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Fair Debt Collection: 15.7.7 Framing a Criminal Law Violation As a Tort Claim; Prima Facie Tort
Some states incorporate the duties created by statutes, particularly criminal statutes, into their tort law on a general basis,535 so a violation of any criminal law restricting collection methods can the basis for a tort claim. For example, a civil claim might be based on a simulated process or criminal blackmail statute.
Fair Debt Collection: 15.7.8 Tort Claims Against Governmental Entities
Where state officials are involved, a tort claim may be cast as a civil rights violation.541 Ordinary tort actions against governmental creditors will, however, raise special problems: the consent to suit found in state tort claims acts generally excludes certain collection activities, such as tax collection, and the complexities of municipal liability law are beyond the scope of this treatise.542
Fair Debt Collection: 15.8 Attorney’s Liability to Third Parties for Collection Negligence and Other Torts
Collection attorneys can be held liable under the Fair Debt Collection Practices Act to debtors against whom they prosecute claims.543 Attorneys can also generally be held liable to opposing parties for intentional torts,544 but common law rules may insulate the attorney from liability to consumers for damages caused by negligent debt collection acts.545 Thus, a collection attorney who negligently files suit against or levies on the home of the wro
Fair Debt Collection: 15.9 Liability of Principals, Officers
The liability of the creditor for acts of a collection agency, which often possesses inadequate capital, should always be investigated. This liability generally turns on the level of control the creditor exercised over the collector’s activities.557 A creditor may also be liable for negligently hiring a collector, even if the collector is an independent contractor.558
Fair Debt Collection: Ala. Code § 40-12-80
Coverage: Debt collectors within the meaning of the FDCPA.
Prohibited Practices: Not specified, but requires licensing.
Private Remedies: No mention of private remedies.
Fair Debt Collection: Alaska Stat. §§ 08.24.041 to 08.24.380
Coverage: Collection agencies: Applies to collection agencies, defined as persons licensed or authorized to engage in the collection agency business, defined as the business of engaging directly or indirectly and having as a primary or secondary object, the solicitation of claims for collection or repossession of collateral security or the collection of claims owed or due or asserted to be due to another, or the repossession of collateral security.
Unfair and Deceptive Acts and Practices: 11.9.1 Introduction
Constitutional challenges to UDAP statutes are rarely successful. The fundamental notion that UDAP statutes and regulations can provide a right of action with flexible remedies for unfair or deceptive sales conduct is unchallengeable. Nevertheless, consumer litigants need to be familiar with constitutional UDAP issues because intransigent merchants may raise constitutional defenses in order to complicate, confuse, or postpone UDAP actions.
Home Foreclosures: 5.2.2 Judicial Foreclosure
In less than half of the states, mortgages are always foreclosed by judicial action, either because of state law requirements or local custom. In these states, the lender must file an action in court, usually in the county where the property is located, to obtain a judicial decree authorizing a foreclosure sale.
Home Foreclosures: 5.2.3 Non-Judicial, “Power of Sale” Foreclosure
In thirty states and the District of Columbia, foreclosing lenders are permitted to sell the mortgaged property at a foreclosure sale without filing a court action.11 In these jurisdictions, foreclosures are accomplished by the lender’s exercise of the “power of sale” contained in the mortgage (or deed of trust).
Home Foreclosures: 5.2.4 Other Methods of Foreclosure
There are two other, less common methods of foreclosure: strict foreclosure and foreclosure by entry and possession.
Home Foreclosures: 5.3.3 Renewing and Tolling the Statute of Limitations
Lenders may attempt to avoid statute of limitation problems by arguing that a limitation period that otherwise expired was renewed. Courts employ a variety of terms to characterize this type of legal claim. According to some courts, a lender may “waive,” rescind,” or “abandon” a prior acceleration. In more recen.t terminology, certain actions may “de-accelerate” or “decelerate” a loan that was previously accelerated.98 It is questionable whether a mortgage lender can unilaterally revoke acceleration at all.
