debtor enforces the clause and court orders them to arbitrate.

 

Citibank is the most deceptive of them all, if a debtor even blinks or whispers arbitration it will immediately file in AAA which is a less expensive forum between the two ( it costs around $1200 in AAA  verses $5,500K in JAMS to initiate).  I have seen many debtors MTC in court and file in JAMS but later find out Citibank has filed in AAA and has started the arbitration process. I think it will take a class action to stop this because whoever initiates first has chosen the forum, but so far no one had raised this issue to get an injunction .

 

So here you are stuck between a rock and hard place and have to think twice about what is the best move. It's like a chess game, every move must be made carefully based on your circumstances. I would do more research if I was you, don't just follow blindly because someone said arbitration is good or bad. It could be both but you make that decision based on your circumstances and not on someone elses's.

  • Like 1
Link to comment
Share on other sites

My brother was just served by OC CAP 1 for roughly 7k.  I brought up the possibility of arbitration to him.  If he chooses to go that route, (JAMS) are his costs for arb capped at 250.00? Or if he were to lose, would he have to pay all the arb fees that OC paid up front?

 

He owes it, and knows he owes it. However he is not in a position to pay it, he could manage maybe 15% in a settlement, but that is about it.  He and his wife were taken in a bad business deal, and are actually barely able to meet the payments of their home at present.  He thinks if he goes to court, he will lose. (to bad they did not sell the loan off)

 

So in your opinion (I now you have no idea how anything would turn out) do you think cap 1 would go the arb route for 7k? And if they did, do you know if he would be responsible for all of the arb costs if judgement were ruled in favor of the plaintiff?   Thanks for your input.

Link to comment
Share on other sites

it's simple, there are a few creditors who are not scared of a debtor electing arbitration. JAMS is a for profit forum meaning creditor pays big money to them for having the forum listed in their clause.

 

Every arbitration will cost creditor  somewhere around $20-100K (depending on the length and time). Consumer's fee is capped at $250, the rest is borne by business. Who do you think has upper hand here ? Not the consumer !

 

I have seen and heard of creditor going all the way in arbitration to teach debtor a lesson. Yep, you can be a target for being a pest.

Sometimes creditors will go along with the arbitration to make an example of someone. It has happened many times, specially with C1, Citibank and DC.

 

After Ross vs Bank of America settlement I know of two creditors ,Chase and BOA who completely stopped pursuing arbitration even when debtor initiated. But the rest will pursue if debtor enforces the clause and court orders them to arbitrate.

 

Citibank is the most deceptive of them all, if a debtor even blinks or whispers arbitration it will immediately file in AAA which is a less expensive forum between the two ( it costs around $1200 in AAA  verses $5,500K in JAMS to initiate).  I have seen many debtors MTC in court and file in JAMS but later find out Citibank has filed in AAA and has started the arbitration process. I think it will take a class action to stop this because whoever initiates first has chosen the forum, but so far no one had raised this issue to get an injunction .

 

So here you are stuck between a rock and hard place and have to think twice about what is the best move. It's like a chess game, every move must be made carefully based on your circumstances. I would do more research if I was you, don't just follow blindly because someone said arbitration is good or bad. It could be both but you make that decision based on your circumstances and not on someone elses's.

 

Howucan2 has laid out nicely things you need to consider and current landscape.  In your current situation, you have made your election known, to the otherside.  You are under no obligation to act upon the election.  I am sure that they didn't send the letter requesting you initiate via (CMRR), so there is no proof they ever responded to your request.

 

If and/or when they decide to file suit, your ability to compel arbitration is not lessened.  This assumes you have been sending your coorespondence via Certified Mail Return Reciept thus having proof of your numerous elections for arbitration.

 

I was successful in motioning for arb in California after the otherside filed suit, based on 2 election letters sent prior to suit.  The court was persuaded by the law and procedures and also by the consistent request on my part for arbitration.

 

So if you want to go there you should not have a problem getting to arb in the future....

 

Having an idea of who the OC is would be helpful in the future for any questions needing an answer...

Link to comment
Share on other sites

Howucan2 has laid out nicely things you need to consider and current landscape.  In your current situation, you have made your election known, to the otherside.  You are under no obligation to act upon the election.  I am sure that they didn't send the letter requesting you initiate via (CMRR), so there is no proof they ever responded to your request.

 

If and/or when they decide to file suit, your ability to compel arbitration is not lessened.  This assumes you have been sending your coorespondence via Certified Mail Return Reciept thus having proof of your numerous elections for arbitration.

 

I was successful in motioning for arb in California after the otherside filed suit, based on 2 election letters sent prior to suit.  The court was persuaded by the law and procedures and also by the consistent request on my part for arbitration.

 

So if you want to go there you should not have a problem getting to arb in the future....

 

Having an idea of who the OC is would be helpful in the future for any questions needing an answer...

 

I think my situation is headed in the same direction as you described above.  Today I received a notice of intention to sue if I don't respond to this notice in 10 days.  Fortunately for me, I have kept records of my request for JAMS arbitration and have records of this since they were mailed CMMR.  The OC for this particular case is Cap1.  After readiing some of the reponses in here, I'm a bit worried about going through arbitration, especially if things have changed and JAMS is no longer that consumer friendly as summarized by Howucan2.

 

What was your experience with your arbitration? Would you consider yourself a proponent or an opponent of going the arbitration vs. court?

Link to comment
Share on other sites

I never had C1, but from others who posted their dealings with it I know that it is notorious in JAMS.

 

I also read (do your own research ) that AAA will not take the cases involving C1, because of their non-compliance with that forums rules.

 

 Now from all the posters who have been there and done that JAMS is not the best place to arbitrate with C1, awards have been issued against debtors sometimes in five figures when the debt was only a few thousand dollars. one person got stuck with $43K attorneys fees on a $2000 debt ! Ridiculous.

 

I would use a different startegy here, since you have elected arbitration why not call AAA and ask if it takes C1 cases when consumer initiates? Simple question.

 

If AAA refuses to arbitrate C1 no matter who initiates then I would wait until sued and file immediately in AAA, then motion to compel arbitration , why? I know for fact they won't be able to proceed and the case is forced to settlement. (that's ideal situation). The theory is to be the initiator here , first who initaites gets to chose the forum.

 

If the scenario changes and AAA says it will accept consumer initiation, stay away and do nothing, I will go to court and force the plaintiff to initiate the case in arbitration.Theory here is to let C1 file and pay all the fees including the consumer's. Although it doesn't matter b/c you are in CA and consumer's  JAMS fees are waived.

 

When in JAMS, C1 will use "Burr Forman" as the law firm to handle the case, you'll no longer deal with the collection attorney/law firm who is involved now.

 

In any case the arbitration maybe where you'll end up if C1's attorney had saved your election letter.  prepare for worst and hope for the best.

 

One more important thing which I must add; If you defaulted after 2010 , C1 took out the arbitration clause and they will fight this issue tooth and nail, so best is use a card agreement that has a surviavbility clause in it if you want arbitration.

 

Also in arbitration C1 will use a 5 yrs SOL based on VA attorney General's opinion that credit card SOL is 5 yrs not 3.

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
 Share

×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.. For more information, please see our Privacy Policy and Terms of Use.