Help Please. Being Sued in MI by Cavalry for Past Debt

[BitsyM]

Can someone please offer some advise as to what steps I should take?  Here's a brief rundown-

Monday evening someone was pounding on the door.  I did not hear them.  I was working in my basement and saw them later via the Ring doorbell playback.  I left the house to pick up my daughter around 9pm and saw that there was a paper taped to my glass door that stated that someone was trying to provide me with legal documents.  There was a name and telephone number on the paper, and my name, but nothing in the date section.  It did not seem very professional in its appearance.  I was suspicious of the validity and authenticity, but still feeling scared and anxious.  Once I returned home, I immediately googled the name of the company noted on the paper.  Pro Process.  It seemed to be a legitimate process serving company.

The next morning at 9am, I called the woman whose name and number was written on the paper.  She told me that she had legal papers to serve me and asked for a good time.  I told her that I was working all day, but could meet her after I dropped my daughter off at swim practice, at a location near the facility.  We met, she had me sign a piece of paper and handed me a stapled bunch of crumpled looking papers.  The top one is a carbon type paper and I believe all of the rest to be the actual summons?  This was Tuesday 04/23/2019.

 

I know that I need to file an answer to the court, from what I have read online.  I'm not quite sure how to fill out the answer document.  I found the document on the court website (52-1 District Court).  I am about to pull a copy of my credit report, as I don't remember ever having an account with Citibank (the original creditor listed).  They did include copies of two old statements from a billing period of 07/18/14-08/19/14.  No charges made, but a payment of $39.20  The other statement was from billing period 08/20/2014-09/17/2014.  No payments, no charges.  I'm guessing that the last payment that was made was 08/06/2014.  I'm really not sure and don't know when the card was even used.  The address on the statement was from a Missouri address that I moved from in October 2014.  I have been in Michigan since that time.

The summons is stamped that it was received for filing on 03/18/2019, but I did not receive this summons until 04/23/2019.  I'm still okay to respond with my answer to the complaint, correct?

The attorney for the plaintiff -

Weber & Olcese, P.L.C

Michael J. Olcese P46247

Geoffrey Werber P67124 (not sure if "Werber" is a typo, base on the name of the firm.  It also has Werber on the complaint)

 

Also included in the papers was a Bill of Sale and Assignment.  This is dated 06/27/2016.  Sale of Citibank accounts to Cavalry SPV I LLC., Credit card Fact Sheet, Card Agreement, Arbitration information.

 

There is nothing with my signature.

 

Can anyone help me?  I've never even gotten a traffic ticket, let alone been sued.  The debt that they are claiming as being owed/damages is $2,551.59.  Do I need to contact an attorney?

Thank you in advance for any assistance.

[Brotherskeeper]

@BitsyM Can you afford to retain an attorney? If so, that is always advisable--even just for a free consultation. The National Association of Consumer Advocates (NACA) is a good place to find an experienced consumer attorney: https://www.consumeradvocates.org/find-an-attorney?field_areas_of_practice_list_value=Debt+Collection&field_practice_states_value=MI

In Michigan, an answer to a complaint is due into the court and mailed to the attorney listed on the complaint within 21 days:

Rule 2.108 Time

(A) Time for Service and Filing of Pleadings.

(1) A defendant must serve and file an answer or take other action permitted by law or these rules within 21 days after being served with the summons and a copy of the complaint in Michigan in the manner provided in MCR 2.105(A)(1). [Rule 2.105 Process; Manner of Service (A) Individuals. Process may be served on a resident or nonresident individual by (1) delivering a summons and a copy of the complaint to the defendant personally;]

When you have a moment to collect your thoughts, read this thread on the strategy of using arbtiration rather than remaining in court. In Michigan, this type of lawsuit with an attorney representing the debt buyer can't be brought in small claims court. Citibank has an arbitration exception for small claims court; you are not in small claims. This will make more sense after you read below:

 

[Brotherskeeper]

1 hour ago, BitsyM said:

Geoffrey Werber P67124 (not sure if "Werber" is a typo, base on the name of the firm.  It also has Werber on the complaint)

He's listed as an attorney with the firm on its website.

[BitsyM]

Thank you for the arbitration information.

So I'm going to fill out my answer to file with the court.  Should I file the MTC at the same time?

I appreciate the help :)

[Brotherskeeper]

On 4/25/2019 at 11:11 AM, BitsyM said:

Also included in the papers was a Bill of Sale and Assignment.  This is dated 06/27/2016.  Sale of Citibank accounts to Cavalry SPV I LLC., Credit card Fact Sheet, Card Agreement, Arbitration information.

Can you please post the "Arbitration Information" they included? 

 

1 hour ago, BitsyM said:

So I'm going to fill out my answer to file with the court.  Should I file the MTC at the same time?

