Archive for May, 2012

No One Appeared for Trial for the Credit Card Bank Suing Me in a Debt Collection Lawsuit

Saturday, May 26th, 2012

Question:
I was at the Superior Court yesterday for the trial.  No one from a large credit card company showed, not even their lawyer, so the judge dismissed the case.  I quickly asked if it could be with prejudice. The judge said no, because there was no trial presentation.  Is there anything that I can do to protect myself from being sued again?

My Response:
The judge is correct. Without the trail starting and the lawyer for the plaintiff credit card bank attempting to present their evidence, the judge is unable to enter dismissal with prejudice.  Please see my blog posting on dismissal with prejudice of a credit card lawsuit.

You should be satisfied that the case was dismissed, because if the debt collection attorney had appeared at the trial with evidence of the credit card account with your name and address, many judges would enter a money judgment for the full amount presented, plus interest, court costs, and attorney’s fees.  Sometimes, the judge decides to not dismiss at trial and asks the clerk to send a written notice to the plaintiff’s attorney, giving them yet another chance to appear and present their case for trial. The result of dismissal is obviously more favorable to you, the defendant, as you need not appear again to see if they will appear.

You are permitted to file a memorandum of costs, to secure the amount that you paid for the filing fee to the clerk of the court. You should file the memorandum of costs with the court within 15 days of being notified that the case has been dismissed.

Because this debt collection lawsuit was dismissed without prejudice, it is possible that another collection lawsuit may be filed on this debt, either by the same company or by another entity, known as a debt buyer. If no other entity files a lawsuit against you on the same debt or if they fail to file within the statute of limitations period, then the debt will be considered discharged by law, once the period of time to file has expired. Please read my blog, explaining the statute of limitations period and what happens if the debt becomes time-barred.

Robert Stempler
www.StopCollectionLawsuits.com
Twitter @RStempler

 

Am I better off filing bankruptcy now, than dealing with a credit card lawsuit?

Saturday, May 19th, 2012

Question:
I was served with a debt collection lawsuit from a credit card that I was not able to pay off.  I had been paying the minimum payments with interest for many years, which no longer made sense to me and was never going anywhere.  A debt collection agency, not the credit card bank, is named in the lawsuit and they have a lawyer here in California.  Does it make sense to file bankruptcy now?

My response:
No. Filing bankruptcy is a substantial decision that can be delayed and decided later, if you are unsuccessful in fighting off or settling this debt collection lawsuit and any other lawsuits that happen to be filed against you for other unpaid debts, if any.  The first video on the home page of  www.StopCollectionLawsuits.com discusses an individual’s six options, each of which deserves consideration and understanding of the pros and cons, before narrowing it down to a couple of worthwhile options, then going with one.  Thus, that video and my other videos are a good starting point, along with my blog posting on making your next steps count.

In deciding whether to file bankruptcy or one of the other six options, much depends on your and your family’s financial status and current income.  Perhaps you do not qualify for a Chapter 7 Bankruptcy, and thus this is not an option for you now, but you may qualify in the future.  Also, perhaps you are in a career or regulated industry that prohibits employees from having a recent bankruptcy filing or any bankruptcy.  Perhaps being able to discharge this and all other debts would make bankruptcy worthwhile, though sometimes if you are patient, you can discharge other substantial debts, such as income taxes.  Perhaps your finances are mixed up with other family members, such as you have property or accounts held in joint names, which can make filing bankruptcy a problem for that asset and the other persons.

If you have further questions, be sure to consult with an experienced debt collection defense attorney to help you understand each of the six options.  If you consult with an attorney who’s practice is mostly bankruptcy cases, he or she may be more inclined advise bankruptcy, rather than offer you alternatives to bankruptcy, such as defending the lawsuit or settling.  My web site’s free eCase review asks whether the consumer has received any settlement demands to settle the debt, because then the consumer knows earlier if settling is realistic.  The key to making the best decision here is to understand your options and having experienced legal counsel.

Robert Stempler
www.StopCollectionLawsuits.com
Twitter @RStempler

Credit Reporting of Non Existent Small Claims Court Money Judgment

Tuesday, May 15th, 2012

Question:
My credit report shows a money judgment from small claims court, but that debt collection case was dismissed when we settled before the case was called.  I have a document showing dismissed and I am applying for a job that may want to check my credit records.

My response:
You probably had a local company sue you in small claims court to collect its own debt, because debt collectors typically are not permitted to enforce in small claims court debts that were assigned to them.  (Cal. Code of Civil Procedure, Section 116.420, subd. (a).)

Please check the small claims court’s record of that case to verify it was dismissed.  Then send a copy of the case record (showing no money judgment, dismissed) with a cover letter to dispute this on your credit report. My Firm’s web site’s (www.stopcollectionharassment.com) sample letter 3.1 would be a good form to follow and already has the addresses for the big three credit reporting agencies. If you only need to dispute with one of them, then remove the other addresses and send it to the one that is reporting this money judgment. Please also be sure that you follow the letter writing tips, such as keep a copy for your records and send by U.S. Certified Mail, return receipt requested. Once disputed, the agencies by law must investigate or remove within 30 days of receipt.

If you find that the court mistakenly entered a money judgment in the collection case in small claims court, then before you can dispute this on your credit reports, you must get the court’s record corrected and the judgment reversed (vacated, set aside).  You may need to file a motion with the court to set aside an invalid default judgment.  See Cal. Code of Civil Procedure, Section 116.740, for the procedures to vacate an improperly entered default judgment.  However, it sounds as though you were properly served and appeared at the hearing, so that you may need to file in Superior Court a separate complaint in equity and have a trial to vacate the improper default judgment, taken without your consent.  This is a complex proceeding and you would be well advised to consult and retain experienced legal counsel to ensure that the case and law are properly presented, or the court may not grant the relief that you need.

Robert Stempler
www.StopCollectionLawsuits.com
Twitter @RStempler

Hospital Overcharges Discovered After Signing A Settlement with Debt Collection Law Firm

Saturday, May 5th, 2012

Question:
I was served with a debt collection lawsuit for an unpaid debt at a hospital. The amount seemed high, but I was not sure what to do and was afraid of having a default judgment entered against me, if I did not do something before my due date to respond to the complaint. I had not contacted any lawyer, so I did not know my rights.  I spoke with someone from the collection lawyer’s office and they sent me a stipulation agreement to settle in full, which I signed and returned, because the payments were affordable. I now learned from reviewing the hospital’s billing records that I was badly over charged and the amount that I agreed to pay was much more than I really should owe. What can I do about this?

My response:
Hospital overcharges and billing errors of uninsured patients are one epidemic that the medical profession has not done much to address. I have represented consumers sued on medical debts, including a couple of cases involving hospitals, which resulted in substantial billing adjustments for improper or excessive charges and errors.  Negligent or ineffective treatments may be one further area for adjusting excessive bills, when appropriate and timely raised by the patient.

In this situation, courts typically enforce written settlement agreements, unless you have convincing evidence that the agreement was induced by fraud. The fact that you did not investigate the bill before signing the settlement agreement may not be enough to avoid the settlement afterwards. Before deciding to not pay the settlement, please consult an attorney with the documentation and any evidence of fraud.  Not paying a settlement usually allows the debt collection attorney to obtain a full money judgment against you, which may make a bad situation worse, as this will show up on your credit report, wage garnishment, and levies on your bank account.

Robert Stempler
www.StopCollectionLawsuits.com
Twitter @RStempler