sasha0378

Appealing in WA state (vs Cavalry)

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Ok, I am nearing my deadline for filing my appelant's brief to which I have to attach a transcript relevant portion of judge's position from the hearing.

 

Here is the transcript. Note the judge's position and his wilingness to argue on the behalf of the plaintiff.

 

JUDGE:  Cavalry SPV I LLC vs ME
 
JUDGE: Now, this is a lawsuit against Ms. ME, case #XXXXXXX, the origin of the complaints was that there was monies due on her account for a credit card. And there was an alleged balance due XXXX, plus costs and fees associated thereto… you answered the complaint… and you made a general denial… okay… and then what happened… first request for production of documents…that is one not done before this court… what was before this court was a motion for summary judgment…now…rescheduled as of 5/20… as of right now I do not see any reply to the summary judgment… You had ample here time to reply but you never submitted any documentation to the court in the regards to this. Is there a reason?
 
ME: Actually, I filed my opposition to summary judgment, Your Honor 
 
JUDGE: you did? When was that?
 
ME: I submitted the court paper yesterday.
 
JDB's ATTORNEY (the only time he spoke during the whole proceeding, by the way): Here it is, your Honor
(it appeared that paper didn't go through to the judge and judge had to review my opposition for a few minutes)
 
JUDGE: Ms. ME, in review of your response to the summary judgment motion… you are… first of all… objecting to the assignment of debt, bill of sale, the assignments of the loan… whatever it may be… but in particular there are a couple of statements contained in the affidavit submitted in support of the plaintiff’s position and one such that there was an account which was opened by you or FIA NA Card Services Alaska Airlines in MM/YYYY, which account became delinquent and charged off on MM/DD/YYYY… now in support thereof of this credit card debt, other than you saying that these records, perhaps, were not kept in the ordinary course of business, we have a number of documents reflecting the Alaska Airlines Visa Card showing a balance of 10,XXX, payments made, credit card agreements, etc. although unsigned, perhaps, but there is never within these documents a denial of the debt
 
ME: I deny that owe to the plaintiff
 
JUDGE: You deny you owe the plaintiff because of the progression are coming from the credit card to another company to another company to the purchase by Cavalry SPV
 
ME: Correct… 
 
JUDGE: That is what you are objecting to?
 
ME: I object that I owe to the Plaintiff, yes, your Honor
 
JUDGE: Okay, I… really… that is no merit to me and I can go ahead and look at some documents that track it to them, that they purchased it… my name could be on this as plaintiff… I could have purchased this debt from the credit card company… and if I had purchased the debt from the credit card company, the only thing you can object to is the underlying debt… if I paid them even 5 cents on the dollar to buy this 10,000 dollar debt and I have got a bill of sale, that is all it takes… What I want you to do is if in fact you are going to deny the debt, deny the debt… NOT the procedure used to get to this point or plaintiff who owns this debt. That is what I haven’t seen here!
...

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Wow!   That judge railroaded you!  

 

So what you need in your appeal is to quote any WA state codes and case law showing that the assignment of a debt must be properly documented to be valid.  This is a point of law and not at a judge's discretion.  The original creditor is NOT the plaintiff and the plaintiff MUST show each step in the chain of assignment is valid.  

 

 

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While I am contemplating a response from Cavalry on my appeal, I am doing my own research. In reviewing Paul Sunde v. Unifund, I came across multiple rulings, which are quite concerning for they undermine the essence of "JDBs must prove their assignment" defense doctrine advised a lot on this forum. There are many more case laws cited, p.21 and forward. Any suggestions, please? What am I missing?

 

In Texas in the case of Bell v. State, 176 S.W. 3d 90 (TX. App. 2004), the Court held that a document prepared by a third party may be admissible under the business records exception to the hearsay rule if 1) it is incorporated and kept in the course of the testifying witnesses' business; 2) that the business typically relies on the accuracy of the contents of the such documents; and 3) the circumstances otherwise indicate the trustworthiness of the document. 

 

 

In the case ofln re: E.A.K., 192 S.W. 3d 133 (TX. App. 2006), the Court held that the foundation witness for business records need not be or have been an employee of the company that created the document.. 

 

 

In the case of Melendez v. State, 194 S.W. 3d 641 (TX. App. 2006), the Court held that an undercover officer was not required to be employed by the organization that made or maintained the record in order for him to be the foundation witness for the record under the business records exception to the hearsay rule.

