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Responding to Discovery Request, Pending MSJ, LVNV, Michigan


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"This affidavit was purportedly signed and notarized on December 4, 2013, and is not dated within 10 days of the Summons and Complaint.  Attached as Exhibit B is a computer generated summary “Account Statement” prepared on behalf of LVNV dated December 17, 2013, also not within 10 days of the Complaint date."

 

The dates are correct.  The Plaintiff's suit has more holes in it than swiss cheese.

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@justiceforall3

 

Here's my rough clean up. 

STATEMENT OF FACTS

 

1.  On January 2, 2014, and again on March 26, 2014, Plaintiff “LVNV Funding, LLC” filed a Complaint alleging two claims: breach of contract, and account stated.  Attached as Exhibit A is “Plaintiff’s Affidavit of Indebtedness and Ownership of Account”, prepared by an “Authorized Representative for LVNV Funding, LLC”.  The affiant’s employer, the person or entity conferring authorization, and responsibilities of an “Authorized Representative” are not identified.  Affiant Matt Pangle, on his information and belief, claims LVNV’s business records confer the right to collect a purchased balance owing of $XXXX.  This affidavit was purportedly signed and notarized on December 4, 2013, and is not dated within 10 days of the Summons and Complaint.  Attached as Exhibit B is a computer generated summary “Account Statement” prepared on behalf of LVNV dated December 17, 2013, also not within 10 days of the Complaint date—and 11 days after the Pangle Affidavit.  The preparer of the Account Statement is not identified.  No other documents referred to in the Complaint or Pangle Affidavit are attached.

2.  On July 21, 2014, after proper written consent from Plaintiff and filing Stipulation And Order to Amend Answer, per MCR 2.118(A)(2)(4), Defendant filed a Second Amended Answer to Plaintiff’s Complaint, denying LVNV’s allegations and stating two Affirmative Defenses: Lack of Standing, and Failure to State a Claim.  Attached to the amended answer is Defendant’s First Amended Affidavit Denying Plaintiff’s Account Stated Claim, dated July 21, 2014.

3. Plaintiff claims it is the assignee of an alleged Heritage First USA account issued by Chase Bank USA, N.A (Comp. para. 1).  Plaintiff failed to attach the chain of assignment agreements supporting these claims to its Complaint.

4. Plaintiff’s Complaint alleges (Comp. para. 4) that on, “September 7, 2006, Defendant opened an account with Chase Bank USA, N.A.  An agreement ("Agreement") was delivered to Defendant(s) and to the best of Plaintiff’s knowledge, is in Defendant's possession.”  Plaintiff has failed to attach exhibits to support these claims.  Defendant denies applying for credit or having the Agreement in his possession. (Def.’s Aff. paras. 3-4).

5.  On or around June 30, 2014, Plaintiff filed its Motion for Summary Disposition, with attached as Exhibit A Chain of Title to verify LVNV’s ownership of the alleged account.  Chain of Title shows a Bill of Sale record dated January 12, 2011, with Chase Bank USA. N.A. as the seller and Sherman Originator III, LLC as the purchaser of debts further “described in Exhibit 1.”  The Plaintiff has failed to attach this referenced “Exhibit 1.”  The Bill of Sale record states that it is an exhibit to the Credit Card Account Purchase Agreement.  Plaintiff has failed to attach the Credit Card Account Purchase Agreement to which the Bill of Sale is an exhibit to.  The Chain of Title also shows a Declaration of Account Transfer record, with Sherman Originator III, LLC as the assignor and Sherman Originator LLC and LVNV Funding LLC as the assignees.  The preparer of both of these records is not identified.  The Plaintiff’s assignor Heritage First USA is not represented in either of these records.  The Defendant and alleged account number are not represented in either of these records. 

6.  Attached as Exhibit B to Plaintiff’s Motion for Summary Disposition are unsworn copies of purported account statements dated between November 7, 2008 and May 6, 2010, LVNV alleges were sent to Defendant.  Defendant has denied receiving these statements in his affidavit. (Def. Aff. Para. ???.)  Plaintiff alleges these statements indicate Defendant’s knowledge of the account, its terms, and charge-off balance as indicated in the final statement.  These purported statements do not show any purchase transactions, and do not show use or how the balances were computed.  The amount due on the purported May 6, 2010 statement is $XXX and does not indicate a charge-off balance or that the alleged account was charged off.  These records were not created by Plaintiff, nor does Plaintiff’s affidavit attest that these records are sworn copies.  LVNV has failed to submit an affidavit or sworn declaration from Heritage First USA or Chase Bank USA, N.A. attesting to the authenticity and accuracy of these statements.

