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Sued by OC Wells Fargo in Arizona


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Starting a new thread to track this journey:

 

Plaintiff: Wells Fargo Bank, N.A.
Firm: Jaburg & Wilk
Amount: $15,000
Service: In person on 11/7/13, most likely valid
Location: Phoenix, AZ (Maricopa County)
SOL: Probably within SOL, last payment within past 18 months
Case Status: Served, need to provide Answer by 11/27/13 (20 days)
Disputed with CRA: No
DV: No, did not send a DV request
 
Claims
1. My name, wife is listed as JANE DOE, everything occurred in Maricopa County, AZ
2. I was acting as agent for marital community.
3. Credit Card Agreement (Exhibit A) was entered in June 2002
4. We used the card and are bound by the terms of the agreement
5. We defaulted and the amount owning is $15,000 (Exhibit B)
6. Claim for attorney fees, plaintiff will incur the min sum of $725 if default judgment
 
Judgment Requested
1. $15,000 balance
2. Attorney fees, $725 if by default judgment
3. Costs
4. Other relief as just and proper
 
Evidence
Exhibit A: A generic and undated Credit Card Agreement
Exhibit B: A monthly statement from June 2013 showing the balance, $35.00 late fee and interest. The account number is not shown on the statement
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I will post the lawsuit (redacted) in the next day or two when I get a chance. I am preparing and wonder what the next best step should be:

 

1. Should I first file a Motion to Dismiss claiming that an older agreement with survivability clause stating that it always applies and can't be changed requires arbitration? I have seen 1 older Wells agreement that arbitration was required, but I need to make sure of this.

 

2. Should I file an Answer and then request as part of Discovery all of the older agreements to find an arbitration clause that can get it thrown out? At that point file the motion to dismiss?

 

MrBookworm

 

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As I recall most of the Wells Fargo credit card agreements exhibits that I have reviewed in the court records had a month/year date coded on the last page of the agreement.

 

https://www.wellsfargo.com/credit-cards/agreements appears to have the current agreements for different classes of credit card. https://www.wellsfargo.com/assets/pdf/personal/credit-cards/agreements/wf_visa_signature_card.pdf shows a copyright of 2013.

 

With an OC I would typically not be thinking in terms of filing an MTD. A defendant's MTD can be used to tune up and tighten up the plaintiff's complaint. I would not want to do their work for them. The exception, for me, is a claim outside SOL (or similar) that is fatal and not correctable by the plaintiff. Here is one viewpoint: http://sussmanadr.com/docs/motions_to_dismiss_plit.pdf

 

It appears to me that Jaburg & Wilk can be fairly tenacious, if Wells Fargo Bank, NA v. Allen, 292 P.3d 195, 231 Ariz. 209 (Ct. App. 2012) is any indication. That case should provide some insights in dealing with Jaburg & Wilk. A summary of the case can be found here: http://azappblog.com/2012/12/04/wells-fargo-bank-v-allen-ca1-12412/

 

If Wells Fargo produces the same deficient affidavit for the OP and files for a pre-discovery MSJ as they did in Allen I would think they should properly be denied their MSJ:

From Allen:

"¶ 19 The purpose of a custodian's affidavit is to authenticate evidence — such an affidavit is of little value when it does not attach the evidence at issue. And to the extent that the paralegal's role was intended to be akin to that of a fact witness or expert witness, the only personal knowledge he could have offered (as required by Ariz. R. Civ. P. 56(e)) would necessarily have been based on his review and analysis of documents. But the paralegal never claimed to have reviewed any specific documents or to know the manner in which they were prepared and kept. His affidavit, therefore, was sufficient neither to invoke the business-records exception nor to support the motion for summary judgment. See Villas at Hidden Lakes Condos. Assn v. Geupel Constr. Co., 174 Ariz. 72, 82, 847 P.2d 117, 127 (App.1992)."

 

Footnote [2] in Allen "... It is not inconceivable that important terms of the contract, such as the default interest rate, might have changed during that period."

 

I would think that a generic agreement versus a specific agreement proven to apply to the OP could have possible issues such as:

1.) different choice of law

2.) mandatory binding arbitration clause (terms - forum, survivability, etc and its existence or nonexistence)

3.) “It is clearly impossible for a contract dated after the date of the credit card issuance to act as the governing agreement between the parties.” (this Discover case might have some insights: http://www.topclassactions.com/lawsuit-settlements/lawsuit-news/1699-discover-fake-credit-card-agreement-class-action-lawsuit- and http://www.courthousenews.com/2012/03/14/Discover.pdf

4.) if specific contract terms are unknown or unclear has a valid contract been formed.

