Being sued in Texas doe Debt, need advice

[Huks]

What is the name of your state (only U.S. law)? Texas

I am being sued in Texas by a collection agency which filed suit May 8th of this year. This is for a debt that all three of my credit reports said last payment was made 10/31/2012. No payment since has been made. Today I received a letter form the paintiff for Summary Disposition. They included a list of the payments I made with the last date (Date of delinquency) of payment as 12/31/2012. They bolded 6/30/2013 as the mandatory charge off and they are basing this on suing me. Question is, do I have a case using the four year statue of limitations? Also, Texas law is kind of vague on when the Date of delinquency is. Does anyone have an example of solid case law history where this was argued in court and won? I guess my real question is, does Texas law saw without a doubt it's the date if delinquency or is it the mandatory charge off date?

 

[FlyingRon]

Unless there is something that tolled the limitations, you are correct, it is time barred.

 

[Huks]

The only other items were late charge assessments which began 12/7/2012 and then the mandatory charge off.

 

[Huks]

I just really need to know what Texas law says. Is it the date of delinquency they look at or the date of the charge off since there was no activity on the account since 10/31/2012. Also, if it is in fact the date of delinquency if someone could point to an actual concrete legal precedent where this was won in court.

 

[latigo]

What is the name of your state (only U.S. law)? Texas

I am being sued in Texas by a collection agency which filed suit May 8th of this year. This is for a debt that all three of my credit reports said last payment was made 10/31/2012. No payment since has been made. Today I received a letter form the plaintiff for Summary Disposition. They included a list of the payments I made with the last date (Date of delinquency) of payment as 12/31/2012. They bolded 6/30/2013 as the mandatory charge off and they are basing this on suing me. Question is, do I have a case using the four year statue of limitations? Also, Texas law is kind of vague on when the Date of delinquency is. Does anyone have an example of solid case law history where this was argued in court and won? I guess my real question is, does Texas law saw without a doubt it's the date if delinquency or is it the mandatory charge off date?

It has always been my belief - discounting a tolling or suspension of the statute - that the clock begins to tick when the cause of action accrues, which would be when the account becomes delinquent (failure to make a due payment) allowing the creditor to bring its suit and not before.

However a source I just found claims that in Texas it is the date of the last payment on the account. Makes no sense to me and no citations of authority from Texas are given.

Anyway there is no logical reason that it should commence with the "charge off date." Which is an accounting procedure and completely within the exclusive control of the creditor.

Understand though that you must plead the running of the statute as an affirmative defense. If you don't, it could deemed to have been waived. In other words, do not allow a default to be taken and expect to raise the defense at some latter date as when the sheriff arrives with a writ of execution or your bank account is garnished.

You may want to take a look at the Ohio Appellate Court case of Taylor vs. First Resolutions Investment Corp (2016). It is an excellent and exhaustive review of case law dealing with debt collectors threatening and/or filing lawsuit in which the statute has run in violation of the Fair Debt Collection Practices Act.

 

[HRZ]

My laymans REad is there are split decisions as to the starting date .some say it is date the account went delinquent...others say it runs from date of last payment...I simply don't know ..but it is quite clear you must raise an affirmative defense to the creditors claim on a prompt basis , a summary judgement is darn hard to unwrap.

AT least on the surface your debt seems too stale by either measure ?

 

[quincy]

... You may want to take a look at the Ohio Appellate Court case of Taylor vs. First Resolutions Investment Corp (2016). It is an excellent and exhaustive review of case law dealing with debt collectors threatening and/or filing lawsuit in which the statute has run in violation of the Fair Debt Collection Practices Act.

I agree with latigo that Taylor v. First Resolutions Investment Corp is an excellent case to read for an in-depth look at debt collection practices that violate the FDCPA.

I recommend you have plenty of coffee on hand to keep you awake, however, if you intend to read all 78 pages.

 

[adjusterjack]

Here's what the statute says:

Sec. 16.004. FOUR-YEAR LIMITATIONS PERIOD.

(a) A person must bring suit on the following actions not later than four years after the day the cause of action accrues:

(1) specific performance of a contract for the conveyance of real property;

(2) penalty or damages on the penal clause of a bond to convey real property;

(3) debt;

(4) fraud; or

(5) breach of fiduciary duty.

(b) A person must bring suit on the bond of an executor, administrator, or guardian not later than four years after the day of the death, resignation, removal, or discharge of the executor, administrator, or guardian.

(c) A person must bring suit against his partner for a settlement of partnership accounts, and must bring an action on an open or stated account, or on a mutual and current account concerning the trade of merchandise between merchants or their agents or factors, not later than four years after the day that the cause of action accrues. For purposes of this subsection, the cause of action accrues on the day that the dealings in which the parties were interested together cease.

You might have a problem with the distinction between (a)(3) and (c).

If (a)(3) were to apply then the accrual date would be the date you failed to make a payment when it was due which would have been when the next payment was due and not paid after the prior payment was made. The lawsuit would be time barred after about January 2017.

