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Arbitration for 5k


xavi72
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I finally got served with a summons from an OC for the amount stated above.  Previous to getting served, I had followed all the steps requesting a DV and arbitration.  This held of the wolves at bay for awhile until recently.

 

Now, I have the option of taking the arbitration route by filing an MTC arbitration but I would be dealing with issues in an area I haven't dealt with before.  I've read and read different forums and blogs where a lot of people discuss that arbitration was developed for a quicker and cheaper resolution.  What makes me worried is that arbitration is suppose to be unbiased but if most of the fees, at least here in California, are to be paid by the plaintiff, wouldn't this tip in favor for the plaintiff?  I've read this article call "suicide by arbitration" and it really opened my eyes.

 

The second options would definitely be to deal with this in Court where I have been successful in two other occasions.  Both cases have actually been with OC and no JBD.  This seems to be the case again.  I'm prepared for battle but just not sure what direction to take.

 

Any advice from those that have gone the arbitration route?

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I've never gone the 'arbitration route' personally but, have backed off OC's by electing, as you have.

.

That being said, my understanding is that you have the same case in arbitration that you have in court with a few differences.

 

The cost factor is the biggest difference. It can cost the plaintiff a LOT of money to follow you into arbitration (depending on the language of the agreement and the forum chosen). If the amount they are suing for is small; they may decide it isn't worth pursuing.

 

Another benefit is the choice of law clause in the agreement. It can significantly affect the SOL if the terms are favorable to the defendant.

 

It, supposedly, is a much more relaxed atmosphere as there isn't a crowd of people in the room for any hearings.

 

Those are about the only things I can think of, off hand.

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I've never gone the 'arbitration route' personally but, have backed off OC's by electing, as you have.

.

That being said, my understanding is that you have the same case in arbitration that you have in court with a few differences.

 

The cost factor is the biggest difference. It can cost the plaintiff a LOT of money to follow you into arbitration (depending on the language of the agreement and the forum chosen). If the amount they are suing for is small; they may decide it isn't worth pursuing.

 

Another benefit is the choice of law clause in the agreement. It can significantly affect the SOL if the terms are favorable to the defendant.

 

It, supposedly, is a much more relaxed atmosphere as there isn't a crowd of people in the room for any hearings.

 

Those are about the only things I can think of, off hand.

 

I've heard that OC's are going all the way in arbitration, especially OC's like  CAP1 and American Express plus I've read posts where many have been unable to apply choice of law appropriately.  I think OC's have gotten wiser and now have gotten better at defending themselves in arbitration.  I read this interesting article that is making me think twice about arbitration:  http://www.jsteelelaw.com/suicideByArbitration.html

 

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I don't know when this article was written but, at the very least, I have to ask myself about the author's bias.

 

It was submitted on an law firm's web site.

This law firm advertises that they concentrate on personal injury cases.

Naturally, they don't want you to go Pro per into arbitration; they want your money to defend you.

Personal injury cases can be more complicated than the typical consumer debt case.

 

Ask yourself this: if arbitration is so favorable to the credit industry; why are so many of the major players removing arbitration clauses from their card member agreements?

Yes, at one time, arbitration was favorable to the creditor. This has been addressed by shutting down the most egregious of the forums; the NAF. They were found to be in the pockets of the creditors and are no longer allowed to, or have chosen not to, arbitrate consumer disputes.

 

Depending on the forums available to you via your card member agreement, I'd suggest that you go to their sites and read their rules. Obviously, if you are asking these questions you've done some research and are aware that JAMS is the most favorable forum for the consumer.

 

I'm not advocating arbitration over the judicial system; in the long run ......... it's your decision as to how you proceed,depending on the circumstances of your particular case. If you have successfully defended yourself in court against 2 OC's you obviously have knowledge and experience enough to do it again.

 

Arbitration is just another viable option IMO.

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  • 2 weeks later...

It really depends on your situation. For us, the OC followed us into arb because the alleged amount is v. large. According to the forum, some OCs like DC will fight to the bitter end in arb regardless of the alleged debt amount.

For us, we chose arb because we felt that the court procedures were confusing and difficult to navigate. The OC's CA would be at an advantage as this is what they do. With JAMS, the rules are much easier to digest. Our CA doesn't seem as familiar wading through arb so I think the playing field is leveled a little.

