Michael K. Jeanes, Clerk of Court

01/16/2009 8:00 AM
SUPERIOR COURT OF ARIZONA
MARICOPA COUNTY
LC2008-000690-001 DT 01/15/2009
Docket Code 512 Form L512 Page 1
CLERK OF THE COURT
COMMISSIONER EARTHA K. WASHINGTON T. Melius
Deputy
D S S FINANCIAL GROUP LTD DANIEL J SIEGEL
v.
DEBORAH WALROD (001) FLOYD W BYBEE
REMAND DESK-LCA-CCC
SOUTH MOUNTAIN JUSTICE COURT
RECORD APPEAL RULE / REMAND
Lower Court Appeal No. CC200714554

This Court has jurisdiction over this appeal pursuant to the Arizona Constitution, Article VI, Section 16, and A.R.S. § 12-124(A). The court has considered the record of the proceedings from the trial court, exhibits made of record, and the memoranda submitted.

The appellee/cross-appellant (hereinafter appellee), DSS Financial Group filed a complaint in the lower court against the appellant/cross-appellee (hereinafter appellant), Deborah Walrod on July 18, 2007. In April of 2007 the appellee had purchased an account from another company for a debt owed by the appellant arising from a credit card agreement. After the appellant refused to pay the debt owed, the appellee filed the complaint. In the complaint it alleged that the contract existed, and that the total amount owed by the plaintiff was $8,460.25.

The appellant representing herself filed an Answer to the complaint. In that pleading the appellant admitted that the lower court had jurisdiction over the case but alleged that the appellee was not entitled to judgment because the statute of limitations had expired on the debt.

The matter went to trial on February 28, 2008. At trial the appellee offered into evidence exhibits that showed that it had been assigned the account from Unifund CCR Partners on April 10, 2007, and that the appellant owed the amount alleged in the complaint from the said account. Unifund had purchased the account from Chase Bank USA; the account had originated from First USA Bank. The managing member of the appellee’s company, Steven Sandler, testified at the hearing. He told the court that the last charge incurred by the appellant was on May 6, 2004. The appellant told the court that she had defaulted on the account in April of 2004 after losing her job a couple of months before then.

Throughout the course of the trial the appellant argued against the admission of certain exhibits based on a hearsay objections. The lower court overruled the objections on all but one exhibit. During its closing argument the appellee stated that the appellant admitted to the debt not only at trial but also through her Answer to the complaint. By not denying the averments in the complaint the appellee argued that pursuant to Rule 8(d) of the Arizona Rules of Civil Procedure they were admitted. It argued that the claim against the appellant was not barred by the statute of limitation because it had “six years under contract to assert the claim,” and thus was entitled to judgment in this case. In her closing the appellant argued two things. She first reasserted her hearsay objections which she claimed prohibited the appellee from introducing its exhibits into evidence. The appellant’s second argument was that A.R.S. § 12-543 limited the appellee’s ability to pursue the claim because the three year statute of limitations had passed. At the conclusion of the trial the lower court found in favor of the appellee and awarded judgment to it in the amount of $5315.00.

The appellant has filed a timely notice of appeal. On appeal she argues that the trial court erred by admitting the appellee’s exhibits over her hearsay and foundation objections. She further argues that the trial court erred by failing to find that the action was barred the statute of limitations pursuant to A.R.S. § 12-543. In its cross-appeal the appellee argues that the lower court erred in not awarding it the costs associated with the case as the winning party pursuant to A.R.S. § 12-341.

“We review the trial court’s rulings on the admissibility of the evidence for abuse of discretion. Roscoe, 184 Ariz. at 491, 910 P.2d at 642 (citing State v. Rivera, 152 Ariz. 507, 515, 733 P.2d 1090, 1098 (1987)).”1 Assuming that the lower court did not abuse its discretion by allowing the appellee to introduce evidence pursuant to the business exception of Rule 803(6) of the Arizona Rules of Evidence, the viability of the claim in regard to the statute of limitations becomes the main issue in this appeal.

A.R.S. §12-543 governs the time limit to pursue a claim of unpaid debt on an open or stated account. The statute provides a three year statute of limitation on such actions.

It states in part; There shall be commenced and prosecuted within three years after the cause of action accrues, and not afterward, the following actions:

2. Upon stated or open accounts other than such mutual and current accounts as concern the trade of merchandise between merchant and merchant, their factors or agents, but no item of a stated or open account shall be barred so long as any item thereof has been incurred within three years immediately prior to the bringing of an action thereon.

The appellate court in Cheatam v. Sahuaro Collection Service, Inc. held that “[a] cause of action accrues whenever one person may sue another… [A] party’s failure to assert a cause of action does not mean that the cause of action has not accrued.”2 In Krumtum v. Burton,3 the Arizona Supreme Court addressed the accrual of causes of actions and the statute of limitations in A.R.S. § 12-543 cases specifically. The Krumtum Court found that the services provided by the plaintiff to the defendants had been furnished on an open account.4 The Court defined an open account as “one where there are running or concurrent dealings between the parties, which are kept unclosed with the expectation of further transactions. * * *’ Connor Livestock Co. v. Fisher, 32 Ariz. 80, 85, 255 P. 996, 997 (1927).”5 The statute of limitations for an open account is three
years.6 The statute of limitations begins to run on an open account from the date of the last item…7 The defendants in Krumtum had successfully plead the statute of limitations before the trial court in a motion for summary judgment. The plaintiff appealed the trial court’s finding. On review, the Supreme Court held that because the statute of limitations had run on the cause of action on the open account, the grant for summary judgment had been proper.8 (“[T]he last item charged on the open account was more than three years before the action was commenced and the statute of limitations having been pled is a bar to the suit.”)

In this case, the credit card agreement between the appellant and First USA Bank, (which was subsequently assigned to the appellee) was an open account. The cause of action for the unpaid debt therefore accrued no later than May 6, 2004, after the last charge had been incurred by the appellant. The appellee had until May 6, 2007, at the latest to file a claim for the unpaid debt. The appellee filed its claim in July of 2007, three months after being assigned the account, but also two months past the statute of limitations deadline.

2 118 Ariz. 452, 454, 577 P.2d 738, 740 (App. 1978); see also Healey v. Coury, 162 Ariz. 349, 353, 783 P.2d 795,
799 (1989).
3 118 Ariz. 448, 532 P.2d 510 (1975).
4 Id. at 451, 513 P.2d at 513.
5 Id. at 450, 577 P.2d at 512.
6 A.R.S. §12-543(2).
7 Krumtum, 118 Ariz. at 451, 577 P.2d at 513.
8 Id.
9 Id.

Because the statute of limitations barred the claim for the unpaid debt, the lower courtshould have dismissed the case at the end of the trial.

IT IS THEREFORE ORDERED reversing the judgment of the lower court.

