Need help fighting sleazy collection lawyers
June 11, 2013 10:31 AM Subscribe
I know I need a lawyer to deal with this, but I'm hoping that knowledgeable MeFi-ites can help me find the language needed to correctly describe the problem and my desired outcome, and perhaps give some advice as to how to find the right sort of lawyer. Warning, this is long...
Here's the background: In 2004, I was sued for an unpaid debt from the late 1990s. I hired a lawyer, and in early 2005 settled the suit by agreeing to pay $6,000 of the $10,000 it was alleged I owed. (The original debt was about $3500; it was determined for purposes of the lawsuit to be $10K due to interest, penalties, fees, etc.) Payment was to be in four monthly installments of $1,500. I made the four payments, and that was the last I thought of it, until...
In February of this year (2013), I received a notice from my local sheriff's office that an account at a local bank was being garnished in connection with a lawsuit against me. I was puzzled, as 1) it was not my bank, 2) I've not been sued by anyone since then, and 3) I didn't immediately recognize any of the other names on the form.
After some digging in my files, I figured out that the bank account belonged to a business for which I had done some free-lance work in the past, but am not currently working with. And the law firm filing the garnishment turned out to be the same bunch that sued me back in 2004.
At that point, my original lawyer in the matter having moved out of state, I went to an acquaintance who's a lawyer (though not a specialist in collections) to get his help.
He called the lawyers who filed the garnishment, and they told him that because they received the fourth and final payment of the settlement a week late back in 2005, they considered the entire settlement invalid. (The payment was indeed sent late, because it took me that long to get the money. I do have certified mail receipts showing that someone at the lawyer's office received and signed for all four payments.)
The upshot of this is that they filed the garnishment because they now claim I owe them an additional $12,000 (!), representing that $4,000 that was negotiated away during the 2005 settlement, plus interest, penalties, etc. accumulated since then.
Let me re-emphasize that the garnishment order is, as mentioned above, the only thing I've heard about the case in more than eight years. The opposing attorneys never contacted me at any time since 2005 to say they considered the judgment unsatisfied, or to demand payment.
While I don't feel that I should have to pay them another cent, in an attempt to put this behind me, I asked my acquaintance/attorney to offer a token payment to settle. He offered the other attorneys $500 to remove the garnishment and close the books on the case, which was refused. We then offered $1,000, which was refused, with a counter-offer saying that if I gave them $10,000 right away, they'd settle.
At this point, my acquaintance/attorney bailed on me. For reasons that I can't determine, he's unwilling to help me pursue legal action to get the garnishment quashed and the debt declared settled.
His parting advice was to either declare bankruptcy, or to try to take my entire financial life off the grid to avoid further garnishments - move my banking out of town, demand that all future clients and employers pay in cash, that sort of thing. Option #2 simply is not viable for me, and I don't want to declare bankruptcy over this unless there's no other option.
Right now, the garnishment isn't hurting me, as I'm no longer doing any work for that particular company. But as things stand, it apparently now is a never-ending open season on anything else this law firm can find to attach, garnish, or put a lien on.
That's simply intolerable for me as well. So my question is this: What is it, exactly, that I need to ask an attorney to do for me next? I know I want the garnishment "quashed," but what is the legal term for getting a judge to look at this and say that, "look, you had your chance, eight years is too long, the debt is settled"?
In my conversations with my acquaintance/attorney, he spoke of an legal principal called "laches," which he said relates to the obligation of both parties in a legal dispute to act in a timely manner, especially when a delay would be of disproportionate benefit to one party over the other.
This would seem to be applicable, as the time scales here are very disproportionate - i.e. the plaintiffs are simultaneously claiming that the final payment being a week late invalidated the entire previous settlement, but that they also can take what is effectively an unlimited amount of time to pursue action against me, all with interest accumulating to their benefit. If anyone can tell more about "laches" and how it might apply here, please do. I'm in Missouri, if that makes a difference.
