catlady22

Colorado - being sued by Portfolio Recovery

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I've been thinking about how to defeat this, in future cases. (I know this won't help the OP.)

I think defendants need to include in their MTC Arb a request that the court order the plaintiff to initiate the arb case. The JDB wouldn't be able to argue that an arbitration they themselves initiated is frivolous.

In Ohio, there is excellent case law that requires the plaintiff to initiate arb.  Capital One v. Rotman.  In states without such case law, you can use the arguments in Rotman to ask the court to make the plaintiff initiate. Namely, it is ludicrous for the defendant to initiate, as that would be filing a case against oneself.

@fisthardcheese  I would like to hear your thoughts on this.

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3 hours ago, nobk4me said:

I think defendants need to include in their MTC Arb a request that the court order the plaintiff to initiate the arb case. The JDB wouldn't be able to argue that an arbitration they themselves initiated is frivolous.

The Plaintiff filing based on a court order initiated by the defense would not overcome the argument that the case is frivolous in arbitration.

3 hours ago, nobk4me said:

Namely, it is ludicrous for the defendant to initiate, as that would be filing a case against oneself.

Here is my thoughts:  all any JDB needs to do is research threads on this site alone to know that the MTC is not about arbitration of the case in a neutral forum it is about making it so expensive that the Plaintiff drops it.  That alone makes it frivolous.  Who initiates the case with JAMS or AAA is not relevant.  Who compelled it and why IS.

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3 hours ago, Clydesmom said:

Here is my thoughts:  all any JDB needs to do is research threads on this site alone to know that the MTC is not about arbitration of the case in a neutral forum it is about making it so expensive that the Plaintiff drops it.  That alone makes it frivolous. 

I disagree.   Arbitration provisions refer to “disputes”.  The dispute is not based upon whether or not a JDB will refuse to arbitrate.   Instead, it is whether or not the defendant owes the money to the JDB.   The JDB made the claim.  Disputing that claim in a forum allowed by the agreement is not frivolous.  JDBs have the option of filing in arbitration rather than court.  They choose court because it’s cheaper.  

It is no different than a JDB that files a MTC when faced with a class-action lawsuit.  The only reason the JDB does so is because class actions are not allowed in arbitration and, therefore, arbitration would be less expensive than a class settlement.  

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@catlady22  Can you reveal the name of the arbitrator?  You can PM me if you don't want to post it here. This is someone I certainly want to avoid.

Their ruling on the fees is absolutely wrong, IMO.  It sounds like you had serious TCPA claims. That you didn't  prevail on them doesn't make them frivolous. Here's what I consider a frivolous claim: The plaintiff filed the lawsuit in the wrong phase of the moon.

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On 11/8/2020 at 1:50 PM, Clydesmom said:

The Plaintiff filing based on a court order initiated by the defense would not overcome the argument that the case is frivolous in arbitration.

Here is my thoughts:  all any JDB needs to do is research threads on this site alone to know that the MTC is not about arbitration of the case in a neutral forum it is about making it so expensive that the Plaintiff drops it.  That alone makes it frivolous.  Who initiates the case with JAMS or AAA is not relevant.  Who compelled it and why IS.

But the "why" goes to motive. No one really knows the defendant's motive, unless they reveal it.

Maybe the motive is privacy. One of the advantages of arb is it is private, unlike court, where everything is a matter of public record. I prefer my financial affairs to be private.

Or maybe the defendant wants to get out of a hostile, pro-creditor good ole boy local court and have the dispute heard in a neutral forum. One where the judge doesn't play golf with the creditor attorneys.

 

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Yeah the whole thing was very confusing. I presented evidence of calls, witnesses to them calling my workplace, the "affidavit of sale" that had wrong dates on it (by 4 years nonetheless - they brought a witness to explain that this was irrelevant but he couldn't say why, and this wasn't even addressed in the final decision) wrote out a long brief, etc etc.

I don't think I should release the arb's name publicly. This is the final part of the decision.