5.) wrong class of CC card agreement - e.g. "I never had a Platinum Signature Mega-miles Award card"

 

I would want to focus on making them prove up all of their elements to their claims. I would not assist them in any way but let them commit to irreversible errors/lies on and for the record that they cannot correct without damaging their credibility.

 

I would also keep my eyes open for possible counter-claims if they develop as litigation is ongoing. OC usually don't produce much counter-claim fodder prior to their filing litigation.

 

To prevail, I simply must show the court that they have not proved all of their required elements to their claim(s): http://www.creditinfocenter.com/community/topic/322180-bottom-line-can-an-oc-win-a-lawsuit-with-account-statements-only/#entry1272680

Elements for Breach of Contract:

http://www.floridalitigationguide.com/contract.php

Arizona
US West Communications, Inc. v. Arizona Corp. Comm'n, 3 P.3d 936, 942 (Ariz. Ct. App. 1999) (“An enforceable contract is formed through an offer, an acceptance, consideration, and sufficient specification of terms.”)
Tabler v. Industrial Com'n of Arizona, 47 P.3d 1156, 1158 (Ariz. Ct. App. 2002) (“For an enforceable contract to exist, there must be an offer, acceptance, and consideration”)
Rogus v. Lords, 804 P.2d 133, 135 (Ariz. Ct. App. 1991) (“For enforceable contract to exist, there must be offer, acceptance, consideration, and sufficient specification of terms so that obligations involved can be ascertained[;] … The requirement of certainty is relevant to ultimate element of contract formation, i.e., whether parties manifested assent or intent to be bound”)

 

Contract formation:

http://www.floridalitigationguide.com/breach.php

Arizona
Chartone, Inc. v. Bernini, 83 P.3d 1103, 1111 (Ariz. Ct. App. 2004) (“It is well established that, in an action based on breach of contract, the plaintiff has the burden of proving the existence of a contract, breach of the contract, and resulting damages.”)

 

Battling an OC is not likely to be a picnic. Especially in creditor friendly states like Arizona. It can be done but I would prepare for an entrenched fight and if the opportunity to reach an agreeable settlement presents itself *I* would offer half as much (while admitting nothing just a good faith effort to prevent further litigation expense) and then continue the battle until I hear a number I want. Litigation poses risks for both sides. I want to exploit their risks and reduce mine.

 

I suppose leverage isn't everything, but in litigation is sure feels like it is to me.

 

I would want to file my answer timely and make sure I have multiple valid and reasonable affirmative defenses filed also. If the SOL is in question I would use it as an affirmative defense (others may choose not to).YMMV

 

When filing my answer (assuming in person) I would want to dig around the case records to see what Jaburg & Wilk cases feel like. The default or stipulated judgments against the defendant don't provide me with many clues but they may still have attached exhibits such as CC agreements.

 

If a CC agreement exhibit is found that might be of use to me I would not leave court without a copy. The cases with long dockets are the ones I would spend some time delving into. I want to know if they ever do discovery prior to filing an MSJ in a collection case and when/how often they do discovery in such cases.

 

I would want to know if Wells Fargo is their number one collections client or just one of many. I would want to know everything I could easily dig into. Of course the collection cases filed by Jaburg & Wilk that terminate without any benefit to Wells Fargo/other N.A.s would be of the most interest to me.

 

Or, I suppose, if I had more money than time, I could simply locate and qualify a local attorney that routinely beats OCs DC attorneys on behalf of consumers and just hire him/her.

 

Of course it is best to remember that in Arizona, after I defeat a DC plaintiff's MSJ, I am likely to get dropped into the court connected arbitration forum: http://www.superiorcourt.maricopa.gov/SuperiorCourt/CivilDepartment/Arbitration/Index.asp And then the game continues.

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Thanks, I am well aware of Allen and already read the whole thing. The credit card agreement they attached to the complaint did not have a date (I've looked 3 times at it now). I will can it and upload it. Anyway, here is the complaint:

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

 

SUPERIOR COURT OF ARIZONA
 
COUNTY OF MARICOPA
 
WELLS FARGO BANK N.A.,
Plaintiff,
 
v.
 
MR BOOK WORM and JANE DOE WORM,
husband and wife,                         
Defendants.
 
Plaintiff, by and through its attorney undersigned, and for its cause of action against the Defendants above named alleges as follows:
 
I
That plaintiff is a national banking association; that Defendants MR BOOK WORM and JANE DOE WORM, are husband and wife and are residents of MARICOPA County' State of Arizona; that all acts and events hereinafter set forth occurred in MARICOPA County, State of Arizona.
 
II
That, at all times mentioned herein, Defendant MR BOOK WORM was acting as an agent for, on behalf of and in futherance of the marital community consisting of Defendants MR BOOK WORM and JANE DOE WORM.
 
