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Portfolio Recovery Suing in Small Claims (Iowa)


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I'm being sued by Portfolio Recovery for a card that existed prior to a divorce that occurred a few years back. My question is related to small claims - is there anything I should be filing besides the appearance and answer with a general denial? It doesn't appear that I can file for discovery in small claims. Do I make all my objections to their evidence in court? I doubt they have any proof of chain of title referencing the actual account and I know I could object to the statement since the attorney doesn't work for HSBC so how could he have personal knowledge that everything stated is correct? I've done quite a bit of research on civil procedure in the past but everything I've read about small claims makes it seem much more informal.

1. Who is the named plaintiff in the suit?

Portfolio Recovery Assoc, LLC

2. What is the name of the law firm handling the suit?

Abbott, Wetsch, and Osborn

3. How much are you being sued for?

$900

4. Who is the original creditor?

HSBC

5. How do you know you are being sued?

Served

6. How were you served?

At home, paperwork given to my 16 yr old daughter.

7. Was the service legal as required by your state?

Yes, I believe so.

8. What was your correspondence (if any) with the people suing you before you think you were being sued?

None. Based on the documents filed with the original petition, it appears that they tried to send a letter to me a few months back but it was sent to an incorrect address.

9. What state and county do you live in?

Iowa, Polk

10. When is the last time you paid on this account?

I don't recall, maybe 2009 or 2010 but I don't have any statements that far back.

11. What is the SOL on the debt?

5 years

12. What is the status of your case? Suit served? Motions filed?

Original petition filed - 7/29/14

Return of original notice - 8/28/14

Appearance and Answer filed - 9/9/14

Hearing scheduled - 9/29/14

13. Have you disputed the debt with the credit bureaus?

No.

14. Did you request debt validation before the suit was filed?

No, didn't receive any collection letters.

15. How long do you have to respond to the suit?

20 days from date of service. Appearance and Answer has already been filed with straight denial of claim.

16. What evidence did they send with the summons?

- A court document labeled "verification of account" that appears to be an affidavit from the attorney stating that he has personal knowledge that the attached statement is true and the balance owed is true.

- A collection letter dated 5/21/14 that lists an incorrect address for me

- One statement from the OC

- A generic assignment/bill of sale signed by a VP from HSBC. Nothing on it refers to any specific accounts.

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The affidavit was by the attorney?

You will object to that.

1. Bill of sale doesn't reference your account, and it states there is no guarantees except for what is provided by the purchase agreement. (Most say that, does yours?) they did not include that agreement, the bill of sale is incomplete.

2. There is no one to testify to the records that have personal knowledge if the account. The records are heresay. Look up some case law for Iowa to support that statement. Google scholar is a good place to start, type in key words such as hearsay exception, debt collection, etc. to find it, click it for Iowa courts.

3. The attorney is not the custodian of records and has no way of knowing if the records are kept in the regular coarse of business, he is not so person of knowledge, his affidavit is hearsay trying to authinticate hearsay.

4. The statement they sent is hearsay, they cannot provide one statement claiming that is what you owe. You have no way of knowing how they arrived at that amount, there are no payments or credits shown, no agreement included to show what governs the account, and it is a copy, not certified as authinticate. I mean you had a card once with HSBC, but you thought that was paid off during your divorce.

5. You never received the letter sent to the wrong address, so you never had the chance to do a debt validation.

Yes small claims is less formal, and rules more lax, but they still need to prove you owe, not just you once had an account somewhere.

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If you are being sued under Account Stated, this is the proof the court requires. From "Gemini Capital Group v. New," (Iowa Crt of App. 2011)

In order to recover a credit card debt from a consumer under an accounts stated theory, a creditor must:

(1) Meet the requirements of account stated, by providing an account agreement with the consumer, a final or "charge-off" statement with the consumer's address, and a sworn statement from a person with knowledge that regular monthly account statements were sent to the consumer at the address provided by the consumer, the charge-off statement is the sum total of those statements, the consumer used the credit card, and the consumer never objected to the monthly statements.

Capital One Bank (USA), N.A. v. Denboer, 791 N.W.2d 264, 282 (Iowa Ct. App. 2010).

