By: Robert J. Nahoum
In a debt collection lawsuit, the Plaintiff (the party bringing the lawsuit) always has the burden to prove that the Defendant (the party being sued) is responsible for the debt. To meet this burden, a junk debt buyer like Cavalry Portfolio Services must prove that (1) it has the right to sue; (2) the debt is attributable to the defendant; and (3) that the amount sued for is correct. It is never the burden of the Defendant to prove that he or she does not owe the debt.
To prove that a debt buyer owns the debt (called “standingâ€), it must show how it came to acquire ownership of the debt. The sale of a debt from a creditor to a debt buyer or from one debt buyer to another is memorialized through an “assignment†in which the original creditor “assigns†ownership (and the right to collect the debt) to a new creditor (called an “assigneeâ€).
Often, debts are sold and resold over and over again to a number of subsequent debt buyers. When this happens, the debt buyer must prove each and every assignment by showing a “chain of title†reaching all the way back in history to the original creditor.
A recent debt collection lawsuit brought by infamous debt buyer Cavalry Portfolio Services against a Nassau, County New York consumer was dismissed because Cavalry failed to prove its standing.
Cavalry argued to the court on its motion for summary judgment that it was entitled to judgment against the consumer as a matter of law with even needing a trial. The court disagreed and held that
“As part of its prima facie proof, [Cavalry] had to establish it provided [the defendant] with notice of the assignment of the debt. […] No such proof has been offered.â€
“To establish its breach of contract action, Cavalry was required to establish the issuance of a credit card by [the original creditor] to [defendant], [defendant’s] use of the case and [defendant’s] default in payment. […] [Cavalry] has failed to provide the court with a copy of the credit card agreement.â€
“To establish its account stated action, [Cavalry] was required to prove statements had been sent to [defendant] and [defendant] failed to pay or object to the statements. […] To meet this requirement, Cavalry is required present evidence in admissible form establishing the mailing of the statements to [defendant]. Cavalry is also required to establish through proof in admissible form that the statements are business records. [Cavalry] has failed to present proof in admissible form establishing that the statements were mailed to [defendant], [defendant’s] receipt of the statements and/or that the statements are business records of [the original creditor].â€
If you need help settling or defending a debt collection law suit, stopping harassing debt collectors or suing a debt collector, contact us today to see what we can do for you. With office located in the Bronx, Brooklyn and Rockland County, the Law Offices of Robert J. Nahoum defends consumers in debt collection cases throughout the Tristate area including New Jersey.
The Law Offices of Robert J. Nahoum, P.C
(845) 232-0202
www.nahoumlaw.com
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