Considering arbitration, not sure if it's right

[Ruby4]

I received a letter from an attorney in my state on behalf of Midland that states I am in default of a credit transaction. The original creditor is GE Cap for a store card. The amount said to be owed is redacted. I would either like to invoke arbitration for the alleged debt. The attorney's letter gives me 30 days to dispute, then the payment is due the day after the 30 days.  Midland's letter claims it bought this debt in October of 2014. So would a card agreement still apply since they are not collecting on behalf of GE? Midland has not reported this on my credit report, and the original letter states they will not report if I enter into an agreement and pay by the beginning of February.

 

Thank you!

[fisthardcheese]

I would send a DV letter that doubles as an arbitration demand letter.  I would not say anything about a settlement at all.  Wait for them to get the bill from JAMS and they will want to give this up completely.  Choose JAMS because it will cost them more than AAA and gives you more leverage against them.

 

I would wait at least 20 days from the date of the last letter (close to the 30 day period).  My letter would state: "I dispute this alleged debt.  I demand arbitration with JAMS per the card agreement and I formally request that you forward any required consumer fees to JAMS as stated in the contract."

 

That's all.  Simple and sweet.  I would also send copies of the card agreement and the JAMS filing paperwork along with this letter too.  Send it all CMRRR.  At the same time, I would send the paperwork and a copy of the DV letter to JAMS to get the arbitration started.  Also include a cover letter to JAMS.  State to JAMS that you are submitting a CONSUMER arbitratoin claim and that you have asked the other party to forward your consumer fee per the contract.  I, personally, highlight the part of the contract that says they will pay on the copy I send to JAMS.

 

Once you have a case number from JAMS, that's all you need to beat a suit.  If they file suit after you have an arbitraiton case number, they have just filed in the wrong venue and have just violated the FDCPA.  Filing arbitration now prevents a lawsuit (not that they may not try, but you will show the court they are wrong).  If they file suit before you file in JAMS, then you would need to motion the court with a Motion to Compel private arbitration.  Once the court grants arbitration, follow the steps above with JAMS. 

 

It will take at least 60 days before JAMS sends the first warning of non payment to the JDB.  They may send 3 or 4 letters demanding paymet from them.  The aribtration case may be pending with no action for several months or years.  I would allow this to happen until SOL runs out.  JAMS may close the case for non payment.  This is fine too, as if they try to file suit after this happens you still have an arb defense for court.

[prove-it]

I don't know your state rules but in a nut shell if your card agreement has the Arb. clause it will say who has to pay. I see a lot of people get hung up on, Can I make them pay for Arb. (it says so in the agreement)

 

There are different opinions on this. I look at it this Why bother with all the added drama fighting about who pays and take the risk of getting lost in the court's, delays, possibly missing an important deadline for submitting a doc. because you focused on $250.00

Jams Arb. is capped for the consumer t $250.00 a lot better than $1500.00 plus you might not beaware that when you start  your Jams case you don't have to make that payment for quite awhile. 

If you file 1st. (And you should) if your contract allows it. Jams will send you a letter "Notice of intent to initiate Arbitration" to both parties then it will take months and several attempts to collect the fees. It is a waiting game to see who folds 1st. if neither party advances there fees Jams will drop the case and you will find your self back in court.

 

Also you don't want it to go to Arb. Arb. is just a tool to force the JDB to either drop the case or spend way, way more money then it is worth to them just to get your $1500.00 plus it opens the door to a real settlement that should be in your favor. But that is up to you to decide.

 

What you have to watch out for is the JDB arguing that the agreement that your using is not the right one and the court should not allow it. So when in doubt I assume the worst you should to, and be prepared to file a MTC Arb. (It is real easy)  

 

This can be somewhat avoided if you strike 1st. and start your Arb. case Now. Then the JDB has to disprove your doc's which is a lot harder once you have submitted it as fact with an affidavit.

 

Going through similar case in MA, and The type of court, if it is a judge or a Mag. these things may change your strategy a little but overall you get the idea.              

[Goody_Ouchless]

Contract appears to spell out the steps quite clearly:

1. The party who wants to arbitrate must notify the other party in writing. This notice can be given after the beginning of a lawsuit or in papers filed

in the lawsuit. The party seeking arbitration must select an arbitration administrator, which can be ... JAMS.