Lastly, what sort of attorney should I be looking for? Most of the ones who say they specialize in collection matters seem to be basically just filers of bankruptcy papers; I need someone who can take the fight back to these sleazebags who are trying to bleed me. Thanks for reading all this!
Here's the background: In 2004, I was sued for an unpaid debt from the late 1990s. I hired a lawyer, and in early 2005 settled the suit by agreeing to pay $6,000 of the $10,000 it was alleged I owed. (The original debt was about $3500; it was determined for purposes of the lawsuit to be $10K due to interest, penalties, fees, etc.) Payment was to be in four monthly installments of $1,500. I made the four payments, and that was the last I thought of it, until...
In February of this year (2013), I received a notice from my local sheriff's office that an account at a local bank was being garnished in connection with a lawsuit against me. I was puzzled, as 1) it was not my bank, 2) I've not been sued by anyone since then, and 3) I didn't immediately recognize any of the other names on the form.
After some digging in my files, I figured out that the bank account belonged to a business for which I had done some free-lance work in the past, but am not currently working with. And the law firm filing the garnishment turned out to be the same bunch that sued me back in 2004.
At that point, my original lawyer in the matter having moved out of state, I went to an acquaintance who's a lawyer (though not a specialist in collections) to get his help.
He called the lawyers who filed the garnishment, and they told him that because they received the fourth and final payment of the settlement a week late back in 2005, they considered the entire settlement invalid. (The payment was indeed sent late, because it took me that long to get the money. I do have certified mail receipts showing that someone at the lawyer's office received and signed for all four payments.)
The upshot of this is that they filed the garnishment because they now claim I owe them an additional $12,000 (!), representing that $4,000 that was negotiated away during the 2005 settlement, plus interest, penalties, etc. accumulated since then.
Let me re-emphasize that the garnishment order is, as mentioned above, the only thing I've heard about the case in more than eight years. The opposing attorneys never contacted me at any time since 2005 to say they considered the judgment unsatisfied, or to demand payment.
While I don't feel that I should have to pay them another cent, in an attempt to put this behind me, I asked my acquaintance/attorney to offer a token payment to settle. He offered the other attorneys $500 to remove the garnishment and close the books on the case, which was refused. We then offered $1,000, which was refused, with a counter-offer saying that if I gave them $10,000 right away, they'd settle.
At this point, my acquaintance/attorney bailed on me. For reasons that I can't determine, he's unwilling to help me pursue legal action to get the garnishment quashed and the debt declared settled.
His parting advice was to either declare bankruptcy, or to try to take my entire financial life off the grid to avoid further garnishments - move my banking out of town, demand that all future clients and employers pay in cash, that sort of thing. Option #2 simply is not viable for me, and I don't want to declare bankruptcy over this unless there's no other option.
Right now, the garnishment isn't hurting me, as I'm no longer doing any work for that particular company. But as things stand, it apparently now is a never-ending open season on anything else this law firm can find to attach, garnish, or put a lien on.
That's simply intolerable for me as well. So my question is this: What is it, exactly, that I need to ask an attorney to do for me next? I know I want the garnishment "quashed," but what is the legal term for getting a judge to look at this and say that, "look, you had your chance, eight years is too long, the debt is settled"?
In my conversations with my acquaintance/attorney, he spoke of an legal principal called "laches," which he said relates to the obligation of both parties in a legal dispute to act in a timely manner, especially when a delay would be of disproportionate benefit to one party over the other.
This would seem to be applicable, as the time scales here are very disproportionate - i.e. the plaintiffs are simultaneously claiming that the final payment being a week late invalidated the entire previous settlement, but that they also can take what is effectively an unlimited amount of time to pursue action against me, all with interest accumulating to their benefit. If anyone can tell more about "laches" and how it might apply here, please do. I'm in Missouri, if that makes a difference.