IT IS FURTHER ORDERED denying the appellee’s request for cost in its cross-appeal.

The matter shall be remanded to the South Mountain Justice Court for any further proceedings
consistent with this opinion.

The appellant seeks costs and attorney’s fees in connection with her litigation of the appeal and defending the action below. The appellant is instructed to proceed pursuant to Rules 12(d) and 13 of the Superior Court Rules of Appellate Procedure-Civil, if the rules are applicable to her. Any objection to the proposed costs and attorney’s fees should be filed by the appellee within five days of the service of the statement by the appellant.

A judgment that grants more relief than a party is entitled to is subject to reversal.  Id.  
Thus, it was reversible error for the trial court to grant summary judgment for
Centurion on a claim it did not raise in its motion for summary judgment.  
We sustain Landaverde’s fourth issue.

REVERSED AND REMANDED: Opinion by Chief Justice Hedges
Before Chief Justice Hedges, Justices Hudson and Guzman
14-06-00712-CV Jose A. Landaverde v. Centurion Capital Corporation

M E M O R A N D U M   O P I N I O N

This appeal arises out of a debt collection action filed by Centurion Capital Corporation
(“Centurion”), assignee of Discover, against appellant, Jose A. Landaverde. Landaverde appeals
from a summary judgment rendered in favor of Centurion.  In his first issue, Landaverde challenges
the trial court’s grant of summary judgment in favor of Centurion on its claims.  

In his second issue, Landaverde argues that the trial court erred in denying his plea in abatement.  
In Landaverde’s third issue, he complains that the trial court erred in “ignoring” his motion to strike
Centurion’s evidence.  In his final issue, Landaverde contends that the trial court erred in dismissing
his counterclaim.  

We reverse and remand.

In his first issue, Landaverde argues that the trial court erred in granting Centurion’s motion for
summary judgment.  In a traditional motion for summary judgment, the movant bears the burden of
establishing that there is no genuine issue of material fact and that it is entitled to judgment as a
matter of law.  Tex. R. Civ. P. 166a(c); KPMG Peat Marwick v. Harrison County Hous. Fin. Corp.,
988 S.W.2d 746, 749 (Tex. 1999).  In deciding whether there is a disputed material fact issue
precluding summary judgment, summary judgment evidence favorable to the nonmovant will be
taken as true, every reasonable inference must be indulged in favor of the nonmovant, and any
doubts are resolved in the nonmovant’s favor.  KPMG, 988 S.W.2d at 749; Nixon v. Mr. Prop.
Mgmt. Co., 690 S.W.2d 546, 549 (Tex. 1985).  

We review de novo the trial court’s decision to grant summary judgment.  Natividad v. Alexsis, Inc.,
875 S.W.2d 695, 699 (Tex. 1994).  

Centurion based its summary judgment motion on: (1) Landaverde’s alleged failure to file a verified
denial of Centurion’s suit on an account, and (2) deemed admissions which Centurion contends
established every element of its suit.  

Texas Rule of Civil Procedure 185 requires a defendant to file a verified denial in response to a
plaintiff’s sworn suit on an account.  Tex. R. Civ. P. 185.  We have previously held that a sworn
account, as intended in Rule 185, applies only “to transactions between persons, in which there is a
sale upon one side and a purchase upon the other, whereby title to personal property passes from
one to the other, and the relation of debtor and creditor is thereby created by general course of
dealing.”  Hou-Tex Printers, Inc. v. Marbach, 862 S.W.2d 188, 190 (Tex. App.- Houston [14th Dist.]
1993, no writ).  

After evaluating Centurion’s original petition, it does not appear that the account subject of this suit
involves such a transaction.  Centurion’s petition states that Centurion and/or its predecessor
“extended credit to Defendant for the Defendant to purchase of (sic) one or more items of goods,
wares, merchandise, or services, or for cash advances.  Defendant accepted the credit extended
by making charges on said credit card account, or by authorizing another person to make said
charges on this account.”  

Additionally, Centurion was assigned this account from “Discover.”[1]  It thus appears that this
account was a credit card account extended to Landaverde for his general use by a financial
institution that was not the seller of the goods or services purchased with the credit card.  Rule 185
is therefore unavailable to Centurion.  See Bird v. First Deposit Nat’l Bank, 994 S.W.2d 280, 282
(Tex. App.- El Paso 1999, pet. denied) (holding that – a credit card issued by a financial institution
does not create the sort of debtor-creditor relationship required in order to bring suit under Texas
Rule of Civil Procedure 185“); Marbach, 862 S.W.2d at 190 (finding that a suit on a promissory
note is not included in Rule 185′s definition of a sworn account); Dunham v. Providian Nat. Bank,
No. 14?01?00027?CV, 2002 WL 192336, at *1 (Tex. App.- Houston [14th Dist.] Feb. 7, 2002, no
pet.) (not designated for publication) (noting that Rule 185 does not apply to a credit card account
which involves only an advance of money).

Centurion attached the following requests for admissions to its original petition which the return of
service shows was hand delivered to Landaverde on October 26, 2005:

(1)     Defendant [Landaverde] entered an agreement whereby Plaintiff [Centurion] or Plaintiff’s
original assignor extended credit to Defendant.

(2)     Defendant was extended credit on the account or accounts the subject of this suit.

(3)     Plaintiff or Plaintiff’s original assignor extended credit to Defendant for the purchase of
goods, wares, merchandise or services or for cash advances on the account or accounts the
subject of this suit.

(4)     Defendant or another with permission of Defendant accepted the credit extended for the
purchase of the goods, wares, merchandise, or services referred to in Request Number 03.

(5)     The prices charged for the goods, wares, merchandise, or services referred to in Request
Number 03 were the prices agreed to by Defendant or another with permission of Defendant.

(6)     The prices charged for the goods, wares, merchandise, or services referred to in Request
Number 03 were the usual and customary prices therefore at the time when delivered and in the
county where delivered.

(7)     The balance due and owing to Plaintiff from Defendant on the account or accounts the subject
of this suit is at least $ 6353.38.

(8)     More than thirty (30) days ago, Plaintiff presented to Defendant a demand for payment of the
outstanding balance stated in Request No. 07.

Landaverde filed an answer (which included a certificate of service recitation) to Centurion’s
complaint on November 15, 2005 and included denials: (1) that Centurion or its predecessors
extended credit to him; and (2) that Centurion demanded payment of the debt.  

Texas Rule of Civil Procedure 198.2 requires a party to respond to a request for admission within
30 days, except that a defendant served with a request before his answer is due has 50 days to
respond to the request.  Tex. R. Civ. P. 198.2(a).  If a response is not timely served, the request is
deemed admitted.  Id. 198.2(c).  Landaverde’s responses filed on November 15, 2005 were timely;
therefore, those denials are given full effect.  The requests for admissions which Landaverde did
not respond to were deemed admitted.  See id.  We must determine if Centurion established the
elements of its suit through the matters deemed admitted.   

