Many debt collectors will offer a settlement agreement or stipulation to a consumer after a lawsuit is filed.  Usually, that agreement specifies that the consumer is to make certain payments every month for a set time period.  Often, the agreement promises that the debt collector will not seek or enforce a judgment, or will simply claim that the consumer can avoid “going to court”, if they only sign the agreement.  Then, when the consumer misses a payment or is short on a payment, significant problems can arise: their bank accounts are emptied, their car is seized, or their wages are garnished.  It is heartbreaking receiving a call from a consumer at this stage, as many of their rights have already been lost.

Countless times, after reviewing the lawsuit documentation, we are able to identify valid affirmative defenses that the consumer could have asserted to prevent the entry of a judgment.  However, most settlement agreements require that you give up your rights to defend the lawsuit.  Sometimes, they require you to agree in writing that you owe the debt – even if this isn’t true!  We have even seen settlement agreements / stipulations that give up your legal right to shield some of your money from judgment creditors.

Before you agree to sign such a settlement agreement, we would be pleased to review it and advise you of your rights and obligations.  For example, perhaps your income and assets are exempt from seizure if the debt collector obtains a judgment against you.  This may include your social security, disability, worker’s compensation, unemployment, wages/salary of the head of household, and other income or assets.  Why would you voluntarily want to give your money to a debt collector if they have no legal right to take it?

Unfortunately, if you aren’t aware of your rights, you may lose a significant portion of your funds that you could otherwise spend on essentials.  Don’t lose those rights – contact us today for a free consultation.

Equable Ascent Financial, LLC hired the law firm of Hayt, Hayt and Landau, P.L. from Miami, Florida to sue our client here in Central Florida for an alleged credit card debt.  Attorneys Robert Orovitz, Dana Stern and Jason Dragutsky represented Equable Ascent Financial, and brought claims for Money Lent and Unjust Enrichment.

Upon being retained by our client, we filed our Notice of Appearance and other necessary legal documentation.  As a result of our efforts, the case against our client was permanently dismissed, without our client paying anything to Equable Ascent Financial.  If you have been sued by Equable Ascent Financial or any other debt buyer, please send us an email or call us for a free consultation before you lose important rights.

Zakheim and Associates, P.A., now known as Zakheim and LaVrar, P.A., sued our client on behalf of Discover Bank in a credit card debt collection lawsuit. The Zakheim attorneys assigned to this case, Kimberlee J. Otis and Michele L. Nihiser from Plantation, Florida, sued our client under the legal theories of Open Account and Account Stated.  NCO Financial Systems had also been involved in this credit card account. After we applied our knowledge of the applicable court rules, statutes and cases, including those applying to Open Account and Account Stated claims, the lawsuit against our client was dismissed.

As a Central Florida Consumer Protection law firm, our mission is Helping Florida Consumers.  We would be honored to put our experience to work for you.

We had the privilege of representing a client in County Court who had been sued for an alleged credit card debt.  The Plaintiff was FIA Card Services, who was represented by attorneys Richard Battaglino, Arturo Arca and Sasha Haro from Zakheim and Associates.

They sued our client for nearly $23,000 under two different theories (Open Account and Account Stated).  We used our knowledge of Florida law and the applicable Rules of Civil Procedure to aggressively defend our client.  We filed interrogatories asking important questions about numerous aspects of the case that were required to be answered by FIA Card Services under oath.  We filed requests for production seeking documents we could use to defend the case.  We also filed requests for admission in an attempt to force the debt collector to narrow the issues in the case.

After reviewing our firm’s aggressive tactics in defending credit card lawsuits, FIA Card Services, through its attorneys Zakheim & Associates, voluntary dismissed their case without any payment at all by our client.

If you have been sued in a credit card lawsuit or other debt collection lawsuit in  Central Florida (including Volusia County, Seminole County, Lake County, Brevard County, Orange County or Flagler County), please feel free to review the information on this website about our experience in defending against such debt collection lawsuits.  We would be honored if you would then contact us for a free consultation about how we can assist you.

There are several ways in which you can defend a lawsuit filed against you by a credit card company, debt collector, bank, auto finance company and other plaintiffs.  One of those ways is by proving an affirmative defense.

An affirmative defense is different than just defending your lawsuit.  In order for a plaintiff to win a lawsuit against you, they have to prove each of the “elements” of their claim.  For example, in a breach of contract lawsuit, they have to prove the existence of a contract with you (which includes offer, acceptance and valid consideration), that you breached the contract, and that they suffered damages as a result of the breach.  In a traditional defense, you can simply point out that they failed to prove one of those elements with admissible evidence and win your lawsuit.  Click here for a more detailed description of how I, as an experienced Florida debt attorney, can defend your debt collection lawsuit.