Lastly, what sort of attorney should I be looking for? Most of the ones who say they specialize in collection matters seem to be basically just filers of bankruptcy papers; I need someone who can take the fight back to these sleazebags who are trying to bleed me. Thanks for reading all this!
Another term that is commonly used for this type of attorney is "debt defense." Make sure you are hiring an attorney and not a debt defense service. The latter is generally a scammy company that will do little to help settle your debt, recommend that you demand expensive arbitration, and then either lose or settle for the same amount the collector would have settled for anyway.
posted by craven_morhead at 10:45 AM on June 11, 2013 [1 favorite]
posted by craven_morhead at 10:45 AM on June 11, 2013 [1 favorite]
IAALBIANYL. Where are you? Start with an attorney referral service through your state bar. Also take a trip down to the courthouse and ask a clerk for the forms you should file in response.
posted by mibo at 11:01 AM on June 11, 2013
posted by mibo at 11:01 AM on June 11, 2013
IANAL. Yeah, you need to stop talking about this on the internet and start talking about it with an attorney, hired and paid for by you (not a friend helping you out as a favor who advises you as poorly as it sounds like this one has), who specializes in consumer rights and debt defense. The idea that you should go into hiding over a debt that you don't believe you actually owe is absurd. You need your own lawyer, a real lawyer who works for you and who understands the very specific laws in this area. Gather all of the paperwork you have related to this debt, your payments, and communications with collectors, and go hire a lawyer.
posted by decathecting at 11:05 AM on June 11, 2013 [1 favorite]
posted by decathecting at 11:05 AM on June 11, 2013 [1 favorite]
I am not a lawyer. I do have personal experience supporting a family member who was sued by a debt collector.
You need to consult with an attorney with knowledge of the Federal "Fair Debt Collection Practices Acts" well as any related state laws (such as the Collection Agency Act and the Consumer Fraud and Deceptive Practices Act in Illinois, for example).
Creditors are bound by certain obligations as they attempt to collect on debts, including how they communicate with you and should abide by a statute of limitations to collect certain debts.
An attorney with the above background should be able to help you determine if the law was violated and can help you pursue a solution.
If you are looking for legal help in the area, I recommend checking out AVVO.com - a site I used to find help in the situation I mentioned above.
posted by mockjovial at 11:24 AM on June 11, 2013 [1 favorite]
You need to consult with an attorney with knowledge of the Federal "Fair Debt Collection Practices Acts" well as any related state laws (such as the Collection Agency Act and the Consumer Fraud and Deceptive Practices Act in Illinois, for example).
Creditors are bound by certain obligations as they attempt to collect on debts, including how they communicate with you and should abide by a statute of limitations to collect certain debts.
An attorney with the above background should be able to help you determine if the law was violated and can help you pursue a solution.
If you are looking for legal help in the area, I recommend checking out AVVO.com - a site I used to find help in the situation I mentioned above.
posted by mockjovial at 11:24 AM on June 11, 2013 [1 favorite]
If you're in the San Francisco East Bay there is a pro-bono group of attorneys that deal with things like this. These things come up pretty frequently.
posted by small_ruminant at 11:54 AM on June 11, 2013
posted by small_ruminant at 11:54 AM on June 11, 2013
I know I want the garnishment "quashed," but what is the legal term for getting a judge to look at this and say that, "look, you had your chance, eight years is too long, the debt is settled"?
IAALBIANYL. TINLA. I garnish people all the time.
Why would eight years be too long? I do not understand where that idea comes from.
What I take from your question is that when your last payment was late, the creditor's attorney received a final judgment and now are garnishing to collect on that final judgment. I enter these agreements all the time where if the debtor does not pay as agreed, I get an instant judgment even if you are one day late.
Garnishment is a statutory creation that varies from state to state. However, as a debtor in a garnishment proceeding, you likely have rights to claim certain exemptions to garnishment if you do it timely. Since all of this started in February, I am concerned that you may have missed your window.