III
That on or about 0X/XX/2002, Defendant, MR BOOK WORM, obtained from Plaintiff a Credit Card (the "Credit Card") and entered into a Consumer Credit Card Customer Agreement & Disclosure Statement Visa Signature (the "Agreement"), whereby Plaintiff agreed to extend credit to Defendant, on open account, and Defendant agreed to re-pay any charges made to the Credit Card, pursuant to the terms of the Agreement. A copy of the most recent version of the Agreement is attached hereto, marked Exhibit "A" and is incorporated herein by reference. That Plaintiff is presently the owner and holder of the Agreement.
 
IV
That the Defendants proceeded to use the Credit Card and authorized charges to be made to the Credit Card. When the Defendants used the Credit Card, they entered into and became bound by the terms and conditions set forth in Plaintiff s Agreement, which was sent to Defendants with the Credit Card. The Agreement contained all of the material terms and conditions regarding Defendants' use of the Credit Card. The Defendants consented to be bound by the terms of the Agreement when they kept and used the Credit Card.
 
V
The Defendants subsequently defaulted in their payment obligations under the terms of the Agreement. As a result of Defendants' default, there is now due, owing and unpaid from Defendants to Plaintiff, after the deduction of all just and lawful offsets, the amount of $15,XXX.XX Gazillion. See account statement attached hereto as Exhibit "B" and incorporated herein  by this reference. Pursuant to the terms of the Agreement, Plaintiff has declared the entire unpaid balance due and owing. Plaintiff has performed all terms and conditions required of it to perform under the Agreement.
 
VI
That, pursuant to the terms of the Agreement and the provisions of A.R S. 12-341.01, Plaintiff is entitled to recover its reasonable attorneys' fees incurred herein. Plaintiff has incurred and will incur attorneys' fees in the prosecution of this action in the minimum sum of $725.00, in the event Judgment is rendered by default.
 
WHEREFORE, Plaintiff prays for Judgment in its favor and against the Defendants MR BOOK WORM and JANE DOE WORM, husband and wife, as follows:
  1. For the current balance of $15,XXX.XX;
  2. For Plaintiffs reasonable attorneys' fees incurred in the minimum sum of $725.00, in the event Judgment is rendered by default;
  3. For Plaintiff s costs incurred herein; and
  4. For such other and further relief as the court may deem just and proper
 

JABURG & WILK

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Thanks, I am well aware of Allen and already read the whole thing. The credit card agreement they attached to the complaint did not have a date (I've looked 3 times at it now). I will can it and upload it. Anyway, here is the complaint:

...

You are welcome.

 

On the bottom of page 11, in the left hand corner of the OP's posted scan of the credit card agreement is printed "VS74 VS76 08/10". I would read that as a "month/year date coded on the last page of the agreement" that I mentioned in my prior post. I would also read it as a date of 08/10. I recall similar coding on the the WF court exhibits of CC agreements I had reviewed.

 

Interestingly, from Allen:

"¶ 5 The Allens filed an answer in which they denied each of the complaint's allegations and asserted a variety of affirmative defenses. In their answer, the Allens stated:

        Plaintiff has attached an alleged credit card agreement to the complaint that has a date of 08/10 printed as part of the form."

 

Perhaps it is the same "Agreement" used in Allen.

 

...

2. Should I file an Answer and then request as part of Discovery all of the older agreements to find an arbitration clause that can get it thrown out? At that point file the motion to dismiss?

 

MrBookworm

SOP is to file a motion to compel arbitration. I have been mulling over the possibility (should the opportunity present itself) of whether or not it makes sense to file an MTD based on a valid mandatory binding arbitration clause denying the court jurisdiction. I am speculating  that if the MTD was denied I should still be able to motion to compel arbitration based on a valid arbitration clause. I have not seen case law that makes me confident that this would readily work but is seems plausible on the surface.

 

A successful MTD should prevent the court from ordering a party to file a claim in arbitration, as I seem to recall some have claimed to experience with their successful MTC arbitration. If the parties don't wish to pursue a dispute in arbitration they should be allowed to let it go.

 

...
III
That on or about 0X/XX/2002, Defendant, MR BOOK WORM, obtained from Plaintiff a Credit Card (the "Credit Card") and entered into a Consumer Credit Card Customer Agreement & Disclosure Statement Visa Signature (the "Agreement"), whereby Plaintiff agreed to extend credit to Defendant, on open account, and Defendant agreed to re-pay any charges made to the Credit Card, pursuant to the terms of the Agreement. A copy of the most recent version of the Agreement is attached hereto, marked Exhibit "A" and is incorporated herein by reference. That Plaintiff is presently the owner and holder of the Agreement.
...