7.  On June 23, 2014, Defendant served LVNV with a Request for Production of Documents (Def.’s Ex.1), requesting all statements generated while the alleged account was open to demonstrate use and to show how the alleged balance was computed. Defendant also requested the “Account Agreement” with the terms and conditions purportedly governing the alleged Heritage First USA account. Lastly, Defendant requested proof of assignment on the alleged account.

8.  On or around July 22, 2014, Defendant received Plaintiff's response with objections to the Request for Production of Documents (Def.’s Ex. 2). LVNV provided no more than the account statements and Chain of Title documents already attached as exhibits to Plaintiff’s Motion for Summary Disposition.  Defendant denies receiving the purported statements generated on the account, as well as possession of the alleged Account Agreement in his Affidavit in Opposition to Motion for Summary Disposition (Def.’s Aff. paras.5-6). 

9.  On July 18, 2014, per instructions by Plaintiff, Defendant emailed an authorization to establish email communication (Def.’s Ex. 3).  On July, 28, 2014, Defendant emailed Plaintiff a Letter to Confer (Def.’s Ex. paras. 4, 5).  Defendant denies receiving a response from LVNV for the outstanding discovery records in his Affidavit in Opposition to Motion for Summary Disposition. (Def.s Aff. para. 9).

10.  As a result, there are genuine issues of material fact that show that the Plaintiff is not entitled to relief for $XXXX plus interest, costs and attorney’s fees under MCR 2.116 ( C )(9) and MCR 2.116 ( C )(10).

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@justiceforall3   Here is a portion of MsWolverine's MSD oppo brief. She had the same situation. Her judge did not buy the argument and ruled the Pangle affidavit was enough. 

 

II.             Plaintiff Has Failed To Establish Prima Facie Evidence Of An Account Stated

     Plaintiff filed its Complaint on November 6, 2013, with “Plaintiff’s Affidavit of Indebtedness and Ownership” (Plaintiff’s Exhibit A), dated October 8, 2013, an affidavit that does not comply with MCL 600.2145.  Under this statute, in order to have prima facie evidence of an account stated, a copy of the account statement must be “annexed” to an affidavit made “within 10 days next preceding the issuing of the writ or filing of the complaint or answer.” Plaintiff’s affidavit, dated October 8, 2013, for a complaint filed on November 6, 2013, was untimely.

     Plaintiff did annex a copy of an account statement (Plaintiff’s Exhibit B ) to the affidavit. The account statement is dated October 15, 2013. The affidavit that the account statement was annexed to was dated October 8, 2013. If accurate, this account statement being entered into the record under the sworn statement of affiant Matt Pangle, was prepared 7 days after the affidavit. It is impossible for the affiant to have reviewed and attested to a document that had yet to be created. If these dates are accurate, the credibility of the Plaintiff and Plaintiff’s affiant are called into question. Under MCR 803(6), trustworthiness is itself an express threshold condition of admissibility. Solomon v Shuell, 435 Mich 104, 120; 457 NW2d 669 (1990).

     In compliance with MCL 600.2145, the Defendant submitted an answer and counter affidavit denying Plaintiff’s allegations of indebtedness and claim of an account stated. Because the Defendant submitted a timely affidavit, Defendant’s denial establishes prima facie evidence of a lack of assent to an account stated.

     An "account stated" refers to a "contract based on assent to an agreed balance," which, like all contracts, must be created through mutual assent. Fisher Sand & Gravel Co v Neal A Sweebe, Inc, 494 Mich 543, 557, 561-562; 837 NW2d 244 (2013). "Parties assent to a sum as the correct balance due from one to the other; and whether this operation has been performed or not, in any instance, must depend upon the facts." White v Campbell, 25 Mich 463, 468 (1872). An express contract arises where the parties expressly agree to the sum due. Fisher Sand & Gravel Co, 494 Mich at 558. A party's acceptance may also be inferred where the party makes payments on the amount due or receives an accounting and fails to object within a reasonable time. Corey v Jaroch, 229 Mich 313, 315; 200 NW 957 (1924); Keywell & Rosenfeld v Bithell, 254 Mich App 300, 331; 657 NW2d 759 (2002).

     When silence forms the basis for inferring assent to a sum owed, the circumstances involved must support an inference of assent. Thomasma v Carpenter, 175 Mich 428, 436-437; 141 NW 559 (1913). In this case, the circumstances do not support the inference of assent. Defendant denied it ever received any communication about this alleged debt from Plaintiff or Plaintiff’s alleged assignors to be able to verify the alleged account or dispute the amount Plaintiff claims is due and owing. (See Defendant’s Affidavit ¶ XX) Plaintiff has not submitted facts or evidence of the manner or method of mailing the demands, nor provided the actual “repeated demands” for payment of the alleged account stated debt. 

