ittldo

Being taken to court by Midland Funding

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Here is my questionnaire info.

 

1. Who is the named plaintiff in the suit?

Midland Funding LLC

 

2. What is the name of the law firm handling the suit? (should be listed at the top of the complaint.)

 

 

3. How much are you being sued for?

1300

 

4. Who is the original creditor? (if not the Plaintiff)

Credit One

 

5. How do you know you are being sued? (You were served, right?)

Served with summons paper.

 

6. How were you served? (Mail, In person, Notice on door)

In person, someone delivered to me.

 

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

As far as I know, it was filed with a district court.

 

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

I have not spoken to them at all.

 

9. What state and county do you live in?

Washington state, Cowlitz county.

 

10. When is the last time you paid on this account? (looking to establish if you are outside of the statute of limitations)

2014

 

11. What is the SOL on the debt? To find out:

Looked on creditcards.com and it says 6 years for WA.

 

12. What is the status of your case? Suit served? Motions filed? You can find this by a) calling the court or B) looking it up online (many states have this information posted - when you find the online court site, search by case number or your name).

Summons was delivered, that's it.

 

13. Have you disputed the debt with the credit bureaus (both the original creditor and the collection agency?)

No

 

14. Did you request debt validation before the suit was filed? Note: if you haven't sent a debt validation request, don't bother doing this now - it's too late.

No

 

15. How long do you have to respond to the suit? (This should be in your paperwork). If you don't respond to the lawsuit notice you will lose automatically. In 99% of the cases, they will require you to answer the summons, and each point they are claiming. We need to know what the "charges" are. Please post what they are claiming. Did you receive an interrogatory (questionnaire) regarding the lawsuit?

It says 20 days after the service or summons

 

16. What evidence did they send with the summons? An affidavit? Statements from the OC? Contract? List anything else they attached as exhibits.

Nothing at all. In the complaint, the first sentence is "The plaintiff is a legal entity having paid all licenses and fees if required by law and is authorized to bring this action."

 

I have seen a similar thread in this state, but i never did see the outcome. Looking for some ideas and help on how to win this. 

This is my response to the complaint.

Superior Court of Washington, County of Cowlitz

 

Plaintiff:

 

 

No.  

MIDLAND FUNDING, LLC,

 

 

ANSWER AND AFFIRMATIVE DEFENSES

v.

 

 

 

Defendant:

 

 

 

MICHAEL  BOLLICH

 

 

 

 

 

 

 

 

                                                                      I. Answer

 

            Defendant answers the complaint as follows:

 

1.                  I admit the statements in paragraph numbers 2.

2.                  I deny the statements in paragraph numbers 1 except for the following statements:

N/A

3.                  I lack knowledge about the truth and so deny the statements in paragraph number(s) 3, 4, 5, 6, 7, and 8.

 

                                                          II. Affirmative Defenses

 

My other defenses are:

T  General Denial: I deny the allegations in the Complaint

T  Plaintiff lacks standing and does not have authority to bring this lawsuit.

£  I am eligible for Charity Care for my hospital debt.

£  I did not receive a copy of the Summons and Complaint

£  I received the Summons and Complaint, but service was not correct as required by law.

T  I do not owe this debt.

£  I am a victim of identity theft or mistaken identity. I am not responsible for this debt.

£  I have paid all or part of the debt.

T  I disagree with the amount of the debt/the amount is incorrect.

£  Statute of limitations (the time has passed to sue on this debt).

£  This debt was discharged in bankruptcy.

£  The collateral (property) was not sold at a commercially reasonable price.

£  Unjust enrichment (the amount demanded is excessive compared with the original debt).

£  Violation of the duty of good faith and fair dealing.

£  Unconscionability (the contract is unfair.)

T  Laches (Plaintiff has excessively delayed in bringing this lawsuit to my disadvantage).

£  Defendant is in the military.

 

DATED this _________ day of ________________, 20___.

 

 

 

 

___________________________________________

 

(Signature)

 

 

Name:

 

 

Address:

 

 

 

 

 

Telephone:

 

I haven't filed this yet so please let me know what you think.

  

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Your defenses don't make sense. Credit One doesn't issue hospital debts. Also it's nonsensical to simultaneously claim you paid the debt,  that it was included in bankruptcy, that the collateral was sold and that you were a victim of ID theft.

As far as the lawsuit, I'd be looking to see if there is an arbitration clause in your credit card agreement.  You really don't want to be trying to defend against Midland in court. 

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Only the defenses that are marked with a T are being claimed. I didn't realize the formatting didn't transfer. 