Your lawyer friend does not want to touch this one, and rather than advise you to get a lawyer to fight this, he said you should declare bankruptcy or evaporate. He is seeing something that we are not. Ask him for a referral. If he will not give you one, ask him why not.
posted by Tanizaki at 11:56 AM on June 11, 2013 [3 favorites]
IAALBIANYL. TINLA. I garnish people all the time.
Why would eight years be too long? I do not understand where that idea comes from.
What I take from your question is that when your last payment was late, the creditor's attorney received a final judgment and now are garnishing to collect on that final judgment. I enter these agreements all the time where if the debtor does not pay as agreed, I get an instant judgment even if you are one day late.
Garnishment is a statutory creation that varies from state to state. However, as a debtor in a garnishment proceeding, you likely have rights to claim certain exemptions to garnishment if you do it timely. Since all of this started in February, I am concerned that you may have missed your window.
Your lawyer friend does not want to touch this one, and rather than advise you to get a lawyer to fight this, he said you should declare bankruptcy or evaporate. He is seeing something that we are not. Ask him for a referral. If he will not give you one, ask him why not.
posted by Tanizaki at 11:56 AM on June 11, 2013 [3 favorites]
Your friend gave you shitty advice and you should have NEVER offered those f*ckers a dime.
Oh well.
Get a proper lawyer. Take this to court, get the original agreement recognized by a judge and get this garnishment rescinded.
BY THE WAY - your last lawyer also fucked you, too, by not getting you documentation that the original agreement was satisfied once final payment was received.
posted by jbenben at 5:19 PM on June 11, 2013 [1 favorite]
Oh well.
Get a proper lawyer. Take this to court, get the original agreement recognized by a judge and get this garnishment rescinded.
BY THE WAY - your last lawyer also fucked you, too, by not getting you documentation that the original agreement was satisfied once final payment was received.
posted by jbenben at 5:19 PM on June 11, 2013 [1 favorite]
Also, only consult with an attorney who does bankruptcies if you want to be talked into declaring bankruptcy.
Bankruptcy is not so bad, but you aren't there yet, so don't let anyone make you panic.
Good luck.
posted by jbenben at 5:23 PM on June 11, 2013
Bankruptcy is not so bad, but you aren't there yet, so don't let anyone make you panic.
Good luck.
posted by jbenben at 5:23 PM on June 11, 2013
They can enforce the judgment because part of that included making timely payments, which as you failed to do, allows them to collect the full amount. BUT -- it's been almost 8 years since you made your last late payment and they were able to enforce the judgment. I'm not certain, but it might be worth asking a laywer what the statute of limitations is on the judgment. I can't imagine that this debt collector can just hold on to a debt this long and then come collecting eight years later. I think this is why statute of limitations exist. You definitely need a lawyer and I'd make sure to ask if it's still a valid debt. Good luck!
posted by loquat at 6:24 PM on June 11, 2013
posted by loquat at 6:24 PM on June 11, 2013
I'm not certain, but it might be worth asking a laywer what the statute of limitations is on the judgment. I can't imagine that this debt collector can just hold on to a debt this long and then come collecting eight years later. I think this is why statute of limitations exist.
The statute of limitations is to protect defendants from stale lawsuits because memories fade, evidence is lost or destroyed, and so on. Those concerns are not at issue once a judgment has been entered.
The statute of limitations applies to the time period between a cause of action accruing and when suit is filed. For example, in my state, you have five years to file suit after breach of contract. However, judgment execution is the final stage of the case - the lawsuit is still going on. There is no limitation on how long a lawsuit can last. There is no reason why a judgment would evaporate. To use a common example, when a divorce takes place (at least in my state), there is a final judgment of dissolving the marriage. No one would suggest that judgment expires at some point. At least in my state, there is no statute or court rule that limits how long judgment execution can last. Things might be different in OP's state, but I do not know how likely that would be.
posted by Tanizaki at 7:41 PM on June 11, 2013 [1 favorite]
The statute of limitations is to protect defendants from stale lawsuits because memories fade, evidence is lost or destroyed, and so on. Those concerns are not at issue once a judgment has been entered.