 

 

In the case of Mitchell v. State, 750 S.W. 2d 378 (TX. App. 1988), 

the Court allowed the introduction of records under the business record exception to the hearsay rule even though the person testifying was not a member of the same agency that prepared the original record. 

 

 

 


In Colorado in the case of Teac Corp of America v. Bauer, 678 P. 2d 3 (CO. App. 1984), the Court held that where business records prepared by another source are adopted and integrated into the Plaintiff s records in the regular course of their business, the records are admissible.
 

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@sasha0378

 

The case law you cited does not undermine the standing defense.  Proving ownership of a debt and the admission of business records prepared by a third party are 2 different issues. 

 

The only way the admission of 3rd party records would come into play is if one is arguing the admission of a bill of sale.  But whether or not the admission of that bill of sale has an effect on standing is if the court rules that the bill of sale proves the JDB's standing to sue. 

 

Also, the reason that case law was cited is because Sunde did not offer a timely objection to the admission of business records.  This is a footnote from the court's ruling:

 

[1] We do not address Sunde's other arguments regarding proof of assignment because he failed to preserve them for appeal. RAP 2.5(a) provides that we may refuse to review any claim of error not raised in the trial court. When a party makes a supported motion for summary judgment, an adverse party may not rest upon the mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in CR 56, must set forth specific facts showing that there is a genuine issue for trial. CR 56(e). If he does not so respond, summary judgment, if appropriate, shall be entered against him. CR 56(e). CR 56© allows an adverse party to file and serve opposing affidavits, memoranda of law, or other documentation not later than 11 calendar days before the hearing.

Here, Sunde failed to file any affidavits in support of his opposition to Unifund's motions for summary judgment. He did not challenge any of the affidavits submitted in support of Unifund's motions on the ground that the affiants lacked personal knowledge of the facts or statements made therein. Nor did Sunde object to or move to strike the statements in those affidavits about information contained in the business records of the original creditors or any of the exhibits attached to the affidavits on the grounds of hearsay. Accordingly, following CR 56(e) and RAP 2.5(a), we decline to review Sunde's claims of error with respect to Unifund's affidavits, including his arguments regarding personal knowledge, hearsay, the hearsay exceptions, and electronic records.

 

http://scholar.google.com/scholar_case?case=6881248198285580411&q=%22Unifund+CCR+Partners+v.+Sunde%22&hl=en&as_sdt=ffffffffffffe04

 

Because Sunde didn't timely object to the admission of the records and challenge Unifund's affidavits, the lower court didn't have to address whether or not the affidavits were sufficient to lay the foundation for the admission of the business records.  As a result, all that had to be shown was that 3rd party records can be admissible.

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@BV80, yes, I believe that my objections to all alleged pieces of evidence in my opposition to MSJ should make a difference between Sunde's and my cases. However, here is what Cavalry's lawyer cite in the same response:

 


A Federal District Court in Krawczyk .v Centurion Capital Corporation, 2009 WL 395458 at *3-7 (N.D. Ill. February 18,2009) in its opinion on the Defendant's Summary Judgment Motion in a Federal Fair Debt Collection Practices Act against an Illinois law firm that had brought a suit on behalf of a debt buyer to collect a consumer debt, rejected the Plaintiff s motion to strike the Affidavits of the debt buyer on the grounds that the deponents did not have personal knowledge and the records of the original creditors were hearsay. The Court in its well reasoned opinion thoroughly analyzed the various arguments made by the Plaintiff in support of the Motion to Strike and found that the records were reliable and admissible as business records under the Federal Rules of Evidence 
Rule 803(6).
 
There are a number of other cases where courts, for instance (I imagine that since the above case reached the appeal phase, proper objections had been in lower courts and thus preserved for appeal and, yet, the appeals court ruled on the admissibility):

In Ohio, the Ohio First District Court of Appeals found that the loan records acquired by a debt purchaser could be authenticated by the debt purchasers and were otherwise admissible. Great Seneca Fin. v. Felty, 170 Ohio App. 3d 737, 869 N.E. 2d 30 (Ohio Ct. App. 2006). The court determined that they were properly authenticated because the debt buyer plaintiff there, in support of the loan records, submitted the affidavit of its custodian of records...

