California Widower Sued by Unifund

[norcal]

My wife was diagnosed with ovarian cancer in 2014 and battled it until she passed away in 2018. During that time we struggled to keep up with medical expenses and other bills. It eventually became too much to deal with, so we just gave up.

I am now being sued by Unifund for some 2017 Capital One credit card debt they purchased from Distressed Asset portfolio. I don’t remember the details of our finances during that time, and I don’t have any records either, so I don’t know whether the information in this lawsuit is true or not.

I already responded with an answer following the book "Stick it to Sue Happy Debt Collectors." Hopefully I didn't screw anything up with my answer and the affirmative defenses I listed. I just got notified that we have a Case Management Conference set for this September. It looks like this is how to start this conversation, so here goes:

1. Who is the named plaintiff in the suit? Unifund CCR LLC

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

3. How much are you being sued for? $4258.63

4. Who is the original creditor? Capital One Bank

5. How do you know you are being sued? Served a summons

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

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

8. What was your correspondence (if any) with the people suing you before you think you were being sued? None.  

9. What state and county do you live in? California, Humboldt County

10. When is the last time you paid on this account? Their exhibit alleges 04/13/2017

11. What is the SOL on the debt? In California, 4 years. Capital One is in Virginia, so I’m not sure if Virginia law applies to the SOL or not.

12. What is the status of your case? Suit served? Motions filed?  I filed an answer denying everything. I used affirmative defenses I found in the book “Stick it to Sue Happy Debt Collectors.” Had a friend send them a copy by certified mail. I just got a Notice of Hearing for a Case Management Conference set for September.

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? No

15. How long do you have to respond to the suit? I already responded. I had 30 days to do so.

 16. What evidence did they send with the summons? EXHIBIT A: Three pages from some Capital One billing statements. EXHIBIT B: Three different Bills of sale showing a sale of some files to Distressed Asset Portfolio III. Then to Distressed Asset Portfolio IV. And then to Unifund CCR, LLC.  EXHIBIT C, A Printout of a spreadsheet showing my name address and various other details from the alleged account.

[norcal]

Here are the affirmative defenses I listed in my answer. I denied all of their allegations. I'm hoping I didn't ruin my chances winning or getting a decent settlement, but what's done is done.

1. Plaintiff lacks standing.

2. Defendant was not notified of any assignment of the debt that is the subject of the complaint.

3. The complaint fails to state a claim upon which relief may be granted.

4. Defendant does not consent to or ratify any assignments of the debt that is the subject of the complaint.

5. Plaintiff's complaint is time barred pursuant to the California Code of Civil Procedure Section 337.

6. Defendant claims Lack of Privity as Defendant has never entered into any contractual or debtor/creditor arrangements      with Plaintiff.

7. Plaintiff's claims are barred by the doctrine of laches.

8. Plaintiff's Complaint fails to allege a valid assignment of debt and there are no averments as to the nature of the purported assignment or evidence of valuable consideration.

9. Plaintiff has failed to name the Real Party of Interest.

10. Plaintiff's Complaint fails to allege that the Assignor/Original Creditor even has knowledge of this action or that the Assignor conveyed all rights and control to the Plaintiff. The record does not disclose this information and it cannot be assumed without creating an unfair prejudice against the Defendant.

11. Defendant claims Accord and Satisfaction as Defendant alleges that the original creditor accepted payment from a third party for the purported debt, or that the Original Creditor received other compensation in the form of monies or credits from the plaintiff.

12. Plaintiff's claims are barred by the principle of waiver.

13. Plaintiff's claims are based on a contract that is an adhesion contract, and as such, all or portions of it are unenforceable.

14. Plaintiff’s claims are based on a contract that is illusory and therefore unenforceable.

15. Plaintiff’s calculation of interest is usurious or based on a rate that is greater than allowed by law.

16. Plaintiff has failed to state a valid claim for attorney fees, and is barred from collecting Attorney fees under the Fair Debt Collection Practices Act.

17. Plaintiff is barred under the Fair Debt Collection Practices Act, from collecting attorney fees, interest, collection fees, and any amount not specifically provided for by purported agreement.

18. Plaintiff's damages are limited to real or actual damages only.

19. Plaintiff’s counsel did not afford Defendant due process of the law.

20. If allowed by this court the defendant reserves the right to plead other affirmative defenses that may become available at a later time.

[norcal]

Sorry if I'm violating forum etiquette, but I'm trying to figure out what to do next. First I'm trying to figure out the statute of limitations on this.

I am in California, but the Capital One agreements say "This Agreement is governed by applicable federal law and by Virginia law." 