In addition to its attempt at using the procedural vehicle of Rule 185, Centurion sued under a
breach of contract and quantum meruit theory.  In order to prove a breach of contract claim, the
plaintiff must show:  (1) the existence of a valid contract; (2) performance or tendered performance
by the plaintiff; (3) breach of contract by the defendant; and (4) damages to the plaintiff resulting
from the breach.  Frost Nat’l Bank v. Burge, 29 S.W.3d 580, 593 (Tex. App. – Houston [14th Dist.]
2000, no pet.).  

The elements of quantum meruit are:  (1) the plaintiff rendered valuable services or furnished
materials; (2) for the party sought to be charged; (3) the party sought to be charged accepted and
enjoyed the services or materials; and (4) the party sought to be charged had reasonable notice
that the plaintiff, in performing the services or providing the materials, expected payment.  Vortt
Expl. Co. v. Chevron U.S.A., Inc., 787 S.W.2d 942, 944 (Tex. 1990); Wohlfahrt v. Holloway, 172 S.
W.3d 630, 634 (Tex. App.- Houston [14th Dist.] 2005, pet. denied).

The deemed admissions here do not support either of Centurion’s claims.  As mentioned above,
Landaverde timely denied: (1) that he was extended credit from Centurion or any of its
predecessors, and (2) that Centurion demanded payment from him.  As a result,  Centurion did not
prove that it or its predecessors performed or tendered performance to Landaverde.  See Burge,
29 S.W.3d at 593.  Landaverde’s denial that Centurion or its predecessors extended credit to him
negates the request intended to show performance.  That same denial negates the quantum meruit
elements requiring Centurion to show that it rendered services or materials and that Landaverde
accepted such services or materials.  See Vortt, 787 S.W.2d at 944; Wohlfahrt, 172 S.W.3d at
634.  Consequently, Centurion did not establish its suit through deemed admissions.  Therefore,
there was no basis on which the trial court could have granted summary judgment on Centurion’s
claims.  We sustain Landaverde’s first issue.

In his second issue, Landaverde argues that the trial court erred in dismissing his plea in
abatement which was based on Centurion’s alleged incapacity to sue.  There is nothing in the
record, however, to indicate that the trial court granted a hearing on the issue or made any other
type of ruling regarding the issue.  Landaverde has therefore waived this issue for purposes of this
appeal.  Tex. R. App. P. 33.1; Bossier Chrysler Dodge II, Inc. v. Rauschenberg, 201 S.W.3d 787,
798 (Tex. App.- Waco, 2006, pet. filed) (holding that a party filing a verified pleading should seek a
hearing on the issue).

In his third issue, Landaverde complains that the trial court erred “when it ignored my motions to
strike the evidence introduced by the Plaintiff.”  Landaverde filed a motion to strike an affidavit
Centurion attached to its original complaint.  The record does not reflect that the trial court ruled on
this issue either, as Landaverde’s statement that the trial court “ignored” his motions seems to
indicate.  Landaverde has failed to preserve this issue for review.  Tex. R. App. P. 33.1.

In his fourth issue, Landaverde contends that the trial court erred when it dismissed his
counterclaim.  Landaverde filed a counterclaim alleging Centurion violated the Federal and Texas
Fair Debt Collection Practices Acts.[2]  Centurion did not address Landaverde’s counterclaim in
its motion for summary judgment.  Nevertheless, in its order granting summary judgment, the trial
court stated, “All relief not expressly granted herein is denied, as this judgment is appealable and
finally disposes of all parties and all claims in this cause of action.”  The supreme court has
provided, as an example of words indicating a trial court’s clear intent for a judgment to be final,
language essentially the same as the language in the trial court’s order in this case.  See Lehmann
v. Har?Con Corp., 39 S.W.3d 191, 206 (Tex. 2001) (stating that “[a] statement like, ‘This judgment
finally disposes of all parties and all claims and is appealable,’ would leave no doubt about the
court’s intention” for a judgment to be final).  Therefore, the trial court’s order was final.  See
Lehmann, 39 S.W.3d at 200 (holding that if the trial court’s intent to finally dispose of the case is
clear, then the order is final and appealable).  

The implication of that finality is that the trial court granted summary judgment in favor of Centurion
on Landaverde’s counterclaim.  As mentioned above, however, Centurion did not raise the issue of
Landaverde’s counterclaim in its motion for summary judgment.  A judgment that grants more relief
than a party is entitled to is subject to reversal.  Id.  Thus, it was reversible error for the trial court to
grant summary judgment for Centurion on a claim it did not raise in its motion for summary
judgment.  We sustain Landaverde’s fourth issue.

We reverse the trial court’s grant of summary judgment in favor of Centurion on its claims and
Landaverde’s counterclaim.  We find, for purposes of this appeal, that Landaverde waived his
complaints regarding his plea in abatement and his motion to strike Centurion’s evidence.  We
remand these issues to the trial court for further proceedings consistent with this opinion.

/s/      Adele Hedges

Chief Justice

Judgment rendered and Memorandum Opinion filed June 28, 2007.

Panel consists of Chief Justice Hedges and Justices Hudson and Guzman.

 

In The

Court of Appeals

For The

First District of Texas

 

NO. 01-07-00380-CV

__________

HUDSON & KEYSE, L.L.C., Appellant

V.

LAVERN W. GIPSON AND EMMETT GIPSON, Appellees

 

On Appeal from the County Civil Court at Law No. 1

Harris County, Texas

Trial Court Cause No. 865145

 

MEMORANDUM OPINION

Appellant, Hudson & Keyse, L.L.C. (“Hudson”), challenges the trial court’s order of dismissal of its suit against appellees, Lavern W. Gipson and Emmett Gipson, to recover an outstanding credit card balance. In two issues, Hudson contends that the trial court erred in dismissing the case for want of prosecution and denying its motion for substitute service.

We affirm.

 

On May 23, 2006, Hudson filed suit against the Gipsons, alleging that they defaulted in making required payments pursuant to a credit card agreement. On May 25, 2006, citation was issued. On June 22, 2006, Hudson filed a motion for substitute service, stating that it had unsuccessfully attempted to serve the Gipsons, who “[could] probably be found” at 808 Junell Street in Houston, Texas, and that the Gipsons could be given notice of the suit through substitute service.

In support of its motion, Hudson attached an affidavit from its process server, who testified that she “attempted to make personal delivery” on the Gipsons at their “place of abode,” ⁽¹⁾ but had “deemed” such service “impractical.” She believed that the Gipsons could be given notice of the suit “by delivering to anyone over the age of sixteen (16) at the [Gipsons'] usual place of abode or by attaching [the citation and petition] to the front entrance of the [Gipsons'] usual place of abode.” The process server had previously attempted to serve the Gipsons at the Junell Street address on five occasions–May 31, June 2, June 3, June 5, and June 10, 2006–but there was no answer at the door. Thus, she left her card on the door. On June 6, 2006, she received a telephone call from a male individual who identified himself as Emmett Gipson and told her that she “should not come back to his house because neither he nor his wife [would] take anything that [she] had.”