Did you decide not to at least consult with an attorney? There are several recent Michigan threads that contain Michigan-specific examples of an answer and a motion to compel arb (MTC). Have you read them?

We need to see the complaint's allegations to see if you're being sued on an account stated cause of action. This is important for your answer. Was there an affidavit included with attached papers?

 

[BitsyM]

On 4/26/2019 at 1:15 PM, Brotherskeeper said:

Can you please post the "Arbitration Information" they included? 

 

Did you decide not to at least consult with an attorney? There are several recent Michigan threads that contain Michigan-specific examples of an answer and a motion to compel arb (MTC). Have you read them?

We need to see the complaint's allegations to see if you're being sued on an account stated cause of action. This is important for your answer. Was there an affidavit included with attached papers?

 

Here's what I received when I was served.

04.23.2019_Redacted.pdf

[Brotherskeeper]

@BitsyM This is a breach of contract suit and they helpfully provided the agreement they claim governs the account. The arbitration section of the agreement lists AAA or JAMS. If you decide to use the arb strategy Fisthardcheese has outlined, you will need to choose which arbitral forum you want to use. I believe AAA charges a consumer $200 to file and JAMS charges $250. There is a term in the agreement's arb section that states they will pay that fee if you ask and they determine there's a good reason. If you qualify as indigent in Michigan court, that is a good reason. 

You will need to draft an Answer to this Complaint. If you wish to use arb, you will need to include in your Answer a separate section titled AFFIRMATIVE DEFENSES to list an agreement to arbitrate disputes. The motion  to compel arbitration may be filed at the same time as your Answer, or soon after. Getting in the Answer by the deadline is the most important task. Post your draft here and ask questions. (The court rules allow you to file an amended Answer once without asking permission within 14 days after your first Answer is filed, if you need to do so. This takes a bit of the pressure off if you were to discover you made an error on the first Answer.) 

[BitsyM]

Thank you so much.  I'm going to work on the draft of the answer this evening and will follow-up once I get started.

 

From reading through the information that was linked, I definitely think that I'll try the arbitration route using AAA.

 

This is so stressful....

[BitsyM]

This may be a really stupid question, but the Answer for the complaint (attached) states that "paragraph numbers in the answer must correspond to paragraphs in the complaint".  The complaint doesn't have paragraphs.  It doesn't make sense with the numbers on the complaint.  

 

The attached form is directly from the court website.

 

Any suggestions?

Civil Answer.pdf

[Brotherskeeper]

2 hours ago, BitsyM said:

The complaint doesn't have paragraphs.  It doesn't make sense with the numbers on the complaint.  

#1 is paragraph 1, #2 is paragraph 2, etc. Each numbered paragraph is a separate allegation or allegations. 

Jurisdiction

1.

2.

3.

Breach of Contract

6.

The fill-in Civil Answer form is so different than what you'd prepare using your own case header and Answer with Affirmative Defenses. The instructions are very helpful for filing and serving. You can use it, but it isn't that difficult to make your own case header template to use for all of the court filings you'll need with your motion to compel, notice of motion and hearing, etc. You can copy the header and format from their Complaint and add in the case number and judge's name. 

Of course this is stressful! The good news is that there is a lot of help and experience on this forum, including examples of all of the documents you're going to submit for you to modify with your specific info. They've made this easier for you by giving the court the cardholder agreement with the arb clause in it. 

[BitsyM]

Slightly off-topic, but I just got around to pulling all credit reports from all 3 bureaus.  No where on any of the 3 is the original Citi account.  I am going to double check them all again, but I was specifically looking for Citi and the only mention of Citi is in the Cavalry Collection account.  Is that normal?  

[Brotherskeeper]

Just now, BitsyM said:

Slightly off-topic, but I just got around to pulling all credit reports from all 3 bureaus.  No where on any of the 3 is the original Citi account.  I am going to double check them all again, but I was specifically looking for Citi and the only mention of Citi is in the Cavalry Collection account.  Is that normal?  

I don't know if it's normal or not, but Citi may stop reporting its tradeline once the account is sold. This happened in my brother's case. 

[Clydesmom]

53 minutes ago, BitsyM said:

Slightly off-topic, but I just got around to pulling all credit reports from all 3 bureaus.  No where on any of the 3 is the original Citi account.  I am going to double check them all again, but I was specifically looking for Citi and the only mention of Citi is in the Cavalry Collection account.  Is that normal?

It is the new normal.  After the recession of 2008 consumers fought back against suits with counter claims for FDCPA and FCRA violations.  Now when a debt is sold the purchaser typically includes the requirement that the original creditor delete their trade line until litigation is over so that there are no counter claims filed against them.

[BitsyM]

@Brotherskeeper and anyone else who may have a free moment to look over what I plan to file at the court today.  