I am finding mixed information about the SOL on credit card debt in Virgnia. But one lawyer's website  says this: "In Virginia, the deadline to sue for credit card debt is normally three years if there is no written contract and five if an adequate signed contract exists."

I don't know if Unifund has a signed contract or not, but if they don't, does this mean I can get it dismissed based on Virginias SOL? They filed one day before the deadline for California SOL. But they filed almost a year late if the three year Virginia law applies and they don't have a signature.

Should I request a bill of particulars to see if they have a signed contract and get a copy of the agreement?

[Brotherskeeper]

33 minutes ago, norcal said:

10. When is the last time you paid on this account? Their exhibit alleges 04/13/2017

Is this accurate? Do you have your bank records from this time period? 

[norcal]

4 minutes ago, Brotherskeeper said:

Is this accurate? Do you have your bank records from this time period? 

I don't know yet. I closed our bank account a while ago and started a new one. I need to go the bank and see if they can pull up statements from our old account. I tried the other day, but you have to schedule an appointment because of Covid.

[Brotherskeeper]

@norcal First, I'm very sorry for your loss. This is a very tough thing to go through in any circumstance; doubly so in your case. 

In your case it appears that the date of default and when the statute of limitations began to run is very important to lock down. 

I would strongly urge you to read up on California's borrowing statute CCP §361, contract choice of law, any tolling of the statute by your absence from the state and related matters so that you understand what you'll need to do to use the Virginia 3-year SOL as an affirmative defense for your case. You need to know how you properly assert this affirmative defense as well as how you raise it before the judge. Remember that the burden to prove an affirmative defense is yours. Check your rules of civil procedure to see how (by motion or notice) you raise the law of a foreign jurisdiction. Unifund CCR, LLC is regulated by the U.S. Security and Exchange Commission and incorporated in the state of Ohio. Since Unifund is not a citizen of the state of California, Unifund can't claim California's SOL applies to them under the borrowing statute. (I am not a lawyer.) 

Code Civ. Proc. §361.

"When a cause of action has arisen in another State, or in a foreign country, and by the laws thereof an action thereon cannot there be maintained against a person by reason of the lapse of time, an action thereon shall not be maintained against him in this State, except in favor of one who has been a citizen of this State, and who has held the cause of action from the time it accrued.
(Enacted 1872.)"

[norcal]

8 minutes ago, Brotherskeeper said:

@norcal First, I'm very sorry for your loss. This is a very tough thing to go through in any circumstance; doubly so in your case. 

In your case it appears that the date of default and when the statute of limitations began to run is very important to lock down....

Thank you. I'll get on it. I appreciate your help!

[Clydesmom]

I am very sorry for your loss.  First and foremost you didn't screw anything up by using that book but STOP using it right now.  It isn't fatal but we need to do some clean up.  Your affirmative defenses right now are simply telling them you know how to cut and paste from the internet.  You don't list everything and hope something sticks.

1. Plaintiff lacks standing.  An issue to be determined at trial but likely won't stand as a good defense but keep it.

2. Defendant was not notified of any assignment of the debt that is the subject of the complaint.  California does not require this to be done.  Remove it.

3. The complaint fails to state a claim upon which relief may be granted.  This is left over from 2008 and the recession.  What reason did they give for the suit?

4. Defendant does not consent to or ratify any assignments of the debt that is the subject of the complaint.  Your consent is not needed.  The terms and conditions of the card agreement state they can sell or transfer the account at any time without your consent.  REMOVE THIS.

5. Plaintiff's complaint is time barred pursuant to the California Code of Civil Procedure Section 337.  THIS is your best defense.  Gold plated if they got the dates wrong.  Confirm that date of first default ASAP.

6. Defendant claims Lack of Privity as Defendant has never entered into any contractual or debtor/creditor arrangements with Plaintiff.  REMOVE THIS.  When the account is sold the buyer steps in to the shoes of the original creditor and gets all the same rights and responsibilities.  

7. Plaintiff's claims are barred by the doctrine of laches.  REMOVE this.  

8. Plaintiff's Complaint fails to allege a valid assignment of debt and there are no averments as to the nature of the purported assignment or evidence of valuable consideration.  This might be helpful in California as they have added protections for their residents.  You need to read the California threads to see how it can help you though.

