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How to Respond to a Collector’s Lawsuit

Always Pick Up Your Certified Mail and Accept Notices About Court Actions. You will not escape the consequences of a lawsuit by hiding from notices about that action.

Get Professional Advice. Fighting back and raising legitimate defenses and claims against a collector can erase some or all of your debt, and a lawyer’s involvement may significantly improve your outcome. Chapter 1 includes tips on finding an affordable lawyer.

If you cannot get the advice you need from a lawyer, see if a self-help manual has been written for your state on how to defend a lawsuit. Make sure you get a manual for your state. Check with the clerk of your local court, local library, or bookstore.

You may be able to get help from the clerk of the court. Court offices are not just for lawyers—you have as much right to ask questions as someone with a law degree. It is the court clerk’s job to provide assistance, but in some busy courts, clerks may not be very helpful. While in others, the advice they give may not be accurate. You may find that the officers in the individual courtrooms are more accurate than the employees in the clerk’s office. Ask several clerks the same question and compare their answers. Write down the clerk’s name and the answer you received.

Some “Help” Will Just Get You into More Trouble. Unfortunately, some companies advertise bogus products to help you defend a collection action or otherwise deal with debt. These products are expensive, do not work, and, worst of all, prevent you from properly defending the collection action.

For example, some companies offer—for a hefty fee—to explain how to eliminate any debt, such as by offering you a “bond for discharge of debt” or a “redemption certificate” or explaining that “monetized” debt need not be paid. These are all bogus. Other than a self-help book from the local bar association, a legal services office, or similar entity, do not pay for non-attorney help.

Be careful even with lawyers who advertise they can help you avoid debt. Some are not even licensed as lawyers. Contact your local bar association if you are unsure whether someone is really a lawyer to see if there are complaints filed against the lawyer. Others will take your money and do nothing. Even worse, they may file faulty responses to your lawsuit which, in some cases, may cause you to lose valuable rights and defenses. Still other lawyers just want to file a bankruptcy for you, which is generally not necessary or advisable when just disputing one debt.

Carefully Read All Court Documents You Receive. The collector must file a document with the court to start a lawsuit. Usually, this is called “the petition” or “the complaint”—this chapter uses the term “complaint.” The complaint asks the court to enter an order or judgment that you owe the collector a certain amount of money.

Along with the complaint, the collector usually must prepare another document to be delivered to you, informing you that a lawsuit has been filed against you. It is often called a “summons” or “original notice” and this chapter uses the term “summons.” The summons usually tells you what the collector wants and the actions you must take to respond to the lawsuit, including the deadline for responding.

In some states a sheriff or constable must personally deliver the summons to you or an adult member of your household. In other states, mailing it to you is sufficient. Dropping the summons on your doorstep is not sufficient.

The summons tells you the steps to take to respond to a lawsuit for that particular court. Do not assume that a response that is appropriate for one type of court will be correct for another court or another type of case. Instead, read the instructions on the summons and seek help from the clerk’s office. Be especially careful to meet the deadlines. The court may not accept responses received after the deadline.

To avoid the collector winning the lawsuit without your having a chance to defend it (called “winning by default”), you must follow the instructions on the summons and meet all deadlines, whether the deadline is to appear at a hearing, file an answer, or file an appearance. Often the collector has little or no evidence to present to the court, and is just hoping you will not respond, so that the collector can win by default. When the collector wins by default, the collector will be granted whatever it requested, even if it was not owed that amount.

Check Which Court Is Hearing the Case. Direct all questions and your responsive documents to the correct court—the court that issued the summons. Collectors usually sue in “small claims court,” designed to decide claims for relatively small amounts of money. For example, the small claims court might only handle cases involving $5,000 or less. Other states have different limits. Small claims courts’ procedure is usually simple and less formal and you do not need a lawyer. In a few states, lawyers are not even permitted. You should feel confident appearing in small claims court without a lawyer.

If the collector is seeking more money than the small claims court limit, the suit must be filed in the state’s general, all-purpose court. These general courts have different names in different states, and follow more formal procedures. Collectors are represented by lawyers and formal legal rules apply. Although you may represent yourself in this type of court (this is sometimes called appearing “pro se” or “pro per”), your wisest course may be to hire a lawyer to represent you.

How to Answer the Summons. The summons tells you that you must appear at a hearing, file a written response, or file an appearance at the clerk’s office. Pay special attention to any deadline for a written response in the summons. If the summons has both a deadline for a written response and a date to appear in court, you must file your written response by the deadline or you may risk losing by default and having your court date canceled.

If the summons requests you to appear at the hearing, it will usually specify a time, date, and place for the hearing. In more formal courts, a hearing typically will not be scheduled immediately, without allowing time for you to file a written answer. In some states, hearings are scheduled right away for small claims courts cases.

A summons often tells you to file a written “answer” to the summons (sometimes called an “appearance”) within a certain number of days, usually fewer than thirty (instead of specifying a date and time). Although the summons may say “appear and defend,” this may not mean that you must physically appear on the date mentioned, but rather that only a written document must be filed with the court by that date.

Many small claims courts that require written answers will provide prepared answer forms, which only need to be signed and returned to the court clerk. The answer form states that the defendant (you) deny the plaintiff’s (the collector’s) claim. You should return these by the appropriate deadline if you wish to dispute the case. Other small claims courts require no written answer.

In more formal courts, there are usually no prepared answer forms, and the answer should usually be written by a lawyer and include reasons why you deny that you owe the money. You may draft an answer on your own without a lawyer, but you should do your best to follow the court’s procedural requirements. Although answers not written by lawyers are accepted by courts, they may be found insufficient on technical grounds.

Most courts require that you send a copy of the answer and any other document you file with the court to the collector or the collector’s lawyer. In that case, indicate on the original court document filed with the court clerk that a copy was mailed to the collector or its lawyer. Keep a copy of the documents you file.

If you need more time to find a lawyer or to prepare an answer, a time extension is usually allowed, either by written agreement with the collector’s attorney or by court order. If you reach an agreement for an extension of time (or any other type of agreement) with the collector’s attorney, confirm the agreement in writing.

If you reach an informal agreement to settle the whole case with the collector, you should still file an appearance and answer. Collectors have been known to proceed with a case and take a default judgment despite having reached an agreement with you. Any agreement should be in writing and include a statement that the collector will drop its lawsuit. The safest course is to file a copy of the written agreement with the court clerk to be entered into the court record.

Promptly Answer a Collector’s Requests for Admissions. A favorite collector tactic is to send you a document that asks you to admit to many facts about the case, including that you owe all the money it seeks. This is a trick, because if you do not answer within the time limit, the law says that you have admitted these requests to be true! That way the collector can win the case without any evidence and without even a hearing—even if you do not owe the money. Failure to respond to the request for admissions can mean that you have lost the case before it even started.

Respond to all questions in the request for admissions, respond by the time deadline, and deny any facts that are not true or where you think they might not be true. You can also say you do not have knowledge about a fact, so you cannot admit or deny it. If you miss the deadline to respond, ask the court to give you more time—the court may or may not do so.