Being sued - Didn't respond to DV

[ssdsco]

My attorney advised me to wait 2 years before filing BK7 to qualify for my current states more generous BK exemptions and some fraudulent transfer issues (support for elderly parents and kids in college).

It's been 13 months since last payment to about 20 creditors. 11 more months to go before filing BK7.

All my debts are with CA's and I DVed all of them within 30 days of their notice.

I occasionally check my county clerks records (online) and a CA recently filed my first lawsuit. Summons has not been severed yet.

I'm judgment execution proof so my main concern is having the extra cost and hassle of removing the automatic lien on my house from any judgment when I file BK7.

I DVed this CA via certified mail in April and never received a response.

Hope this makes sense.

Any advice on delaying the judgment or the possibility of suing them for not following FDCP would be greatly appreciated.

Thanks

[treehugger1]

There is nothing to stop a creditor or CA from suing you instead of sending the DV. However, in an answer to the summons, you might clearly state you have no knowledge of the debt or suit as filed by the plaintiff. They would probably need to provide this under discovery. I have no personal experience other than small claims, so perhaps others will weigh in. There are some debtor websites that might help you with how to answer the summons.

Best to you, and keep us informed!

[Loose Cannon]

This is a good reason why all DV letters should be sent CMRRR. In that case, if the CA files suit before sending the DV the dates on the green return card and the date the suit is filed should be evidence.

[ssdsco]

if they receive the DV before they file suit they are barred from filing suit until they comply with the DV since the FDCPA puts a stop to all collection activity until they provide a DV.

That's what I thought. Do you know where in the lawsuit process I would use the violation as an affirmative defense ?

Thanks

[treehugger1]

All I can say is good luck. There is nothing to stop a CA from suing you regardless of the FDCPA and DV. Oh, you might get a grand or two in a counter claim, but stacked up against $8000 - $20000 debt and potentially additional attorney fees, a FDCPA violation by the CA on a big debt, doesn't really amount to much.

The point is that you appear to be undergoing a lawsuit. While there may or may not be a FDCPA response available, it is up to you to initiate the response in your answer to the summons. If you do not, then the court will side with the plaintiff. The court will only know about any FDCPA violation if you make it clear in an answer. You are where you are at this point in time. The ball is in your court. What will you do? At the least you can hope to stall any judgment. At the best, you hope a court will throw out the entire issue. You have no way of knowing what an outcome will be unitl you actually engage the problem, which has now been defined by the CA/creditor. How much time, money, and energy do you have to spend in a legal dispute? Best to you.

[ssdsco]

All I can say is good luck. There is nothing to stop a CA from suing you regardless of the FDCPA and DV. Oh, you might get a grand or two in a counter claim, but stacked up against $8000 - $20000 debt and potentially additional attorney fees, a FDCPA violation by the CA on a big debt, doesn't really amount to much.

The point is that you appear to be undergoing a lawsuit. While there may or may not be a FDCPA response available, it is up to you to initiate the response in your answer to the summons. If you do not, then the court will side with the plaintiff. The court will only know about any FDCPA violation if you make it clear in an answer. You are where you are at this point in time. The ball is in your court. What will you do? At the least you can hope to stall any judgment. At the best, you hope a court will throw out the entire issue. You have no way of knowing what an outcome will be unitl you actually engage the problem, which has now been defined by the CA/creditor. How much time, money, and energy do you have to spend in a legal dispute? Best to you.

I'm not trying to stop the suit. That train left the station. I'm trying to delay the judgment until I can file BK7 next year. Probably can't do that but at least I can cause some grief for the CA suing me.

I have lots of time and energy. I'm just trying to avoid paying a couple hundred bucks to remove the lien when I do file BK. So it's not worth any money investment.

BTW, I always appreciate your posts and info.....Thanks

[treehugger1]

That's what I thought. The best you can do is prepaer your "answer." I don't have any personal expereince in this, but I think the path of resistance will come to you. Does it cost you to file an answer in your state? Would this be several hundred dollars? Something else to think about.

[WhatMoney]

Section 1692g(b) then provides that if the consumer disputes the debt, the collector must cease further collection efforts until the validation procedure is completed. However, the debt collector's contemporaneous filing of a lien with the clerk of court and the sending of an initial collection letter to a consumer prior to the consumer requesting verification of that debt does not violate the FDCPA.
from: Spears v. Brennan, 745 N.E.2d 862 (Ind. App. 2d Dist. 2001).

So you have an FDCPA violation according to Spears. If you bring this up I think it should be as a counter-claim, not affirmative defense. Problem is most state judges don't want Federal law cases in their courtroom, and may therefore ignore your counter claim. It may not slow your case down one day. They may tell you to sue in Federal, meanwhile you are still getting sued for your debt today, and with no affirmative defense all you can do is deny the debt is yours and hope the Plaintiff is unable to prove it is. You can delay with Discovery and hope the CA attorney doesn't have the validation and eventually gives up if you keep challenging their evidence.

Of course court fees keep piling up every hearing. I've seen many internet brave soles get all worked up about defending themselves, until they actually answer and find out it's going to cost them $250 without an attorney in court costs.

You can always sue in Federal court for the FDCPA violation. But you'll need an attorney. And the attorney will tell you that one violation of the FDCPA is not enough to assure you will win. What you need are continued and deliberate violations of FDCPA by the collector, with proof of each violation.