The clerk’s record does not show that the trial court ruled on Hudson’s motion for substitute service. ⁽²⁾ Moreover, there is no evidence in the record that Hudson ever again attempted to serve the Gipsons during the following eight months in which the suit remained pending or that Hudson filed any additional requests for substitute service supported by any new evidence.

On January 5, 2007, the trial court granted Hudson a continuance. ⁽³⁾ Three months later, on March 5, 2007, the trial court signed an order of dismissal “for want of prosecution,” stating that the parties had been notified of the trial date and had “failed to appear.”

On March 28, 2007, Hudson filed a motion to reinstate, in which it stated that it had filed a second motion for continuance on February 28, 2007, “explain[ing] that it was having difficulties serving [the Gipsons].” Although this motion for continuance is not contained in the clerk’s record, Hudson, in its appellate briefing represents that it filed this second motion for continuance “prior to dismissal indicating to the trial court that it was having continuing difficulties with service.” (Emphasis added). However, there is no evidence in the record that Hudson made continuing service efforts following its five service attempts in late May and early June 2006. In its motion to reinstate, Hudson also asserted that Harris County Appraisal District (“HCAD”) records established that the Gipsons owned “homestead property” at the Junell Street address and that the Gipsons had not been home or were avoiding service. However, Hudson did not attach the referenced HCAD records to its motion, and they are not contained in the record before us.

On April 5, 2007, the trial court signed an order stating that it heard Hudson’s motion to reinstate and that the motion was “not well taken.” Thus, the trial court denied the motion to reinstate. Although the order recites that a hearing was held on the motion, there was no reporter’s record filed with this Court.

Dismissal for Want of Prosecution

In its first issue, Hudson argues that the trial court erred in dismissing the case for want of prosecution because Hudson attempted service on five different occasions, it provided proof that it made these service attempts at the Gipsons’ homestead, the trial court should have allowed substitute service, and it exercised diligence.

A court may dismiss a case for want of prosecution “on failure of any party seeking affirmative relief to appear for any hearing or trial of which the party had notice.” Tex. R. Civ. P. 165a(1). In fact, “[a]t the dismissal hearing, the court shall dismiss for want of prosecution unless there is good cause for the case to be maintained on the docket.” Id. In addition to the express authority under Rule 165, the common law vests trial courts with the inherent power to dismiss a case when the plaintiff fails to prosecute the case with due diligence. Alexander v. Lynda’s Boutique, 134 S.W.3d 845, 850 (Tex. 2004); Villarreal v. San Antonio Truck & Equip., 994 S.W.2d 628, 630 (Tex. 1999). We review a trial court’s order dismissing a case for want of prosecution for an abuse of discretion. Wright v. Tex. Dep’t of Criminal Justice-Institutional Div., 137 S.W.3d 693, 696 (Tex. App.–Houston [1st Dist.] 2004, no pet.).

Here, the trial court, in its March 5, 2007 dismissal order, recited that the parties had been notified of the trial date and failed to appear. In its appellate briefing, Hudson does not address the consequence of failing to appear on the trial date. Hudson does not contend that the trial court failed to provide it with the required notice. See Tex. R. Civ. P. 165a(1) (setting forth notice requirements before case may be dismissed for want of prosecution for failure to appear). Nor does Hudson assert any specific reason as to why it was not required to appear. Moreover, Hudson does not challenge the trial court’s statement in the dismissal order that Hudson, in fact, failed to appear. We note that although Hudson, in its subsequently-filed motion to reinstate, referred to the filing of a February 28, 2007 motion for continuance prior to the trial court’s dismissal, there is no copy of any such motion in the record. On this record, we cannot conclude that the trial court abused its discretion in dismissing the case for want of prosecution under Rule 165 when Hudson failed to appear on the trial date on March 5, 2007. See id.

In regard to Hudson’s motion to reinstate, a party may file a motion setting forth grounds for reinstatement, and the trial court “shall set a hearing on the motion.” Tex. R. Civ. 165a(3). The trial court “shall reinstate the case upon finding after a hearing that the failure of the party or his attorney was not intentional or the result of conscious indifference but was due to an accident or mistake or that the failure has been otherwise reasonably explained.” Id. We review a trial court’s ruling on a motion for reinstatement for an abuse of discretion. WMC Mortg. Corp. v. Starkey, 200 S.W.3d 749, 752 (Tex. App.–Dallas 2006, pet. denied).

Here, in its first issue, Hudson has not specifically challenged the trial court’s denial of its motion to reinstate. However, to the extent that it seeks to challenge this ruling, it has not cited anything in the record to show that the trial court would have abused its discretion in not making the requisite finding to reinstate the case, i.e., the finding that Hudson’s failure was not intentional or the result of conscious indifference but was due to an accident or mistake or that Hudson’s failure has been otherwise reasonably explained. Tex. R. Civ. 165a(3). In considering whether the record would support such a finding, we note that although the order denying the motion to reinstate suggests that a hearing was held on Hudson’s motion, there was no reporter’s record taken at the hearing. Thus, we are not aware of what additional evidence, if any, was considered by the trial court in denying the motion to reinstate. Furthermore, although Hudson, in its appellate briefing, suggests that it was having continuing difficulties with service, the only evidence in the record is that Hudson made five service attempts in an eleven-day period from May 31 to June 10, 2006. There is no evidence as to what service efforts, if any, Hudson undertook during the subsequent eight-month period from June 2006 until March 2007, when the case was dismissed. Accordingly, we hold that the trial court did not err in dismissing the case for want of prosecution and denying Hudson’s motion to reinstate.

We overrule Hudson’s first issue.

Substitute Service

In its second issue, Hudson argues that the trial court erred in denying its motion for substitute service because it made five separate service attempts at the Gipsons’ residence and that the Gipsons would not “cooperate in the service process.” Hudson asserts that “[c]learly they were evading service and substituted service was the only means available to serve them” and that the “quality and quantity” of its service attempts shows “extreme diligence.” Hudson also asserts that the trial court’s error “caused this case to remain pending without any disposition until the trial court dismissed it for want of prosecution.”

Texas Rule of Civil Procedure 106(b) provides,

Upon motion supported by affidavit stating the location of the defendant’s usual place of business or usual place of abode or other place where the defendant can probably be found and stating specifically the facts showing that service has been attempted under either (a)(1) or (a)(2) at the location named in such affidavit but has not been successful, the court may authorize service
(1) by leaving a true copy of the citation, with a copy of the petition attached, with anyone over sixteen years of age at the location specified in such affidavit, or
(2) in any other manner that the affidavit or other evidence before the court shows will be reasonably effective to give the defendant notice of the suit.
Tex. R. Civ. P. 106(b).

