BEING HARASSED FOR DEBTS MORE THAN 4 YEARS OLD..... DEBT IS UNCOLLECTABLE UNLESS YOU ENTER FOOLISHLY INTO A PAYMENT PLAN AND MAKE A PAYMENT.

Dear Readers:

Not long ago I had a collector calling me regarding an old AT&T bill.  Wanted to make a deal with me to settle for HALF of what I owed.  I asked him home much I owed and he said like $400.00 but would settle for $200.00......   Then as I got to thinking..... I asked him how old is that bill?  He balked at telling me but finally admitted it was from 1998!!!!! That was like 13 years ago!!!!  I recognized as an attorney the statute of limitations had run.  I realized that that they had no more right to report this on my credit report.  I realized that they couldn't touch me.  I informed him that this bill was charged off when I was a broke person and couldn't pay.  Its well over the FOUR YEAR STATUTE of limitations he has to sue me for an account.  He tried to say that I made a payment within the last four years..... this was a lie!!!  I told him show me proof of that..... again he hemmed and hawed.....  I told him I wasn't going to pay it and that he should just sue me if he thought he had a chance to win.  I haven't heard nothing from him since!  He knew statute was blown....

BUT I GOT TO THINKING ABOUT THE NON-ATTORNEYS who don't know their rights and who could be bullied into paying a bill that was uncollectable....  Then I ran across this story..... These collectors and their attorneys could be in for a LOT OF TROUBLE!  Read on....

McCollough v. Johnson, Rodenburg & Lauinger, LLC, 2011 Westlaw 746892 (9th Cir. 2011)

            Facts:  A consumer failed to pay his credit card debt, and the issuer subsequently charged off the account.  A few years later, the issuer sold his account to a collection agency in the business of purchasing bad debt portfolios.  The collection agency brought suit against the consumer, who raised the defense of limitations; undeterred, the collection agency then referred the account to a law firm.

            According to the firm's records, the account was not barred by limitations, because the consumer had supposedly made a recent payment.  In fact, the records were incorrect. Without seeking to verify those records, the firm then brought suit against the consumer, who filed a pro se answer, again raising the bar of limitations and informing the firm that he was severely disabled.  The firm nevertheless pressed ahead with the prosecution, serving requests for admission on the consumer.  Those requests for admission failed to contain an explanation required by state law that the requests would be deemed admitted if there was no response within 30 days.  After the consumer retained counsel, the firm dismissed the second collection action.

            The consumer then filed suit in federal court, alleging violations of the Fair Debt Collection Practices Act ("FDCPA"), along with state law claims for malicious prosecution and abuse of process.  The trial court granted partial summary judgment to the consumer on his FDCPA claims.  His tort claims were then tried to a jury, which awarded him $250,000 in emotional distress damages and $60,000 in punitive damages.  The Ninth Circuit affirmed.

           

            Reasoning: The law firm first argued that it could not be held liable under the FDCPA because its conduct was the result of a "bona fide error."  But the appellate court affirmed the trial court's summary judgment in favor of the consumer, holding that the firm "erred by relying without verification" on the collection agency's representation that the account was not time-barred.  Further, the firm's reliance on the collection agency's data was unreasonable as a matter of law, since the collection agency had itself expressly disclaimed "the accuracy or validity" of its data.

            The Ninth Circuit also affirmed the trial court's ruling that the firm's requests for admission violated the FDCPA as a matter of law because they asked the consumer "to admit facts that were not true."  The court also noted that the firm's failure to include a statutorily-required explanation that the requests would be deemed admitted if not contradicted within 30 days was misleading as a matter of law, from the standpoint of "the least sophisticated debtor."  The firm argued that discovery procedures should be excluded from coverage under the FDCPA, since the applicable court rules already provide sufficient protection.  But the court held that the "clear statutory language" of the FDCPA sufficiently encompassed discovery abuses.

            Turning to the malicious prosecution claim, the court held that there was substantial evidence that the firm did not reasonably believe that the second suit against the consumer was not time-barred, since the firm failed to check with the collection agency to verify that the statute of limitations was inapplicable.  Finally, the court also upheld the jury verdict on the abuse of process claim:

[The firm] filed suit to extract money . . . that it could not legally obtain in a collection action and . . . filed a baseless action with knowledge that it had no legal claim . . . . [The firm] filed and pursued a time-barred lawsuit . . . , even though [the firm's] own electronic file indicated that the suit was time-barred . . . . [The firm] sought attorney's fees without confirming that [the consumer] had a contractual fee obligation. The jury could have inferred from this evidence that [the firm's] purpose in filing the lawsuit was to coerce [the consumer] to pay awards and fees to which it and [the collection agency] were not entitled.

           

           So for you people out there that are being harassed about an old debt TAKE HEED. 

1.  DO NOT ENTER INTO A PAYMENT PLAN FIRST

2.  ASK TO SEE AN ACCOUNTING OF THE DEBT YOU OWE.

3.  DO NOT REFUSE TO PAY SIMPLY STATE THAT YOU ARE UNSURE OF WHETHER YOU OWE THE DEBT AND WOULD LIKE TO SEE THE ACCOUNTING.

4.  IF YOU FIND THE LAST ENTRY FOR A PAYMENT YOU MADE OR  A CHARGE ON THE ACCOUNT WAS MADE OVER FOUR YEARS AGO, CONSULT WITH AN ATTORNEY.  THERE MAY BE NO WAY FOR THEM TO COLLECT FROM YOU.  BUT YOU MUST CONSULT AN ATTORNEY TO KNOW FOR SURE.

Good Luck out there!