Sued by Capital One for open account with expired SOL

[dlrbtr]

Sorry for such a long post - but we need some advice!

A more detailed history is provided below, but here's a quick run-down of the situation:

Capital One is suing us for an old credit card account which I believe has an expired SOL. The original debt was $500; they are now suing us for a grand total of $5,409 plus interest ($1,549 principle, $110 accrued costs, $3,750 attorney's fees).

We are Arizona residents; Arizona has a 3 year SOL, as does Virginia, which I believe is the governing state stated in the original customer agreement. The Plaintiff is claiming Arizona law governs, but as both states have the same SOL I don't think it really matters. (or does it?)

The last charge on this account was approx Oct 2004, last payment was around March/April 2005. The COMPLAINT was filed August 18, 2008. The validation of debt (copy of an old statement) that was provided to the court has a date of August 20, 2005.

From what I understand, unless they can prove we made a payment or charge after August 18, 2005, the SOL has expired and they cannot collect.

As shown below, we responded to the COMPLAINT and now have a PreTrial Conference set for October 24th. However, they have filed a MOTION FOR SUMMARY JUDGMENT...does this require an answer within 20 days (which is I think 4 days BEFORE PreTrial)?

What's our next step? Thank you all so much in advance for your help!

=========================================

July 2008:
We received a notice from the Plaintiff's attorneys (for Capitol One) that they were attempting to collect on an old credit card dept. It stated that they intended to take legal action if payment was not received. I called them shortly thereafter to request validation of the debt - none was sent.

September 1st:
We were served with a SUMMONS and were required to respond within 20 days. COMPLAINT filed August 18th. The Plaintiff's COMPLAINT was as follows:

Complaint: Breach of Contract/Open Account(s) or Account(s) stated

The complaint states that the Plaintiff alleges that "Maricopa County has Jurisdiction", we are indebted for "$1,549.82 together with interest for goods and services purchased which includes contract interest on a breach of contract or in the alternative open account(s) or on a theory of account(s) stated.", and that "If any Defendant was or became married during the time extensions of credit were made on the account(s), Plaintiff alleges the debt on the account(s) to be both community and separate in nature.".

Further, "Plaintiff prays for Judgment against the Defendant(s), both separately and as a community, if applicable, and each of them, for the amount stated above, plus contract interest, costs, and requests reasonable attorney's fees if contested and such other relief as the Court deems just and proper.".

September 15th:
We filed an ANSWER as a Marital Community - a denial stating validation of the debt had not yet been received. We requested validation of the debt.

September 26th:
We received a NOTICE OF COMPREHENSIVE PRETRIAL CONFERENCE HEARING DATE dated Sept 24, 2008 along with a blank DISCLOSURE STATEMENT. A Pretrial Conference was set for October 24, 2008.

Instructions for the DISCLOSURE STATEMENT state that "The Arizona Rules of Civil Procedure require that each party share with the other party all information known or available concerning this case...This DISCLOSURE STATEMENT provides a format for you to make such disclosure. This DISCLOSURE STATEMENT must be completed and exchanged with all parties within 40 days of the filing of the ANSWER."

We also received a copy of a credit card statement from the Plaintiff's attorneys as validation. The date on the copy was August 20, 2005. It showed a balance of $882.14 and no payment from the previous statement.

September 29th:
We received the following documents: MOTION FOR SUMMARY JUDGMENT (with Memorandum of Points and Authorities), JUDGMENT (unsigned), PLAINTIFF'S STATEMENT OF FACTS IN SUPPORT OF ITS MOTION FOR SUMMARY JUDGMENT (with copy of credit card statement mentioned above), AFFIDAVIT OF ATTORNEY FEES (with itemization of services), and VERIFIED STATEMENT OF COSTS.

In the MOTION FOR SUMMARY JUDGMENT, the Plaintiff acknowledges that it is an open account. Also in the document is "ARS Section 44-1205(C) states that a credit card revolving account, including an account that permits access by check, is governed by the laws of this state and is subject to this subsection.". They are requesting judgment in the amount of $1,549.82 plus interest at the contract rate, court costs, and attorney fees.

In the unsigned JUDGMENT, damages are as follows: Principle Damages $1,549.82, Accrued costs $110.00, Reasonable attorney's fees (blank). Interest on the principle sum at 25.9% per annum from the date of filing suit of 08/21/2008 until paid in full; interest at the rate of 10% per annum on accrued costs and attorney's fees from date of Judgment until paid in full; and accruing costs.

In the AFFIDAVIT OF ATTORNEY FEES, it is stated that their office hourly rate is $250 per hour. The Itemization of Services shows a total of 4.2 hours current time along with an anticipated and estimated post judgment services time of 11.3 hours - their total shows 15 hours, they did their math wrong. Total costs (current and anticipated) at their hourly rate $3,750.

