Cokie500

KRS 371.050 Assignee to aver consideration -- Amount recoverable

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I've been trying to find more about this Kentucky statue and whether it applies to CC accounts:

 

371.050 Assignee to aver consideration -- Amount recoverable.
In an action on any assignment of a writing, the consideration for the assignment
shall be averred. The plaintiff shall recover no more than the consideration actually
paid by him for the note or assignment.
Effective:October 1, 1942
History: Recodified 1942 Ky

 

http://www.lrc.ky.gov/Statutes/chapter.aspx?id=39133

 

Some people say it does apply, others say it doesn't. I've found a couple people's posts on other sites that claimed they used this in their defense and subsequently had their case dismissed by the Plaintiff. Unfortunately they don't go into a lot of detail about the case, so I don't know if citing this rule is really what scared the JDBs off.

 

Anyone here have any success with it?

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@Cokie500

 

I don't believe that KRS 371.050 has anything to do with credit card debts purchased by JDBs.  The reason I say that is because the first statute in the General Provisions is the Statute of Frauds (371.010).   The section lists 9 types of things for which a person cannot be sued unless the contract, writing, etc. is signed by the party to be charged.  At the end, it states that the subsection doesn't apply to credit card transactions.

 

371.010

 

No action shall be brought to charge any person

 

(9) Upon any promise, contract, agreement undertaking, or commitment to loan money, to grant, extend, or renew credit, or make any financial accommodation to establish or assist a business enterprise or an existing business enterprise including, but not limited to the purchase of realty or real property, but this subsection shall not apply to agreements pursuant to which credit is extended by means of a credit card or similar device, or to consumer credit transactions;

unless the promise, contract, agreement, representation, assurance, or ratification, or some memorandum or note thereof, be in writing and signed by the party to be charged therewith, or by his authorized agent.

 

That last part (unless the promise, contract, etc.) applies to all 9 instances listed.  In order to be sued for any one of those 9 things, there has to be a written signed contract.  BUT, it doesn't apply to credit card agreements which means a signed contract is not necessary in order for one to be sued for credit card debt.

 

It stands to reason that the assignment referenced in 371.050 is an assignment of a debt or property that was based upon a written, signed contract.  Again, that doesn't apply to credit card agreements.

 

If this applied to JDBs, there would be something about that statute available somewhere from KY defense attorneys, but there's not.  I know that some people have said the JDBs dismissed the case when they used that defense.  However, a JDB's voluntary dismissal doesn't prove that was the reason they dismissed the case.

 

http://www.lrc.ky.gov/statutes/chapter.aspx?id=39133

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@Cokie500

 

I don't believe that KRS 371.050 has anything to do with credit card debts purchased by JDBs.  The reason I say that is because the first statute in the General Provisions is the Statute of Frauds (371.010).   The section lists 9 types of things for which a person cannot be sued unless the contract, writing, etc. is signed by the party to be charged.  At the end, it states that the subsection doesn't apply to credit card transactions.

 

 

Then why would you not just assume that the  FIRST statute does not apply? There are many other statutes listed; including the one that Cokie500 is talking about. Assignee to aver consideration; not statute of fraud.

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Then why would you not just assume that the  FIRST statute does not apply? There are many other statutes listed; including the one that Cokie500 is talking about. Assignee to aver consideration; not statute of fraud.

 

I said I "don't believe" it applies.  But here's my reasoning.

 

First, you take a look at the title of the entire section.

 

CHAPTER 371 FORMALITY AND ASSIGNABILITY OF CONTRACTS -- INSTALLMENT SALES CONTRACTS

 

Note the word "contracts" in the title of Chapter 371.   The first section under that chapter (371.010) is the Statute of Frauds which is under General Provisions.   A general provision applies to all categories in a section or chapter.   The Statute of Frauds says that contracts are to be in writing and signed by the person to be charged.   Considering that the word "contracts" is in the title of the chapter, and the very first section of the general provisions says that contracts are to be in writing and signed, that would indicate the rest of the sections under that chapter are based upon written, signed contracts.

 

As we know, credit card agreements do not require a signature.  In addition, that section specifically omits credit card accounts unless there is a signed agreement.  Therefore, they are not subject to the statute of frauds.   Since they are not subject to the statute of frauds, Chapter 371 would not apply to credit card accounts.

 

Next, note the words "installment sales contracts" in the title.   A credit card account is not an installment account.

 

Third, if this did apply to JDBs, consumer defense attorneys in KY would be all over it.  But that's not the case.  There's absolutely no case law to support it, and if you google the statute, you won't find anything from a consumer defense attorney regarding it.

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