Whenever creditors increase their pressure on an obligor of a debt, the consequences of failing to address such efforts is that the creditor will attempt to collect the debt by filing a civil lawsuit. After the service of a summons and complaint where they are named as a defendant, consumers cannot ignore the fact that they must defend a lawsuit.
After the service of a lawsuit, it will be more difficult to settle the payment of the debt and resolve the situation. Why? Now a debtor must propose a settlement that is better than the creditor’s current standing – a plaintiff in a civil suit with an excellent chance of winning the case. The result is that the debtor must arrange to repay some or all of the debt to the plaintiff or otherwise see the lawsuit go forward.
Banks and other financial institutions typically have vast resources, including collection agents, and legal resources, including collection attorneys, located throughout the United States to pursue unpaid debts. The collection of delinquent debts is part of doing business.
Theron Morrison and his team of debt collection defense attorneys may provide valuable assistance in helping consumers defend against debt-collection lawsuits. They can help consumers assert all applicable defenses and provide expertise and guidance throughout all court proceedings and any settlement negotiations. A debt collection defense attorney is crucial at the trial stage of an action for an unpaid debt based on breach of contract or an open account.
Once a debtor files an answer that responds to the complaint, a presiding court will typically schedule discovery, which is the process by which both of the parties to the lawsuit “discover” or exchange information. Discovery may occur through depositions, interrogatories, requests for statements of admission or requests for the production of documents. Both the plaintiff and defendant must abide by all discovery requests unless they invoke an applicable privilege or procedural rule.
Often in cases for credit card debts that are unpaid by a consumer, there is no valid defense to the failure to pay the debt. The debtor is the true obligor of the alleged unpaid debt and creditors typically succeed by filing a motion for summary judgment alleging that there is no genuine issue of material fact, such as the debt’s existence and the identity of its true obligor, in dispute.
A debt collection defense attorney may move the court for dismissal of the case if the plaintiff lacks the evidence to prove liability. These types of cases rarely progress to trial when liability is clear since both parties find it mutually advantageous to avoid expending further resources, such as attorneys’ fees and reach some settlement.
When a court renders a decision in favor of a creditor and grants it an award, it does so in the form of a judgment that establishes the parties’ rights and liabilities. At the time a court enters a judgment for a creditor who is a plaintiff, the creditor becomes a judgment creditor, and the losing defendant becomes a judgment debtor. The attorneys at the Morrison Law Group can help any Utah resident deal with judgment creditors, especially with a bankruptcy case filing.
A debt collection defense attorney may bring to light circumstances where a defendant never received an opportunity to be heard or there is no proof that the plaintiff is the rightful owner of the judgment. Documentation establishing proof of ownership of the debt may be missing, inadequate or simply nonexistent. If it is clear that the plaintiff-creditor is the legal owner of the debt, another option is to negotiate a settlement of the judgment, perhaps even for a lump sum payment of 50% or less.
A bankruptcy case filing will immediately stop a collection lawsuit. It will discharge the underlying debt of the civil lawsuit while stopping all efforts of a judgment creditor to execute and collect on its judgment. The amount of the judgment may be substantial and it may not be the only unpaid debt subject of a civil lawsuit to enforce collection. Thus, bankruptcy may be an effective, cost-efficient option.
Talk to the Morrison Law Group about your Chapter 7 or Chapter 13 bankruptcy options. Call 801.456.9933 today to schedule a FREE consultation. We are Utah’s only statewide bankruptcy law firm and have locations in Ogden, Logan, Sandy, and St. George to serve the residents of the counties of Weber, Cache, Salt Lake, Utah, Morgan, Davis, Washington, and surrounding areas.