The statute of limitations applies to the time period between a cause of action accruing and when suit is filed. For example, in my state, you have five years to file suit after breach of contract. However, judgment execution is the final stage of the case - the lawsuit is still going on. There is no limitation on how long a lawsuit can last. There is no reason why a judgment would evaporate. To use a common example, when a divorce takes place (at least in my state), there is a final judgment of dissolving the marriage. No one would suggest that judgment expires at some point. At least in my state, there is no statute or court rule that limits how long judgment execution can last. Things might be different in OP's state, but I do not know how likely that would be.
posted by Tanizaki at 7:41 PM on June 11, 2013 [1 favorite]
Tanizaki, it sounds like the OP tried in good faith to settle the debt and the collection lawyers are behaving like grifters.
It may be technically legal, but from a layman's perspective, it certainly doesn't seem fair, equitable or just. (And yes, we all know "the law" has nothing to do with justice, common sense, or what most people would think is "the right thing to do," so no need to get up on a soapbox about that.)
That you think this sort of thing is perfectly OK - and this is a general observation about the profession, not a personal attack - may help explain why so many people hold lawyers in such low esteem. I hope the OP can find a decent attorney - in both senses of the word - and a judge who will put a stop to this nonsense.
posted by Nat "King" Cole Porter Wagoner at 8:54 PM on June 11, 2013 [1 favorite]
It may be technically legal, but from a layman's perspective, it certainly doesn't seem fair, equitable or just. (And yes, we all know "the law" has nothing to do with justice, common sense, or what most people would think is "the right thing to do," so no need to get up on a soapbox about that.)
That you think this sort of thing is perfectly OK - and this is a general observation about the profession, not a personal attack - may help explain why so many people hold lawyers in such low esteem. I hope the OP can find a decent attorney - in both senses of the word - and a judge who will put a stop to this nonsense.
posted by Nat "King" Cole Porter Wagoner at 8:54 PM on June 11, 2013 [1 favorite]
That you think this sort of thing is perfectly OK - and this is a general observation about the profession, not a personal attack - may help explain why so many people hold lawyers in such low esteem.
Please forgive me for making a reply to any commenter.
I did not state any approval or disapproval. The reason is because my approval or disapproval does not help answer the OP's question. I simply stated the law as I know it to be based on my creditor's rights practice.
But, there is not going to be a "a judge who will put a stop to this nonsense" if the law has been followed. There is no "technically legal" any more than there is "technically pregnant". If it is legal, a judge is going to (or should) apply the law, no matter now unfair or inequitable that may seem to a layman's perspective. A judge is not there is exercise a "layman's perspective". That is why OP needs to talk with a lawyer in his jurisdiction so he can have a professional's perspective.
posted by Tanizaki at 5:22 PM on June 12, 2013 [1 favorite]
Please forgive me for making a reply to any commenter.
I did not state any approval or disapproval. The reason is because my approval or disapproval does not help answer the OP's question. I simply stated the law as I know it to be based on my creditor's rights practice.
But, there is not going to be a "a judge who will put a stop to this nonsense" if the law has been followed. There is no "technically legal" any more than there is "technically pregnant". If it is legal, a judge is going to (or should) apply the law, no matter now unfair or inequitable that may seem to a layman's perspective. A judge is not there is exercise a "layman's perspective". That is why OP needs to talk with a lawyer in his jurisdiction so he can have a professional's perspective.
posted by Tanizaki at 5:22 PM on June 12, 2013 [1 favorite]
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I googled "Consumer Lawyer" and got some names that way. Don't know if it's a bankruptcy thing, but some advertise that they deal with collections fraud.
Start there, see if you can get some satisfaction.
posted by Ruthless Bunny at 10:44 AM on June 11, 2013