Arb is a lot more relaxed. To us, it's a big plus not to have to go to court as right now, we find it intimidating (but the more we fight, to less scary it is).

Downside is that in arb, you are at the mercy of the whims of the arbitrator.

Also check your Agreement's appeal clause. Do they allow an appeal using 3 arbitrators deciding the case anew? If so, then the cost will increase for the OC in your favor.

Do you have the time and will to do your research? What do you have to lose vs what does the OC/CA have to lose is you choose arb?

You have to weigh the pros and cons.

In our case, the OC has everything to lose regardless of the outcome since our final bullet is BK7...But it ain't over till the fat lady sings.

We were allowed to at the CAs into the Complaint (the arb clause clearly included debt collectors). That upped our prayer for relief. Be ready to defend your position about adding CAs because they will fight to get themselves out!

Finally what is your exit strategy? Are you ready for what will happen if you lose in arb? BK7? Garnishment? Everyone's case is different!

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It really depends on your situation. For us, the OC followed us into arb because the alleged amount is v. large. According to the forum, some OCs like DC will fight to the bitter end in arb regardless of the alleged debt amount.

For us, we chose arb because we felt that the court procedures were confusing and difficult to navigate. The OC's CA would be at an advantage as this is what they do. With JAMS, the rules are much easier to digest. Our CA doesn't seem as familiar wading through arb so I think the playing field is leveled a little.

Arb is a lot more relaxed. To us, it's a big plus not to have to go to court as right now, we find it intimidating (but the more we fight, to less scary it is).

Downside is that in arb, you are at the mercy of the whims of the arbitrator.

Also check your Agreement's appeal clause. Do they allow an appeal using 3 arbitrators deciding the case anew? If so, then the cost will increase for the OC in your favor.

Do you have the time and will to do your research? What do you have to lose vs what does the OC/CA have to lose is you choose arb?

You have to weigh the pros and cons.

In our case, the OC has everything to lose regardless of the outcome since our final bullet is BK7...But it ain't over till the fat lady sings.

We were allowed to at the CAs into the Complaint (the arb clause clearly included debt collectors). That upped our prayer for relief. Be ready to defend your position about adding CAs because they will fight to get themselves out!

Finally what is your exit strategy? Are you ready for what will happen if you lose in arb? BK7? Garnishment? Everyone's case is different!

There are too many factors in favor and against arbitration that's for sure.  I just realized that I was previously sued for the same account by a different collection firm which was dismissed w/o prejudice.  I have all my paperwork from the previous case that for for me, the lawsuit might be a better avenue to take as I'm somewhat familiar with how to navigate the Court system plus I wouldn't have to re-invent the wheel so to speak in terms of writing legal documents all over again.

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There are too many factors in favor and against arbitration that's for sure.  I just realized that I was previously sued for the same account by a different collection firm which was dismissed w/o prejudice.  I have all my paperwork from the previous case that for for me, the lawsuit might be a better avenue to take as I'm somewhat familiar with how to navigate the Court system plus I wouldn't have to re-invent the wheel so to speak in terms of writing legal documents all over again.

Makes sense to me.

 

I found the uncertainty of overlaying the contract terms, various forum rules, and the lack of any requirement that the arbitrator follow the laws or the facts to be most troubling. I prefer the stare decisis, predictable rules and legitimate appeal of errors in court. The fact that opposing was paying the tab did not make me sleep any easier either. That was based on me being the claimant. I highly doubt things would somehow improve if I was the respondent.

 

I have won against OCs in court and am guessing I would prefer the results of the appeal process provided there vs. a quick review by a 3 member arbitration panel (if even available). YMMV

 

Remember...

In Arbitration No One Can Hear You ScreamTM

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I finally got served with a summons from an OC for the amount stated above.  Previous to getting served, I had followed all the steps requesting a DV and arbitration.  This held of the wolves at bay for awhile until recently.

 

Now, I have the option of taking the arbitration route by filing an MTC arbitration but I would be dealing with issues in an area I haven't dealt with before.  I've read and read different forums and blogs where a lot of people discuss that arbitration was developed for a quicker and cheaper resolution.  What makes me worried is that arbitration is suppose to be unbiased but if most of the fees, at least here in California, are to be paid by the plaintiff, wouldn't this tip in favor for the plaintiff?  I've read this article call "suicide by arbitration" and it really opened my eyes.