However, if (c) were to apply then the SOL would accrue from the "day that the dealings in which the parties were interested together cease." That would be the charge off date of 6/30/17 so the lawsuit would not be time barred with the lawsuit being filed in May 2017.

It took me a while but I finally found a case decision of the Texas Court of Appeals from 2015 that seems similar to yours. If your creditor is suing on the basis of an open account (as described in the decision) then the latter SOL may apply and the lawsuit might not be time barred.

Read the decision for yourself:

http://scholar.google.com/scholar_case?case=10996371930566600579&q=16.004(3)&hl=en&as_sdt=4,44

 

[Huks]

yeah, and this is the issue. Texas law is written in a way where it's so vague it's seems open to interpretation. The Plaintiff is basing his case on the charge off date. Nothing in the Texas law is clear in black and white stating No, the clock does not start on the charge-off date or no, the clock does not start on the date of last payment. This is what is throwing me off...

"not later than four years after the day that the cause of action accrues." Whatever this means...

 

[Huks]

I'm taking it that the Sec. 16.004. FOUR-YEAR LIMITATIONS PERIOD. (a) A person must bring suit on the following actions not later than four years after the day the cause of action accrues: means the day AFTER I made the last payment? Because late charges started 12/2012. no payment was made in November.

 

[adjusterjack]

Sorry, I was looking at the 12/31/12 date. If your last payment was 10/31/12 then the default date would be when the next payment was due (around 11/31/12) and wasn't paid. That's if (a)(3) applies.

If (c) applies then that wouldn't matter and the SOL would start to accrue on 6/30/13 the "day that the dealings in which the parties were interested together cease."

The Kaldis decision explains:

"Courts have held that the elements of an open account elements are (1) transactions between parties, (2) creating a creditor-debtor relationship through general course of dealing, (3) with the account still being open, and (4) with the expectation of further dealings."

Your creditor could have left the account open until the charge-off with the expectation of further dealings even if you had no such expectation.

Yes, it's uncertain whether your court will rule for you or against you. There are two many things unknown, like what the allegations are, what the evidence is, what is contained in the Motion for Summary Disposition.

What I can tell you is this. If you go at this without an attorney you seriously risk being steamrolled.

How much are you being sued for and is it for a credit card? If not a credit card then what?

 

[Huks]

Being sued for $1700 and they want to add on the lawyer fee of $1200. It was a Conns line of credit back in 2011. Even one of the larger law firms here states on their site it's last payment but still make it sound like it's a possibility.



The statute of limitations to collect debt is Texas is generally (4) years. This is for a breach of contract claim. When this four year clock starts to run is debatable. Usually it is the last payment date to the original creditor. For instance, if you were paying Bank of America and stopped paying 5 years ago, and now you are being sued by a debt buyer like Portfolio Recovery then you would have a good statute of limitations defense.

The clock stops when the lawsuit is filed, not when you are served with the lawsuit. For instance, if you are served 4.5 years after your last payment, but the case was filed 3.9 years after your last payment, then you likely do not have a statute of limitations defense.

The statute of limitations is a defense that must be proved by you. Simply saying that your last payment was more than 4 years ago is not enough. You typically need evidence. For instance, your credit report may be a good piece of evidence.

Try checking your credit report at www.annualcreditreport.com. You are allowed one free credit report per year from each major bureau pursuant to Federal Law. Check to see when the account was charged off and subtract 180 days from this date. This is a good indication of when your last payment was. You can also try checking old bank statements or payment records.

If you have been sued on an old debt, it is a good idea to try and determine when you made your last payment. If your last payment was more than four years from when the lawsuit was filed then you may have a good statute of limitations defense.

 

[HRZ]

IN general the theory of a summary judgement is that there are no issues to be addressed before the court by the other side .

You may have two valid points to be considered by the court ...the date the breech of contract occurred is well more than 4 years prior to date case was filed , DItto as to date of your last acrual payment to creditor ....I'd lay out a crystal clear two sets of points , dates, and any on point Federal or tx citations you can find and get an answer filed safely before the due date ... and if the creditor has picked a wrong date and you can clearly zero in on that, do so.

 

[latigo]

. . . . . You may have two valid points to be considered by the court ...the date the breech of contract occurred is well more than 4 years prior to date case was filed , DItto as to date of your last acrual [sic] payment to creditor (?) . . . blah, blah, blah . . .

Your "acrual" is not a word to be found in the English language!

If you meant the word "accrual" as in the your phrase "your last 'accrual' payment" the result is nothing but senseless gibberish. Yet most befitting considering the rest of the above pointless rambling.

 

[adjusterjack]

Being sued for $1700 and they want to add on the lawyer fee of $1200. It was a Conns line of credit back in 2011. Even one of the larger law firms here states on their site it's last payment but still make it sound like it's a possibility.

With all due respect for lawyers I often find misinformation, or incomplete information, in their website summaries and I get especially annoyed when they don't cite authorities for what they are saying.

With regard to your opponent's motion for summary judgment I hope you understand that you have to respond to it with reasons why it shouldn't be granted.