Uncategorized | Your Legal Leg Up

Is Defending Yourself Hard?

June 18, 2018

Are Debt Collectors Hard to Beat?

Considering that I direct many of my marketing efforts towards people who are regular people and not necessarily doctors and lawyers, it is surprising how often I do not get asked the question: Is It Hard? Is it hard to represent yourself in court against the debt collectors?

Well, is it? Here’s a good lawyerly answer: “Yes…and no.”

Or maybe I should say, “No…and yes.”

I wouldn’t say (although I have heard others say it) that a trained monkey could be a lawyer. But anybody reading this could defend himself or herself in court in a debt collection case. This particular type of law is not that hard. And there are two main reasons for that: the law is relatively simple, and the actual cases are dominated by a few simple questions that do not involve subtle determinations of who is telling the truth.

Debt Law

The law regarding debt is ancient and well-established. Debt is as old as the law itself, and with very few variations, the law provides a remedy if the creditor can show that the money is owed. The law concerning debt collection and collectors, on the other hand, does involve slightly more complexity. But not much more, and the standard of behavior is generally considered from the point of view of an “unsophisticated” consumer. That means fewer loopholes and less arguing about whether the words spoken have some meaning that an average person wouldn’t know.

Debt Cases

And on the other hand, the facts in debt law are simple: can they provide the evidence in a form recognizable by the courts? Do they have the actual, original documents? And do they have people with actual knowledge of what they say and why? And often the debt collectors, because they purchased the debts from someone else, do not have these documents, and they never have the actual knowledge. So then the question becomes: can they find the people who do have that knowledge and get their testimony without the whole suit becoming unprofitable.

And the answer is that they usually cannot.

So debt cases generally involve simple questions of evidence. They are easy that way, and a non-lawyer has almost as good a chance at winning as a lawyer. So what’s hard about it?

The challenge to representing yourself is more psychological. Undoubtedly you have to be brave.

You have to be brave enough to tell yourself that you are worth defending even if you don’t have much, or any money. Brave enough to see that today’s financial disaster could give way to a much brighter tomorrow if you can stand up for yourself. Brave enough to see yourself in a new place, enjoying life

as you may not have done for a while. And brave enough to look at something that’s probably completely new and take the time to figure it out instead of panicking.

That does take some real courage.

But with a little help, a little guidance, and a little background information, anybody can do it. It’s only hard because it’s unfamiliar. But those who do it find that the world has changed more than they ever thought possible.

Mailbox Rule – Counting Time in Litigation

June 18, 2018

You Add Time to the Due Date when the U.S. Mail is Used

In most courts, if a party sends material to the other side by mail rather than in-person delivery, and that thing requires action by a certain deadline, then time will automatically be added according to the rules of civil procedure. That is called the “mailbox rule.” This video discusses the mailbox rule and how days are counted in litigation. It answers fascinating questions like, what happens if the due date falls on a weekend or holiday?

One of the most basic facts you should know – that I frequently get asked – is when the days start counting. If you are served on Monday, day one of the count is Tuesday in every jurisdiction of which I am aware. Watch this video to understand the way time is counted. It can be important!

Failing to Respond to Requests for Admission

June 18, 2018

You Need to Fix This Fast

As you know if you’ve read any of my materials on the subject, when you fail to respond to any (or a set of) Requests for Admissions, they are, in most states, automatically “deemed” admitted. That means that if you do not take some action to change that, they will be considered proven and beyond dispute.

There is no need to file a motion to compel or any of the preliminary negotiation that might involve when it comes to requests for admissions. Fail to deny a request for an admission and it is considered admitted automatically. That means you can’t deny it later – either in response to a motion for summary judgment or at trial.

Debt Collectors Looking for a Quick, Cheap Victory

Naturally, debt collectors love requests for admissions because a little carelessness on your part can lead to a quick victory for them. They normally request that you admit that every single part of your answer, and all your denials of their allegations, are not true. Fail to respond and it looks like you have admitted your entire case was just a lie. They just wait a day or two after the time has passed and then file a motion for summary judgment.