2. If a party files a lawsuit in court asserting claim(s) that are subject to arbitration and the other party files a motion with the court to compel

arbitration, which is granted, it will be the responsibility of the party asserting the claim(s) to commence the arbitration proceeding.

 

Looks like you tell them you want JAMS and then it's up to them to do everything else.

[prove-it]

I found your 2012 agreement if you still want it

[Ruby4]

Thank you for the agreement! Could you explain this line a little more: "if neither party advances there fees Jams will drop the case and you will find your self back in court." So if I paid my fees, I should be fine? 

Also, is the "If you ask us to, we will pay all the fees the administrator or arbitrator charges, as long as we believe you are acting in good faith."  part going to be a problem? Seems like it would be a loophole for the attorney to say that I did not act in good faith for some reason. "Good faith" seems vague.

[fisthardcheese]

Thank you for the agreement! Could you explain this line a little more: "if neither party advances there fees Jams will drop the case and you will find your self back in court." So if I paid my fees, I should be fine? 

Also, is the "If you ask us to, we will pay all the fees the administrator or arbitrator charges, as long as we believe you are acting in good faith."  part going to be a problem? Seems like it would be a loophole for the attorney to say that I did not act in good faith for some reason. "Good faith" seems vague.

 

Here is the thing:  You are compling with the contract by asking for the fees.  You show JAMS that you asked them, that the contract says they will pay if you ask, and that's the end of it.  JAMS will then bill them for the fees.  If they want to make the claim that you are not acting in good faith, they will have to pay all of the JAMS fees, get an arbitraitor selected, pay more fees for a hearing to be set, then argue to the arbitrator that you did not act in good faith.  At this point they will have shelled out at least $5k or more just to argue that you owe $250.  If they want to do that, fine. Let them.  At worst, the arbitrator says you owe the filing fee, so you pay back the $250 and let them pay another $5k to set a new hearing date to deal with the actual merrits of the case.

 

That is the entire point of arbitration. Each time a motion is made, objections are raised, or hearings are had, the cost for the JDB or OC shoots up.  A full arbitration complete with an appeal and award can cost them up to $100k or more easily.  That is why it is effective.

 

As I said before, once you get that case number from JAMS by filing the initial paperwork, you are sitting in a very good position.  They have no where else to go without paying 10 times what they claim you owe them, or by violating the FDCPA and getting hit with a federal lawsuit as well.

[prove-it]

Ruby4,

                   If it puts your mind at ease, Your situation is about as clear cut as it can get. You are the text book example of when Arb. is the magic bullet. Remember strike 1st. (They have not filled suit) This is where the wheels tend to fall off the Arb. wagon. When they file suit and then you have to file Motions like MTC Arb. and argue with  a JDB about if the agreement that you submitted is valid. And then having to appeal to a higher court.

 

You don't have to worry about any of that nonsense as:

 

They have not filled suit

you have the correct agreement

 

Smoke Them !!!!!!!!!!!!!!!!!!!!!!!!!!!!

[Ruby4]

Is there a good reason to send the JDB the CC agreement? In that massive arbitration Q&A thread, Linda7 said not to send one to the JDB. I'm just wondering if it's personal preference, or if rules have changed. 

Thanks all! I'm 99.9% ready to smoke them, as prove-it said. I just want to make sure I have everything lined up as much as possible beforehand so I can anticipate any moves they may make. 

[prove-it]

If both agreements are not exact I would use the one closest to the date (2012) and submit it with an affidavit stating this agreement to the best of my knowledge ...........................

 

All your concerns will be addressed one at a time. 1st. things 1st.

 

START ARB.   Check the JAMS rules. If need be post each ? one at a time and then members can help you fill in the blanks .

 

Once you start putting pen to paper it will become clear

(Don't get to bogged down with the JDB and if they want to argue about what the definition of IS, IS)   

 

Cover letters, affidavits, MTC Arb. How many copies, Also the when, where, who, what  & why it's just pushing papers around.

And all is researched, filled out and filled from the comfort of your house.

 

They should be felling the heat shortly, Don't give them any water or shade they will be wilting soon. 

[prove-it]

I sent mine to both the JDB and there lawyer. That covers all your bases and cost's only a few extra bucks.