 

I am finishing up my civil answer right now, but attached are the draft of the MTCA and the letter that I will be sending to the plantiff's attorney.  

Please let me know if anything needs to be changed.  I used @LabLady documents that she so kindly shared as a starting point for my documents.

Thank you in advance for any help that you can provide and for all of your assistance thus far.

MTCA 05.10.2019.docx Notice of Arbitration Election 05.10.2019.docx

[Brotherskeeper]

@BitsyM You wrote:

"1.    That on or about March 18, 2019, Plaintiff filed its Complaint against Defendant.
2.    Defendant moves this court to compel binding Private Arbitration based on the terms and conditions of the Credit Card Agreement (see Exhibit A, attached)."

I make the following suggestions for you to consider incorporating into your motion:

      1.  Defendant was personally served with the Summons and Complaint in the above-captioned matter on or about XXXX, XX, 2019. Plaintiff alleges it is an assignee of Defendant's account with Citibank, N.A. Attached as a Complaint exhibit is a "CARD AGREEMENT" that Plaintiff asserts is the contract that governs the subject account. This Card Agreement contains a binding Arbitration provision (Plaintiff's Exhibit, pages 9-13), incorporated herein by reference.

     2.  On XXX, XX, 2019, Defendant filed and served her Answer and Affirmative Defenses.  Affirmative Defense I asserts that the existence of a binding agreement to arbitrate disputes bars Plaintiff's claims. (Defendant's Answer, Aff. Def. I).

     3. Defendant sent a letter via USPS certified mail to Plaintiff's attorney on  XXXX, XX, 2019, electing arbitration with Judicial Arbitration and Mediation Services, Inc. (JAMS) and requesting dismissal or stay of this case pending arbitration. A true copy of the written election notice is filed and served as Defendant's Exhibit A. 

[Brotherskeeper]

@BitsyM (I am not a lawyer.) The following quote is modified from Michigan poster gg2008's granted motion to compel arb. Because you are not submitting a motion brief as rules require, paragraph 10 incorporates Michigan precendential case citations about the FAA. 

"10. The Federal Arbitration Act (FAA), 9 U.S.C. §§ 1-15, governs actions in both federal and state courts arising out of contracts involving interstate commerce. Burns v. Olde Discount Corp., 212 Mich App 576, 580, 538 N.W.2d 686 (1995). State courts are bound under the Supremacy Clause, US Const, art VI, § 2, to enforce the substantive provisions of the federal act. Kauffman v Chicago Corp, 187 Mich App 284, 286; 466 NW2d 726 (1991). To ascertain the arbitrability of an issue, a court must consider whether there is an arbitration provision in the parties' contract, whether the disputed issue is arguably within the arbitration clause, and whether the dispute is expressly exempt from arbitration by the terms of the contract. Burns, supra, at 580.  Any doubts about the arbitrability of an issue should be resolved in favor of arbitration. Id. In the present case, all three of the requisites to arbitration are established.  There is a written arbitration clause that is part of a valid written contract. The claims at issue fall under the scope of the arbitration clause. Defendant, at the first opportunity, has sought to compel arbitration as permitted in the Agreement's "How Arbitration Works" section.  (Pl.'s Ex., pp 10-11)."

 

     WHEREFORE, for the foregoing reasons, Defendant respectfully requests that this Honorable Court grant this Motion to compel Plaintiff to arbitrate all of its claims alleged in the Complaint per the terms of the Arbitration Agreement and dismiss this action.  In the alternative, the Court should order that this action be stayed pending completion of private contractual arbitration in JAMS.

[Brotherskeeper]

@BitsyM Why have you included a verification by affidavit at the end? This is not necessary. (IANAL) 

Rule 1.109 Court Records Defined; Document Defined; Filing Standards; Signatures; Electronic Filing and Service; Access

(3) Verification. Except when otherwise specifically provided by rule or statute, a document need not be verified or accompanied by an affidavit. If a document is required or permitted to be verified, it may be verified by

(a) oath or affirmation of the party or of someone having knowledge of the facts stated; or

(b) except as to an affidavit, including the following signed and dated declaration:

“I declare under the penalties of perjury that this _________ has been examined by me and that its contents are true to the best of my information, knowledge, and belief.” Any requirement of law that a document filed with the probate court must be sworn may be also met by this declaration.

In addition to the sanctions provided by subrule (E), a person who knowingly makes a false declaration under this subrule may be found in contempt of court.

(E) Signatures.

(1) A signature, as required by these court rules and law, means a written signature as defined by MCL 8.3q or an electronic signature as defined by this subrule.

(2) Requirement. Every document filed shall be signed by the person filing it or by at least one attorney of record. A party who is not represented by an attorney must sign the document. In probate proceedings the following also applies:

(a) When a person is represented by an attorney, the signature of the attorney is required on any paper filed in a form approved by the State Court Administrator only if the form includes a place for a signature.