 

The second options would definitely be to deal with this in Court where I have been successful in two other occasions.  Both cases have actually been with OC and no JBD.  This seems to be the case again.  I'm prepared for battle but just not sure what direction to take.

 

Any advice from those that have gone the arbitration route?

You need to read the thread - Strategy and Steps of Arbitration to get a better understanding.  It is "not" a cheaper resolution for the creditor.  As a matter of fact, that is part of the strategy for the consumer - the cost for the creditor at times is more than the actual debt itself, thereby making it easier for the consumer to get a walkaway or at least a better settlement offer.  In California you can ask for a waiver for your part of any initial fees - "not" the creditor!  And read your agreements!!  Some say that the creditor has to pay the whole thing - even if they win the arbitration.

 

Not knowing who you are up against, it's hard to say more than that.  The governing agreement would have to be known before any meaningful discussion.

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You need to read the thread - Strategy and Steps of Arbitration to get a better understanding.  It is "not" a cheaper resolution for the creditor.  As a matter of fact, that is part of the strategy for the consumer - the cost for the creditor at times is more than the actual debt itself, thereby making it easier for the consumer to get a walkaway or at least a better settlement offer.  In California you can ask for a waiver for your part of any initial fees - "not" the creditor!  And read your agreements!!  Some say that the creditor has to pay the whole thing - even if they win the arbitration.

 

Not knowing who you are up against, it's hard to say more than that.  The governing agreement would have to be known before any meaningful discussion.

Thanks for your feedback!  Reading your thread "Strategy and Steps of Arbitration" is what got me interested in possibly going into arbitration with the Creditor which in this case it's Capital1 and they're being represented by a collection law firm.  So I followed everything in the thread up to the point of actually electing arbitration and sending my notice to the Plaintiff.  n my situation, I can also use a 2008 credit card agreement.  The only problem, if it can be called a problem, is that this lawsuit if for a credit card account that I previously defended and had it dismissed w/o prejudice.  

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Thanks for your feedback!  Reading your thread "Strategy and Steps of Arbitration" is what got me interested in possibly going into arbitration with the Creditor which in this case it's Capital1 and they're being represented by a collection law firm.  So I followed everything in the thread up to the point of actually electing arbitration and sending my notice to the Plaintiff.  n my situation, I can also use a 2008 credit card agreement.  The only problem, if it can be called a problem, is that this lawsuit if for a credit card account that I previously defended and had it dismissed w/o prejudice.  

Why would that be a problem? 

 

What was the year the alleged account was opened and what year was the default?

 

*BTW, what reason did Capital One dismiss it before?

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Why would that be a problem? 

 

What was the year the alleged account was opened and what year was the default?

 

*BTW, what reason did Capital One dismiss it before?

I thought there would be an issue if I initially had gone through the Courts initially and now this time around I want to arbitrate the account.  The alleged account was opened in 2005 and it defaulted in 10/2009.

 

I was not given a reason why it was initially dismissed.  The Cap1 lawyers sent me an overnight letter on the eve of trial stating that they were going to dismiss the case without prejudice.  I had subpoenaed their testifying witness and maybe she wasn't going to show to Court and this is why they decided to have the case dismissed.  

 

The reason why I'm contemplating going to Court with them is b/c I have all my documents that I used in my initial case and thought maybe it might be easier for me since I'm somewhat familiar on how to navigate the Court a bit better and more comfortably.  

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I thought there would be an issue if I initially had gone through the Courts initially and now this time around I want to arbitrate the account.  The alleged account was opened in 2005 and it defaulted in 10/2009.

 

I was not given a reason why it was initially dismissed.  The Cap1 lawyers sent me an overnight letter on the eve of trial stating that they were going to dismiss the case without prejudice.  I had subpoenaed their testifying witness and maybe she wasn't going to show to Court and this is why they decided to have the case dismissed.  

 

The reason why I'm contemplating going to Court with them is b/c I have all my documents that I used in my initial case and thought maybe it might be easier for me since I'm somewhat familiar on how to navigate the Court a bit better and more comfortably.  

You need to do what you feel is more comfortable for you.

 

Keep in mind though, if it was dismissed before because their witness was going to be a no show - this time around, they may have their ducks in a row and have a witness available.

 

Going through court before though has no effect on using your consumer right to arbitrate as stipulated in the agreement.

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