Perhaps Wells Fargo stopped updating their credit card agreements as of 08/10 as implied in the complaint posted that states that "the most recent version of the Agreement is attached". Judging from the pdf found at the link to their CC agreement I previously posted with a 2013 copyright date I find that scenario highly unlikely. I just noticed that on page 7 of that CC agreement that there is a coded date of "VS74.VS76 12/11". "Unlikely" just became "impossible". Of course if it is due to them being a different class of CC agreement then it might all make sense. Details, details.

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Perhaps it is the same "Agreement" used in Allen.

 

SOP is to file a motion to compel arbitration. I have been mulling over the possibility (should the opportunity present itself) of whether or not it makes sense to file an MTD based on a valid mandatory binding arbitration clause denying the court jurisdiction. I am speculating  that if the MTD was denied I should still be able to motion to compel arbitration based on a valid arbitration clause. I have not seen case law that makes me confident that this would readily work but is seems plausible on the surface.

 

A successful MTD should prevent the court from ordering a party to file a claim in arbitration, as I seem to recall some have claimed to experience with their successful MTC arbitration. If the parties don't wish to pursue a dispute in arbitration they should be allowed to let it go.

 

I like this idea.

 

Can anyone point me to a WF card agreement between 2002 and 2010? I have looked far and wide and come up with nothing. I'm guessing that somewhere between 2002 and 2010 the agreement would have a mandatory arbitration clause with survivability. I guess I will have to head to the court house and look through old cases to try and find one myself. I have found one that states that "arbitration can be elected at any time", rather than the one they provided that states "notwithstanding that a lawsuit or other proceeding has been previously commenced."

 

The alternative will be to ask for all agreements and amendments during discovery and use one of those for a MTD.

 

My current thought is to file my answer with denials for most things and add a defense that it is subject to arbitration.

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Don't make it a defense... you will want to file a separate motion to compel arbitration... this puts them on the defensive - they either need to concede that there is arbitration - or deny that that portion of the agreement is valid - opening the door for you to say "well if they can toss what's inconvenient for them, I want to toss the whole thing!" 

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Don't make it a defense... you will want to file a separate motion to compel arbitration... this puts them on the defensive - they either need to concede that there is arbitration - or deny that that portion of the agreement is valid - opening the door for you to say "well if they can toss what's inconvenient for them, I want to toss the whole thing!" 

 

Yes, I plan on doing that. However, if one of the agreements or amendments has mandatory arbitration then I can potentially get the suit dismissed with prejudice. My hope is that at some point from 2002 that the arbitration clause had language that required arbitration (rather than allowing either party to elect it) and a survivability clause. If I can find that then I can file a motion to dismiss with prejudice claiming that the suit should not have been brought in the first place.

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Here is my first draft answer, comments and suggestions are appreciated.

 

SUPERIOR COURT OF ARIZONA

MARICOPA COUNTY

 

 

 

 

 

 

WELLS FARGO BANK N. A.,

 

Plaintiff,

 

v.

 

Mr. Bookworm and JANE DOE Bookworm,

 

Defendants.

 

 

Defendants Mr. Bookworm and Mrs. Bookworm, appearing pro se, in answer to the Complaint of Wells Fargo Bank, N. A. filed on November 5, 2013 states as follows:

 

Answers

 

  1. In regards to Plaintiff's allegations in paragraph 1, Defendants admit that they are husband and wife, and that they are residents of Maricopa County, State of Arizona. Defendants deny the remaining allegations.

  2. Defendants deny Plaintiff's allegations in paragraph 2.

  3. Defendants deny Plaintiff's allegations in paragraph 3.

  4. Defendants deny Plaintiff's allegations in paragraph 4.

  5. Defendants deny Plaintiff's allegations in paragraph 5.

  6. Defendants deny Plaintiff's allegations in paragraph 6.

  7. Defendants deny each allegation of Plaintiff's complaint, which is not specifically admitted or otherwise addressed above.

Affirmative Defenses

  1. Plaintiff has failed to state a claim upon which relief may be granted.

  2. Discovery may reveal the existence and applicability of additional, affirmative defenses. For the specific purpose of not waiving any defenses that may be revealed through further discovery, Defendants preserve the right to any affirmative defenses that may be revealed through further discovery.

WHEREFORE, Defendants respectfully request:

  1. Dismissal of the case with prejudice

  2. Fees and costs in defending this action

We, Mr. Bookworm and Mrs. Bookworm, declare and verify under penalty of perjury that the foregoing information is true and correct.

 

/S/ Mr. Bookworm

/S/ Mrs. Bookworm

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Here is a CO centric list of affirmative defenses: http://www.jeffvail.net/2010/05/affirmative-defenses-litigation.html and the lit of ADs posted on this board: http://www.creditinfocenter.com/legal/affirmative-defenses.shtml

 

One AD seems a little light IMO. I would review to see if some others might apply in this case.

