A recent decision in Essique v. Walnut Woods Condominium Association, No. 2:15-CV-12049, 2016 WL 7337246 (E.D. Mich. Dec. 19, 2016) is a good example of how important it is to strictly comply with the requirements of the federal Fair Debt Collection Practices Act (FDCPA). Following is the judge’s summary of the requirements pertinent to the case (citations omitted):
“The FDCPA mandates a specific sequence of actions from a debt collector: in the initial contact with the consumer (or within 5 days of initial contact), the debt collector must provide notice that the consumer has 30 days to dispute the debt. If the consumer disputes the debt, the debt collector must mail ‘verification of the debt‘ to the consumer. [T]here are no time limits for a debt collector to validate the debt. But until the debt collector provides verification to the consumer, the debt collector must ‘cease collection of the debt’.
The assessment collection attorney for Walnut Woods provided a ledger to Essique along with the initial demand letter. However, after Essique disputed the debt, no additional verification of the debt was provided to Essique. Instead, the attorney proceeded immediately to file a lien against Essique’s unit. The attorney tried to argue that: (1) he complied with the FDCPA because the ledger provided with the initial demand letter satisfied the requirement for verification of the debt; and (2) in the alternative, recording a lien does not constitute a debt collection activity.
The judge rejected both of those arguments, citing both precedent case law and statute, and confirmed that the attorney should have ceased collection of the debt, which would include refraining from recording the lien, until after an additional verification of the debt had been sent to Essique.
It should be noted that Essique did not even challenge the legality of the lien itself in the lawsuit; she only objected to the attorney’s violation of the FDCPA in not following the proper procedure. So, cutting corners is not allowed with respect to the FDCPA – be sure that your association’s collection attorney’s efforts are not impeded by noncompliance.
By Mark Petrie, Legal Assistant
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