We examine a trial court’s denial of a motion for substitute service for an abuse of discretion. See Izen v. Sjostrom, No. 14-06-00142-CV, 2007 WL 968841, at *4 (Tex. App.–Houston [14th Dist.] 2007, pet. denied) (mem. op.).

Initially, we note that the record does not contain an order denying Hudson’s motion for substitute service. It appears that the trial court simply did not rule on Hudson’s motion. See Tex. R. App. P. 33.1 (providing that as prerequisite to presenting complaint for appellate review, record must show that trial court ruled on motion, expressly or implicitly, or refused to rule on motion, and complaining party objected to refusal). Nevertheless, contrary to Hudson’s assertions that it exercised “extreme diligence,” the record does not establish that Hudson made continuous efforts to serve the Gipsons throughout the underlying proceedings. Rather, the record shows that Hudson’s process server made five attempts during an eleven-day period to serve the Gipsons at their purported home address shortly after Hudson filed suit. There is nothing in the record to indicate that, after these initial attempts, Hudson ever made any additional service attempts or that Hudson ever filed any additional motions for substitute service, supported by any additional evidence. Accordingly, we hold that the trial court did not abuse its discretion in not authorizing substitute service. See Izen, 2007 WL 968841, at *4 (holding that trial court did not abuse its discretion in denying motion for substitute service after plaintiff attempted to serve defendant at his residence on four separate occasions).

We overrule Hudson’s second issue.

 

We affirm the order of the trial court dismissing the case for want of prosecution.

Terry Jennings

Justice
Panel consists of Chief Justice Radack and Justices Jennings and Bland.

1. The process server stated, without any explanation, that the Gipsons place of abode “was established personally in [her] efforts.” Although Hudson, in its briefing, asserts that the trial court denied its motion for substitute service, the clerk’s record contains no such order. The clerk’s record does not contain a copy of any motion supporting Hudson’s request for a continuance, nor does it contain any evidence as to the basis for the continuance.

2.

3.

Conclusion

Factual and Procedural Background

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M E M O R A N D U M    O P I N I O N

In this suit to collect a credit-card debt, debtor Celia Barajas asks us to reverse the traditional summary
judgment granted in favor of the creditor=s assignee, appellee Harvest Credit Management, VI-B, LLC
(“Harvest”).  Because Harvest failed to establish its entitlement to judgment on its contract claim as a matter
of law, we reverse and remand.

I.  Factual and Procedural Background

Celia Barajas received, signed, and returned an application for a credit card from Metris Direct Merchants
Bank (“Metris”).  Metris issued her a credit card, and Barajas accepted and agreed to the terms and
conditions associated with its use.  Under the terms of the account, Barajas was required to pay in full for all
charges incurred through her use of the credit card.

Harvest, in its asserted capacity as Metris=s assignee, subsequently sued Barajas for her alleged
indebtedness on the account.  The trial court granted traditional summary judgment in Harvest=s favor, and
this appeal ensued.

II.  Issue Presented

In her sole issue on appeal, Barajas contends the summary judgment in favor of Harvest should be reversed
because (a) some of the exhibits offered in support of the motion are defective and are not competent
summary judgment evidence, and (b) no other evidence supports the summary judgment.

III.  Standard of Review

We review a summary judgment de novo.  Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex.
2005). To prevail on a summary judgment motion, the movant must establish that there are no genuine
issues of material fact and that it is entitled to judgment as a matter of law.  See Tex. R. Civ. P. 166a(c).  
Once the movant establishes a right to judgment as a matter of law, the burden shifts to the non?movant to
produce evidence raising a genuine issue of material fact.  Id.; City of Houston v. Clear Creek Basin Auth.,
589 S.W.2d 671, 678B79 (Tex. 1979).  In our review, we take as true all evidence favorable to the
non?movant, and we indulge every reasonable inference and resolve any doubts in the non?movant=s
favor.  Sw. Elec. Power Co. v. Grant, 73 S.W.3d 211, 215 (Tex. 2002).

IV.  Analysis

Barajas asserts that Harvest failed to prove that she Amade purchases and cash advances on [the] credit
card, and the items, dates, amounts, and [these] were made [sic] signed for or by@ her.  In connection with
this argument, we note that in her statement of facts, Barajas made the uncontroverted assertion that Ano
agreement has been introduced to establish what terms and conditions Appellant agreed to by accepting
and using the Card to purchase various goods, wares, merchandise, services, or to take cash advances.@[1]

To be entitled to summary judgment on its breach-of-contract claim, Harvest was required to prove, as a
matter of law, the following essential elements of its claim: (1) the existence of a valid contract, (2)
performance or tendered performance by the plaintiff, (3) breach of contract by the defendant, and (4)
damages sustained as a result of the breach.  See Winchek v. Am. Express Travel Related Servs. Co., 232
S.W.3d 197, 202 (Tex. App.CHouston [1st Dist.] 2007, no pet.).  Parties form a binding contract when the
following elements are present: (1) an offer, (2) an acceptance in strict compliance with the terms of the
offer, (3) meeting of the minds, (4) each party=s consent to the terms, and (5) execution and delivery of the
contract with the intent that it be mutual and binding.  Id.  To be enforceable, a contract must be sufficiently
certain to enable a court to determine the rights and responsibilities of the parties.  Id. (citing T.O. Stanley
Boot Co. v. Bank of El Paso, 847 S.W.2d 218, 221 (Tex.1992)).  The material terms of a contract must be
agreed upon before a court can enforce the contract.  See T.O. Stanley Boot, 847 S.W.2d at 221 (holding
that interest rate is material term in context of contract to loan money).

Here, Harvest=s summary-judgment evidence did not include the actual agreement or any other evidence
that established the agreed terms, including the applicable interest rate or the method for determining the
applicability and amount of finance charges.  Harvest also produced no evidence regarding any transactions
or cash advances associated with the account or any statements issued to Barajas.  Moreover, statements
contained in affidavits offered in support of Harvest=s motion for summary judgment conflict with Harvest=s
representations in its pleadings and in its summary-judgment motion.  For example, Harvest attached two
documents to its original petition.  The first document is identified by Harvest as an affidavit by Martin Ravin,
Harvest=s general manager, in which he stated that the interest rate applicable to Barajas=s account is
23.9%.  The second document is entitled ADirect Merchants Credit Card Bank Last Statement Details,@ and
identifies the applicable interest rate as 29.99%.  As summary-judgment evidence,[2] however, Harvest
attached David Ravin=s affidavit, in which he asserted that Barajas=s indebtedness includes interest at an
unspecified Alegal rate.@

The summary-judgment motion and evidence also presented conflicting statements regarding the basis for
the alleged indebtedness.  Contrary to the representations in its pleadings and summary-judgment motion
that Harvest purchased the account from Metris, Harvest=s summary-judgment evidence includes David
Ravin=s statement that Harvest Ais the original and current owner and holder of the account.@ (emphasis
added).[3]  He further represented that ADefendant became obligated to Plaintiff on this debt by purchasing
items of goods, wares, merchandise, or services sold to the Defendant by Plaintiff and for which Plaintiff sues.
@ (emphasis added).