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@justiceforall3  Here are some cases we've used:

 

[MCR 2.116( C )(9)]

“Summary disposition is inappropriate under this subrule when a material allegation of the complaint is categorically denied.” Village of Dimondale v Grable, 240 Mich App 553, 564‐565 (2000).

 

     It is well settled that where the truth of a material factual assertion of a moving party's affidavit depends on the affiant's credibility, there exists a genuine issue to be decided at trial by the trier of fact and a motion for summary disposition cannot be granted. Metropolitan Life Ins Co v Reist, 167 Mich App 112, 118; 421 NW2d 592 (1988); Brown v Pointer, 390 Mich 346, 354; 212 NW2d 201 (1973); Crossley v Allstate Ins Co, 139 Mich App 464, 468; 362 NW2d 760 (1984).

 

"Here the affidavit was made out of time, and when the plaintiff went to trial his situation was no better than it would have been if no affidavit had been made. He was required to prove his case in the ancient way." McHugh v Butler, 39 Mich 185, 186 (1878); see also Snyder v Patton & Gibson Co., 143 Mich. at 351-352, 106 N.W. 1106 (1906).

 

     If the affidavit is defective or is rebutted by the defendant with competent proof, the plaintiff simply is left with the burden to prove its case in the usual fashion. See Law Offices of Lawrence J. Stockler, P.C. v Rose, 174 Mich App 14, 55-56, 436 NW2d 70, 90-91 (1989). As the state court of appeals explained in unpublished decisions, Mich. Comp. Laws § “600.2145 is not the only way to establish a claim for an account stated; such a claim can be proven through evidence of an express understanding, or words and acts, and the necessary and proper inferences thereon.” Klochko Equip. Rental Co., Inc. v Village Green Construction, LLC, 2003 WL 21398305, *3 (Mich. App. 2003). An “affidavit . . . made more than ten days before the complaint was filed” does not void the collection lawsuit; untimeliness merely “prohibits a court from assigning prima facie evidentiary weight to such an untimely affidavit.” Capital One Bank v Ringelberg, 2005 WL 2319125, *1 (Mich App 2005).

   

An "open account" is "an unpaid or unsettled account" or "an account that is left open for ongoing debit and credit entries and that has a fluctuating balance until either party finds it convenient to settle and close, at which time there is a single liability." An "open account" "consists of a series of transactions and is continuous or current, and not closed or stated." Fisher Sand & Gravel Co v Neal A Sweebe, Inc, 494 Mich 543, 553-554; 837 NW2d 244 (2013).

 

  An account stated, like all contracts, requires mutual assent. Specifically, "[a]n account stated requires the manifestation of assent by both parties to the correctness of the statement of the account between them.” Fisher Sand & Gravel Co v Neal A Sweebe, Inc, 494 Mich 543, 553-554; 837 NW2d 244 (2013).

 

  [T]he agreed statement serves in place of the original account, as the foundation of an action. It becomes an original demand, and amounts to an express promise to pay the actual sum stated. The creditor becomes entitled to recover the agreed balance, in an action based on the fact of its acknowledgment by the debtor, upon an adjustment of their respective claims. The effect of the operation is said to be much the same as though the debtor had given his note for the balance. White v Campbell, 25 Mich 463, 468 (1872).

 

Absence of evidence establishing continued course of dealing, or other circumstances suggesting balance struck required for account stated, precludes establishing liability upon accounts stated merely on proof of billing and accounts receivable ledger. R. G. Moeller Co. v Van Kampen Constr. Co.., 57 Mich App 308, 225 NW2d 742, (1975) 16 UCCRS 706.

 

     The party asserting a breach of contract has the burden of proving its damages with reasonable certainty, and may recover only those damages that are the direct, natural, and proximate result of the breach. In re F Yeager Bridge Culvert Co., 150 Mich App 386, 401, 389 NW2d 99 (1986); Alan Custom Homes, Inc v. Krol, 256 Mich App 505, 667 NW2d 379, (2003).

 

     As the Michigan Supreme Court has said, the party alleging that a fact is true should suffer the consequences of failing to prove its truth. A plaintiff has the burden of proof (risk of nonpersuasion) for all elements necessary to establish the case. Kar v Hogan, 399 Mich 529, 539; 251 NW2d 77 (1976).