9. Plaintiff has failed to name the Real Party of Interest.  REMOVE THIS.  The plaintiff IS the real party of interest.

10. Plaintiff's Complaint fails to allege that the Assignor/Original Creditor even has knowledge of this action or that the Assignor conveyed all rights and control to the Plaintiff. The record does not disclose this information and it cannot be assumed without creating an unfair prejudice against the Defendant.  REMOVE THIS

11. Defendant claims Accord and Satisfaction as Defendant alleges that the original creditor accepted payment from a third party for the purported debt, or that the Original Creditor received other compensation in the form of monies or credits from the plaintiff.  REMOVE THIS.  You cannot use accord and satisfaction.  You still owe the debt even if they sell the account.

12. Plaintiff's claims are barred by the principle of waiver.  REMOVE THIS

13. Plaintiff's claims are based on a contract that is an adhesion contract, and as such, all or portions of it are unenforceable.  REMOVE THIS

14. Plaintiff’s claims are based on a contract that is illusory and therefore unenforceable.  REMOVE THIS

15. Plaintiff’s calculation of interest is usurious or based on a rate that is greater than allowed by law.  You can try it but I would not hold your breath.

16. Plaintiff has failed to state a valid claim for attorney fees, and is barred from collecting Attorney fees under the Fair Debt Collection Practices Act.  REMOVE THIS.  NOTHING in the FDCAP prevents the collecting of attorney fees and court costs in a lawsuit.

17. Plaintiff is barred under the Fair Debt Collection Practices Act, from collecting attorney fees, interest, collection fees, and any amount not specifically provided for by purported agreement.  REMOVE THIS

18. Plaintiff's damages are limited to real or actual damages only.  REMOVE THIS.  They aren't seeking punitive damages.

19. Plaintiff’s counsel did not afford Defendant due process of the law.  REMOVE THIS

20. If allowed by this court the defendant reserves the right to plead other affirmative defenses that may become available at a later time.  KEEP THIS

Basically you need to read all the threads you can on California and their rules of civil procedure and recommended defenses on THIS SITE.  Burn that book.  I would look in to filing an amended defense ASAP.  Especially if you can confirm they missed the SOL.  If they did a motion to dismiss or summary judgment for SOL would be appropriate too.

[Clydesmom]

9 hours ago, norcal said:

10. When is the last time you paid on this account? Their exhibit alleges 04/13/2017

WHEN did they file the suit?  Not when you finally were served.  What date is stamped on it by the clerk as filed?

[Clydesmom]

9 hours ago, norcal said:

16. What evidence did they send with the summons? EXHIBIT A: Three pages from some Capital One billing statements. EXHIBIT B: Three different Bills of sale showing a sale of some files to Distressed Asset Portfolio III. Then to Distressed Asset Portfolio IV. And then to Unifund CCR, LLC.  EXHIBIT C, A Printout of a spreadsheet showing my name address and various other details from the alleged account.

This may be your second best defense.  If the SOL thing doesn't work then having the account sold multiple times does.  California has a requirement that you can enforce that they have to have a LIVE witness from each JDB to testify to the records and the transfer.  There is a specific way to file this.  Read the threads and study up.

[norcal]

15 minutes ago, Clydesmom said:

I am very sorry for your loss.  First and foremost you didn't screw anything up by using that book but STOP using it right now.  It isn't fatal but we need to do some clean up.  Your affirmative defenses right now are simply telling them you know how to cut and paste from the internet.  You don't list everything and hope something sticks.....

.....

Basically you need to read all the threads you can on California and their rules of civil procedure and recommended defenses on THIS SITE.  Burn that book.  I would look in to filing an amended defense ASAP.  Especially if you can confirm they missed the SOL.  If they did a motion to dismiss or summary judgment for SOL would be appropriate too.

Okay. I'll work on makjng those changes and finding out if I can amend the defense. Thank you very much.

[norcal]

19 minutes ago, Clydesmom said:

WHEN did they file the suit?  Not when you finally were served.  What date is stamped on it by the clerk as filed?

4/12/2021

[norcal]

19 minutes ago, Clydesmom said:

This may be your second best defense.  If the SOL thing doesn't work then having the account sold multiple times does.  California has a requirement that you can enforce that they have to have a LIVE witness from each JDB to testify to the records and the transfer.  There is a specific way to file this.  Read the threads and study up.

Will do. Thanks!

[norcal]

20 minutes ago, Clydesmom said:

This may be your second best defense.  If the SOL thing doesn't work then having the account sold multiple times does.  California has a requirement that you can enforce that they have to have a LIVE witness from each JDB to testify to the records and the transfer.  There is a specific way to file this.  Read the threads and study up.

Okay great. Back to school! Thank you!

[Clydesmom]

2 hours ago, norcal said:

4/12/2021

DAMN.  If the dates are accurate they beat the SOL by ONE day.  I would still consider trying the SOL defense and make them prove their dates are accurate.

