It seems that a number of folks are getting dunned for out of statute debts. Unless you reside in a state that has a statute of repose, a lawsuit can be brought, which will require that you plead as an affirmative defense that the SOl has expired. Current thought is just to send a C&D letter and be done with it. After researching some cases and watching the players, a full C&D as the first line of defense may have unintended consequences. First of all you need to research your state law and cases on SOL. Recently in my local court, defendants are being successful in thwarting the efforts of some large CC, CA's, JDB's and their uninformed counsel based on my states borrowing statutes. But, not all states have a borrowing statute. Most CC agreements have a Choice of Law Provision and it could be the Choice of Law state has a SOL that is longer than the state you reside in. Further, it may be that plaintiff's counsel may successfully argue that Choice of Law state trumps your residing state SOL. That is unless there is case law in your state that says the lesser of SOl applies, as it does in my state. This is how I would approach the issue. Let say I am dunned and I know for a fact that the alleged debt is way past the SOL or truly not mine. First, I would respond with a DV letter without a C&D provision. There will more than likely be no response. Secondly, after thirty days send a follow-up letter, something like: On xx/xx/xx I wrote to you in response to your letter of xx/xx/xx. I can only conclude by your silence and non-communication that you contacted me in error or that you are unable to validate and or verify the allegations contained in your correspondence. I fully expect that you have closed this matter and there is no need for further communication. Please govern yourself accordingly. With lowest regards, xxxxxxxxxxx Any thoughts or comments.
Good advice Enigma, and good summary of the possibilities. There does seem to be a rise in this "old debt" activity.
SOL is very state specific. One issue, if the choice of law is a state that you are never in, that state law might say that you not being there tolls the statute of limitions until you return. This could mean that you'd never ever see the end of it since you never go to that state, so your state might have a rule that says that if the other state's rules are really, really unfair, then your state's rules apply for that specific issue. So that can happen with SOL. Or not, check your state's case law, rules and laws. Also, again this is probably specific for each state, the rules might require that anyone wishing to use choice of law plead that in their complaint, or I guess answer. I think this is to provide notice to the other parties, but check your rules and case law.
I think on any JDB situtation, pre-SOL you avoid engaging unless you have money to settle or they actually sue, and after SOL you engage as an unsophisticated consumer and accumulate as many documented FDCPA violations as you can because SOL can always be a problem to plead and prove, but FDCPA violations bite back. And assuming you have a quiverful of FDCPA violations, I would always argue for $1k per violation statutory damages (against the existing case law that says it's per action, not per violation) on the grounds that we've had years of inflation since then and simply by virtue of the fact that the creditor has violated a lot it's clear that the $1k per action interpretation provides an insufficient deterrent to carry out the will of Congress that violations not occur. Sooner or later some debtor will get that one to fly.
I agree. Why not ask for more. If it goes to trial, the judge will award whatever they feel is appropriate anyway, regardless of what you ask (could be more, could be less). Besides, the real money in FDCPA lawsuits is in the attorney's fees. I saw one case where the award was $1000 for the FDCPA violation and $50-some thousand in 'reasonable' attorney's fees (they have some formula they use to compute 'reasonable'). From looking at the documents for that case, the attorneys for the plaintiff worked pretty hard for their money, nevertheless, the defendant's attorneys worked equally hard but the defendant doesn't get repaid for those expenses. At the same time, I've read a few pretty frivolous cases where the defendant was awarded attorney's fees. In one case, I would have also awarded punitive damages against the plaintiff for being stupid, if I were the judge (and that were allowed). The plaintiff's case was that bad.
I don't like the idea that a choice-of-law provision could result in an SOL clock that never starts ticking because the debtor doesn't live in the state the agreement chooses. It would be a surprise (not in the ordinary sense, but in the legal sense) worked upon any debtor who was hit with it (and the law doesn't like surprises all that much). The creditor knew where you were when you signed the document. They take you as they find you. Choice-of-law with respect to SOL is always going to be plead specifically by the defendant ... that's what an affirmative defense should do.