 

Some comments on AZ Rule 26.1 disclosure: http://www.creditinfocenter.com/community/topic/318802-discovery-261-disclosure-in-arizona/#entry1223095 http://www.creditinfocenter.com/community/topic/318662-submitting-an-answer-in-arizona/page-3#entry1222945

 

Arizona v. Federal Rules disclosure & discovery comments: http://www.lang-baker.com/articles/arizona-federal-rules.htm

 

Information on Maricopa's Court Connected Mandatory Non-binding Arbitration for disputes under $50k: http://www.superiorcourt.maricopa.gov/SuperiorCourt/CivilDepartment/Arbitration/Index.asp

 

I do not recall the court records I reviewed indicating that Wells Fargo and the defendants had routinely engaged in discovery. There may have been one case or none. With pro per defendants I would doubt it is as common for them to propound discovery in a collection case as for a DC attorney represented Mega Bank, N.A. Lacking indication that the parties got involved in discovery would suggest to me that Wells Fargo did not routinely pursue discovery in their collection cases.

 

I would speculate that Wells Fargo would rather motion for summary judgement versus getting bogged down in discovery or court connected arbitration. YMMV

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Footnote 1 in Wells Fargo v. Allen would seem to make it a lot of work to prevail on an open account theory:

[1]The complaint alleged that Wells Fargo had agreed to extend credit to the Allens "on open account." "In Arizona it is the settled rule that the burden is on the person seeking to recover on an open account to prove the correctness of the account and each item thereof." Holt v. W. Farm Servs., Inc., 110 Ariz. 276, 278, 517 P.2d 1272, 1274 (1974). A "merely general description" of the transactions between the parties is insufficient for a plaintiff to recover an amount owing on an open account; there must be "some descent into detail." Trimble Cattle Co. v. Henry & Horne, 122 Ariz. 44, 49, 592 P.2d 1311, 1315 (App.1979).

 

Wells Fargo must have DC attorneys that like to work hard. Perhaps WF is incapable of placing a valid, binding and applicable contract into admissible evidence to prove up a breach of contract claim or perhaps doing so would incur undisclosed risks that they prefer to avoid. Makes one wonder what they are afraid of.

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Thanks for the pointers. I don't want to put a bunch of affirmative defenses that I don't understand and won't be able to explain. I have thought of a couple that may apply, but I'm not sure how to put them in.

 

1. Wife and I did not get married until two years ago. The complaint alleges the account was opened in 2002. I will file a MTD her from the complaint after the answer, but I don't want to lose the ability to file that.

 

2. I think there may have been a mandatory binding arbitration clause in one of there agreements for credit cards or checking accounts. Once I ask for those agreements in discovery I want to make sure I can use one of those if I find one.

 

Also, if I was served on November 7th, is my answer due on November 27th or November 28th (20 days)?

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Thanks for the pointers. I don't want to put a bunch of affirmative defenses that I don't understand and won't be able to explain. I have thought of a couple that may apply, but I'm not sure how to put them in.

 

1. Wife and I did not get married until two years ago. The complaint alleges the account was opened in 2002. I will file a MTD her from the complaint after the answer, but I don't want to lose the ability to file that.

 

2. I think there may have been a mandatory binding arbitration clause in one of there agreements for credit cards or checking accounts. Once I ask for those agreements in discovery I want to make sure I can use one of those if I find one.

 

Also, if I was served on November 7th, is my answer due on November 27th or November 28th (20 days)?

I believe that many affirmative defenses can be waived if not timely filed. While I would like to be comfortable explaining all my defenses, my priority is to have some defenses in the record to work with. When I have put in non-applicable (I believed they might apply) affirmative defenses with my answers opposing has routinely ignored them. I end up defending and using what I needed. Not suggesting a laundry list of non-applicable but I have always found more than one that I believed could apply.

 

I am not confident that opposing is as great a source for those agreements as others might believe. As I recall the cover sheet had checked account stated and the complaint included a generic contract. I read that as two causes of action plead in the alternative. If coughing up specific agreements, that are of the appropriate class of CC agreements, would help the OP they are not going to be able to "find" them (even through discovery) and they will likely fall back on account stated if necessary. Meanwhile, any "cooperation" will be them picking and choosing generic agreements that are not the ones sought but can be used to confuse and contaminate the record. Having to rely on account stated CoA might cause them to lose some monetary damages such as attorney fees (no contract for such fees) and work hard to produce a bunch of evidence (good thing IMHO).

 

One source for past agreements sought by the OP might be the exhibits entered into the court record for Wells Fargo lawsuits.