[norcal]

1 hour ago, Clydesmom said:

DAMN.  If the dates are accurate they beat the SOL by ONE day.  I would still consider trying the SOL defense and make them prove their dates are accurate.

I know. Crazy, right? Ugh. I'll go to the bank and see if they can give me a statement from that month. I'm also going to try seeing if I can apply Virginia's SOL to this. Capital One is in Virginia where the SOL is three years if there's no signed contract. The Capital One agreement says Virginia law applies to it. I don't know if they have a signature though. Should I ask for a bill of particulars or some sort of discovery?

[nobk4me]

Applicable case law on CA's borrowing statute is Resurgence v. Chambers:  https://caselaw.findlaw.com/ca-superior-court/1289969.html

[norcal]

I made an appointment with the bank on Wednesday to see if they can pull up the statements from the month they allege that the last payment was made. Also called the court to find out how to file an amended answer. The clerk said I just redo it and put "Amended" on there somewhere. That seems pretty simple. Now I gotta rewrite it. There's not going to be a lot left after I remove all the stuff that shouldn't be there.

Should I list two separate time bar affirmative defenses, one for California and one for Virginia where Capital one is based? Also wondering how lengthy the affirmative defenses should be. Basically I want one of the affirmative defenses to say the credit card agreement says it is governed  by Virginia Law, so this complaint is time barred according to Virginia law. Can I keep it simple and maybe just reference the Virginia code section where it says that. Then in the motion to dismiss argue the point in more detail?

Anyway, I'm on my lunch break and will work on this some more when I get off work. Thanks everyone for your help so far!

[norcal]

4 minutes ago, nobk4me said:

Applicable case law on CA's borrowing statute is Resurgence v. Chambers:  https://caselaw.findlaw.com/ca-superior-court/1289969.html

This is great! Thank you!

[Brotherskeeper]

@nobk4me I couldn't remember the Resurgence case name. Thanks so much for putting me out of my misery!

@norcal Google Scholar is a great resource, if you don't know about it:

Resurgence Financial, LLC v. Chambers, 173 Cal.App.4th Supp. 1, 92 Cal. Rptr.3d 844 (2009).

 

Wash. Mut. Bank v. Superior Court, 24 Cal.4th 906, 921, 103 Cal. Rptr.2d 320, 15 P.3d 1071 (2001).

"Even though Nedlloyd was decided in the context of a negotiated arm's length transaction between sophisticated business entities, its analysis appears suitable for a broader range of contract transactions. California, we observe, has no public policy against the enforcement of choice-of-law provisions contained in contracts of adhesion where they are otherwise appropriate. (See Bos Material Handling, Inc. v. Crown Controls Corp. (1982) 137 Cal.App.3d 99, 108, 186 Cal. Rptr. 740; Gamer v. duPont Glore Forgan, Inc. (1976) 65 Cal.App.3d 280, 286-287, 135 Cal.Rptr. 230; Windsor Mills, Inc. v. Collins & Aikman Corp. (1972) 25 Cal.App.3d 987, 995, fn. 6, 101 Cal.Rptr. 347.) More importantly, Nedlloyd's analysis contains safeguards to protect contracting parties, including consumers, against choice-of-law agreements that are unreasonable or in contravention of a fundamental California policy. (Nedlloyd, supra, 3 Cal.4th at p. 466, 11 Cal.Rptr.2d 330, 834 P.2d 1148.) Under Nedlloyd, which adopted the Restatement approach and found the enforceability of choice-of-law clauses closely related to that of forumselection clauses (Nedlloyd, supra, 3 Cal.4th at p. 464, 11 Cal.Rptr.2d 330, 834 P.2d 1148), the weaker party to an adhesion contract may seek to avoid enforcement of a choice-of-law provision therein by establishing that "substantial injustice" would result from its enforcement (Rest., § 187, com. (b), p. 562)^[6] or that superior power was unfairly used in imposing the contract (see Cal-State Business Products & Services, Inc. v. Ricoh (1993) 12 Cal. App.4th 1666, 1679-1680, 16 Cal.Rptr.2d 417 [indicating that evidence of unfair use of bargaining power may defeat enforcement of a forum-selection clause contained in an adhesion contract]). In light of these protections, we conclude Nedlloyd's analysis is properly applied in the context of consumer adhesion contracts."