What can you do about that? Well, if the time has passed for filing responses to the requests, you cannot simply serve denials on the other side and expect them to mean anything. They do not. Rather, you must ask the court’s permission “leave” to file them “out of time.” Your argument is that your state (and every one does) has a strong policy in favor of determining cases “on the merits” according to actual justice. Your failure to answer the requests is a mere technicality – you were not meaning to subvert or disrespect the legal process – and therefore you should be allowed to file your responses now. And of course you attach your responses to that motion.

Time Really Counts

The less late you are, the better your chance – and really you should win it almost every time.

One thing the debt collectors do to try to stack the deck against you is to file their motion for summary judgment as quick as they can. Then they will argue that they have been “prejudiced” by your attempting to take back all your admissions. That is, they will say, they have spent vast amounts of time and effort on their motion in the innocent belief that you had admitted everything. Well, it never worked for me when the shoe was on the other foot, but these are rich plaintiffs dealing with, in general, poor and disfavored defendants. And the shoe never really does go on the other foot in that situation, does it? Speaking realistically.

Your Case against the Debt Collector Rides on it

So you will have to work harder to get the admissions withdrawn. Remember that if you fail to do so, your case is basically over – you will have admitted everything against you. In a way, the extremity of their requests – and the blatant opportunism that implies – is your best argument. But there’s something else you can do to make your chances much better. Debt collectors file these cases by the dozens, and requests for admissions are their standard second step. And their standard third step? … filing motions for summary judgment. Chances are therefore very, very good that your debt collector will have file one or more (most likely) motions for summary judgment in exactly similar situations, making the same arguments. In fact, the motion for summary judgment will probably be standardized, too. You’ll see that only a few words were changed. You need to find at least one of those, because that will be proof that they did not spend any significant time on their motion for summary judgment, and their claim that they did is (going to be obviously) a lie.

Specific Action

Technically, what you would do here is Missouri (but I don’t know for your jurisdiction) is file a Motion for Leave to File Responses to Requests for Admissions out of Time, file the denials with them as an attachment, and file a Memorandum in Opposition to the Motion for Summary Judgment based on the facts deemed and declared admitted by the debt collector being “mooted” by your denials. Because if you denied their requests for admissions, their motion for summary judgment will no longer have any basis at all.

Equitable Defense – Unclean Hands

June 18, 2018

“Unclean Hands” in Debt Litigation

How does the equitable doctrine of “unclean hands” show up in debt litigation? Can you use it in your defense? Yes… sometimes. And it might be used against you, too – although rarely with effect. The basic idea behind unclean hands is that the party with the dirty hands did something specifically that would make court intervention on his or her behalf wrong. This often, but not always, translates into some action related to the claim in question that either profits the person bringing suit or prejudices the other’s right or ability to defend unfairly.

Introduction

Like laches, the doctrine of “unclean hands” it is an equitable doctrine that has its roots in English history. And like laches, it is rarely considered, but potentially useful, in defending debt litigation.

What are “Unclean Hands?

Unclean hands are hands (figuratively speaking) soiled by some sort of wrongdoing. If your hands are “unclean,” you may not ask the court to assist you because the court is supposed to maintain a higher integrity and will not be a party to immorality or injustice.

The doctrine of unclean hands as we know it got its start in England. In English law, the law was long considered a sort of absolute, and if you could comply with the absolute words of a statute (law), you could invoke the remedy of the law regardless of how the legal wrong had occurred. Over time, the courts became aware that simple adherence to the law could sometimes lead to serious injustice, and “equity” was born. That was the idea that the court could take a look at the overall situation and should not allow itself to be a pawn in someone’s immoral game even if that game fell within the letter of the law.

Considering the difficulty of applying “morality” uniformly or predictably in as large a country as ours, courts have striven to define uncleanliness more tightly, and this has tended to merge the concepts of law and equity considerably. But there are differences.

Unclean Hands in Modern Law

The most obvious application of “unclean hands” is the well-established notion that the court will not enforce an illegal contract. The Mafia would not be able to sue a hitman for damages for failing to carry out an assassination, for example. Their remedies, if any, would be strictly “extrajudicial”–not necessarily an advantage for the incompetent hitman.

