Being Sued by Credit Card Company

[novelist999]

I live in Missouri, and I'm being sued for over $7,000 plus legal fees and 9% interest in Circuit Court for a credit card debt by the original credit card holder. They claim the last transaction on the account was in Sept, 2004 when they did a charge off.

They've included two copies of account statements. One showing the supposed debt with a late fee and over the limit fee, the other, dated a few days later, showing the debt and a charge off with a balance of zero. Neither of these statements were mailed to me, and I didn't live at the address on the statement during that time, though the credit card company did have my new address.

I'm defending the case on the grounds that the statutory limit has passed. It may not have passed in Missouri, though I believe I quit paying on this card in April 2003, but the plantiff (who attached a copy of the membership terms to the petition) says in the terms that: "This Agreement and any claim arising out of this agreement will be governed by applicable federal law and, to the extent, state law applies, Delaware law." Delaware's statute of limitations is 3 years.

Do you think it's possible that I will win on these grounds alone?

Other things I'm bringing up in my defense are:

1. I had what's called AccountGuard on this credit card, which should have paid the debt if I suffered financial hardship. During the time that I quit paying, I'd lost my job, our home was foreclosed on, and I amassed a large federal and state tax debt. Currently, I'm on an installment payment agreement with the IRS. I'd written to the credit agency about this in 2003 and told them I'd no longer be able to make payments.

Would the AccountGuard be grounds for getting this case dismissed?

2. The plantiff claims I owe $7,000, but I don't believe I owe that much, and they haven't presented any paperwork to show how they came to that amount. I'm requesting proof of all payments and charges. I believe I owe about $2,000.

3. The plantiff never wrote to me about the debt or allowed me to contest it. In fact, they have my address wrong on 3 of the court documents. Even on the latest document, they have my zip code incorrect.

4. They've offered no proof of contract. I'm requesting that they show the original contract or agreement that I signed.

Do you have any suggestions? Do you think it's possible that I'll win this case?
I'm presently working on my response and I want to make sure I include everything I can think of.

[StephenH]

live in Missouri, and I'm being sued for over $7,000 plus legal fees and 9% interest in Circuit Court for a credit card debt by the original credit card holder. They claim the last transaction on the account was in Sept, 2004 when they did a charge off.

They've included two copies of account statements. One showing the supposed debt with a late fee and over the limit fee, the other, dated a few days later, showing the debt and a charge off with a balance of zero. Neither of these statements were mailed to me, and I didn't live at the address on the statement during that time, though the credit card company did have my new address.

I'm defending the case on the grounds that the statutory limit has passed. It may not have passed in Missouri, though I believe I quit paying on this card in April 2003, but the plantiff (who attached a copy of the membership terms to the petition) says in the terms that: "This Agreement and any claim arising out of this agreement will be governed by applicable federal law and, to the extent, state law applies, Delaware law." Delaware's statute of limitations is 3 years.

Do you think it's possible that I will win on these grounds alone?

I am not sure. The Delaware SOL is a very interesting argument to bring up under the agreement. I don't know if a judge will apply it or the Missouri SOL. That will be a question of law for them to decide. As to them using an incorrect address and they knew it was wrong, it is possible that the judge might lower the penalties and interest a little but It is up to the judge.


Other things I'm bringing up in my defense are:

1. I had what's called AccountGuard on this credit card, which should have paid the debt if I suffered financial hardship. During the time that I quit paying, I'd lost my job, our home was foreclosed on, and I amassed a large federal and state tax debt. Currently, I'm on an installment payment agreement with the IRS. I'd written to the credit agency about this in 2003 and told them I'd no longer be able to make payments.


Would the AccountGuard be grounds for getting this case dismissed?

I would read about how Accountguard works. Some credit insurance plans only pay the minimum payment for a set time, not the entire balance. Depends on how long the accountguard should have kicked in for.


2. The plantiff claims I owe $7,000, but I don't believe I owe that much, and they haven't presented any paperwork to show how they came to that amount. I'm requesting proof of all payments and charges. I believe I owe about $2,000.

Probably default interest, court costs and attorney fees were added. I would at least do a discovery here to determine how this was calculated.


3. The plantiff never wrote to me about the debt or allowed me to contest it. In fact, they have my address wrong on 3 of the court documents. Even on the latest document, they have my zip code incorrect.

I am not sure this will buy anything for you in court, but I would bring it up anyway.


4. They've offered no proof of contract. I'm requesting that they show the original contract or agreement that I signed.

I am sure that the cardholder agreement is the actual contract here.


Do you have any suggestions? Do you think it's possible that I'll win this case?
I'm presently working on my response and I want to make sure I include everything I can think of.

That is good. I might consider hiring legal counsel here.

[Heir7]

In general, debtors rarely prevail in court if the debt is within the statute of limitations where they live. The courts, in general, are pretty much on the creditor's side. You might take this opportunity to make yourself as judgment proof as you possibly can before they get a judgment-- checking accounts and savings accounts are no longer safe places to put your money once they get a judgment. You might also consider filing bankruptcy, especially if you have other debts that will be heading in the same direction soon. If you filed bankruptcy quick enough, it would stop the lawsuit dead in its tracks before they ever get a judgment. You can file bankruptcy pro se (by yourself) and save a lot of money on legal fees. It's not easy, but it is doable.

[Zigner]

1) Merely writing a letter to the CC company won't activate your account protection. There are specific steps you have to follow.

2) SOL is a DEFENSE that you must present in court. You should seek advice from an attorney.

[novelist999]

Thanks for all of your replies. I appreciate your help.

I can't file for bankruptcy or my husband and I will lose our home. In addition, my husband's income is just over the new federal limit.

I have a small self-employment income of less than $500.00 a month after expenses, but I also owe a big tax debt and make installment payments to the IRS which claims any disposable income. I work online and get my pay via Paypal. The payments I receive from customers are recurring membership payments.

So I wonder, if they do win a judgment, can they take the money from my Paypal account with a writ of Garnishment? Is there any way that I can defend my earnings or get them excluded since I owe an IRS debt?

I'm including an Exempt Income and Assets section to my reply.

Other than that, I'm pretty much judgement proof. They can't take the house thanks to Missouri's tenants by the entirety law. I really have no other assets.