I conclude Gemini has met its burden of proof under an accounts stated theory of recovery. Gemini provided a final statement with New's address and New himself testified he charged the purchase of items to the account and received monthly billing statements. There was no evidence New ever objected to any of the monthly statements or made a payment after his June 9, 2004 statement. New did not contest the amount on the statement was the sum total of his statements.

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You might also consider a MTC arbitration. I don't see PRA following through on a 900. debt. If you don't have the original agreement you can find one online.

HSBC had hundreds of different cards, so I'm not sure if these will work.

http://www.cardmemberagreements.org/hsbc-2/

You will want to find an agreement around the time of your last payment. This information can be found on your credit bureaus.

http://www.consumer.ftc.gov/articles/0155-free-credit-reports

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Unfortunately we have very few posters here from Iowa. I apologize because the first time I read your initial post I only looked at the questions you answered. The difficult thing is that all states vary on how the legal process operates in small claims court. In my state you either plead guilty or ask for a trial date at your first hearing.

Is that what you did on 9/9?

Is this 9/29 just a hearing or is it going to be your actual trial date?

If you haven't already check out the link below.

http://www.iowalegalaid.org/files/A3ED30CF-AFFE-7431-9310-0D521E4312AF/attachments/44B42758-808A-4DDC-B62E-61E9E3240BE8/small-claims-court-jul-2012.pdf

Are you sure it is the attorney that signed this? If it is as @shellieh98 stated you will want to object to this. It is really strange to have the plaintiff's attorney do this because an attorney can not testify as a witness. Do you mind posting the affadivit? Just black out all personal information. This will really help determine if you need to subpoena the witness. Do this soon because you are limited on time.

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  • 2 weeks later...

No, on 9/9 I just filed an answer stating I deny all claims.  I then received notice of the hearing scheduled for 9/29.  From everything I've read on small claims in Iowa, it appears that the hearing will be the trial setting.  Thanks for providing the link on small claims in Iowa, I had found that previously and have read over it a few times. 

 

I have attached the documents that were filed by the attorney as evidence.  The second page is the one where the attorney makes a statement attesting to the validity of the billing statement from the original creditor.

 

 

Court Docs 201409_Redacted.pdf

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Unfortunately, small claims doesn't usually work to the debtor's advantage.  The process is quick, informal, and some/many judges tend to be pro-creditor.  If you admit the credit card is yours,  many judges will find you liable for the debt.   Oftentimes,  small claims judges don't care about the fine points of evidence, documentation or standing.  You do not want to commit perjury, but you do not want to admit that you used the card. Re-read the links I posted and hammer away at the proof that is required under IW case law.

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Unfortunately, small claims doesn't usually work to the debtor's advantage.  The process is quick, informal, and some/many judges tend to be pro-creditor.  If you admit the credit card is yours,  many judges will find you liable for the debt.   Oftentimes,  small claims judges don't care about the fine points of evidence, documentation or standing.  You do not want to commit perjury, but you do not want to admit that you used the card. Re-read the links I posted and hammer away at the proof that is required under IW case law.

 

Thanks for the advice, I appreciate that.  In my opinion, a judge being biased toward either party is a breakdown of the judicial system.  Small claims or not, there are still procedural rules that should be followed and each party should be guaranteed an unbiased hearing and review.  I realize there's probably absolutely nothing I can do if I feel the case was treated unfairly (besides appeal) but just had to vent.  I will memorize the case law related to this and hope for the best.  Thanks again. 

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I know you are running out of time, but you might want to attend a court session if you haven't already. That way you can see how this judge acts in court. 

 

Yes, I was planning on getting to the courthouse a few hours early to observe.  I know the public is free to sit in on any of these proceedings but just haven't had time to get there.  I will attempt to adjust my approach once I see how it operates.  At this point, I think the objection based on lack of standing, the objection to the attorney's statement that the billing statement is accurate, and the case law within Capital One Bank v. Denboer will be sufficient if the judge will listen.

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@RexSti0000

 

The following link about small claims is from the Iowa Bar.  About halfway down the page is the subheading "I've Been Sued-What Do I Do?"

 

http://www.iowabar.org/?page=smallclaimscourt

 

Thank you.  I actually already have that bookmarked and have read over it a few times.  At this point, I'm reading and re-reading all procedural information I can find and any relevant case law.