"Claimant alleged various violations of federal and state laws that are designed to protect consumers from harassment and abuse from debt collectors. In its pre-hearing brief, as well as through the evidence offered during the hearing, Respondent clearly and succinctly addressed each statutory violation that Claimant cited and provided credible defenses against her numerous allegations, none of which were credible or met her burden of proof.
The Arbitrator finds that, due to the overwhelming lack of credible evidence, Claimant􏰂s claims are patently frivolous. Respondent met its burden of proof with respect to the elements of an action for account stated, namely, (a) Respondent proved that there was an agreement between the Claimant and Citibank regarding the debt, which Claimant never denied, and which Respondent assumed, (b) the amount of the debt was confirmed by numerous notices sent to Claimant􏰂s correct mailing address by both Respondent and Citibank, which Claimant never denied or disputed in accordance with applicable laws, and (c) Claimant made payments on her credit card account for over ten years before she stopped paying on it, which confirms her acknowledgement of a promise to pay the balance owed on the account.
Claimant􏰂s claims are hereby DENIED and the debt she owes to Respondent in the amount of $6,8XX is hereby confirmed. In accordance with AAA􏰂s Consumer Arbitration Rules, Section (ix), page 37, because I find that Claimant􏰂s claims are patently frivolous and without merit, I hereby AWARD Respondent the following additional amounts: $148 for the costs of the County Court proceeding, $4,700 for the costs of this arbitration. Claimant shall pay Respondent a total amount of $11XXX.XX within 30 days of the date of this Final Award, and any unpaid amounts thereafter shall bear interest at a rate of 8% per annum."

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A very unfortunate decision. And it sounds like the arbitrator doesn't even understand arb law. An arb award is worthless unless confirmed in court as a judgment.  The party that prevailed has up to a year to confirm it in court.  I don't see how he can dictate that you have to pay in 30 days and assign interest. Statutory interest on a judgment is set by a court.

Edited to add:  then again, since I have never seen the language of an arb award, maybe this is standard. I don't know.

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I wish I would have seen this sooner, or commented if I did see it. PRA does use auto dialers. Don't let them lie to you. They are registered in Texas to use them and have over 16,000 numbers associated with the registration. I know personally because I had to use excel to match numbers from the list to numbers on my phone bill. My alleged amount was much smaller than yours, and they ended up deleting it from my credit report and all. The only reason I was able to get the list of numbers is the PUC of Texas is kind enough to provide the information by simply asking.

@Clydesmom as to using arbitration being frivolous, how is that so when the agreement provides for it? If there is a small claims exception, or justice court exception, perhaps then it could be construed as frivolous. Does the agreement say "once we filed in court your right to arbitrate is null and void"?

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On 11/8/2020 at 10:17 AM, nobk4me said:

I think defendants need to include in their MTC Arb a request that the court order the plaintiff to initiate the arb case. The JDB wouldn't be able to argue that an arbitration they themselves initiated is frivolous

I don't like this and I wouldn't do it myself.  I would just file the arbitration case myself every time after a judge grants an MTC.  Arbitrators make bad ruling all the time.  We've seen a couple here and this is one of them.  The appeal would likely reverse the fee shifting this arbitrator ordered, as I doubt 3 other arbitrators can look at a case with arbitration in the contract and a court order to arbitrate based off the respondent's court case and claim that the action itself is frivolous.

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12 hours ago, fisthardcheese said:

I don't like this and I wouldn't do it myself.  I would just file the arbitration case myself every time after a judge grants an MTC.  Arbitrators make bad ruling all the time.  We've seen a couple here and this is one of them.  The appeal would likely reverse the fee shifting this arbitrator ordered, as I doubt 3 other arbitrators can look at a case with arbitration in the contract and a court order to arbitrate based off the respondent's court case and claim that the action itself is frivolous.

But this is the first time I am aware of that a JDB has taken an arb case all the way, paid all the fees, and got the arbitrator to hit the consumer with the fees.  I know there have been cases where the OC has taken an arb case all the way through and won.  

Yes, it probably would be reversed on appeal.  But, if an appeal costs $6K, that is not an option for most consumers.  And they (the JDB and the bad arbitrator) know it.

I feel so bad for the OP.  We all told her this was the sure way to beat a JDB, that they would drop the case rather than go through arb.

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2 minutes ago, nobk4me said:

We all told her this was the sure way to beat a JDB, that they would drop the case rather than go through arb.