If they didn't include any cardholder agreement, and i don't have a copy is there a good way to research it?

I have seen a few threads about beating  Midland Funding in court but they are a few years old. Is there some new information that  makes it harder to win cases against them?

 

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3 hours ago, ittldo said:

My other defenses are:

T  General Denial: I deny the allegations in the Complaint

T  Plaintiff lacks standing and does not have authority to bring this lawsuit.

T  I do not owe this debt.

T  I disagree with the amount of the debt/the amount is incorrect.

T  Laches (Plaintiff has excessively delayed in bringing this lawsuit to my disadvantage)

WHY do you assert you do not owe the debt? 

WHY do you disagree with the amount?

You can try a laches defense but odds on it working are slim to none.

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My reasoning behind these defenses are ( as I understand in my little bit of research):

It is up to the plaintiff to prove that I own the debt. Without proof of owning the debt I would have to disagree with the amount owed as there would be nothing owed.

I am very new at any of this so i appreciate your input. 

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2 hours ago, ittldo said:

I have seen a few threads about beating  Midland Funding in court but they are a few years old. Is there some new information that  makes it harder to win cases against them?

There's been a few precedents set in the last few years that have made it much easier for Midland to win, but really, courts are by and large treating the old strategies as 'smoke and mirrors'.

Take a look here to see if you can find an applicable credit card agreement. 

https://www.consumerfinance.gov/credit-cards/agreements/

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I was able to locate the agreement on the link. There is no arbitration in this case due to it being in small claims court. 

I guess my options at this point are to file my response or reach out to Midland or the attorney office representing them and try to settle?

 

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5 hours ago, ittldo said:

It is up to the plaintiff to prove that I own the debt.

I think you mean that you "owe" the debt.  They have copies of statements with your name and address on them.  In many courts that is more than enough proof that you opened the account, used it, and the subsequent default is your responsibility.

5 hours ago, ittldo said:

Without proof of owning the debt I would have to disagree with the amount owed as there would be nothing owed.

They did send proof of assignment.  They also pled in their complaint that they are the assignee from the original creditor laying the foundation for their standing.

2 hours ago, ittldo said:

I guess my options at this point are to file my response or reach out to Midland or the attorney office representing them and try to settle?

File the response and start REALLY studying.  You can settle at any time prior to trial.  If you put up enough of a fight Midland just might back down and drop it.  To defend this you cannot just say "I don't think they own it so I don't owe it."  You have to be able to effectively challenge their standing.  The problem is doing that is not as easy as it used to be.  In the past the JDB would not come to court with the assignment and bill of sale for the account.  After Midland got nailed by the CFPB along with a few other large JDBs they entered into a consent judgment to not file suit until they DID have that proof.  The old defense tactics no longer work.  The creditors have adjusted their plan of attack and approach to litigation.  Consumers have to step up their game to win.

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6 hours ago, ittldo said:

There is no arbitration in this case due to it being in small claims court. 

What does the "small claims" exemption from your agreement say?  And are you looking at an agreement dated no later than 2014?

4 hours ago, Clydesmom said:

If you put up enough of a fight Midland just might back down and drop it.

I haven't seen this happen in years.  Capped legal fee agreements have eliminated any incentive JDB plaintiff's once had to walk away from a debt.  Better to just plan on either arbitration (if you can) or challenging their records.

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I'm tired and I'm probably too inclined to be blunt when I'm tired.  You said you're in District Court, presumably Small Claims Division, yet the answer says Superior Court.   The first thing you absolutely need to know is which court you're in because you need to know the court rules for the court you're in.

My experience is limited to Superior Court, but the laws are the same.  Court rules are different, I assume.  Why is the plaintiff's lawyer not listed with your information?   I'm curious:  They're not trying to sue in small claims without an attorney, are they?

You need to get the dates nailed down.  I don't care what some website says the SOL is, and the court doesn't care either.  It's about the ability to research Washington law and precedents, and convince the judge you're right and why you're right.  My research indicates that the SOL can be as short as 3 years, depending on a number of factors.   What theory are they suing on?  Can you use the borrowing statute?  etc. etc.  But if they got in under 3 years, then it wouldn't help anyway.

Lack of standing is always ground zero with a JDB but. . .they will introduce their evidence and if you want to win then you have to know the court rules and WA law to know how to get everything they try to introduce stricken.  A little farther down in this forum there is a thread titled An Interesting Read that is an Idaho opinion--it is essentially a roadmap for make your argument for striking anything they try to introduce.  Obviously, it would be helpful to have Washington references, but you can drag in stuff from other states, too.