(b) An application, petition, or other paper may be signed by the attorney for the petitioner, except that an inventory, account, acceptance of appointment, and sworn closing statement must be signed by the fiduciary or trustee. A receipt for assets must be signed by the person entitled to the assets.

(3) Failure to Sign. If a document is not signed, it shall be stricken unless it is signed promptly after the omission is called to the attention of the party.

(4) An electronic signature is acceptable in accordance with this subrule.

(a) An electronic signature means an electronic sound, symbol, or process, attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record. The following form is acceptable: /s/ John L. Smith.

(b) Retention of a signature electronically affixed to a document that will be retained by the court in electronic format must not be dependent upon the mechanism that was used to affix that signature.

(5) Effect of Signature. The signature of a person filing a document, whether or not represented by an attorney, constitutes a certification by the signer that:

(a) he or she has read the document;

(b) to the best of his or her knowledge, information, and belief formed after reasonable inquiry, the document is well grounded in fact and is warranted by existing law or a good-faith argument for the extension, modification, or reversal of existing law; and

 (c) the document is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.

[Brotherskeeper]

@BitsyM Here are the rules for motions. Your judge may or may not want her/his own copy marked as "Judge's Copy" see rule 2(d). I don't want to confuse you, but include these rules for clarity. 

Rule 2.119 Motion Practice

(A) Form of Motions.

(1) An application to the court for an order in a pending action must be by motion. Unless made during a hearing or trial, a motion must

(a) be in writing,

(b) state with particularity the grounds and authority on which it is based,

(c) state the relief or order sought, and

(d) be signed by the party or attorney as provided in MCR 1.109(D)(3) and (E).

(2) A motion or response to a motion that presents an issue of law must be accompanied by a brief citing the authority on which it is based, and must comply with the provisions of MCR 7.215(C) regarding citation of unpublished Court of Appeals opinions.

(a) Except as permitted by the court, the combined length of any motion and brief, or of a response and brief, may not exceed 20 pages double spaced, exclusive of attachments and exhibits.

(b) Except as permitted by the court or as otherwise provided in these rules, no reply briefs, additional briefs, or supplemental briefs may be filed.

(c) Quotations and footnotes may be single-spaced. At least one-inch margins must be used, and printing shall not be smaller than 12-point type.

(d) A copy of a motion or response (including brief) filed under this rule must be provided by counsel to the office of the judge hearing the motion. The judge's copy must be clearly marked JUDGE’S COPY on the cover sheet; that notation may be handwritten.

(3) A motion and notice of the hearing on it may be combined in the same document.

(4) If a contested motion is filed after rejection of a proposed order under subrule (D), a copy of the rejected order and an affidavit establishing the rejection must be filed with the motion.

[BitsyM]

@Brotherskeeper I should remove the Supreme Court Ruling and replace with Michigan Ruling, or add in the Michigan Ruling?

 

I removed the verification of affidavit at the end.

[Brotherskeeper]

18 minutes ago, Brotherskeeper said:

(3) A motion and notice of the hearing on it may be combined in the same document.

https://courts.michigan.gov/Administration/SCAO/Forms/courtforms/mc326.pdf

[Brotherskeeper]

1 minute ago, BitsyM said:

@Brotherskeeper I should remove the Supreme Court Ruling and replace with Michigan Ruling, or add in the Michigan Ruling?

No. Use Concepcion paragraph as written. Add the Michigan paragraph (marked as 10 on gg208's MTC) as numbered after what you currently have as #4. 

[Brotherskeeper]

@BitsyM Did you prepare a proposed order for the judge to sign? 

[BitsyM]

25 minutes ago, Brotherskeeper said:

@BitsyM Did you prepare a proposed order for the judge to sign? 

I did   

Attached.

LMK if you see anything that looks wonky.

Judges Copy Proposed Order MTCA.docx

[Brotherskeeper]

7 minutes ago, BitsyM said:

 

I did   

Attached.

LMK if you see anything that looks wonky.

Judges Copy Proposed Order MTCA.docx 21.58 kB · 0 downloads

You could include a copy of this proposed order with your notice to Plaintiff to elect arb sent CMRRR. This way if plaintiff signs to stipulate, great. If not, and plaintiff ignores the proposed order, after 7 days you can assume it's been rejected. In many Michigan courts, judges want you to reach out to the opposing party to try to avoid wasting the court's time. 

[BitsyM]

27 minutes ago, Brotherskeeper said:

You could include a copy of this proposed order with your notice to Plaintiff to elect arb sent CMRRR. This way if plaintiff signs to stipulate, great. If not, and plaintiff ignores the proposed order, after 7 days you can assume it's been rejected. In many Michigan courts, judges want you to reach out to the opposing party to try to avoid wasting the court's time. 

I will definitely do that.  Thank you.