Unless there is no lawyer listed (YET) Since this is not in court yet. The letter that you received saying that if do not ................. they we will do....................... 

Does it say anywhere on the letter that a lawyer is involved or is it just a demand letter from the JDB. Just to be 100% sure your not  dealing with any in house collections (They sometimes pose as a different Co. but they are just an arm or division within the OC)

 

if this is the OC's DBA co. that is contacting you then Arb may not be of much help because the OC will have the proof needed to fight you in Arb. Not always but they can and have.

 

So lets pump the brakes for just a minuet and verify your not dealing with a branch of the OC. And if it is a JDB then we can stoke the fire. 

[prove-it]

That demand letter should state that (Midland as the assignee of GE Capital) and list your card #  

In the event that the lawyer that sent you the letter is not the one that would be representing them in court is a good reason to send JAMS to both of them Midland and the lawyer listed on the demand letter. If they change counsel after you start your JAMS claim then that's there problem and there responsibility to notify you and JAMS of the change in counsel.

 

Just take a few moments to confirm the info on that demand letter. I still think your in great shape.  

[prove-it]

Check JAMS rules it will say to send one to everyone listed in your JAMS complaint. Unless your dealing with only the OC then you send one to them, if your dealing with a JDB you send it to them instead and not the OC. If there are lawyers listed in your complaint then your need to send one to them also.

 

If you send everything to where you need to, But also send copy's to where they are not required oh well it's only a few extra bucks for postage.     

[Ruby4]

The letter came from an attorney in my state. When I signed onto Midland's website to see what info they had, it said that it was now being handled by the attorney's office. The attorney's letter said that I had until mid-February to send payment directly to Midland, and if I did so, then I would not be considered in default. It also said I could contact the attorney's office to set up a payment plan. The original letter from Midland said it purchased my account. 

[prove-it]

Is Midland the most recent ?

Does it say any where about "Midland As assignee of GE)...................

 

It is always best to verify and confirm but the way it looks (from all angles) is to Send JAMS to Midland and the lawyer they say has the authority to accept payments on there behalf at least for now.

 

Again I don't won't to rain on your parade, I just want you to dot your I's and cross your T's You will be better for it in the long run.

 

May be fisthardrcheese  can take a look see at these little details to see if we missed anything. and maybe streamline things for you. until we get in to the meat & potatoes of JAMS paper work.    

[Ruby4]

 I'll pull out the letter as soon as I get a free moment to check the wording, but I don't think it says anything about them being an assignee of GE.

 

Not that I'm fully considering this, but just curious: is it possible to send a letter that says "I dispute this account, but in the interest of saving time, I am willing to settle this account in full for $XXX. If this settlement is not agreeable, then I wish to begin arbitration proceedings to handle our dispute"? Or is that a no-no to offer a settlement of an alleged debt before asking for arbitration fees?

 

I really appreciate all of your help! Thank you!

[Ruby4]

Also, I found the correct agreement for the specific card that was issued in 2012. Heh.

[Ruby4]

Okay, the letter says the account was sold to Midland and they are now the sole owner of the alleged debt. Then it says that Midland Credit will be collecting on behalf of Midland Funding.

[prove-it]

You have all the leverage, Don't offer and or accept anything at this point. They sent you a demand, Now you send them JAMS Arb.

If they don't try to dispute the agreement. You will get Arb. if they attempt to challenge you (Your striking 1st.) So there is no chance of them saying that you entered in to litigation and therefore you have waived your right  to elect Arb.

 

That is why you need to start Arb. before they start suit. Other wise there is always the chance they will pull some such nonsense.

Then you have to go through the whole MTC route.

 

If it were me I would let them stew for awhile if they are serious about a settlement and you don't feel comfortable with the Arb. proses

offer them a settlement of $250.00 as that would have been the cost of Arb. (if you have to pay based on the contract your using)

 

Other wise smite thee with FIRE !!!!!!!!!!!!!!!!!!!       

[Ruby4]

Okay, sounds good! One last question (for now ), I'm still within my 30 days from when the attorney sent the letter for debt validation. Should I request DV at the same time as requesting arb? Writing something like "I dispute this account. Additionally, I elect arbitration via JAMS to settle any disputes between us"? Or do I need to send them one at a time? Since the attorney is demanding payment before my 30 days is up (since I did not receive the letter the same day they mailed it), this is a violation, yes? And it should be pointed out in my letter?