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@sasha0378

 

You're still focusing on the admission of the business records.  It's good that you objected to the admission of their evidence, but you also need to also need to focus on their standing to sue.  The judge said:

 

"I can go ahead and look at some documents that track it to them, that they purchased it"

 

"What I want you to do is if in fact you are going to deny the debt, deny the debt… NOT the procedure used to get to this point or plaintiff who owns this debt. That is what I haven’t seen here!"

 

He had already decided that they owned the account.   If you're going to argue standing, you have to show how he abused his discretion...that his decision was wrong.  Did they provide a bill of sale?  If so was it signed by a representative of the OC?

 

In regard to Cavalry's affidavit, how exactly did you object to it?  How did you argue that it was insufficient?

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Note this difference in WA Appellate Courts:

 

 

 

There is a dispute between the various divisions of the Washington Court of Appeals regarding the “proof” 
required to obtain summary judgment upon a debt arising from the use of a credit card. In Discover Bank 
v. Ray, 139 Wn.App. 723, 162 P.3d 1131 (2007), Division III of the Court of Appeals held that the 
cardholder agreement plus credit card statements were sufficient to establish the debt to be owing.
However, in Discover Bank v. Bridges, 154 Wn.App. 722, 226 P.3d 191 (2010), Division III of the Court of 
Appeals held that, in addition to the credit card agreement and statements of account, cancelled checks 
showing payments upon the account were required. In City Bank South Dakota, NA v. Ryan, 160 
Wn.App. 286, 247 P.3d 778 (2011), Division I of the Court of Appeals agreed with the analysis of Division 
II outlined in Bridges

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Note this difference in WA Appellate Courts:

 

 

 

There is a dispute between the various divisions of the Washington Court of Appeals regarding the “proof” 
required to obtain summary judgment upon a debt arising from the use of a credit card. In Discover Bank 
v. Ray, 139 Wn.App. 723, 162 P.3d 1131 (2007), Division III of the Court of Appeals held that the 
cardholder agreement plus credit card statements were sufficient to establish the debt to be owing.
However, in Discover Bank v. Bridges, 154 Wn.App. 722, 226 P.3d 191 (2010), Division III of the Court of 
Appeals held that, in addition to the credit card agreement and statements of account, cancelled checks 
showing payments upon the account were required. In City Bank South Dakota, NA v. Ryan, 160 
Wn.App. 286, 247 P.3d 778 (2011), Division I of the Court of Appeals agreed with the analysis of Division 
II outlined in Bridges

 

My understanding is that arguing the contract issue is a weak one, unless the credit card account's existence was denied in the first place, which I didn't: Cavalry will easily overcome such, at least in WA. Here is an opinion of Appeals Court:

Here, Ayhan has asserted at various times that he (1) used the account at issue, (2) is subject to the Providian contract, (3) did not owe about $4,000.00 which he claimed was the result of mistake or fraud, and (4) discontinued paying on the account.3 Thus, the existence of the contract, and its application to Ayhan, is not at issue

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@sasha0378

 

You're still focusing on the admission of the business records.  It's good that you objected to the admission of their evidence, but you also need to also need to focus on their standing to sue.  The judge said:

 

"I can go ahead and look at some documents that track it to them, that they purchased it"

 

"What I want you to do is if in fact you are going to deny the debt, deny the debt… NOT the procedure used to get to this point or plaintiff who owns this debt. That is what I haven’t seen here!"

 

He had already decided that they owned the account.   If you're going to argue standing, you have to show how he abused his discretion...that his decision was wrong.  Did they provide a bill of sale?  If so was it signed by a representative of the OC?

 

In regard to Cavalry's affidavit, how exactly did you object to it?  How did you argue that it was insufficient?

@BV80,

in my original opposition to their MSJ, on the standing issue, I wrote the following:

 

 

the Plaintiff has not established its standing in this matter. The Plaintiff has the burden to prove that the debt alleged is owed by the Defendant to the Plaintiff. Washington law, RCW 19.16.270 provides that where "the fact of assignment is put in issue ... proof of the assignment is essential to a recovery by the assignee" and "[t]he burden of proof of the assignment is on the one claiming to be the assignee." Smith v. Rowe, 3 Wash.2d 320, 323, 100 P.2d 401 (1940).

 

 

 

In my appellant's brief, I repeated the above statement and added:

 

 

When the assignment of the debt was put in issue before the trial court, it erred -- by not applying the applicable statute requiring to prove the assignment by Cavalry and suggesting the only available alternative of defending against the suit brought by Cavalry is the denial of the debt itself – as follows:

(cited judge's stance from the transcript of the hearing)

 

 

 

Yes, they provided a bill of sale signed (allegedly) by OC and on OC's letterhead, which refers to an Excel file, with a print-out of my account information.