In the VERIFIED STATEMENT OF COSTS, it shows $60 for Court Fees and $50 for Service of Process, for a total of $110.00.

October 1st:
We received the following documents: REQUEST TO APPEAR WITHOUT REAL PARTY INTEREST AND REQUEST FOR TELEPHONIC APPEARANCE, and MOTION TO CONTINUE PRE-TRIAL.

In the MOTION TO CONTINUE PRE-TRIAL the Plaintiff cites the pending MOTION FOR SUMMARY JUDGMENT as the reason for the requested continuance.

[dlrbtr]

I just checked my voicemail - I have 2 messages in the past 24 hours from their law offices wanting me to call in to "set up payment arrangements".

I forgot to ask - is there any way we can counter for costs so we could afford an attorney?

[Enigma]

I am not familiar with your courts rules. But, in general, when you filed your answer you should have raised the affirmative defense of statute of limitation. in general, failure to raise the defense precludes you from raising it at trial. That being said:

1. Motion to amend your answer, adding statute of limitations, and counter claims,
2. Motion for Summary Dismissal based on SOL,
3. Engage in Discovery.

[dlrbtr]

The reason we did not raise the SOL issue in our initial answer is because we had no documentation of the alleged debt; should I state that in the Motion to amend our answer?

[Enigma]

It didn't matter if you had proof or not. It's the Plaintiff's job to disprove SOL.

Just amend your answer, don't explain why, just do.

Do Discovery before the PTH.

[dlrbtr]

Got it.

I checked the court's website for forms - this is their Motions form:

superiorcourt.maricopa.gov/justiceCourts/docs/CV_Motion_packet.pdf

I'll use it to file the Motion to Amend, but judging from their Counterclaim form I'll have to file a motion requesting permission to file a counterclaim since I have already filed an answer:

superiorcourt.maricopa.gov/justiceCourts/docs/CV_Counterclaim_packet.pdf

Or can I just include the counterclaim in with the Motion to Amend?

Also - can I file all of these Motions (Motion to Amend, Motion for permissiong to file Counterclaim, Motion for Dismissal) at the same time, or do I need to wait for a response from the court regarding the Motion to Amend?

[Enigma]

Quote:

Originally Posted by dlrbtr Got it. I checked the court's website for forms - this is their Motions form: superiorcourt.maricopa.gov/justiceCourts/docs/CV_Motion_packet.pdf I'll use it to file the Motion to Amend, but judging from their Counterclaim form I'll have to file a motion requesting permission to file a counterclaim since I have already filed an answer: superiorcourt.maricopa.gov/justiceCourts/docs/CV_Counterclaim_packet.pdf Or can I just include the counterclaim in with the Motion to Amend? Also - can I file all of these Motions (Motion to Amend, Motion for permissiong to file Counterclaim, Motion for Dismissal) at the same time, or do I need to wait for a response from the court regarding the Motion to Amend?

The questions are all procedural, which I cannot answer. Call the Clerk of the Court. They should be able to tell you.

[dlrbtr]

I understand.

I did locate some of their procedural information online at:
superiorcourt.maricopa.gov/justiceCourts/CourtsAndSections/CivilSuits.asp

I'll be filing an objection to their Motion for Summary Judgment tomorrow as well.


A question regarding Counterclaims; how does one generally come up with the amount they wish for damages? Are there any guidelines regarding this?

[Enigma]

$1000 if it is an FDCPA counter claim.

[ilovemydogs]

Quote:

Originally Posted by dlrbtr I understand. I did locate some of their procedural information online at: superiorcourt.maricopa.gov/justiceCourts/CourtsAndSections/CivilSuits.asp I'll be filing an objection to their Motion for Summary Judgment tomorrow as well. A question regarding Counterclaims; how does one generally come up with the amount they wish for damages? Are there any guidelines regarding this?

If you can afford a consumer lawyer now would be the time to do so.
ILMD

[centex]

remember also that it is not sufficient to simply say 'we asked for validation and have not received it." That does not serve to rebut the presumption of claim. You have to unquivocably deny the claim or it is subject to summary judgment as there are no material facts in dispute in the filings currently before the Court.

[dlrbtr]

Quote:

Originally Posted by ilovemydogs If you can afford a consumer lawyer now would be the time to do so. ILMD

I wish we could

[dlrbtr]

Quote:

Originally Posted by centex remember also that it is not sufficient to simply say 'we asked for validation and have not received it." That does not serve to rebut the presumption of claim. You have to unquivocably deny the claim or it is subject to summary judgment as there are no material facts in dispute in the filings currently before the Court.

We are filing a Motion to Amend - also a response to the MSJ and a Motion to dismiss.