We conclude that the evidence offered in support of Harvest=s motion for traditional summary judgment
presents questions of material fact and is insufficient to establish the terms of a valid contract as a matter of
law.  See Williams v. Unifund CCR Partners Assignee of Citibank, BS.W.3dB, No. 01-06-00927-CV, 2008 WL
339855, at *4 (Tex. App.CHouston [1st Dist.] Feb. 7, 2008, no pet.) (reversing summary judgment where the
creditor failed to produce evidence establishing the contract=s terms).  We therefore sustain Barajas=s sole
issue on appeal.

V.  Conclusion

Because Harvest failed to carry its summary-judgment burden, we reverse the trial court=s judgment and
remand the case for further proceedings consistent with this opinion.

/s/        Eva M. Guzman

Justice

Judgment rendered and Memorandum Opinion filed August 28, 2008.

Panel consists of Justices Frost, Seymore, and Guzman.

[1]  See Tex. R. App. P. 38.1(f) (AIn a civil case, the court will accept as true the facts stated unless another
party contradicts them.@).  Further, Barajas=s statement of facts is consistent with her answers to requests
for admissions, which she filed as an attachment to her answer to Harvest=s petition in the trial court.  There,
she admitted that she applied to Metris for a credit card; that her application was approved; and that she
accepted and agreed to the terms and conditions associated with the credit card account, including terms
requiring her to pay Metris in full for all charges incurred by her use of the card.  See Tex. R. Civ. P. 166a(c)
(trial court considers pleadings and admissions of the parties in rendering summary judgment).

[2]  The exhibits Harvest offered in support of its motion for summary judgment include:

A.         Defendant=s Original Answer and Original Cross-Complaint, with attached Affidavit of Celia Barajas;

B.         Two Affidavits by David Ravin;

C.         A computer print-out of the amounts alleged by Harvest as the original claim amount, interest, and
total amount due;

D.         Affidavit of Harvest=s attorney regarding attorneys= fees;

E.         A demand letter from Harvest=s attorney to Celia Barajas, dated December 12, 2005; and

F.         A computer print-out of the text of 15 U.S.C.A. ‘ 1666.

Barajas argues that an unidentified exhibit is A[n]ot a copy of agreement indicating terms, conditions, and
attorneys[=] fees.@  In support of her position that such particulars must be included with these exhibits,
Barajas relies solely on Guthrie v. Suiter.  934 S.W.2d 820, 824B25 (Tex. App.CHouston [1st Dist.] 1996, no
writ).  In Guthrie, the First Court of Appeals applied Texas Rule of Civil Procedure 166a(f), and held that the
trial court did not abuse its discretion in refusing to consider an expert-opinion affidavit in which the expert
referred to documents that were not attached to or filed with the affidavit. Id. (citing Tex. R. Civ. P. 166a(f)).  
Rule 166a(f) provides in pertinent part that A[s]worn or certified copies of all papers or parts thereof referred
to in an affidavit shall be attached thereto or served therewith.@  Tex. R. Civ. P. 166a(f) (emphasis added).  
Here, Exhibits C, E, and F are not affidavits and do not refer to other papers; hence, Guthrie=s application of
Rule 166a(f) does not apply to them.

Exhibit B, however, contains two affidavits by Harvest employee David Ravin.  In the first of these, Ravin
states that he is the custodian of Harvest=s records, but he makes no reference to any of Harvest=s
records.  The only documents referred to in this affidavit are Harvest=s motion for summary judgment, and
Harvest=s original petition.  Both of these documents were filed with the court and served on Barajas, and
the affidavit was attached to the motion for summary judgment.  In his second affidavit, the only document to
which Ravin refers is Barajas=s answer, and a copy of the answer was served with the affidavit and the
motion for summary judgment.  Thus, neither the reasoning in Guthrie nor the text of Rule 166a(f) requires
the exclusion of these affidavits.

[3]  Barajas did not argue, at trial or on appeal, that the affidavits were improperly attested or failed to
demonstrate how the affiant obtained personal knowledge of the facts recited therein.

“An account stated has been defined as an agreement between parties who have had previous transactions that the account representing those transactions is true and that the balance stated is correct, together with a promise, express or implied, for the payment of such balance.” McHugh v. Olsen, 189 Ill.App.3d 508, 514, 545 N.E.2d 379 (1st Dist. 1989).

“An account stated is merely a form of proving damages for the breach of a promise to pay on a contract.” Dreyer Medical Clinic, S.C. v. Corral, 227 Ill.App.3d 221, 226, 591 N.E.2d 111 (2d Dist. 1992).

A cause of action for an account stated therefore requires allegation and proof that (1) there was a contract between the parties, such as a credit card agreement or a contract for the sales of goods or services, Dreyer, 227 Ill.App.3d at 226-27, (2) a statement of account was sent to the party sought to be held liable, and (3)
the statement was agreed to, expressly or by implication. Thomas Steel Corp. v. Ameri-Forge Corp., 91 C 2356, 1991 U.S. Dist. LEXIS 18110, 1991 WL 280085 (N.D.Ill., Dec. 27, 1991). Agreement may be inferred from payment or retention for a substantial period without objection.

However, both the basic agreement and the rendition of an account must be proven. “[T]he rule that an account rendered and not objected to within a reasonable time is to be regarded as correct assumes that there was an original indebtedness, but there can be no liability on an account stated if no liability in fact exists, and the mere presentation of a claim, although not objected to, cannot of itself create liability. . . . In other words, an account stated cannot create
original liability where none exists; it is merely a final determination of the amount of an existing debt.” Motive Parts Co. of America, Inc. v. Robinson, 53 Ill.App.3d 935, 940, 369 N.E.2d 119 (1st Dist. 1977).

Thus, a cause of action for an account stated is founded on both (a) the underlying contract and (b) the statement of account sent to the debtor and agreed to by the debtor. Both must be attached.

Is contract and assignment attached to complaint as required by §2-606 of Code of Civil Procedure?

735 ILCS 5/2-606 provides:

Sec. 2-606. Exhibits. If a claim or defense is founded upon a written
instrument, a copy thereof, or of so much of the same as is relevant,
must be attached to the pleading as an exhibit or recited therein,
unless the pleader attaches to his or her pleading an affidavit stating
facts showing that the instrument is not accessible to him or her. In
pleading any written instrument a copy thereof may be attached to
the pleading as an exhibit. In either case the exhibit constitutes a part
of the pleading for all purposes.

