Debt Collectors Need Not Use Plain English

March 7, 2007 | Roger McEowen


The plaintiff bought products from JCPenney using a credit card. When she didn’t make her payments, the creditor started collection actions (on an unpaid balance of $731).  A judgment was entered against the plaintiff, but she didn’t pay, appeal or file bankruptcy. The creditor, through its law firm, sent a Citation to Discover Assets to the plaintiff’s bank where she had a checking account with a balance that exceeded the judgment amount. The law firm instructed the bank not to turn over the plaintiff’s exempt assets. Since the bank wasn’t sure which assets were exempt and which were not, it froze the plaintiff’s account. The plaintiff’s claimed that the entire balance was exempt because all of her income consisted of Social Security disability payments. The creditor didn’t challenge that assertion, but the plaintiff refused to pay the balance due on the credit card.  She did, however, pay the bank a $70 processing fee and her lawyer $1,000. She then sued the law firm under the Debt Collection Practices Act (Act) on the basis that the law firm is a “debt collector” under the Act, and the law firm’s complaint filed in the state court litigation violated the Act because their description of the contracts among JCPenney and the credit companies was not clear enough for an unsophisticated consumer to understand - she was confused by the description of the relationship between the seller, transaction processor and creditor. The court held that while the law firm is a “debt collector” for purposes of the Act, the Act has no application to the contents of complaints, affidavits and other papers filed in state court. That was the case because of a recent amendment to the Act specifying that legal pleadings need not be preceded or accompanied by verification.  Instead, the Act prohibits a debt collector from using any false, deceptive or misleading representation or means in connection with collecting a debt. Legalese in complaint, the court reasoned, did not make the complaint deceptive. Indeed, the court pointed out that it was the judge, rather than the plaintiff, that had to determine to whom the debt was owed and prepare the judgment to which the prevailing party is entitled.  Beler v. Blatt, Hassenmiller, Leibsker & Moore, LLC, No. 06-2707, 2007 U.S. App. LEXIS 5260 (7th Cir. Mar. 7, 2007).