 

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This affidavit was purportedly signed and notarized on December 4, 2013, and is not dated within 10 days of the Summons and Complaint.  Attached as Exhibit B is a computer generated summary “Account Statement” prepared on behalf of LVNV dated December 17, 2013, also not within 10 days of the Complaint date—and 11 days after the Pangle Affidavit.  

 

Don't you mean 13 days?  

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This affidavit was purportedly signed and notarized on December 4, 2013, and is not dated within 10 days of the Summons and Complaint.  Attached as Exhibit B is a computer generated summary “Account Statement” prepared on behalf of LVNV dated December 17, 2013, also not within 10 days of the Complaint date—and 11 days after the Pangle Affidavit.  

 

Don't you mean 13 days?  

No, you mean 13 days.  :roll:  I'm just some wacky stranger who can't count! (Sorry) This is why you must verify everything I say! 

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@justiceforall3

To make up for my poor math, here is a quote I used in the Standard of Review at the end of the section for a motion under MCR 2.116( C )(9) before 2.116( C )(10):

 

Pro se pleadings are to be construed liberally and expansively, affording them all opportunity in obtaining substance of justice, over technicality of form. Maty v Grasselli Chemical Co., 303 US 197 (1938).

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@justiceforall3

 

I know you've been swamped, but did you get a chance to read the Maryland Tax Board Cease & Desist order for LVNV et al.? It's a primer on their business model and how their affidavits are designed to mislead defendants and the court. It lays out most of your argument in a simple way and may have some things you didn't think of. For example, do any of the Bill of Sale docs have language like the accounts are sold with disclaimers, without recourse, representations or warranties, or refer to another section of the agreement that isn't included? No warranty would also apply to any derivative database imported into LVNV or Resurgent's electronic records that were transferred along with the chain of assignments. 

http://www.sanjosebankruptcyfdcpalawyer.com/LVNV%20cease%20%26%20desist%20order.pdf

 

Win or lose your case, I would advise you to consult with an experienced consumer attorney to see if you don't have a good FDCPA case.   http://www.naca.net/

 

 

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Ok so instead of simply copying and pasting my entire brief, I am attaching it.  This is my first draft.  I have been staring at these pages for so long now I probably am not seeing things I have missed, or if something is supported by the wrong case law.  I will be proofing it tomorrow and making additions and subtractions to content as needed.  

 

I am not sure about the bold. I thought it might be good at first in case the Judge skims it.  Am I allowed to use bold, and if so, can I bold parts of case law?  

Justiceforall3.docx

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I know you've been swamped, but did you get a chance to read the Maryland Tax Board Cease & Desist order for LVNV et al.? It's a primer on their business model and how their affidavits are designed to mislead defendants and the court. It lays out most of your argument in a simple way and may have some things you didn't think of. For example, do any of the Bill of Sale docs have language like the accounts are sold with disclaimers, without recourse, representations or warranties, or refer to another section of the agreement that isn't included? No warranty would also apply to any derivative database imported into LVNV or Resurgent's electronic records that were transferred along with the chain of assignments. 

http://www.sanjoseba...esist order.pdf

 

I will take a look tomorrow.  Thanks.

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Ok so instead of simply copying and pasting my entire brief, I am attaching it.  This is my first draft.  I have been staring at these pages for so long now I probably am not seeing things I have missed, or if something is supported by the wrong case law.  I will be proofing it tomorrow and making additions and subtractions to content as needed.  

 

I am not sure about the bold. I thought it might be good at first in case the Judge skims it.  Am I allowed to use bold, and if so, can I bold parts of case law?  

@justiceforall3

Personally, I would not do the bold. Italics, not bold, may be used very sparingly; bold is hard on the eyes. When you choose to highlight a word or phrase in italics inside a case cite you're quoting, you must put at the end (emphasis added). Italicized emphasis that was put there by the ruling judge needs to be quoted exactly as it appears. 

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Ok, I read all of it. This is one of my oppositions. I mentioned in one of my PMs that I would use caution in using one of mine. There is new case law out there that will supersede some of this case law, like Fisher Sands and Gravel Comp vs. Sweebe. That MI Supreme Court opinion thoroughly addresses open account, mutual account and account stated. It set precedents. You need to use it to support your affidavit. 

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@bmc100

 

Thanks for the advice.  I have taken out and added the following (starting after I declare the documents hearsay.)