In addition to the underlying contract, the assignment(s) showing that plaintiff has title to the claim is a document on which the action is founded. Candice Co. v. Ricketts, 281 Ill.App.3d 359, 362, 666 N.E.2d 722 (1st Dist. 1996), see also V.W. Credit, Inc. v. Alexandrescu, 13 Misc. 3d 1207A; 824 N.Y.S.2d 759
(N.Y.Civ.Ct. 2006), and MBNA America Bank, N.A. v. Nelson, 15 Misc. 3d 1148A, 841 N.Y.S.2d 826 (N.Y.Civ. Ct. 2007).

At the time the parties’ rights are determined, actual assignments sufficient to vest title to the obligation sued upon in the plaintiff must be in the record. Bayview Loan Servicing, L.L.C. v. Nelson, 5-06-0664, 2008 Ill. App. LEXIS 596, 890 N.E.2d 940 (Ill.App., 5th Dist., June 16, 2008).

Failure to establish ownership of the debt deprives the debt buyer of standing to 10 sue. In Unifund CCR Partners v. Cavender, 14 Fla. L. Weekly Supp. 975b (Fla. County Court, Orange County July 20, 2007), the court held :

The Court has reviewed the documents presented by the Plaintiff, Bill of Sale and the Assignment, and finds that they fail to sufficiently identify the accounts that were assigned or sold to the Plaintiff. Neither the Bill of Sale nor the Assignment indicate the account numbers or names of account holders. They do not provide any information that would allow the Court to determine if the alleged account of Defendant was one of the accounts sold or assigned to the Plaintiff.

Without any indicia of ownership that would sufficiently identify the true owner of the account at the time that Plaintiff filed this action, the Plaintiff is unable to prove that it had standing to bring the action. An assignment is the basis of the Plaintiff’s standing to invoke the processes of the Court in the first place and is therefore an essential element of proof. Progressive Express Ins. Co. v. McGrath Community Chiropractic, 913 So. 2d 1281, 1285 (Fla. 2nd DCA 2005); Oglesby v. State Farm Mutual Automobile Ins. Co., 781 So. 2d 469 (Fla. 5th DCA 2001). “Only the insured or medical provider ‘owns’ the cause of action against the insurer at any one time.” Id. at 470.

This means that debt buyers who file lawsuits have to be licensed. Failure to obtain a license may be grounds for dismissal. LVNV Funding v. Minnick, 2008 AR 000868 (DuPage Co. Cir. Ct.)

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FOR PUBLICATION

ATTORNEY FOR APPELLANT:    ATTORNEYS FOR APPELLEE:

CLIFFORD W. SHEPARD    THOMAS J. GRAU
Consumer Protection Law Offices     CAROL A. NEMETH
Indianapolis, Indiana    White & Raub
            Indianapolis, Indiana

 

 

IN THE COURT OF APPEALS OF INDIANA

GREG A. SPEARS,         )

                             )
Appellant-Plaintiff,         )
                             )
vs.                          )    No. 49A02-0003-CV-169
                             )
TIMOTHY L. BRENNAN,          )
                             )
Appellee-Defendant.          )

APPEAL FROM THE MARION SUPERIOR COURT
The Honorable Kenneth Johnson, Judge
Cause No. 49D02-9802-CP-236

March 26, 2001

OPINION – FOR PUBLICATION


NAJAM, Judge

STATEMENT OF THE CASE

    Greg A. Spears challenges the trial court’s entry of summary judgment in favor of attorney and debt collector Timothy R. Brennan on Spears’ complaint alleging violations of the Fair Debt Collection Practices Act (“the FDCPA” or “the Act”), 15 U.S.C. § 1692 et seq. Spears presents four issues for our review, which we restate as:
1.    Whether Brennan misrepresented the amount of attorney’s fees to which he was entitled for the collection of Spears’ debt in violation of 15 U.S.C. §§ 1692e(2)(B) and 1692f(1).

2.    Whether Brennan’s debt collection notice to Spears complied with 15 U.S.C. § 1692g(a).

3.    Whether Brennan violated 15 U.S.C. § 1692g(a) when he scheduled two hearing dates on the debt collection claim and obtained a default judgment against Spears within the thirty-day debt validation period.

4.    Whether Brennan violated 15 U.S.C. § 1692g(b) when he obtained a default judgment against Spears after Spears had notified Brennan in writing that he was disputing the debt and before Brennan had mailed verification of the debt to Spears.

    We affirm in part, reverse in part and remand for further proceedings.
FACTS AND PROCEDURAL HISTORY
    On September 30, 1994, Spears obtained a loan from American General Finance, Inc. (“American General”) in the amount of $2,561.59. The consumer credit contract executed by Spears contained the following collection costs provision:
If you don’t make any payment when it is due, you will pay us reasonable amounts permitted by law which we spend trying to collect what you owe or trying to take, foreclose or sell the security. You will also pay our reasonable attorney’s fees, if referred to an attorney who is not our salaried employee, including any for appeals as permitted by law.

 

Record at 17 (emphasis added). When Spears stopped making the loan payments, American General retained Brennan to collect the unpaid contract balance.
    On October 24, 1996, Brennan sent a debt collection notice to Spears that read:
RE:    Creditor: American General Finance, Inc.
    Balance: $2,918.47 less applicable rebates

Dear Mr. Spears:

    This communication is from a debt collector and is an attempt to recover a debt owed to the above named Creditor[;] any information obtained will be used for that purpose. Verification of the debt or the name and address of the original Creditor, if different than the above, will be provided upon written request to this office within thirty (30) days[;] otherwise the debt will be assumed valid.

Record at 33. On October 30, 1996, Brennan filed a notice of claim against Spears on behalf of American General in small claims court, seeking recovery of the $2,918.47 unpaid contract balance and $972.82 in attorney’s fees, for a total judgment of $3,891.29. Brennan’s notice of claim further stated:
THIS IS AN ATTEMPT TO RECOVER YOUR DEBT OWED TO [AMERICAN GENERAL][;] ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE. VERIFICATION OF THE DEBT, OR, THE NAME AND ADDRESS OF THE ORIGINAL CREDITOR, IF DIFFERENT THAN THE ABOVE, WILL BE PROVIDED UPON WRITTEN REQUEST TO THIS OFFICE WITHIN 30 DAYS[;] OTHERWISE THE DEBT WILL BE ASSUMED VALID. A REQUEST FOR INFORMATION WILL NOT RESULT IN A DELAY OF LEGAL PROCEEDINGS.