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Yes, I was planning on getting to the courthouse a few hours early to observe.  I know the public is free to sit in on any of these proceedings but just haven't had time to get there.  I will attempt to adjust my approach once I see how it operates. 

 

It is usually a better option if you can attend a day you are not on the docket. If you can't any observation is better than none. Not sure if it will work in Iowa, but if things start looking bad in many states you can request a continuance. In my state both sides are allowed one continuance without a lot of hassle. I only mention this in case you get to court and the judge seems like he is working for the other side. 

 

If you have researched a lot of the threads here you will find some things are the same everywhere. When court begins the judge will call up each attorney and start reading his/her part of the docket. Its not uncommon for 90%+ of those called getting a judgment for not showing up or just giving in. Then you will hear one or two called that have attorneys. These will disappear and you will never know the outcome because most are dismissed. Then you might get lucky and one or two show up and fight. This is where you will see if the judge is fair or not. The problem you might run into is that you might be the only one that does this on your day. 

 

I'm not saying to ask for a continuance lightly, but just remember it is an option if you are about to get steam rolled. 

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It is usually a better option if you can attend a day you are not on the docket. If you can't any observation is better than none. Not sure if it will work in Iowa, but if things start looking bad in many states you can request a continuance. In my state both sides are allowed one continuance without a lot of hassle. I only mention this in case you get to court and the judge seems like he is working for the other side. 

 

If you have researched a lot of the threads here you will find some things are the same everywhere. When court begins the judge will call up each attorney and start reading his/her part of the docket. Its not uncommon for 90%+ of those called getting a judgment for not showing up or just giving in. Then you will hear one or two called that have attorneys. These will disappear and you will never know the outcome because most are dismissed. Then you might get lucky and one or two show up and fight. This is where you will see if the judge is fair or not. The problem you might run into is that you might be the only one that does this on your day. 

 

I'm not saying to ask for a continuance lightly, but just remember it is an option if you are about to get steam rolled. 

 

Got it, thank you.  I didn't even think about the possibility of nobody showing up that day to fight except for me.  I might be SOL on observing then.  I will keep the continuance possibility in mind.  Would this be something I would ask for immediately if I feel the hearing is going bad or is there an opportunity for closing statements where I would mention this? 

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Got it, thank you.  I didn't even think about the possibility of nobody showing up that day to fight except for me.  I might be SOL on observing then.  I will keep the continuance possibility in mind.  Would this be something I would ask for immediately if I feel the hearing is going bad or is there an opportunity for closing statements where I would mention this? 

 

You would have to ask for it immediately and have a good reason at that point.  If you wait until the hearing is under way it is WAY WAY too late and won't be granted.

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@Clydesmom is correct on requesting a continuance. You have to do it before your case begins. The judges will grant a continuance to the plaintiff for about any reason. The most common reason used by defendants is the need to consult with an attorney. I have witnessed judges lecture people on waiting until the last minute, but they always grant at least one. Keep in mind my experience is in TN and that IA may be different. 

 

Going back to what @shellieh98 brought up earlier you really need to find out if attorneys are allowed to sign these affidavits in IA. In most cases an employee from the JDB signs these. Find out what IA law says about an attorney acting as a witness similar to below. You also need to find out what kind of hearsay is allowed in court. Some states have business exceptions. I would definitely object to this being admitted the second the attorney admits into evidence.  

 

Rule 3.7: Lawyer as Witness

 

Rule 3.7 Lawyer As Witness
(a) A lawyer shall not act as advocate at a trial in which the lawyer is likely to be a necessary witness unless:(1) the testimony relates to an uncontested issue;
(2) the testimony relates to the nature and value of legal services rendered in the case; or
(3) disqualification of the lawyer would work substantial hardship on the client.
(b A lawyer may act as advocate in a trial in which another lawyer in the lawyer's firm is likely to be called as a witness unless precluded from doing so by Rule 1.7 or Rule 1.9.
 
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You will need to keep copies of all state laws, rules and case citations you plan to use. Keep them in separate folders with large labels so you can find them easily. Make at least one extra copy of each to give the judge if requested. Do not just pick and choose one sentence or paragraph to use to make your points, although you can highlight them. You need to include the entire opinion, etc. 