But what do you do if the credit card company or other plaintiff can prove its case?  Does that mean you automatically lose and will have a judgment entered against you?  The answer is not necessarily, if you can prove a valid affirmative defense.

An affirmative defense is a defense that essentially provides a reason why you should win even if the plaintiff in a lawsuit can prove its case.  If you prove an affirmative defense, you can win the lawsuit or reduce the amount of money the plaintiff can recover.

One such affirmative defense is the Statute of Limitations.  A Statute of Limitations is a state law that prohibits a plaintiff from winning a lawsuit if they simply wait too long to enforce their rights.  For example, the Statute of Limitations for a breach of contract in Florida can be four years.  If they wait more than four years from the breach of contract, you can assert the affirmative defense of Statute of Limitations and have their lawsuit dismissed.  Click here for an example of a credit card lawsuit against our client that violated the statute of limitations and was dismissed.

Another affirmative defense can arise if you reached a settlement agreement with the credit card company and fully performed your obligations under that agreement.  If they then sue you for the original amount owed before the settlement, you can assert the affirmative defense of Accord and Satisfaction.  That simply means you reached a new agreement that you fully complied with, and they are not entitled to renege on their deal.

Examples of other potential affirmative defenses are:

• Plaintiff’s failure to attach the contract or other necessary paperwork to the lawsuit complaint
• Plaintiff’s failure to comply with court rules regarding how they must present their claim and describe
• An out-of-state Plaintiff’s failure to post the necessary bond with the clerk of the court
• Being sued on credit card charges that you did not authorize: if you did not authorize the charges (and are not a co-signer for someone else’s account), you are not responsible for the charges
• Being sued for late fees, over limit charges, collection fees, attorney fees, court costs and other fees and charges, unless those charges are explicitly allowed under the contract or Florida law

There are also many other affirmative defenses, depending on the type of case.  The key point, however, is that you can lose your affirmative defenses if you do not assert them properly and at the right time.  In some cases, these affirmative defenses can also allow you to bring a counterclaim against the debt collector or its attorneys.  In those cases, you may be able to not only win your case, but recover money from the other side.

You should consult with a knowledgeable Florida consumer attorney who is experienced in defending debt collection lawsuits.  If you are located in Central Florida (including Seminole County, Orange County, Lake County, Brevard County, Volusia County or Flagler County), we would be honored if you would call us on our toll-free number, 1-888-834-5297 for a free consultation.  That one call can mean the difference between winning and losing your lawsuit.  Of course, you can also contact us by using our convenient website contact form or by faxing us.  As a Florida debt lawyer, I am committed to pursuing justice on your behalf.

In prior postings on this blog, I have identified numerous problems with the way credit card companies, debt collectors, and their lawyers try to abuse consumers through the legal system.  In this post, I provide some guidance on possible solutions that would at least curb some of the most flagrant abuses.

Require Proper Evidence of the Debt:  In many debt collection lawsuits, the credit card company and their lawyers don’t attach the credit card contract to the lawsuit.  Why do we tolerate debt collectors who sue on an alleged contract but don’t even provide you a copy of that contract?  Florida’s laws of civil procedure require that the contract be attached to the complaint or statement of claim.  If it is not, the debt collector should be forced to either provide a copy of the contract or dismiss their lawsuit.

Require Meaningful Reviews by Lawyers Before Suing:  In many debt collection lawsuits, the lawyers simply file a form pleading that is essentially the same as for all their other lawsuits.  Requiring the lawyer to review the facts of each case before signing the lawsuit paperwork would go a long way toward curbing these lawsuits.  In one of my recent cases, a debt collector sued on an alleged credit card contract, but then denied that such a contract existed.  Such lawsuits are frivolous and nothing but an attempt to intimidate the consumer.

Strengthen Government Enforcement:  Meaningful enforcement of state and federal laws can also prevent significant debt collector abuse of the legal system.  Instead, the government’s enforcement tends to get publicity only in the run-up to elections.  Then, it conveniently fades until the next election.  Having an assistant attorney general spend an entire day in small claims court watching the abuses that take place would undoubtedly be an eye-opening experience for them.

Improve Consumers’ Access to Legal Assistance:  Very few consumers sued for credit card debt are represented by lawyers.  Part of the reason is that many attorneys prefer to work for large and wealthy corporate clients; in contrast, consumer protection attorneys in Central Florida are few and far between.  It would be helpful for court clerks to at least post information outside the courtrooms telling consumers where they can find free or low-cost legal representation.