We've also found out that Capital One isn't actually the Plaintiff. We called Capital One and they stated that they no longer own the account. It was transferred to TRAKAmerica...I'm not sure if TRAKAmerica still owns the account and hired the local lawfirm to file, or if the lawfirm bought it from them. Either way, Cap One is definately NOT the plaintiff.

I'm still trying to figure out how and where to put that in my documents...I've been working on this for three days now, my head is about to pop.

[Enigma]

If the lawsuit is titled Cap1 v. your name, then MTD for Failure to Join Dispensable Party.

While you are at it, to thwart the MSJ, file a Sworn Denial:

Pleading Heading

SWORN DENIAL

Defendant, XXXX denies this is her/his debt and if it is her/his debt, Defendant denies that it is still a valid debt and if it is a valid debt, Defendant denies the amount sued for is the correct amount.

[dlrbtr]

Yes, it's titled Cap1 v. my name.

I understand the Sworn Denial. Do I still need to file the Motion to Amend?

Regarding the MTD: Is it Dispensable Party or Indispensable Party? I'll be honest, I really don't know what that means or how to present that (what to write)...is there any generic text to help get me started?

[Enigma]

Yes do the Amend and yes it is Indispensable party.

Here are some Motion examples.

[flacorps]

For this to work, Arizona needs to either be a choice-of-law state or needs to recognize the Cap1 agreement's adoption of Virginia law creates an ambiguity that should be resolved against the drafter (creditor).

Thisis from an online manual for Virginia and indicates that the cc debt SOL in VA may be 2 years rather than 3:

Quote:

Open Account Practice Commentary One of the unanswered questions in Virginia law is what is the limitation for an open account, two or three years? A logical starting point is to define an open account. Unfortunately the term is not clearly defined in Virginia law. A federal Ninth Circuit case, defines an open account as: An account which has not been finally settled or closed, but is still running or open to future adjustment or liquidation. Open account, in legal as well as in ordinary language, means an indebtedness subject to future adjustment, and which may be reduced or modified by proof. Pacific Micronesian Lines, Inc., v. New Zealand Insurance Company, Ltd., 366 F. 2d 333 9th Circuit (1966) Virginia Code § 8.01-246 sets forth the limitation for a contract in writing and signed by the party as five years and three years for an unwritten contract, expressed or implied. There is no reference in this statute to the limitation for an open account. Of the statutes that deal with the accrual time for limitations only § 8.01-249 specifically addresses an open account. See paragraph 8. In actions on an open account, from the later of the last payment or last charge for goods or services rendered on the account. Since the legislature has carved out a specific accrual time for an open account, it can be argued that it is not simply a common law unwritten contract. If so, since § 8.01-249 is silent as to the limitation for an open account then you look to the limitation catchall statute, § 8.01-248, and use the 2-year limitation.

triple-w dot lsnv dot org/Introduction_GDC_Manual dot htm (can't post URLs yet so you'll have to reassemble this one yourself)

[Enigma]

MOTION FOR SUMMARY DISPOSITION

Defendant, XXXXXX, pursuant to Rule 7.135, Florida Small Claims Rules, files this her Motion for Summary Disposition, and in support thereof would show as follows:

1. Pursuant to Rule 7.135, Florida Small Claims Rules, at the Pretrial Conference or at any subsequent hearing, if there is no triable issue, the Court shall summarily enter an appropriate order or judgment.

2. In the instant action, Plaintiff, Capital One Bank, has filed a Complaint to seek monies purportedly owed under a Capital One credit card. In particular, according to the allegations of the Complaint, XXXXXX purportedly entered into a credit card customer agreement with Capital One Bank, a copy of which is purportedly attached to Plaintiff’s response to Defendant’s Request for Production of Documents.

3. Page two (2) of the purported Customer Agreement provides:
Applicable Law: This agreement will be governed by Virginia Law
and Federal Law.

4. This was an Open Account as there was a situation where there had been running or current dealings between the parties and the account had been kept open with the expectation of further dealings.

5. The Virginia legislature carved out a specific accrual time for an Open Account. Code of Virginia (1950) 8.01-249(8.) “In actions on an open account, [the accrual period begins] from the later of the last payment or last charge for goods or services rendered on the account.” A copy of the aforementioned statute is attached hereto as Exhibit “D”.

6. By so doing, and not addressing an Open Account in Code of Virginia 8.01-246, the legislature thereby considers an Open Account to be distinct from a written contract, oral contract, quasi-contract, or implied contract. A copy of the aforementioned statute is attached hereto as Exhibit “E”.