There is nothing that prevents the creditor from claiming they did send you a DV letter for example. No proof of delivery is required - only that the CA has a system set up to respond to DV's. Then they can claim a bona fide error defense, and still defeat you. In other words, the FDCPA is a difficult path stacked against the debtor in any court, unless you have multiple violations and a good attorney.

http://www.horwitzlaw.com/images/MO-CLE-09-24-05.pdf is a good legal discussion of the FDCPA.

Congress' intent in enacting the FDCPA has not been fulfilled. As is apparent from the decisions discussed below, the abuses Congress meant to abolish have continued virtually unabated. Many of these decisions deal with serious violations by attorney and nonattorney debt collectors alike, such as "padding" debts with unauthorized charges, systematically filing lawsuits in improper forums to make it difficult or impossible for consumers to be heard, and impersonation of attorneys by lay debt collectors, often with the complicity of the attorneys whose names are used. Debt collectors have displayed a remarkable lack of willingness to voluntarily comply with the law.

[ssdsco]

Section 1692g(b) then provides that if the consumer disputes the debt, the collector must cease further collection efforts until the validation procedure is completed. However, the debt collector's contemporaneous filing of a lien with the clerk of court and the sending of an initial collection letter to a consumer prior to the consumer requesting verification of that debt does not violate the FDCPA.
from: Spears v. Brennan, 745 N.E.2d 862 (Ind. App. 2d Dist. 2001).

So you have an FDCPA violation according to Spears. If you bring this up I think it should be as a counter-claim, not affirmative defense. Problem is most state judges don't want Federal law cases in their courtroom, and may therefore ignore your counter claim. It may not slow your case down one day. They may tell you to sue in Federal, meanwhile you are still getting sued for your debt today, and with no affirmative defense all you can do is deny the debt is yours and hope the Plaintiff is unable to prove it is. You can delay with Discovery and hope the CA attorney doesn't have the validation and eventually gives up if you keep challenging their evidence.

Of course court fees keep piling up every hearing. I've seen many internet brave soles get all worked up about defending themselves, until they actually answer and find out it's going to cost them $250 without an attorney in court costs.

You can always sue in Federal court for the FDCPA violation. But you'll need an attorney. And the attorney will tell you that one violation of the FDCPA is not enough to assure you will win. What you need are continued and deliberate violations of FDCPA by the collector, with proof of each violation.

There is nothing that prevents the creditor from claiming they did send you a DV letter for example. No proof of delivery is required - only that the CA has a system set up to respond to DV's. Then they can claim a bona fide error defense, and still defeat you. In other words, the FDCPA is a difficult path stacked against the debtor in any court, unless you have multiple violations and a good attorney.

http://www.horwitzlaw.com/images/MO-CLE-09-24-05.pdf is a good legal discussion of the FDCPA.

Thanks for the info.

[treehugger1]

I think the last comments are important. Maybe you answer and don't attempt anything other then to figure out how to show up in court. I, too, wonder what the response of the court is to someone who knows they owe the debt but cannot pay it as agreed. Does the judge have the right to stipulate a repayment plan?

I am still not highly educated as to what happens in my state of Oregon. If one answers a summons, it appears you are in the queue for arbitration (non-small claims court,) prior to an actual trial case beginning. What I can't figure out is what happens in arbitration and who pays for it? Everything I can see on the county websites that report status of suits suggest "eligible for arbitration." What does this mean?

[WhatMoney]

treehugger,

This site (Clackamas County) is all I know about civil court arbitration. I would expect it is the same for most of the large OR counties.

http://www.ojd.state.or.us/cla/arbitration.html

In civil cases, the lawsuit goes into arbitration depending on the amount of money the plaintiff is asking for. Cases less than $50,000 must go into arbitration.

How does a case end up in arbitration? The court orders a case into arbitration. Once the court order is entered, the court provides a list of arbitrators, and the parties can either select an arbitrator from the list or choose someone that both sides trust to make fair decisions.

What is the cost of arbitration? Within 14 days of the appointment of the arbitrator, each party must tender to the arbitrator the sum of $350.00 as preliminary payment How does arbitration work? Arbitration is a way to keep the cost of lawsuits down and shorten the time it takes for a case to get resolved. The arbitrator decides when motions and hearings are set. Before the hearing, each side must give the arbitrator a list of the witnesses who will testify at the arbitration hearing and a description of any evidence that will be presented.

Just a few excerpts from the site above. $350 per party for arbitration? And $125/hr for the arbitrator? How does this keep the cost down?

[ssdsco]

Thanks for all the info and suggestions.

At this point I'm inclined to let it go to a default judgment and pay the additional fees when I file BK to remove the lien. From what I understand I should be able to remove the lien because the judgment/lien impairs a BK exemption. I am going to do some research and try to understand why many recommend you respond to a summons even if you owe the debt and are filing BK at some point.

Now I have to go read all the threads on protecting my pension checks/bank account from the judgment.

Thanks again.

[treehugger1]

I think many folks can't afford a 25% garnishment of after-tax wages or whatever their state allows. Such being the case, either one needs to respond/answer, or file BK.

Its good to keep in mind that a judgment is nothing other than a court document stating you owe money to the plaintiff. It is true that if the judgment exceeds a certain monetray value, a lien is automatically placed on real property. There are exemptions for judgments as well as exemptions for BK, and in Oregon these are the same. It is up to you to make use of your exemptions.

Your pension should be exempt, and it is great that you are thinking about potential future issues before they rise up and bite you.

Cheers!