These recommendations are drawn in large part from the May 2000 report entitled Debt Deception – How Debt Buyers Abuse the Legal System to Prey on Lower-Income New Yorkers.  Based on my experience as a consumer protection lawyer in Central Florida, these recommendations would go a long way to help Florida consumers from being victimized by debt collectors.

Recently, a new report was published regarding debt deception and how debt buyers abuse the legal system.  Although the report was based on a study in New York, my experience as a consumer protection lawyer in Central Florida reveals the same kind of debt collection abuse takes place here in the Orlando – Daytona – Melbourne metropolitan area.

Debt buyers are companies who buy debt from other companies who were unable, unwilling or prohibited from collecting those debts from consumers.  For example, a credit card company may decide that it is unlikely to collect a debt from a consumer, and simply sell that debt to another company who specializes in debt collection.  Usually, such debt is sold for pennies on the dollar.  That way, a debt buyer who is successful in collecting on that debt stands to make a huge profit.

The study revealed that 94% of debt buyers prevailed in court, usually through default judgment.  A default judgment is when the plaintiff (in this case, the debt buyer) wins the lawsuit simply because the defendant did not show up in court or did not file the proper paperwork.  The study noted that 90% of the consumers did not answer the summons and complaint, and only 1% were represented by an attorney.  As you might expect, virtually all people who had default judgments entered against them lived in low- or moderate-income neighborhoods.

Debt collectors obtain billions of dollars in judgments, sometimes using questionable or even illegal tactics.  Some of these tactics include:

• Filing lawsuits on claims that are legally barred, such as filing them after the statute of limitations has run
• Filing lawsuits on claims for which they lack proof of the debt
• Failing to ensure defendants receive proper notice of the lawsuit
• Failing to provide notice of their right to dispute the debt under the federal Fair Debt Collection Practices Act
• Using intimidation to pressure consumers to give up their legal defenses

This is consistent with my experience in Florida’s small claims courts in Central Florida.  This past week, I was in court on one of my cases in Volusia County.  My client was the only one who had a lawyer assisting her, out of 14 cases scheduled for that morning.  In other cases, I have personally observed consumers manipulated by stand-in lawyers who the consumers apparently believed to be impartial mediators.

Don’t allow yourself to be intimidated by debt collectors using illegal or questionable tactics.  If you have been sued by a debt collector, contact a consumer lawyer before you are deprived of your rights.  If you are in Central Florida (Orange County, Seminole County, Volusia County, Brevard County, Flagler County, Lake County, and surrounding area) and need an attorney to defend you in a debt collection lawsuit, please feel free to call us for a free consultation.  Or, just click here to send us an email and we will be happy to call you to discuss your case with you.  Remember, once a debt collector receives a judgment against you, they may be able to freeze your bank accounts, seize your assets (including cars), and garnish your wages.  A judgment will make it more difficult for you to obtain credit, secure housing or even find a job.   Don’t let this happen to you!

A recent study published by the National Consumer Law Center shed new light on the abuses that can arise from forced arbitration.  Arbitration is a process where the parties avoid going to court by using a private process to resolve disputes that would otherwise normally end up in court.  Arbitration is a private process, with lots of secrecy and without many of the most important rights you would have in court.  Unfortunately, many agreements have forced arbitration buried in the fine print of your contract, including credit card agreements, car purchase agreements, bank agreements, phone company agreements and many others.

Millions of consumers have given up their right to have a court resolve any disputes, along with the protections provided by the court.  Instead, the big business gets to choose the arbitrator.  Often, big businesses chose arbitrators that had previously given them what they wanted in such cases.  Simply put, the deck is stacked against consumers in those cases, no matter what the facts are and no matter what the law says.  Once big business wins in arbitration, it is generally very difficult for a court to set that win aside.

The study showed that, back in 2006, a Wall Street Investor to stack the deck even more.  He helped facilitate a direct financial connection between a law firm who often represented big business in those arbitrations and the arbitration companies themselves.  This corrupt arrangement was finally uncovered by the Minnesota Attorney General in the summer of 2009.

As a result of the work by the Attorney General and her staff, the National Arbitration Forum (NAF) was exposed, and agreed to stop doing most consumer arbitrations.  At least four giant banks also agreed to stop enforcing the arbitration provisions.  The giant debt collection law firm, Mann Bracken, collapsed from the fraud charges.  Please click here to read the full NCLC report.

Now that the fraudulent practices of forced arbitration have been exposed, I hope that they will disappear.  However, the banks’ pledge not to enforce arbitration agreements expires in 2013.  That is why it is important to put legislation in place to prevent companies from forcing you into arbitration through the use of fine print.  There has been some discussion of this in Congress recently, but only time will tell if it becomes the law of the land.