[norcal]

Okay I'm working on the amended answer. Hoping to finish this and file it tomorrow. Here's my new list of affirmative defenses:

1. Plaintiff lacks standing.

2. Plaintiff's complaint is time barred pursuant to the California Code of Civil Procedure Section 337.

3. The original Capital One credit card agreement contains a choice of law provision that states: “This Agreement is governed by applicable federal law and by Virginia law.” Pursuant Code of Virginia § 8.01-246, paragraph 3 the plaintiff's time to file this lawsuit expired three years after the cause of action and is therefore time barred.

4. Plaintiff's Complaint fails to allege a valid assignment of debt and there are no averments as to the nature of the purported assignment or evidence of valuable consideration.  

5. Plaintiff’s calculation of interest is usurious or based on a rate that is greater than allowed by law.

6. If allowed by this court the defendant reserves the right to plead other affirmative defenses that may become available at a later time.

[norcal]

18 hours ago, Brotherskeeper said:

Google Scholar is a great resource, if you don't know about it:

Thank you! I muddled through it a little last night. This is great because the local law library is only open when I'm working.

[norcal]

I just called Resurgence, the law firm representing Unifund, to offer a settlement. First the guy said the amount was something like $300 more than what is being sued for. I offered him $250. I said the case is past the SOL and I have consulted with a bankruptcy attorney. He said they do these cases every day and he can assure me it's not outside the SOL. He said they wouldn't even consider an offer under 50% and they'd need some list of income and expenditures to go with the offer.

I figured it was worth a shot to save myself some time and stress, but either they're right about the SOL or they're bluffing. If he had countered with $1000 I would have went for it. I'm finishing up the amended answer to file it tomorrow.

My main concern is my affirmative defense #3: "The original Capital One credit card agreement contains a choice of law provision that states: 'This Agreement is governed by applicable federal law and by Virginia law.' Pursuant to the Code of Virginia § 8.01-246, paragraph 3, the plaintiff's time to file this lawsuit expired three years after the cause of action and is therefore time barred."

Do you all think that paragraph looks okay? Should I cite the Virginia case law or leave that out?  @Clydesmom @Brotherskeeper @nobk4me 

I'm hoping that language is correct and will suffice for the answer. I figure a motion to dismiss based on this will need more detail. I just want to get this amended answer in as soon as possible per @Clydesmom instructions.

Thanks again!

[norcal]

I'm doing my best to figure this out. Sorry if I'm being annoying. I've been digging around more and more, and I'm reasonably certain that the Virginia SOL is actually three years on this. I kinda want to turn this in tomorrow, but I may have to wait until Thursday. I read somewhere that an amended answer can be submitted without leave of the court within 10 days. My first one was filed May 11, so I think Friday May 21 is ten days after that. I'm feeling kinda panicked, and I'm hoping I can submit new defenses if I don't get this perfect.

I'm leaning toward this wording on my SOL affirmative defense:

Plaintiff's complaint and each and every cause of action is barred by the applicable statute of
limitations. The original Capital One credit card agreement contains a choice of law provision that states: “This Agreement is governed by applicable federal law and by Virginia law.” Pursuant Code of Virginia § 8.01-246, paragraph 3, the plaintiff's time to file this lawsuit expired three (3) years after the cause of action and is therefore time barred.

[Clydesmom]

Yes the SOL in VA is 3 years.  You have nothing to lose by filing this except the court denying it.  The last thing you want is to not try and find out it would have worked.

5 hours ago, norcal said:

I said the case is past the SOL and I have consulted with a bankruptcy attorney. He said they do these cases every day and he can assure me it's not outside the SOL.

He probably isn't even looking at the dates involved and is scripted to say that to pressure you in to paying.  Many of these people make a base salary and then commission based on the number of accounts they collect on.  As for the BK threat it is pointless to use that as they hear it thousands of times a year and until you actually file is not a real threat.

3 hours ago, norcal said:

Plaintiff's complaint and each and every cause of action is barred by the applicable statute of
limitations. The original Capital One credit card agreement contains a choice of law provision that states: “This Agreement is governed by applicable federal law and by Virginia law.” Pursuant Code of Virginia § 8.01-246, paragraph 3, the plaintiff's time to file this lawsuit expired three (3) years after the cause of action and is therefore time barred.

If you use the CA borrowing statute then the SOL expired ONE YEAR and 3 days prior to filing.  You need to change the time frame.  I would consider adding a statement that you also believe that the SOL is expired based on California law as well.

13 hours ago, norcal said:

5. Plaintiff’s calculation of interest is usurious or based on a rate that is greater than allowed by law.

If I didn't say it before DUMP THIS.  While CC interest is high it is not usurious in any state.  You want defenses that will make them reconsider going to court and dropping the entire matter.