This is why they were able to successfully convince the arbitrator that the case was frivolous.  The advice here (myself included) as always been the goal is not to actually arbitrate but to make it so expensive they go away.  Well, one JDB got smart and turned the tables.  When you use the terms in the contract providing arbitration to negate the terms in the contract to pay the debt you owe solely based on expense of the action then that is a frivolous claim.

The other adage that is often repeated (more so with OCs) is that a bad case is court is equally bad in arbitration.  If you read the major basis for the arbitrator's decision it was that catlady had 10 years of statements, charges, payments at her known address showing she knew the account was hers, had used it, and defaulted.  That is all that would be needed in court to prevail.  Whether the decision on the interest or payment timeline can be enforced is separate but the pitfall to arbitration vs court is the arbitrator has leeway the court does not.  

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12 minutes ago, Clydesmom said:

This is why they were able to successfully convince the arbitrator that the case was frivolous.  The advice here (myself included) as always been the goal is not to actually arbitrate but to make it so expensive they go away.  Well, one JDB got smart and turned the tables.  When you use the terms in the contract providing arbitration to negate the terms in the contract to pay the debt you owe solely based on expense of the action then that is a frivolous claim.

The other adage that is often repeated (more so with OCs) is that a bad case is court is equally bad in arbitration.  If you read the major basis for the arbitrator's decision it was that catlady had 10 years of statements, charges, payments at her known address showing she knew the account was hers, had used it, and defaulted.  That is all that would be needed in court to prevail.  Whether the decision on the interest or payment timeline can be enforced is separate but the pitfall to arbitration vs court is the arbitrator has leeway the court does not.  

Basically the JDB didn't turn any tables, they just said okay to themselves, thumbed their nose and did what they did. The OP didn't think about it going the route it did, I am sure nobody imagined it would go that way. I agree a bad case is a bad case, for sure. I personally would prefer arbitration to avoid a judgment being reported. That is my goal, in instances where I have been sued for a debt. Not necessarily the costs of it or even if I do have to pay the debt, just don't want the judgment on my credit reports. Agreed or default, either way if "judgment" is there, I don't want that.

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7 minutes ago, alwayswinning36 said:

Basically the JDB didn't turn any tables, they just said okay to themselves, thumbed their nose and did what they did. The OP didn't think about it going the route it did, I am sure nobody imagined it would go that way. I agree a bad case is a bad case, for sure. I personally would prefer arbitration to avoid a judgment being reported. That is my goal, in instances where I have been sued for a debt. Not necessarily the costs of it or even if I do have to pay the debt, just don't want the judgment on my credit reports. Agreed or default, either way if "judgment" is there, I don't want that.

But the way arb law works, at least in Ohio, is that an arb award is turned into a judgment.  The prevailing party can apply to a court of common pleas to confirm the award as a judgment.

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2 minutes ago, nobk4me said:

But the way arb law works, at least in Ohio, is that an arb award is turned into a judgment.  The prevailing party can apply to a court of common pleas to confirm the award as a judgment.

I guess I got really lucky then, in my matters. I did find where it is done, reporting arbitration award as a judgment. Some will knock me for saying it, but also helps to find any viable counter-claims you could push back against the JDB.

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1 hour ago, alwayswinning36 said:

I guess I got really lucky then, in my matters. I did find where it is done, reporting arbitration award as a judgment. Some will knock me for saying it, but also helps to find any viable counter-claims you could push back against the JDB.

Not all judgments get reported on your credit. I think recent law or rule changes made it more difficult for judgments to be reported.

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I think they are entering a judgement in court. On my case there's a new entry of Exhibits/Proposed Order/Mtn for Arbitration Award.

 

My arguments in terms of the 10 years of payments was this - I don't know why my Autopay turned off, but it did and I wasn't aware of it. When it defaulted was around the same time they changed things around with our street name and added N and S to certain neighborhoods, and I frequently get mail for the N version of my address and vice versa. So I never received a single letter from Citi about default or anything from PRA.

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3 hours ago, nobk4me said:

But this is the first time I am aware of that a JDB has taken an arb case all the way, paid all the fees, and got the arbitrator to hit the consumer with the fees.

The 3rd time I know of.  One of which was overturned on an appeal, and the other was way too far gone and not listening to reason or advice here anyway.  All 3 were with PRA.  There have been a small handful of other PRA cases that have gone further into arbitration than usual, but those ended up settling eventually, albeit late into the process.