 

I am not sure how an arbitration agreement in a checking account would apply to a credit card account.

 

Once I find that arbitration agreement I would understand that by my motioning the court to compel  arbitration I would be claiming to the court and for the record  that a specific contract or series of contracts is binding on me. Assuming a grant of my MTC arbitration with admission to a particular contract binding on me *I* would not have high hopes of avoiding an adverse arbitration award which would be easily convertible into a judgment. If opposing refused to follow me into arbitration perhaps I am only out my portion of the arbitration fees. I view binding arbitration as the nuclear option and I would prefer to be execution of judgment-proof (uncollectable) when going that route.

 

I think it is likely proper to sue both souses in a community property state, assuming the plaintiff wants to get a judgment against the community property. I would think they almost always would want such a judgment. Jaburg appears to have someone in their office familiar with the nuances of community property/foreign judgment issues: http://www.jdsupra.com/legalnews/foreign-judgments-and-community-property-79444/ I am not thinking I would be filing an MTD on the issue.

 

As for filing deadlines the AZ RCP http://government.westlaw.com/linkedslice/default.asp?SP=AZR-1000 is usually the place I check. As I recall, in calculating the deadline for an AZ instate answer, I skip the day of service and count forward 20 days. The rules cover deadlines landing on weekends and holidays but I don't believe that applies in the case of the OP.

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...

SOP is to file a motion to compel arbitration. I have been mulling over the possibility (should the opportunity present itself) of whether or not it makes sense to file an MTD based on a valid mandatory binding arbitration clause denying the court jurisdiction. I am speculating  that if the MTD was denied I should still be able to motion to compel arbitration based on a valid arbitration clause. I have not seen case law that makes me confident that this would readily work but is seems plausible on the surface.

 

A successful MTD should prevent the court from ordering a party to file a claim in arbitration, as I seem to recall some have claimed to experience with their successful MTC arbitration. If the parties don't wish to pursue a dispute in arbitration they should be allowed to let it go.

...

 

I like this idea.

 

Can anyone point me to a WF card agreement between 2002 and 2010? I have looked far and wide and come up with nothing. I'm guessing that somewhere between 2002 and 2010 the agreement would have a mandatory arbitration clause with survivability. I guess I will have to head to the court house and look through old cases to try and find one myself. I have found one that states that "arbitration can be elected at any time", rather than the one they provided that states "notwithstanding that a lawsuit or other proceeding has been previously commenced."

 

The alternative will be to ask for all agreements and amendments during discovery and use one of those for a MTD.

 

My current thought is to file my answer with denials for most things and add a defense that it is subject to arbitration.

Some thoughts on using MTD instead of MTC arbitration: http://www.jha.com/us/articles/viewarticle.php?56 - for future reference.

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I am not sure how an arbitration agreement in a checking account would apply to a credit card account.

 

Why wouldn't it if someone had a checking account with the OC at the same time and their agreement says it does?

 

Here is an excerpt from an Addenda in Feb 2012 (the highlights are mine):

 

Binding arbitration

If you have a dispute with the Bank, and you are not able to resolve the dispute informally,

you and the Bank agree that upon demand by either you or the Bank, the dispute will be

resolved through the arbitration process as set forth in this part. A”dispute" is any unresolved

disagreement between you and the Bank. It includes any disagreement relating in any way

to services, accounts or matters; to your use of any of the Bank's banking locations or facilities;

or to any means you may use to access your account(s). It includes claims based on broken

promises or contracts, torts, or other wrongful actions. It also includes statutory, common

law, and equitable claims.

 

<snipped>

 

Rights preserved

This arbitration agreement does not prohibit you or the Bank from exercising any lawful

rights or using other available remedies to preserve, or obtain possession of property;

exercise self-help remedies, including setoff rights; or obtain provisional or ancillary

remedies such as injunctive relief, attachment, garnishment or the appointment of a

receiver by a court of competentjurisdiction. All statutes of limitations applicable to any

dispute apply to any arbitration between you and the Bank. The provisions of this

arbitration agreement shall survive termination or amendment of the deposit relationship

or any other relationship between you and the Bank.

 

If I am subject to an agreement that requires mandatory and binding arbitration and states that it covers any other relationships then I can claim that WF brought suit when they shouldn't have. They write the agreements, so if I am subject to one that requires arbitration and is survivable then I can move to dismiss with prejudice. Yes, it is a long shot, but not that long of a shot. The agreement to access WF online requires mandatory arbitration, so I will include that one as well when the time comes.

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Why wouldn't it if someone had a checking account with the OC at the same time and their agreement says it does?