 

Plaintiff does not show a common law “Account Stated”. Even if the records submitted by the Plaintiff were deemed admissible, Plaintiff would still not be entitled summary disposition based upon the theory of account stated. An "account stated" refers to a "contract based on assent to an agreed balance," which, like all contracts, must be created through mutual assent. Fisher Sand & Gravel Co v Neal A SweebeInc, 494 Mich 543, 557, 561-562; 837 NW2d 244 (2013). "Parties assent to a sum as the correct balance due from one to the other; and whether this operation has been performed or not, in any instance, must depend upon the facts."White v Campbell, 25 Mich 463, 468 (1872). An express contract arises where the parties expressly agree to the sum due. Fisher Sand & Gravel Co, 494 Mich at 558. A party's acceptance may also be inferred where the party makes payments on the amount due or receives an accounting and fails to object within a reasonable time. Corey v Jaroch, 229 Mich 313, 315; 200 NW 957 (1924); Keywell & Rosenfeld v Bithell, 254 Mich App 300, 331; 657 NW2d 759 (2002). The Defendant has denied receiving statements on the account, or repeated demands for payment in his affidavit (Def.’s Aff. paras. 5-6). Furthermore, Plaintiff has failed to show proof that Defendant received statements and failed to object, or proof of the alleged repeated demands for payment.

            Merely sending bills or attaching a few bills to the complaint or motion for summary disposition does not create an account stated.  Absence of evidence establishing continued course of dealing, or other circumstances suggesting balance struck required for account stated, precludes establishing liability upon accounts stated merely on proof of billing and accounts receivable ledger. R. G. Moeller Co. v Van Kampen Constr. Co.., 57 Mich App 308, 225 NW2d 742, (1975) 16 UCCRS 706.  There must be some acknowledgement by the party billed that he admits owing the debt and that he further admits the amount claimed is accurate.  The Plaintiff does not show that Defendant ever acknowledged he owes the Plaintiff anything and there has been no acknowledgment by the Defendant that he owes the amount claimed (Def.’s Aff. para.8),

            Further looking at recent case law, In Unifund CCR Partners v. Riley, Mich; Court of Appeals (2010), In this case, the submitted evidence shows that the defendant originally had an open account based on the credit card issued by Citibank. Plaintiff also provided evidence that payments were made on the account, thereby establishing that a debt was owed. However, this is insufficient to transform an open account to an account stated without evidence that the Defendant was the one who made payments. There is no evidence that Defendant made the asserted payments.  Furthermore, the fact that Defendant did not question the accuracy of the charges is insufficient to transform an open account to account stated absent proof that the Defendant was aware of the account and the charges being made thereon.

            The Defendant did deny the account, denied the amount owed, denied receiving billing statements, and denied making payments on the account in the Defendant’s answer, affidavit, as well as this brief.  Since the Plaintiff is relying upon a stale affidavit, an affiant who does not have personal knowledge of the records submitted and is not a qualified witness, and with no additional documentation or authenticated evidence showing the amount claimed is due and owing, the Court must as a matter of law deny the Plaintiff’s account stated claim for summary disposition.

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@justiceforall3

 

A housekeeping note: you have several case cites that are not in proper form. Only the name of the parties--Wile E. Coyote v Acme Corp.--is italicized; the rest of the cite is not. Also, when you use supra it means you have already cited that case in full earlier. Underlining of case names is not proper according to the Michigan Citation guide. 

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@Brotherskeeper

 

I finally got some time to read the Maryland Tax Board.  Some great stuff here.  would you recommend incorporating into my brief?

 

Either way, I think you are right - I will look into the FDCPA.

@justiceforall3

I thought this cease & desist order would help clarify in your mind what your arguments are. I haven't finished reading your brief. IANAL, but I think any way you can condense the length the better. 

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@justiceforall3

 

(Sadder but wiser) I would be remiss if I didn't caution you to make certain you back up your info and have enough paper and printer ink on hand if you plan to print 3 copies of this brief. Murphy's Law applies at the worst possible moment--including the CIC site being unavailable.  One of our posters lost her driver's license and had to go get a replacement before she could get her affidavit notarized! 

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Ok, I read all of it. This is one of my oppositions. I mentioned in one of my PMs that I would use caution in using one of mine. There is new case law out there that will supersede some of this case law, like Fisher Sands and Gravel Comp vs. Sweebe. That MI Supreme Court opinion thoroughly addresses open account, mutual account and account stated. It set precedents. You need to use it to support your affidavit. 

 

Thank you bmc100,  I specifically mentioned the Fisher case to the OP in one of my posts here.

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@justiceforall3

 

A housekeeping note: you have several case cites that are not in proper form. Only the name of the parties--Wile E. Coyote v Acme Corp.--is italicized; the rest of the cite is not. Also, when you use supra it means you have already cited that case in full earlier. Underlining of case names is not proper according to the Michigan Citation guide. 

 

Good point, I gave the OP a link to proper MIch citation earlier

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