 

My objection to their affidavit in my opposition was as follows:

 

 

The Plaintiff has submitted an Affidavit of Claim to the Court, alleging certain facts.

The Plaintiff relies exclusively on Ms. Eileen Gonzalez’s affidavit, who identifies herself as a “Legal Administrator”. Ms. Eileen Gonzalez claims familiarity with the recordkeeping practices of the Plaintiff, and has “reviewed the applicable computer records” that are allegedly kept in the regular course of Plaintiff’s business.

The Defendant states that the Plaintiff’s affidavit pertains to acts and events that allegedly occurred between the Defendant and a third party, FIA Card Services N.A. At no time was the affiant nor any of the Plaintiff’s employees present to witness any purported acts or creation of the records of transactions and communications occurring between the Defendant and FIA Card Services N.A; as such, the affidavit of Ms. Eileen Gonzalez is not based on personal knowledge and falls under the hearsay Rule ER 802 and is inadmissible as evidence.

The Defendant further states that the affidavit is not subject to the applicable hearsay business records exemption because it was not made at or near the time of the purported acts or events, and, therefore, the information contained in the affidavit is hearsay.

The Defendant further states that the underlying documents for the alleged account, annexed in Plaintiff’s Motion for Summary Judgment, were not records kept in the course of regular business by the Plaintiff, but appear to be records kept by Bank Of America, which is not a party to this lawsuit (a business could not lay the proper foundation to admit the records of another business because the requesting business lacked the personal knowledge to ensure reliability). There is no record of who compiled the underlying data specifically, and therefore no way to challenge and cross-examine the accuracy of this data in the course of a trial. The mere acceptance or incorporation of electronically transferred data from a third party, into the Plaintiff’s business records is not enough to satisfy the trustworthiness requirements of Rule ER 803(6). The source of information or the method or circumstances of preparation indicate a lack of trustworthiness and reliability.

 

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after Cavalry's response, I will have one last shot with my appellant's reply brief. I expect their argument to be that the original creditor is a national bank with established record-keeping practices and therefore its records are trustworthy and Cavalry is a reputable debt collection company.

 

Would it be useful if I refer to the following in my reply brief:

Bank of America to Pay $16.65 Billion in Historic Justice Department Settlement for Financial Fraud Leading up to and During the Financial Crisis

?

 

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@sasha0378

 

 

You could include it, but I don't know if it would help you.  From what I read, it appears to be about defective mortgage loans.  Also, the parties involved settled.  The banks were not found liable by a court.  I'm not sure that the judge would agree that the claims made by the DOJ would have anything to do with credit cards.

 

You need to carefully study WA court rulings.  From the rulings I've read, WA courts are not very debtor-friendly.

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Would it be worth mentioning one pending case against the collection attorneys: Suttel & Hammer who employ robo-signing affidavits to stress the lack of trustworthiness of such "authenticating" documents?

 

This is available from pacer.com - the battle has been going since 2010:

Eastern District of Washington  

U.S. District Court (Spokane)  

CIVIL DOCKET FOR CASE #: 2:09-cv-00251-EFS

 

 

 

P.S. Bad news, the NACA attorney, who initiated the suit on behalf and who was arguably enemy #1 of JDBs, died of cancer in 5/2014 :(

 

Here I am attaching a scan of the complaint, which can probably be used to mount attacks on JDB's affidavits, since there have been questions on this same topic. Too late for me, but could be useful for someone else, I hope

Exhibit-C-Excerpts-of-Fraud-Lawsuit.pdf

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@sasha0378

 

 

You could include it, but I don't know if it would help you.  From what I read, it appears to be about defective mortgage loans.  Also, the parties involved settled.  The banks were not found liable by a court.  I'm not sure that the judge would agree that the claims made by the DOJ would have anything to do with credit cards.

 

You need to carefully study WA court rulings.  From the rulings I've read, WA courts are not very debtor-friendly.

@BV80, here is one sample I could find:

http://www.debtorboards.com/index.php?topic=8920.0

 

is probably the closest on the standing issue, which resulted in reversal of summary judgment.

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@BV80, here is one sample I could find:

http://www.debtorboards.com/index.php?topic=8920.0

 

is probably the closest on the standing issue, which resulted in reversal of summary judgment.