 

Here is an excerpt from an Addenda in Feb 2012 (the highlights are mine):

 

Binding arbitration

If you have a dispute with the Bank, and you are not able to resolve the dispute informally,

you and the Bank agree that upon demand by either you or the Bank, the dispute will be

resolved through the arbitration process as set forth in this part. A”dispute" is any unresolved

disagreement between you and the Bank. It includes any disagreement relating in any way

to services, accounts or matters; to your use of any of the Bank's banking locations or facilities;

or to any means you may use to access your account(s). It includes claims based on broken

promises or contracts, torts, or other wrongful actions. It also includes statutory, common

law, and equitable claims.

 

<snipped>

 

Rights preserved

This arbitration agreement does not prohibit you or the Bank from exercising any lawful

rights or using other available remedies to preserve, or obtain possession of property;

exercise self-help remedies, including setoff rights; or obtain provisional or ancillary

remedies such as injunctive relief, attachment, garnishment or the appointment of a

receiver by a court of competentjurisdiction. All statutes of limitations applicable to any

dispute apply to any arbitration between you and the Bank. The provisions of this

arbitration agreement shall survive termination or amendment of the deposit relationship

or any other relationship between you and the Bank.

 

If I am subject to an agreement that requires mandatory and binding arbitration and states that it covers any other relationships then I can claim that WF brought suit when they shouldn't have. They write the agreements, so if I am subject to one that requires arbitration and is survivable then I can move to dismiss with prejudice. Yes, it is a long shot, but not that long of a shot. The agreement to access WF online requires mandatory arbitration, so I will include that one as well when the time comes.

Excellent (assuming a party is qualified to pursue arbitration and wishes to go there). Assuming that the Feb 2012 agreement applies to the OP I can see merit to the argument based on the arbitration clause being fairly broad.

 

If successfully argued it would seem to support a motion to compel arbitration without admitting the existence of a credit card agreement binding to the OP.

 

I don't see what forum selections are offered. AAA, JAMS or NAF are common arb forums.

 

Just thinking out loud here... I have been mulling the idea of whether it is possible to prevail on a special appearance pre-answer MTD based on an AZ RCP 12( b )(3).

 

16 A.R.S. Rules of Civil Procedure, Rule 12( b )

Rule 12( b ). How presented; motion to dismiss

Every defense, in law or fact, to a claim for relief in any pleading, whether a claim, counterclaim, crossclaim, or third-party claim, shall be asserted in the responsive pleading thereto if one is required, except that the following defenses may at the option of the pleader be made by motion:

1. Lack of jurisdiction over the subject matter.

2. Lack of jurisdiction over the person.

3. Improper venue.

4. Insufficiency of process.

5. Insufficiency of service of process.

6. Failure to state a claim upon which relief can be granted.

7. Failure to join a party under Rule 19.

A motion making any of these defenses shall be made before pleading if a further pleading is permitted. No defense or objection is waived by being joined with one or more other defenses or objections in a responsive pleading or motion. If a pleading sets forth a claim for relief to which the adverse party is not required to serve a responsive pleading, the adverse party may assert at the trial any defense in law or fact to that claim for relief. The defense numbered 3 may be made only if the action cannot be or could not have been transferred to the proper county pursuant to A.R.S., § 12-404. If, on a motion asserting the defense numbered 6 to dismiss for failure of the pleading to state a claim upon which relief can be granted, matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56, and all parties shall be given reasonable opportunity to present all material made pertinent to such a motion by Rule 56.

 

AUTO. MECHANICS LOCAL 701 v. Vanguard Car Rental, 502 F.3d 740 (7th Cir. 2007).

It is not entirely clear whether a motion seeking dismissal based on a forum selection clause, including an arbitration clause, is better conceptualized as an objection to venue, and hence properly raised under Rule 12( b )(3), or as a failure to state a claim, and thus properly raised under Rule 12( b )(6). See generally 5B Charles A. Wright and Arthur R. Miller, Federal Practice & Procedure § 1352 at 318-19 (3d ed.2004). Wright and Miller observe, however, that "most of the decided cases use [Rule 12( b )(3)] as the basis" for deciding such a motion. Id. at 319. This court has followed the majority rule. See Continental Ins. Co. v. M/V Orsula, 354 F.3d 603, 606-07 (7th Cir.2003). This is consistent with our view that the choice of an arbitral forum can be waived early in the proceedings, and generally is waived once the party who later wants arbitration chooses a judicial forum. See Grumhaus v. Comerica, Inc., 223 F.3d 648, 650-51 (7th Cir. 2000); Cabinetree of Wis., Inc. v. Kraftmaid Cabinetry, Inc., 50 F.3d 388, 390 (7th Cir.1995)

 

Whether that MTD should be accompanied by a notice to the bank, "upon demand by either you or the Bank, the dispute will be resolved through the arbitration process" is unknown.