Home Foreclosures: 5.4 Res Judicata Following a Ruling on the Merits Against the Lender
Loan owners and servicers who voluntarily bring an accelerated loan before a court for an adjudication of rights must deal with the consequences of what a court decides. The outcome could turn out to be negative for the foreclosing party, and the ultimate impact depends on the form of the order terminating the litigation.
Home Foreclosures: 5.5.1 Overview
Before a legally valid foreclosure sale can take place, there must be a valid mortgage between the parties, a default by the borrower, proper foreclosure procedure, and no cure (if permitted) or redemption by the borrower.176 This section and Chapter 9, infra, will outline various legal challenges which the homeowner may mount to the foreclosure—including challenging t
Collection Actions: 10.2.13.3 Department of Health and Human Services
The debt collection regulations of the Department of Health and Human Services (HHS) are similar to the joint regulations.294 They authorize administrative offset, credit bureau reports, installment payment agreements, tax intercepts, administrative wage garnishment, transfer to the Treasury Department for centralized collection, offset against federal employees’ salaries, compromise of debts, suspension and termination of collection activities, and referral to collection agencies.
Collection Actions: 10.2.13.4 Department of Housing and Urban Development
The debt collection regulations of the Department of Housing and Urban Development (HUD) authorize administrative offset, administrative wage garnishment, and salary offset.305 In 2011, HUD revised these regulations to eliminate provisions that simply repeated requirements of the joint regulations.306
Collection Actions: 10.2.13.5 Department of Veterans Affairs
The debt collection regulations of the Department of Veterans Affairs (VA)307 permit disclosure to a credit reporting agency that an individual owes an obligation to the United States.308 The VA regulations regarding administrative offset set forth additional standards for collection efforts.309 They explicitly state, however, that the Department’s failure to comply with the standards shall not be available as a defense to any debtor.
Collection Actions: 10.2.13.6 Department of Agriculture
The collection of loans owed to the Department of Agriculture is governed by rules reflecting the provisions of the Claims Collection Act.324 In early 2008, the Department overhauled these rules.325 The agency must give the debtor written notice thirty days before exercising administrative offset, explaining the proposed action and the method of obtaining review.326 The debtor may request, in writing, a review of the agency’s determination that the
Collection Actions: 10.3.3 MOVED—Prejudgment Remedies
[Editor’s note: This section has been moved to § 10.3.2, supra.]
Consumer Banking and Payments Law: 3.7.3 Wrongful Dishonor
A drawee bank has no acceptor’s liability on a check unless it has accepted the check by signing it.398 But the drawee bank does have an obligation to the drawer to pay any check that is properly payable.399 If the drawee bank refuses to pay a check that is properly payable and covered by funds in the customer’s account, the check is wrongfully dishonored.400
Consumer Banking and Payments Law: 3.7.4 Access to Cancelled Checks
A depositor who has drafted a check may need a copy of the paper check, such as for proof of payment, tax purposes, or litigation, or to verify whether a check was altered or the drawer’s signature was forged.427 This section covers the rules regarding access to paper checks, copies of paper checks and substitute checks under Check 21.428
Consumer Banking and Payments Law: 3.8.1 Introduction
The drawee bank can take on the obligation of the acceptor by signing the check. The more common way for a drawee to become obligated to pay a check is to make final payment on the check. This usually occurs by the drawee holding onto the check beyond the time for dishonoring (bouncing) the check.445 This section discusses the forward check collection process, including how and when the drawee bank is deemed to have made final payment on the check.
Consumer Banking and Payments Law: 3.8.2.1 Automated Check Collection
Check processing in this country is highly automated, and most checks are never examined by a human being. Rather, they are processed by machines that can read the MICR code at the bottom of the check. Only some checks are pulled for human inspection. These might include checks for which there are insufficient funds or checks that are somehow physically damaged. Most banks will also pull a sampling of random checks and large checks over an amount that varies from day to day.
Consumer Banking and Payments Law: 3.8.2.2 Conversion of Check to an Electronic Image of the Check—Check 21 Act
Even with automation, banks were still required to ship paper checks around the country for processing. U.C.C. § 4-110 led the way in facilitating the electronic presentment of checks through images of the check, or electronic information derived from a check between banks with an agreement for such an exchange, rather than presentment of the check.446 Under U.C.C.