 

Make sure and ask the judge for his/her patience since you are new to this. Always address the judge as "your honor" and everyone else as Mr. or Mrs. Try to only look at the judge when speaking. Even if you get upset try to remain calm and keep it professional. If you get confused ask the judge for a moment then shuffle some papers, take a deep breath and continue. Even a less than fair judge will usually give a pro se defendant a little extra time if requested. 

 

Dress in your best clothes and get to court early. I find it best to sit on the front row so you can hear and see everything that is going on. Watch how the judge acts and reacts to different people and use this to your advantage. 

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@Clydesmom is correct on requesting a continuance. You have to do it before your case begins. The judges will grant a continuance to the plaintiff for about any reason. The most common reason used by defendants is the need to consult with an attorney. I have witnessed judges lecture people on waiting until the last minute, but they always grant at least one. Keep in mind my experience is in TN and that IA may be different. 

 

Going back to what @shellieh98 brought up earlier you really need to find out if attorneys are allowed to sign these affidavits in IA. In most cases an employee from the JDB signs these. Find out what IA law says about an attorney acting as a witness similar to below. You also need to find out what kind of hearsay is allowed in court. Some states have business exceptions. I would definitely object to this being admitted the second the attorney admits into evidence.  

 

Rule 3.7: Lawyer as Witness

 

Rule 3.7 Lawyer As Witness
(a) A lawyer shall not act as advocate at a trial in which the lawyer is likely to be a necessary witness unless:(1) the testimony relates to an uncontested issue;
(2) the testimony relates to the nature and value of legal services rendered in the case; or
(3) disqualification of the lawyer would work substantial hardship on the client.
(b A lawyer may act as advocate in a trial in which another lawyer in the lawyer's firm is likely to be called as a witness unless precluded from doing so by Rule 1.7 or Rule 1.9.
 

 

 

Thank you.  The rule in Iowa for Lawyer as a Witness is the same as you have stated above so I will definitely object to that.  I'm still trying to determine the rules on hearsay but from some of the case law I've read, I think there are valid objections on those grounds in my case.  I actually found a case where this same attorney lost partially based on what appears to be hearsay related to the affidavit and billing statement.

kevin_abbott_credit_card_lawsuit_defense_ruling.pdf

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@RexSti0000

 

If you look at the actual form (Verification of Account) on the court website, the wording on your form has been changed.   The court form starts out "I,_________________, am a party or an employee of Plaintiff(s)...".

 

The form you have starts out with the attorney stating that he's the attorney for the plaintiff.   I'd call Legal Aid and ask if the attorney can change the wording, and if he's allowed to sign it.

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You may be dealing with an attorney that is getting the job done for PRA very efficiently. By efficient I mean not worrying about the law and going the route with the least amount of cost and effort. If this is the case and mean IF then definitely call them out on it. Make sure and read up on how and when to object based on the IA state and/or local rules. If this guy is making a living getting away with this then he is probably not wanting anyone to spoil his fun. 

 

Even though the above may work for you make sure and have other arguments backed up with law and case citations. If it goes any further you will definitely want to ask for a documented chain of individual ownership. Try and not let the case be about if you ever had an account with the OC. You want the entire trial to be about making PRA prove ownership. Other arguments above and beyond this include proving the amount. If it gets this far how did they come up with the amount. What was the interest rate charged? When did the interest start accruing and does it include post charge off interest. Was this legal by contract? If so where is the evidence of the contract/agreement that allows it? etc.

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I don't have time to look through all of this, but you really need to concerning pre-judgement interest. When you find the most recent version of the law print and make copies of it. From a quick search it looks like IA only allows statutory interest of 5% meaning if they charge over that amount it must be by contract. If it is over 5% you need to make them prove they can do it. Make them present a contract/agreement proving this. 

 

http://search.legis.state.ia.us/nxt/gateway.dll/ic?f=templates&fn=default.htm

 

This is ammunition to keep in case the judge allows the affidavit and testimony from the attorney. Make sure this attorney knows you are not going to quit, even it includes an appeal. Occasionally these attorneys will dismiss a case if they think you are going to take up too much of their time. 

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