If a collections action goes to court, does the claimant have to be present?
September 20, 2010 3:42 PM   Subscribe

If a collection goes to court, does the claimant have to be present? And a couple other questions about collections.

My questions first, then an explanation. Also, I recognize that any answers to my questions are not legal advice.

First, if a collections action goes to court does a staff person from the business that claims I owe the debt have to be present in court?

Second, if a collections agency chooses to sue for the amount does the agency themselves have to drive to my county to file the suit, or can they request that a lawyer in my county do it.

Third, are invoices adequate proof of debt?

Fourth, do you have any other suggestions about how to proceed or links to websites that you think would particularly helpful? So far, I've been reading ehow and the federal trade commission documents. (I think ftc... some federal site.)

Now my explanation:

I am dealing with a collections action for $600 that is illegitimate. It is between a private after-school arts program and myself on behalf of my son. The school recruited my son from the local public school. But they never requested parental approval for their program and never provided a schedule of fees for their program. I've been researching on the internet the laws that govern collections and tried my best to understand how to contest it.

First I contested it with the school. I asked them to produce a document with a schedule of fees for their program that either my wife or I signed. They did not. I knew they couldn't because neither of us was shown a schedule of fees, nor did we ever sign anything.

Their response was to send it to a collections agency in their city and state where I no longer live. When that agency called me, I asked for verification of the debt. And asked them to not contact me further except to provide that proof. Unfortunately, I can't find any documentation for that conversation. Because I believe that they had only 5 days to provide that information and I know it was much longer.

Last week a different agency from my own state sent me copies of two invoices that the school had sent me and demanding that I pay it within 30 days. These invoices were dated August of last year, and May of this year. Nothing in between.

I am going to contact this agency and tell them that I contest this collections action and explain the circumstances and why the amount they believe I owe is not legitimate. I will then ask them to not contact me again, and follow it up with a certified letter that requires signature of receipt.

My understanding is that if the collections agency wants to pursue it after that, they have to sue me. But in order to do that, they need to file in my county which is a 4 hour drive from the agency. And a 9 hour drive from the school..

Thank you for any help you can provide. Hopefully I've given enough information about this situation.
posted by frodoxiii to Law & Government (2 answers total)
- You need to dispute the claim IN WRITING. Request the proof in writing, via certified mail. Specifically in your case, I think that would include the signed permission form you originally requested (and never received) from the from the school.

- Anyone can make up an invoice and sell it as a debt to a collection agency. If your defense is that you never agreed to the service or whatever, include (copies!) of that documentation (letters to your son's school, etc.) when you reply in writing to the new collection agency. If you've never disputed this in writing to the school and the after-school program - DO THAT NOW.

- This happened to me once for an erroneous towing bill made up and submitted to a collection agency 1 year after the service was provided. The towing agency had been sold to a new owner, and that owner made invoices and sold the (fake) debts to a collection agency. In my county, there is a city agency that licenses towing companies. I had a nice long chat with one of the inspectors at the agency. Within a week, the owner of the towing company withdrew the collection against me. I collected all the pertinent paperwork and kept it in case the debt became "zombie debt."

Is there an agency that licenses or funds after-school programs or similar that you can contact in your old city or state? They would be VERY interested to hear about this bogus billing practice, I reckon.

- Be careful the agency doesn't tack on enough fees and interest to bump the debt into federal court. Suddenly a $600 debt could become a $6,000 debt and a lawsuit. This has also happened to me. In my case, a clerk at the debt collection agency signed an affidavit stating "This person owes X monies" and that was ALL the proof required for the collection agency to file suit.

In short, debt collection is kinda like the Wild Wild West these days. It's all just a big fat scam. Most folks are willing to pay because it is easier than disputing.

Keep your paperwork. Respond via writing and build on the paper trail. If you can't resolve it or make it go away with disputes in writing... consider paying it. Or keep disputing in writing and wait for it to drop off your credit report 7 years from now.

YMMV, but that's my experience with crazy debt collections that pop up out of no where.

Good Luck.
posted by jbenben at 4:15 PM on September 20, 2010

I'll give it a go, since you recognize that IANAL. I do have some experience with collection agencies (CAs) trying to collect debts which I did not owe, so I'm familiar with the two federal laws that govern this kind of thing. You will be particularly interested in the Fair Debt Collections Practices Act (FDCPA).

The answer to your topic question is no - you do not have to be present, but if you or your representative are not present, it's near certain that the court will enter a default judgment against you and for the plaintiff.

Second question: yes, they have to have someone file it personally - at least in my state. Usually they'll have their law firm (or the CA itself) bring a big bunch of these filings at once, dozens per day, to minimize their travel and expenses. The court clerk loves it. And yes, the plaintiff does actually have to show up for the hearing, or it will be dismissed. You have a constitutional right to face your accusers, and that goes for civil court as well as criminal proceedings.

Third question: no, an invoice is not proof of debt. If I invoiced you for $10K, does that mean you actually owe me $10K? Of course not. You did the correct thing in asking for copies of your agreement(s) with this school. Once you demand them, they have 30 days in which to provide you proof that you agreed to pay the debt. Since they did not do so, it's a good news/bad news thing. Bad news is that it doesn't mean they are prohibited from suing you for it. Good news is that it's a defense should they file a lawsuit against you.

There's a better-than-average chance that the school sold your debt to a collection agency for literally a couple of cents per dollar. The agency is now trying to get as much money from you as they can by using the tactics they are using. If they get you to pay them, yay for them, because they didn't spend very much to buy the 'debt' from the school. The school got a little money, though not as much as they wanted.

If you don't pay the CA, they've only lost their expenses. Their threat to sue you may be a bluff because even if they win, it may cost them too much to go through. Then again, maybe not - they may believe your relationship with that school is good enough to get the entire $600.

How they go about reporting this to the credit bureaus is covered by the Fair Credit Reporting Act (FCRA), and it's a involved subject that I don't think we'll be able to explain here. There are several sites with forums about FCRA and dealing with credit scoring and fixing erroneous reports - start at InfiniteCredit.com. They have forums that cover just about all aspects of debt collection and credit scoring. (No, they're not a paid 'fix your credit score' place. It's all do-it-yourself advice.)

Good luck!
posted by lambchop1 at 4:36 PM on September 20, 2010 [1 favorite]

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