Unclean Hands in Debt Law

The doctrine of unclean hands comes up often in foreclosure law, as a party is supposedly not entitled to profit from a wrong it caused itself. Suppose you have a mortgage you’re paying which includes an escrow for taxes, for example. This is very common, and the mortgage provides that the bank will, according to certain formulas, determine that escrow and add an appropriate amount to the loan payment amount. Mortgage agreements often also provide that partial payments need not be accepted by a bank and that there is no “legal” defense to foreclosure for failure to make payments as required by contract.

If the bank wrongly increases the escrow by miscalculating the taxes, it could raise the payments due to a level beyond your ability to pay. If you then continued making the correct payments, the bank might refuse to accept those payments and put you into foreclosure. Unclean hands might be the doctrine that could stop that foreclosure: the bank itself caused the inability to make payments. Because the courts have not always applied the doctrine, Congress stepped up with various laws (e.g., the Truth in Lending Act, among others) to add to consumers’ protection.

Unclean Hands in Credit Card Debt Law

Another possible application of the doctrine might be the ways the banks apply what is called the “universal default” provision which they so often sneak into credit card applications. According to the universal default provision, a default in payment to one creditor can be, but does not have to be, considered a default on all creditors. In other words, if you are disputing a bill with one credit card and allow it to go into default, that default might trigger default in another, unrelated credit card. When that happens, the second bank might raise its interest rates from 9% to 30%. In theory this is to cover for the increased risk of default of a troubled debtor, but in reality it is intended, as so many aspects of the credit card agreements are, to profiteer from somebody’s mistake,

At some point, a court might consider that sort of exploitation “unclean” and deny a bank the use of the courts to carry it out. Because the doctrine might also equally apply to many of the fees and charges the banks heap onto delinquent accounts, a debt defendant should always consider adding the unclean hands defense. And this would be especially true where a debt collector’s illegal actions, for example a communication to an employer, actually hampered the consumer’s ability to make the payments supposedly owed.

For More Equitable Doctrines

Click here to read about what equitable doctrines are – estoppel, issue or claim preclusion (court doctrines that prevent you from relitigating issues you either have, or should have, argued in front of court) and how they might apply to your case.

Conducting Discovery in Debt Cases

June 18, 2018

This video discusses the things you need to know – and how you find them – as you begin the discovery process. Things like interrogatories, requests for production and requests for admissions, and even depositions. These are the things you need in order to prove that the debt collector doesn’t have a case.

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Three Questions and Answers about Discovery

June 18, 2018

When Does the Process Begin, What Is the Court’s Role, and How Do the Methods of Discovery Relate to One Another?

I get certain basic questions about the discovery process quite often.

When can you begin conducting discovery? And when can the debt collector do it?
How do interrogatories, requests for documents, and requests for admissions relate to one another?
And What is the Court’s involvement in the discovery process?

The answers aren’t always clear, but this article will answer these questions to the extent they can be answered.

When Does Discovery Begin?

The simplest answer to this question is no answer at all: Discovery begins when the Rules of Civil Procedure for your jurisdiction say it begins. I have discovered that the discovery process begins at very different times for different courts.

Federal Courts

In the federal courts, the defendant can serve discovery immediately upon being served with the summons, whereas the plaintiff must wait for some time before beginning the discovery process. I guess this is a way of allowing a defendant to focus on investigating the complaint and filing an answer.

Most State Courts

In most state courts, the parties can begin discovery at the same time, either immediately or after some period of time, usually thirty days after service. In debt law cases, though, I have rarely observed that debt collectors begin discovery as quickly as they could. My guess is that they are hoping everybody will default (and most defendants do), so it would be wasteful to start the discovery process before the time for default has passed. This gives a defendant an advantage to begin the discovery process before the debt collector does, and this advantage should not be allowed to slip away.

Some State Courts

In some state courts, most often courts of limited jurisdiction (i.e., for smaller amounts, as most debt cases are), the parties are not allowed to begin discovery without an order of the court that allows it. I think this is a terrible rule. But regardless of my opinion, you need to know if that’s the rule in your jurisdiction, and if it is you need to seek an order permitting discovery as quickly as possible. Remember that discovery is an important part of your defense. There is even one jurisdiction of which I am aware where no discovery is allowed at all. In this jurisdiction, though, you can seek a trial “de novo” if you are not happy with the result. That is, you can start the whole case over in a higher up court that does allow discovery. In Maryland, on the other hand, discovery begins immediately upon service of the suit – and ends about a month later – unless you receive permission from the court.