Washington is arb friendly if you can go that way.  I thought about it, but preferred my chances in court.

And this is where I'm going to be blunt--unless you're willing to devote a ton of time, unless you're good at writing, unless you're comfortable with oral argument, unless you know how to research--you'll probably lose.  I've been through this multiple times and the truth is this:  I'd gladly pay $1300 not to go through it all again.  Make no mistake:  Midland is in court here a lot.  They apparently usually have their ducks in a row.  They don't lose often, and they don't appear to be easy to back down.

I had tried to countersue with a WA FDCPA claim, but I literally didn't have enough time to do the research I needed get done and abandoned it.  With a relatively small amount, you may be able to find some mistake they've made to exploit.  Review--I think it's RCW 19.16.250 but I'm not sure. 

Time for bed now.  Good luck.

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8 hours ago, MisterLoon said:

Washington is arb friendly if you can go that way.  I thought about it, but preferred my chances in court.

Just wanted to make a point here.  The difference between court and Arbitration is there are no "chances" with arbitration.  Midland will dismiss once it's clear they have no choice but to go to arbitration.  That's what makes it so effective against them.

8 hours ago, MisterLoon said:

And this is where I'm going to be blunt--unless you're willing to devote a ton of time, unless you're good at writing, unless you're comfortable with oral argument, unless you know how to research--you'll probably lose. 

It takes professional attorneys years to get good at these things, and that's with daily practice.  Of course consumers win against JDBs from time to time, but those times have way more to do with luck (pro-consumer judge, mostly) than skill.  If you end up with a judge that favors JDBs, or even one that tends to run down the middle of the road, your chances of beating Midland is almost nil.

Quote

I'd gladly pay $1300 not to go through it all again.  

OP's debt is $1,300.  He/she could settle with Midland for probably 75% of that.

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Thank you all for your input. I decided to do even more research and I am still torn, however I think my plan of action is going to be this: Reach out to the attorney representing midland and see what settlement offer i might be able to work out. While also cleaning up my response and be prepared to file if we can't reach something reasonable with them.

Is there any ways to tip the scales in my favor for a lower settlement?

 

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Let me go into Arb in Washington a bit, and why I don't like it as a strategy although I have to admit some people that have come through this board have had success with it.

The first problem I have with it is philosophical--how can I invoke an agreement I don't acknowledge having made in the first place?  You can't invoke an agreement without also acknowledging you've entered into that agreement.  Starting behind the eight ball.

But, that aside, the entire strategy basically hinges on running costs and assuming that it won't be cost effective for the JDB or OC to pursue it.  Admittedly, that sometimes works, but I've spent hours studying cases at the court house.  Let me explain how it can go really, really bad in a hurry using this $1300 case as an example.

Motion court to compel arb.  Court compels arb.  Now Midland has a problem.  It's expensive to arbitrate, but they're  under court order.  For whatever reason, they don't pull or settle at this point--they go ahead with the arb.  If you read and study how RCW 7.04 (I think it's 7.04) WA arb is written and applied, the court case isn't dismissed--the arb goes forward and the results are brought back to the court to be certified, modified, amended, etc.

So, your $1300 case goes to arb, Midland spends $6000 on arb, you lose, it goes back to court and Midland petitions for certification of $1300, and asks for costs of $6000 and attorney fees of $2400, and suddenly you're staring at a judgment of around $10K with statutory interest at 12%.

If you go to the courthouse and study cases, this happens more than you'd realize--probably because none of the people come to the board to explain how they screwed up so badly.

There is simply no panacea--either court or arb can go okay or very, very badly.  Based on what I've seen, I've never been the huge fan of arb that some people are.

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42 minutes ago, MisterLoon said:

The first problem I have with it is philosophical--how can I invoke an agreement I don't acknowledge having made in the first place?  You can't invoke an agreement without also acknowledging you've entered into that agreement.  Starting behind the eight ball.

You don't  have to acknowledge making the agreement.  One who claims to be a non-signatory (the consumer) can MTC compel a signatory (OC or JDB) to arbitrate.  There's plenty of case law supporting that fact.

Granted, you would not be able to claim that the JDB doesn't own the account because there must be a signatory.   Therefore, you're admitting the JDB owns the account.  But considering JDBs will rarely arbitrate a debt collection lawsuit, it's not an issue.