4 hours ago, nobk4me said:

We all told her this was the sure way to beat a JDB, that they would drop the case rather than go through arb.

Speaking for myself only, I have never and would never say ANYTHING is a "sure thing". I say that arbitration is by far your best odds to beat the case.  And it still is.  Factor in the 3 times we know it hasn't worked into the thousands of times it does work, then it simply doesn't make sense to go any other route.

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3 hours ago, alwayswinning36 said:

I am sure nobody imagined it would go that way

Anyone who has not settled and has the arbitration hearing days away should always imagine this is the way it will go.  If you aren't doing more to slow it down, add in speed bumps and get a settlement BEFORE the hearing, then you should always assume this will be the outcome.

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1 hour ago, fisthardcheese said:

Anyone who has not settled and has the arbitration hearing days away should always imagine this is the way it will go.  If you aren't doing more to slow it down, add in speed bumps and get a settlement BEFORE the hearing, then you should always assume this will be the outcome.

Well then yeah, in that case. But I mean just sitting thinking I will file the motion to compel arbitration and all from that very point. Way early on. I wouldn't personally imagine that upon filing the MTC it would go all the way to arbitration. Always worth it to dig into things and see if there is any potential counter-claim as well. In both cases of mine there were. And each one, the cost of those potential violations amounted to more than the debt they were trying to collect. I personally didn't give a hoot about recovering any of the damages for the violations. Just wanted it go away and it did.

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23 hours ago, nobk4me said:

A very unfortunate decision. And it sounds like the arbitrator doesn't even understand arb law. An arb award is worthless unless confirmed in court as a judgment.  The party that prevailed has up to a year to confirm it in court.  I don't see how he can dictate that you have to pay in 30 days and assign interest. Statutory interest on a judgment is set by a court.

Edited to add:  then again, since I have never seen the language of an arb award, maybe this is standard. I don't know.

Interesting because PRA already went to County Court to start entering a judgement before the 30 days was even up. 

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On 11/12/2020 at 10:56 AM, Clydesmom said:

When you use the terms in the contract providing arbitration to negate the terms in the contract to pay the debt you owe solely based on expense of the action then that is a frivolous claim.

That is incorrect.  A “claim” is not about the selected forum or the costs associated with filing in that forum.  A “claim” is a demand by one party for something owed by another party. In this case, the claim was that the OP owed PRA money.  In fact, the JDB is the party who originally claimed the money was owed.

In selecting arbitration, a consumer is merely exercising the legal right provided to him in the agreement to choose the forum.  

 A claim is frivolous "if the proponent can present no rational argument based on the evidence or law in support of that claim." Hamon Contractors, Inc. v. Carter & Burgess, Inc., 229 P.3d 282, 299 (Colo.App.2009) (quoting Western United Realty, Inc. v. Isaacs, 679 P.2d 1063, 1069 (Colo.1984)).

Here is a TX Supreme Court ruling:

When deciding whether a dispute must be resolved through binding arbitration instead of through litigation in the courts, "the question is not which forum is quicker, cheaper, or more convenient, but which one the parties picked." In re Merrill Lynch Tr. Co. FSB, 235 S.W.3d 185, 187 (Tex. 2007).

It doesn’t matter why a party chooses arbitration when the agreement allows for it.   Some banks’ arbitration provisions contain small claims exceptions while others do not.   If a contract does not contain that exclusion, the cost of arbitration is not a viable objection for a business that chose to include arbitration to cover disputes but did not see fit to exclude small claims actions. 

The JDB chose to “step into the shoes of the creditor” and must abide by the terms of the agreement it chose to purchase.  It cannot later complain that the shoes aren’t a perfect fit.

 

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On 11/12/2020 at 4:38 PM, catlady22 said:

Interesting because PRA already went to County Court to start entering a judgement before the 30 days was even up. 

You can file objections in the court, arguing that the arb award should not be confirmed.

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14 hours ago, catlady22 said:

Doesn't it say somewhere in the AAA rules that arb awards are final?

 

These are objections you file with the court, pursuant to your state's arbitration laws, and potentially the Federal Arbitration Act.

An arb award is not enforceable by itself. An arb forum can't issue orders to garnish wages, for example. That's why an arb award is confirmed as a judgment in a court.

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