 

A denial of a Motion to Compel Arbitration is appealable, the MTD is not so perhaps a pre-answer Motion to Stay and Motion to Compel Arbitration are where the smart money is IDK.

 

Recently I saw something indicating that a judge cannot order the successful MTC arb defendant to file in an arbitration forum. The arb agreement drafters were backed into a corner when some of the arb forums refuse to let the bank file and arbitration against a consumer of a collection dispute. That court ordering you to "file an arbitrate against yourself" concern is what prompted me to look down this rabbit hole of MTD instead of MTC arbitration.

 

I will try to locate the law that prevents the judge from ordering the defendant to file an arbitration claim.

 

These thoughts/ideas are in their infancy and I do not recommend them without experience or intense research.

 

And as I have often stated, In Arbitration No One Can Hear You Scream TM

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Excellent (assuming a party is qualified to pursue arbitration and wishes to go there). Assuming that the Feb 2012 agreement applies to the OP I can see merit to the argument based on the arbitration clause being fairly broad.

 

 

I don't want to go to arbitration actually. What I'm looking for is very specific, Mandatory Binding Arbitration. If I can go that route then I can potentially get this dismissed with prejudice as the OC would have been required to go to arbitration rather than suing.

 

I beat a lawsuit this way when I sold a house and they had to replace the roof 2 years later. They filed a lawsuit but the sales agreement required arbitration first. You can't sue someone if you both agreed to mandatory arbitration.

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  • 2 weeks later...

Current status:

Suit filed

Answer submitted

 

Received the following settlement letter, presumably because they got the answer rather than a default.

 

attachicon.gifWF - Settlement Offer - Redacted.jpg

That is an interesting letter. I have not experienced a discounted settlement offer from a law firm, representing an OC, after just filing an answer.

 

I don't see anything magic in the redacted answer posted and cannot say precisely what has generated the offer letter. I would be surprised if it was their business practice to routinely send out such letters, post answer, on OC alleged debt during the last ten years. Perhaps engaged consumers fighting alleged debt suits has increased as a percentage and is driving up costs while reducing the smooth sailing of ~90% defaulting judgments. IDK

 

Looks like no more than a 33% discount. I suppose it is not too bad if close to the 33%. A stipulated judgement with monthly payments is definitely not something that would interest me.

If seriously considering a counter-offer, I would want to be comfortable with the limitations of Rule 408 (some discussion here) http://www.creditinfocenter.com/community/topic/321131-being-sued-in-phoeniz-az-by-midland-kaplan/page-10#entry1266771

To me the offer seems to say, "our firm's time & risk reduction is worth the discount between the judgment we expect to procure and the lump sum offer".

 

If I ignored the settlement and continuing the litigation I would believe it is safe to assume I am in for a significant fight. I would guess that the fight would likely start with a plaintiff filing a pre-discovery MSJ.

 

Whether I would immediately focus on Rule 26.1 disclosure (links in post #12) and propound sharp and focused discovery on opposing would depend in large part on the specifics of my situation and my comfort with discovery. Although I do not have experience with such, I would think a plaintiff's MSJ, if filed during ongoing discovery, should be relatively easy to successfully oppose.

 

"complete the enclosed Financial Statement". Sounds like something I would use to start a fire on a cold night.

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I'm not going to settle, but I think I will respond to their offer and ask them to explain the stipulated judgment in more detail. That will give them something to work on.

 

I am fine with discovery and will be putting together my own disclosure plus rogs and requests for production too. I was also thinking of stopping by a few WF branches to get business cards of loan officers and branch managers. I can list them on my disclosure form as potential witnesses that I want to ask about their credit card and checking account agreements.

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  • 3 weeks later...

I received the following Notice of Appointment of Arbitrator.

 

post-155714-0-49361200-1388680795_thumb.post-155714-0-15990300-1388680796_thumb.

 

I'm planning on using my 1 strike against the arbitrator just because I can. By my calculation I have 10 days to file that which would be by January 13th (time is calculated as court business days for deadlines that are less than 11 days in Superior Court). I counted the days as follows:

 

  1. Mon Dec 30
  2. Tue Dec 31
  3. Thu Jan 2
  4. Fri Jan 3
  5. Mon Jan 6
  6. Tue Jan 7
  7. Wed Jan 8
  8. Thu Jan 9
  9. Fri Jan 10
  10. Mon Jan 13

I have not received any rule 26.1 disclosure from them as of yet. Disclosure is due 40 days from the date my answer was filed, which was Nov 27. I calculate that to be due on Mon Jan 6th (3 days in Nov, 31 days in Dec, 6 days in Jan). I will send them my disclosure this weekend plus my discovery requests.

 

Mr. Bookworm

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