42 minutes ago, MisterLoon said:

Motion court to compel arb.  Court compels arb.  Now Midland has a problem.  It's expensive to arbitrate, but they're  under court order.  For whatever reason, they don't pull or settle at this point--they go ahead with the arb.  If you read and study how RCW 7.04 (I think it's 7.04) WA arb is written and applied, the court case isn't dismissed--the arb goes forward and the results are brought back to the court to be certified, modified, amended, etc.

So, your $1300 case goes to arb, Midland spends $6000 on arb, you lose, it goes back to court and Midland petitions for certification of $1300, and asks for costs of $6000 and attorney fees of $2400, and suddenly you're staring at a judgment of around $10K with statutory interest at 12%.

Again, it's rare for a JDB to arbitrate.   In fact, I don't recall Midland agreeing to arbitrate a debt collection lawsuit.

If a JDB were to agree, it would not necessarily receive its arbitration costs.  First, it depends upon the language in the agreement (each side bearing its own costs or own attorney fees).   Second, an award of costs is left up to the discretion of the arbitrator.   If the arbitrator doesn't award arbitration costs, I don't that a judge has that right because all he can actually do is confirm the arbitration award.  While he might be able to award attorney fees, I'm not sure he has the right to award arbitration costs when the arbitrator chose not to do so.

I'm not a HUGE fan of arbitration because I can see things eventually backfiring in some way.  For instance, if more consumers start taking frivolous claims to arbitration, I can see arbitrators catching on and awarding costs to creditors. 

OR it could cause more OCs can eliminate arbitration from their agreements.   In that event, we're back to arguing in court.  

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43 minutes ago, MisterLoon said:

For whatever reason, they don't pull or settle at this point--they go ahead with the arb. 

I have never seen Midland go to arbitration and I've seen reports of other JDBs walking away from a $30k debt.  It just doesn't fit their business model of 'buy low,  collect high'.

OCs on the other hand will almost always arbitrate anything over $2,000. Below that amount is a crap shoot with an OC depending mostly on the creditor. I had Cap1 dismiss a $2,000 lawsuit when I backed them into arbitration, but that was 7 years ago. I doubt I'd be so lucky these days. 

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1 hour ago, MisterLoon said:

So, your $1300 case goes to arb, Midland spends $6000 on arb, you lose, it goes back to court and Midland petitions for certification of $1300, and asks for costs of $6000 and attorney fees of $2400, and suddenly you're staring at a judgment of around $10K with statutory interest at 12%.

If you go to the courthouse and study cases, this happens more than you'd realize--probably because none of the people come to the board to explain how they screwed up so badly.

There is simply no panacea--either court or arb can go okay or very, very badly.  Based on what I've seen, I've never been the huge fan of arb that some people are.

Does "RCW 7.04 (I think it's 7.04) WA arb" allow for the court to award costs and fees that weren't part of the arbitration award?

Most jurisdictions that have statutes based on the UAA or RUAA allow only the confirmation of the arbitration award.  If jurisdiction was passed to the arbitrator, it is within his or her discretion whether or not to award fees and costs  (except in California for consumer arbitration).  The two major arbitration firms have such provisions in their rules and even spell it out explicitly in the cover letter that is sent in response to the filing of any new arbitration case.

Maybe Washington state is different?  You've seen confirmation awards in Washington state court that not only confirm the arbitration award but also order costs and fees assessed not by the arbitrator but by the court?

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6 minutes ago, Harry Seaward said:

I had Cap1 dismiss a $2,000 lawsuit when I backed them into arbitration, but that was 7 years ago. I doubt I'd be so lucky these days. 

It depends on the OC.  Cap1 and BofA removed arbitration from their agreements.

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General reply--all points granted.  I don't like the arb strategy in Washington state.  Unlike some states where going to arb can get you a dismissal of the court action, here the court action remains open and the court has discretion, pursuant to the arb act, to modify, assign costs, and so on.  And yes, much of the time, electing arb will somehow or another make it go away--but not always.   And when a case goes bad. . .

Just want to make sure the OP knows that there are risks involved.

Ittledo, the one thing I know nothing about is how to settle.  I fought everything.  But--one thing to bear in mind is this: Washington is a pocket docket state.  That means the court action is usually initiated by service.  Does the summons have a case number?  Did you check the docket to see if the case has been filed yet?  Usually--and bear in mind I haven't been following this closely for the last two-three years--a JDB will forward a bunch of cases to an attorney and they'll serve 'em.  Then they wait to see who pays up and only file (and pay the filing fee) for the ones they haven't heard from or the ones that answered.