7. From information and belief, the last charge for goods and services purportedly made by the Defendant was xx/xx/xx.

8. From information and belief, the last payment purportedly made by the Defendant was xx/xx/xx.

9. This instant action was filed on xx/xx/xx.

10. In light of the Choice of Law Provision contained in the purported customer agreement, this instant action is time-barred since it has been longer than three (3) years since either the last charge for goods or services or the last payment. Compare, Mazzoni Farms, Inc. v. E. I. DuPont & Company, 761 So.2d 306 (Fla, 2000)[it is incumbent upon the parties seeking to avoid enforcement of choice law provisions required that the foreign law contravenes public policy of the forum jurisdiction].

WHEREFORE, Defendant, XX/XX/XX, respectfully moves this Honorable Court for summary disposition against Plaintiff, Capital One Bank, dismissing this instant action with prejudice.

[dlrbtr]

Enigma - you are an absolute lifesaver...I've been trying to figure this out for days now, and about the time I think I get it, there's another rule/law/etc that screws me up again. Somehow I get the feeling that is just how the law works!

flacorps - Both Arizona and Virginia have a 3 year SOL, so I don't believe that I even have to argue the issue of jurisdiction. Date of original default to date of filing was 3 years, 6 months....

[dlrbtr]

In my Motion For Leave to Amend Answer I am making the argument that the Plaintiff will not be subject to undue prejudice as they were aware of the facts (that I'm adding to my answer) prior to the filing of their complaint.

Does anyone know of a case I could cite for Arizona Rules of Civil Procedure Rule 56(a).Amendments "...leave shall be freely given when justice so requires."?

[dlrbtr]

Could someone interpret this for me? I'm trying to find the rule directly addressing the attorney's misprepresenting Capital One as the actual plaintiff...

From Arizona Rules for Civil Procedure Rule 17(a):

Every action shall be prosecuted in the name of the real party in interest. An executor, administrator, guardian, bailee, trustee of an express trust, a party with whom or in whose name a contract has been made for the benefit of another, or a party authorized by statute may sue in that person's own name without joining the party for whose benefit the action is brought; and when a statute of the state so provides, an action for the use or benefit of another shall be brought in the name of the State of Arizona. No action shall be dismissed on the ground that it is not prosecuted in the name of the real party in interest until a reasonable time has been allowed after objection for ratification of commencement of the action by, or joinder or substitution of, the real party in interest; and such ratification, joinder or substitution shall have the same effect as if the action had been commenced in the name of the real party in interest.

[flacorps]

You need to determine whether TRAKAmerica is a JDB or a CA.

If they are a JDB and now own the debt, you have the right to make Cap1's name come off and Trakamerica's name go on the caption of the case.

If Trakamerica is merely a CA in this instance, then they are acting as Cap1's agent in working with the attorney. It's possible that some law is violated thereby, but probably what they're doing is OK, or at least a grey area.

[dlrbtr]

Quote:

Originally Posted by flacorps You need to determine whether TRAKAmerica is a JDB or a CA. If they are a JDB and now own the debt, you have the right to make Cap1's name come off and Trakamerica's name go on the caption of the case. If Trakamerica is merely a CA in this instance, then they are acting as Cap1's agent in working with the attorney. It's possible that some law is violated thereby, but probably what they're doing is OK, or at least a grey area.

I'm working on verifying that info now - when we spoke to Capital One on Friday, they said that they didn't own the account anymore.

Either way, the attorneys are violating 17(a) of Civil Procedure, right?

I found the Az Rules of Civil Procedure and Arizona Revised Statutes online, and having them in front of me is making it far easier to navigate this process. I've read through the Civil Procedure enough times now that I'm becoming quite a bit more familiar with them...still working on the Statutes.

[dlrbtr]

Quick question: Does the following rule mean that I cannot file a separate Motion for Summary Dismissal with Prejudice? And if so - do I include a request for dimissal w/prejudice in my answer to the plaintiff's MSJ?

Rule 7(a). Pleadings allowed

There shall be a complaint and an answer; a reply to a counterclaim denominated as such; an answer to a cross-claim, if the answer contains a cross-claim; a third-party complaint, if a person who was not an original party is summoned under the provisions of Rule 14; and a third-party answer, if a third-party complaint is served. No other pleading shall be allowed, except that the court may order a reply to an answer or a third-party answer.

[flacorps]

Quote:

Originally Posted by Enigma 10. In light of the Choice of Law Provision contained in the purported customer agreement, this instant action is time-barred since it has been longer than three (3) years since either the last charge for goods or services or the last payment. Compare, Mazzoni Farms, Inc. v. E. I. DuPont & Company, 761 So.2d 306 (Fla, 2000)[it is incumbent upon the parties seeking to avoid enforcement of choice law provisions required that the foreign law contravenes public policy of the forum jurisdiction].

I'm a little confused ... the prior paragraphs seem to lay out the admittedly rather arcane argument for a 2 year statute ... then state 3 years as the operant time frame. Just being conservative? Trying not to confuse judge? Trying to let judge be led to the 2 year conclusion on hiw own?