 

 

The case in the above link is unpublished, but the court cited some good case law.  Here's a link to the Appellant's brief from the case.

 

http://www.courts.wa.gov/content/Briefs/A02/361515%20appellant.pdf

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Per Rule 14.1, an unpublished opinion cannot be cited in Washington,  but....

 

 

 

We recently explained, “If a party finds a helpful analysis in an
unpublished opinion, the proper way to present it is to cite the
authorities relied on in the unpublished opinion and show how
they apply.” State v. Nysta, 168 Wn. App. 30, 44, 275 P.3d 1162
(2012), review denied, 177 Wn.2d 1008 (2013). This suggestion,
while admittedly a workaround, enables a party to confront the
Court of Appeals with its previous decisions without violating GR
14.1(a).

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The above paragraph was from the Washington Insurance Law Journal.  There's nothing about consumer law here, but rather an analysis of tort cases.  They discuss slip and fall, dog bites, being injured on the job, etc.  The cases are short,  broken down into plain English, are easy to understand, and give an insight into how law is decided.  It's interesting reading.

 

 

http://rmlaw.s3.amazonaws.com/newsletters/Fall2013WashingtonInsuranceLawLetter.pdf

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Do you think if it would be helpful to have the following introduction in my appellant's reply brief:

 

Appellant Bernard Madoff (hereafter “Bernard Madoff”) agrees that this is a simple collection case, which, however, should not have even made to a hearing before the trial court and dismissed before then because Respondent Cavalry (hereafter “Cavalry”) relies on inadmissible evidence (robo-signed affidavits not made on personal knowledge) and misleading and deceptive statements to make its case.
 
This court should be aware that there is an ongoing class action lawsuit in Eastern District of Washington U.S. District Court (Case #2:09-cv-00251-EFS) against the Respondent Cavalry’s attorney of record for violation of Section 1692 of Fair Debt Collection Act by having their debt collecting clients’ affiants make false, misleading, unfair and deceptive statements employing robo-signing practices.
 
Coincidentally, the name of the affiant, Eileen Gonzalez, appears on multiple robo-signer lists in the internet.
 
With the well-known widespread practices of robo-signing across the nation revealed by the recent financial meltdown, when affiants employed by debt collectors work full-time to sign hundreds of affidavits a day without having actual personal knowledge of purported facts and events and very high default judgment rates in such debt collection suits, there is nothing extraordinary in the fact the trial court was misled and admitted Cavalry’s documentation as valid evidence and rule in Cavalry’s favor.

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hard to believe, folks, but summary judgment in plaintiff's favor was reversed and dismissed today on this appeal in a Superior court. I will start producing more details within a few days. Too tired now.

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My opening statement was:

 

I appeal to this court from a District Court’s summary judgment in favor of Cavalry, Plaintiff/Respondent in a credit card collection matter.

 

To save everyone’s time here, I will NOT dispute that I had AN account with Bank of America, from which the plaintiff allegedly purchased the credit card account. However, this is not the point of this appeal.

 

The issues on the appeal are that the trial court erred in determination that the Plaintiff submitted proper and sufficient evidence that the Plaintiff had a valid assignment of the credit card debt in order to establish its standing to bring the collection lawsuit.

 

First of all, when submitting affidavits, the plaintiff failed to comply with Court Rule 56 that requires that such an affidavit be made on personal knowledge, to which I objected in my opposition to plaintiff’s motion for summary judgment and over which I extensively argued in my appeal’s brief.

 

Second, the trial court erred in admitting third party's business records that were not authenticated by the third party, which allegedly produced those records during its regular course of business and allegedly sold to the plaintiff. I objected to the admission of such third party’s business records in my opposition on the ground of hearsay and stipulated that those records do not qualify for the exception from hearsay rule of evidence ER803.

 

As a consequence, the trial court erred in finding that the plaintiff had the standing to sue and therefore the summary judgment was inappropriate. The summary judgment should be reversed.

 

Nothing further.

Thank you.

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I will have to transcribe the argument by the Cavalry's attorney. There was some back-n-forth between the judge and the attorney, after which the judge ruled in my favor.

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Attached is my brief. Caution: this is based on late Mr. Michael Kinkley's excellent appellant's brief Sunde v. Unifund. As an amateur, I may have screwed up badly -- please review and let me know of your comments, I will be fixing them for the future.

APP_BRIEF_REDACTED.pdf

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