In practical terms, that means that the ones that pay or work out a settlement never have a court case and judgment that shows up on the public record--and therefore it doesn't show up on a credit report either.  If they file (whether you answer or not), they frequently insist on a stipulated judgment to settle, and that does show up eventually on your credit report.  So when you're settling, you'll have to decide how much all that is worth to you and plan your settlement strategy accordingly.

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7 minutes ago, MisterLoon said:

General reply--all points granted.  I don't like the arb strategy in Washington state.  Unlike some states where going to arb can get you a dismissal of the court action, here the court action remains open and the court has discretion, pursuant to the arb act, to modify, assign costs, and so on.  And yes, much of the time, electing arb will somehow or another make it go away--but not always.   And when a case goes bad. . .

Just want to make sure the OP knows that there are risks involved.

Ittledo, the one thing I know nothing about is how to settle.  I fought everything.  But--one thing to bear in mind is this: Washington is a pocket docket state.  That means the court action is usually initiated by service.  Does the summons have a case number?  Did you check the docket to see if the case has been filed yet?  Usually--and bear in mind I haven't been following this closely for the last two-three years--a JDB will forward a bunch of cases to an attorney and they'll serve 'em.  Then they wait to see who pays up and only file (and pay the filing fee) for the ones they haven't heard from or the ones that answered.

In practical terms, that means that the ones that pay or work out a settlement never have a court case and judgment that shows up on the public record--and therefore it doesn't show up on a credit report either.  If they file (whether you answer or not), they frequently insist on a stipulated judgment to settle, and that does show up eventually on your credit report.  So when you're settling, you'll have to decide how much all that is worth to you and plan your settlement strategy accordingly.

I believe this is the applicable WA statute:


RCW 7.04A.250
Judgment on award—Attorneys' fees and litigation expenses.
(1) Upon granting an order confirming, vacating without directing a rehearing, modifying, or correcting an award, the court shall enter a judgment in conformity with the order. The judgment may be recorded, docketed, and enforced as any other judgment in a civil action.
(2) A court may allow reasonable costs of the motion and subsequent judicial proceedings.
(3) On application of a prevailing party to a contested judicial proceeding under RCW 7.04A.220, 7.04A.230, or 7.04A.240, the court may add to a judgment confirming, vacating without directing a rehearing, modifying, or correcting an award, attorneys' fees and other reasonable expenses of litigation incurred in a judicial proceeding after the award is made.

Is there another statute that allows judges to award costs and fees relating to the arbitration proceedings?

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40 minutes ago, MisterLoon said:

Unlike some states where going to arb can get you a dismissal of the court action, here the court action remains open and the court has discretion, pursuant to the arb act, to modify, assign costs, and so on. 

In some jurisdictions, a court will sometimes dismiss the action after a motion to compel arbitration is granted.  But generally that is a considered to be a mistake, and it is far more common for the case to remain non-adjudicated pending the completion of arbitration by way of an implicit or explicit stay.  A stay seems to be what the UAA/RUAA (and arguably the FAA) require.

You mentioned that based on your study of cases at the court house in WA, court awarded costs happen far more often than people realize.  Do you have some sample cases for which you obtained the documents?

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No, I did not make copies of anything because I chose not to pursue that route.  There were a surprising number of cases given the relatively small size of the county and the impression I'd always gotten from the board that JDB's never go to arb.  Admittedly, I don't remember seeing many cases involving small amounts--5k was pretty much the low end.  As I recall, the court would generally just confirm the arbitration and add attorney costs while the matter of the cost of arbitration was part of the agreement, but there were cases where quite a bit of discretion was exercised and apparently built into the arb act here.  And it's hard to say if any of the cases I reviewed would have stood up in appeal.  Most cases simply aren't appealed.

At the end of the day, all I could do was research as best I could and make the best informed decision for myself that I could, bearing in mind the agreements I would have to deal with, how costs might be assigned, how local judges have a history of viewing things, and so forth.  For me, all things considered, I didn't want arb.  But my cases were all much larger than this case, I had assets waiting to be grabbed , and I was pretty sure that I wasn't going to easily deter anyone because of the cost of arb. 

My intent isn't to necessarily dissuade anyone, but one needs to be aware of what they may be getting into.  Any strategy based on running costs can come back to bite you here in Washington.  Basically, I see everyone saying:  Elect arb--they won't pursue it 'cause it costs too much.  But you should be aware that they may pursue it and those costs boomerang back on you.   And for whatever reason, sometimes people draw the Ziggy straw like that guy in Florida that got into it with Cap 1 over a $600 claim and ended up getting stuck with $102K in Cap1 legal costs.

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