[prove-it]

Midland Credit and Midland funding are owned by the same Co. If in there letter they say MC. is collection on behalf of MF. then they are acting as the assignee. Either way if your not 100% sure there is no harm in sending it to both MC & MF it will most likely end up in the same place.

 

When you get to the point of sending out doc's I would send everything USPS Certified R.R.R to the  Court, JDB, There lawyer, JAMs  (To All) Make sure to send copy's to anyone you have listed in your JAMS complaint, The more you list in your complaint the more money it will cost them to fight you.

 

Again I can't stress this enough You don't want to go to Arb. It is just a tool to give you leverage. And right now you are loaded with leverage. A lot of people pondering the Arb. route would love to be in the position your in.  

[prove-it]

Don't believe anything that they say or do. They are not bound by anyone to wait 30 days (unless it is court ordered) Don't talk to them.

 

Responding to Debt validation you will be sending your requests/answers not only to the JDB but also to the court. So there is always the chance that they might view this as entering into litigation. Fisthardcheese and others have said weave Arb. with JAMS into the DV request this may be a better way to go for you.

 

Maybe Fisthardcheese could help you tweak your DV/JAMS request to cover all your bases. It just needs to be clear and simple. A few lines.

 

Again Act don't react, Make them scramble to react to your Demands.        

[Ruby4]

Great, thanks! I'll have to send you a fruit basket when this is all over. I sent a message to Fisthardcheese to see if he could skim the updates of my thread when he gets a chance, and help me draft an iron-clad letter.

[fisthardcheese]

Here is a step by step the way I would do it:

 

1. Type up a DV/Arbitration Demand letter.  My previous reply states exactly what I would say in that letter, which would be; "I dispute this debt.  I am formally demanding arbitration with JAMS and am requesting that you forward the consumer fees per the card agreement contract."  This is all that needs to be said.  Do not go into any extra details that may end up shooting you in the foot later.

 

2. Go to the JAMS website, http://www.jamsadr.com/consumer-arbitration/and read the rules for consumer arbitration.  Then download and fill out the JAMS Demand forms here:  http://www.jamsadr.com/files/Uploads/Documents/JAMS_Arbitration_Demand.pdf  As required by JAMS rules, send a copy of these filled out forms AND a copy of the card agreement along WITH your DV/Demand letter to the law firm.  In the JAMS demand form, you will list Midland as the respondent and the law firm that sent the letter to you as their attorney/representative.  You list yourself as the claimant.  In the "nature of dispute", you can put some generic information for now, such as "consumer credit dispute, FDCPA and state law violations".  Make it that simple. Don't over complicate it.

 

3.  Send ALL of the JAMS paperwork, the copy of the card agreement and your demand letter to the law firm CMRRR.

 

4.  Send 2 copies (per JAMS rules) of the exact same paperwork, including your DV/Demand letter and the card agreement to JAMS.  Add an additional cover letter for JAMS that simply states you are submitting a claim for consumer arbitration and that per the contract you have demanded that Midland pay your consumer fee.  (I would highlight the line in the contract that says they will pay if you ask).  Send it CMRRR.

 

That's it.  You are done.  You will get an email from JAMS confirming they are processing your demand paperwork. They may ask you for proof of service, which means you will email them a copy of the signed green card showing the law firm recieved your paperwork.  They should then be able to give you your case number.  Then you just sit and wait.  You have done everything you can and you are now in the perfect position.  Now you just wait and see what they try to do.

 

Do not add any extra information to your letters. Make them simple and to the point.  Do not point out what FDCPA violations you have at this time, that will be for disovery once they have paid their fees to JAMS.

[prove-it]

Ruby4,

 

Please disregard when I mention about sending doc's to the court in the last few posts, I'm just so used to talking to people about MTC's for Arb. and trying to get Arb. after a suit has started.

 

After all you are somewhat of a   "Arbitration Unicorn" Very Rare.  

 

But it looks like Fisthardcheese has it all laid for Ya, Just a little careful placement of pen and paper, then just sit back and wait for them to  "Slither Away"