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Mega Contributor
RobertEG
Posts: 18,463
Registered: ‎03-19-2007
0

Re: Debt Validation Questions

Precedent, on the Federal Court of Appeals level, that the initiation of legal action is not precluded by lack of prior debt validation stems from the case  Vega v. McKay (U.S.C.A., 11th Cir., 12/2003), 351 F.3d 1334).  Quoting from their decision:

"it is more consistent with the purpose and intent of Congress ... [that] the term `communication' as used in the Act does not include a `legal action' or pleadings or orders connected therewith." McKnight, 176 F.Supp.2d at 1306, 1308 (noting that the purpose of the FDCPA is to "curb abusive debt collection practices, not legal actions"). Significant to the court's holding in McKnight was the fact that the Federal Trade Commission does not consider a legal action to be a "communication" in connection with the collection of a debt. See id. at 1305-06 (noting that the FTC has stated in non-binding commentary that "[a] debt collector's institution of formal legal action against a consumer ... is not a `communication in connection with collection of any debt,' and thus does not confer section 809 notice-and-validation rights on the consumer") (citing 53 FR 50097, 50108).

“We now conclude that the holding of McKnight, that a legal action does not constitute an "initial communication" within the meaning of the FDCPA, accurately states the law. The Vegas' contention, that McKnight has been overruled by In re Martinez, is without merit because the question of whether a legal action constitutes an "initial communication" was never at issue in In re Martinez, and we in no way indicated our intent to overrule McKnight.”

Valued Member
IMPROVELIFE
Posts: 58
Registered: ‎11-04-2010
0

Re: Debt Validation Questions

 I needed this info. thanks alot  :smileyhappy:


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Senior Contributor
O6
Posts: 3,626
Registered: ‎10-13-2009
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Re: Debt Validation Questions

 


RobertEG wrote:

Precedent, on the Federal Court of Appeals level, that the initiation of legal action is not precluded by lack of prior debt validation stems from the case  Vega v. McKay (U.S.C.A., 11th Cir., 12/2003), 351 F.3d 1334).  Quoting from their decision:

"it is more consistent with the purpose and intent of Congress ... [that] the term `communication' as used in the Act does not include a `legal action' or pleadings or orders connected therewith." McKnight, 176 F.Supp.2d at 1306, 1308 (noting that the purpose of the FDCPA is to "curb abusive debt collection practices, not legal actions"). Significant to the court's holding in McKnight was the fact that the Federal Trade Commission does not consider a legal action to be a "communication" in connection with the collection of a debt. See id. at 1305-06 (noting that the FTC has stated in non-binding commentary that "[a] debt collector's institution of formal legal action against a consumer ... is not a `communication in connection with collection of any debt,' and thus does not confer section 809 notice-and-validation rights on the consumer") (citing 53 FR 50097, 50108).

“We now conclude that the holding of McKnight, that a legal action does not constitute an "initial communication" within the meaning of the FDCPA, accurately states the law. The Vegas' contention, that McKnight has been overruled by In re Martinez, is without merit because the question of whether a legal action constitutes an "initial communication" was never at issue in In re Martinez, and we in no way indicated our intent to overrule McKnight.”


 

Shoddy legal research, Robert.

 

Aside from the fact that you're comparing oranges to tangerines, FTC advisories and, in fact, US Supreme Court decision in Heintz et al v. Jenkins hold that litigation activity to recover a debt is "collection activity" covered by the FDCPA. 

 

The case presented by the OP, and your erroneous response that failure to respond to a DV notice did not preclude legal action, deals not with initial communication.  I do not see where the OP states his initial communication from the Ca was in the form of a Summons & Complaint.  Accordingly, your cite of Vega v. McKay is irrelevant since it deals with the issue of whether the initiation of a lawsuit, via a law firm whose practice includes substantial debt collection litigation, is initial communication.  The issue here is not "initial communication", but rather "collection activity" after a CA's initial communication.

 

Even if the issue were initial communication, your cite applies only to the 11th Circuit Court of Appeals encompassing only Florida, Georgia and Alabama.  Other Circuits, most notably the 2nd and 7th, have held contrary to the 11th.  As it stands, it appears far from settled law, but more courts disagree with the 11th than agree.

 

The fact remains that until you sit on the Supreme Court and rewrite the law, a timely made DV request negates the CA's ability to take further collection activities, which include filing a legal action and credit bureau reporting, until DV is made. 

 

IAALBNYL

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