The important “take-away” from all this is that state laws vary, and you need to know your state’s law as soon as possible. Not finding this out is asking for trouble.

Click here for the rest of this article

Coaching and Training Others

June 16, 2018

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Debt Litigation Manual – Pre-suit

June 15, 2018

If you are in the “pre-suit” stage, you are at least pretty sure that you are either going to sue or be sued. Of course this is not true of most debts – a vast majority of them never get litigated at all. But you almost never know for sure whether a debt will, or will not, go to litigation. Therefore you must make efforts to protect your rights.

As soon as the possibility of litigation enters the picture – and for as long as it stays there – you must remember that you are playing by different rules than you would in ordinary life. In ordinary life, for example, people think it admirable to admit your wrongs and try to make them right. To pay at least a little even if you can’t pay it all. And above all to communicate with the other people to minimize bad feelings and maximize possibilities.

This all changes if the possibility of litigation is there. All those usual things would just hurt you then. For example, admitting the debt and trying to work out terms might – and most likely would – constitute an admission that made it easier for them to sue you. And making it easier to sue you means making it more likely. Making any partial payment would “re-age” the debt, making it start all over from the point of view of the statute of limitations.

Thus if litigation seems at all likely, you need to start acting more strategically: make them think that suing and winning isn’t likely or at least that it will be expensive. Any doubts you can encourage about their ability to get any money even if they win are good ones. And if you don’t see how you will pay it all, you probably shouldn’t pay anything.

Teleconferences at Your Legal Leg Up

June 7, 2018

Tip 8 of Uncommon Common Sense

June 6, 2018

Tip 8: Lots of proof of one thing doesn’t make up for not enough proof of something else.

Today’s tip concerns proof.

Once you get past the risk of defaulting or losing (or winning) on some technicality, there remains the challenge of actually winning your case. If you are the defendant, you might put this as “not losing” your case by motion (for summary judgment) or at trial. To do this, you need to know about proof and evidence.

You’ll Win or Lose Based on Evidence

As you know, debt lawsuits are about proving that, for some reason, you owe the debt collector money. What they have to prove, and how much evidence they need are important questions.

Their case

In debt law, the debt collector must prove ownership of the debt or some other right to collect the debt, the amount owed, the fact that it hasn’t been paid already (as aspect of amount owed), and that it is due. In “contract” language: that there is a contract, that the contract gives the plaintiff the right to collect, that payment is due and owing, and that payment has not been made. Each one of these things must be proved separately.

Burden of Proof

The burden of proof is just what you’d think. It’s the amount of proof that must be put forward. In civil cases, this is not the “beyond a reasonable doubt” standard that you might have heard of in criminal cases, but a much lower burden. This burden is called a “preponderance,” which is just a fancy way of saying a “majority,” or, as jury instructions usually say, “more likely than not.”

We all know these cases are almost never going to come down to a delicate balancing of uncertain evidence. In 999 out of 1,000 cases, the issue will just be whether the debt collector can put on legitimate evidence to prove its case. And it normally will not have any legitimate (truly admissible) evidence of some of the issues. Remember, they have to prove each element of their case.

The Tip

And thus we come to our tip: Lots of proof of one thing doesn’t make up for not enough proof of something else. The debt collector may have a lot of proof that it owns the debt. It may have a lot of proof that you owe somebody the debt. Although to tell the truth it often will not have proof of either of these things. They will likely have a few “statements” that you were supposedly sent (although they won’t have evidence that they actually were sent), an affidavit claiming that you owe a certain amount, and they’ll try to bluff it through from there.

Remember at every stage of the actual proof that the debt collector must prove each part of its case, and a lot of evidence of one part does not in any way lesson the burden of proving every other part. When you are attacking their case, therefore, you attack every part of it. Challenge every piece of evidence and show that the evidence isn’t admissible. Learn the important rules of evidence and prepare your objections before trial. This is not something you can “wing.” To give yourself a chance to win, you must prepare your objections in advance.