Record at 16. The small claims court set the debt collection claim for hearing on November 13, 1996, and in the notice of claim ordered Spears to appear on that date.
    Spears retained attorney Clifford Shepard to represent him in the debt collection claim on November 12, 1996, on which date counsel moved to continue the hearing. The small claims court granted the motion for continuance, and Shepard subsequently agreed with Brennan by telephone to reschedule the hearing for November 27, 1996. Also on November 12, Shepard sent Brennan a letter informing him that Spears “disputes your debt collection-related allegations, denies the same, and demands strict proof and verification thereof. This dispute, denial, and demand are made in accordance with federal law.” Record at 21.
    On November 26, 1996, Shepard again moved to continue the hearing on grounds that Brennan, on behalf of American General, “has failed or refused to provide the requested validation and verification” of the debt despite Spears’ demand of the same. Record at 22. The small claims court denied the motion for continuance as untimely and proceeded with the hearing on November 27, 1996. Neither Spears nor Shepard attended the hearing, and the trial court entered a default judgment against Spears in the amount of $3,891.29.
    After learning that a default judgment had been entered against Spears on the debt collection claim, Shepard contacted Brennan, who agreed not to object to a motion to set aside the default judgment. No such motion was ever filed with the small claims court. Instead, Spears filed for bankruptcy and brought an action against Brennan seeking civil liability under the FDCPA. Brennan and Spears filed cross motions for summary judgment on the FDCPA action. The trial court denied Spears’ motion for summary judgment and entered summary judgment in favor of Brennan, concluding that “[a] careful consideration of the record in this cause discloses that . . . Brennan, without any issues of material fact[], has not violated the provisions of the [FDCPA.]” Record at 164. This appeal ensued.

DISCUSSION AND DECISION
Standard of Review
    Our analysis proceeds from the premise that summary judgment is a lethal weapon and that courts must be ever mindful of its aims and targets and beware of overkill in its use. Bunch v. Tiwari, 711 N.E.2d 844, 847 (Ind. Ct. App. 1999). Summary judgment is appropriate only when the designated evidentiary material shows that there are no genuine issues of material fact and the moving party is entitled to a judgment as a matter of law. Id.; Ind. Trial Rule 56(C). When reviewing an entry of summary judgment, we stand in the shoes of the trial court. Sizemore v. Templeton Oil Co., 724 N.E.2d 647, 650 (Ind. Ct. App. 2000). We do not weigh the evidence but will consider the facts in the light most favorable to the nonmoving party. Id. All doubts as to a factual issue must be resolved in the nonmovant’s favor. Bunch, 711 N.E.2d at 848. A trial court’s grant of summary judgment is “clothed with a presumption of validity,” and the appellant bears the burden of demonstrating that the grant of summary judgment was erroneous. Id. (citation omitted). Nevertheless, we must carefully assess the trial court’s decision to ensure the nonmovant was not improperly denied his day in court. Id.
    This case also involves questions of statutory interpretation. The interpretation of a statute is a question of law reserved for the courts. Wayne Metal Prods. Co., Inc. v. Indiana Dep’t of Envtl. Mgmt., 721 N.E.2d 316, 317 (Ind. Ct. App. 1999), trans. denied. Appellate courts review questions of law under a de novo standard and owe no deference to a trial court’s legal conclusions. Id. If the language of a statute is clear and unambiguous, it is not subject to judicial interpretation. Montgomery v. Estate of Montgomery, 677 N.E.2d 571, 574 (Ind. Ct. App. 1997). However, when the language is susceptible to more than one construction, we must construe the statute to determine the apparent legislative intent. Id.
    We ascertain and implement legislative intent by giving effect to the ordinary and plain meaning of the language used in the statute. Clifft v. Indiana Dep’t of State Revenue, 660 N.E.2d 310, 316 (Ind. 1995) (citation omitted); Newsom v. Friedman, 76 F.3d 813, 819 (7th Cir. 1996) (interpreting FDCPA and observing that “[t]he plain meaning of legislation should be conclusive.”); Matter of Voelker, 42 F.3d 1050, 1051 (7th Cir. 1994) (noting that if statute is unambiguous, “we must enforce the plain meaning of the language enacted by Congress.”). The statute is examined and interpreted as a whole, and while the language itself is scrutinized, this court refrains from overemphasizing a strict literal or selective reading of individual words. Clifft, 660 N.E.2d at 316 (citation omitted). Finally, this court is compelled to ascertain and execute legislative intent in such a manner as to prevent absurdity and difficulty and prefer public convenience. Indiana State Teachers Ass’n v. Board of School Comm’rs of City of Indianapolis, 693 N.E.2d 972, 974 (Ind. Ct. App. 1998). In so doing, we are required to keep in mind the objects and purposes of the law as well as the effect and repercussions of such a construction. Id.

The FDCPA
    In enacting the FDCPA, Congress stated its findings and declared the purposes of the Act as follows:
(a)    There is abundant evidence of the use of abusive, deceptive, and unfair debt collection practices by many debt collectors. Abusive debt collection practices contribute to the number of personal bankruptcies, to marital instability, to the loss of jobs, and to invasions of individual privacy.

(b)    Existing laws and procedures for redressing these injuries are inadequate to protect consumers.

(c)    Means other than misrepresentation or other abusive debt collection practices are available for the effective collection of debts.
* * *

(e)    It is the purpose of this subchapter to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses.

Ziobron v. Crawford, 667 N.E.2d 202, 205 (Ind. Ct. App. 1996) (quoting 15 U.S.C. § 1692), trans. denied. “The FDCPA is a broad statute that was designed to ‘protect consumers from a host of unfair, harassing, and deceptive debt collection practices without imposing unnecessary restrictions on ethical debt collectors.’” Blakemore v. Pekay, 895 F. Supp. 972, 977-78 (N.D. Ill. 1995) (citations omitted) (also observing that Act was designed to reach “very broad spectrum of abuses”).
    Spears maintains that the trial court erred when it entered summary judgment in favor of Brennan on his complaint alleging violations of the FDCPA. In particular, Spears contends that: (1) Brennan misrepresented the amount of attorney’s fees to which he was entitled for the collection of Spears’ debt in violation of 15 U.S.C. §§ 1692e(2)(B) and 1692f(1); (2) Brennan’s debt collection notice to Spears did not comply with 15 U.S.C. § 1692g(a); (3) Brennan violated 15 U.S.C. § 1692g(a) when he scheduled two hearing dates on the debt collection claim and obtained a default judgment against Spears within the thirty-day debt validation period; and (4) Brennan violated 15 U.S.C. § 1692g(b) when he obtained a default judgment against Spears after Spears had notified Brennan in writing that the debt was being disputed and before Brennan had mailed verification of the debt to Spears. We address each of Spears’ contentions in turn.

Issue One: Misrepresentation of Attorney’s Fees
    15 U.S.C. § 1692e provides in pertinent part:
A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section:

 

* * *

(2)    The false representation of –
* * *

(B) any services rendered or compensation which may be lawfully received by any debt collector for the collection of a debt.

15 U.S.C. § 1692e(2)(B). 15 U.S.C. § 1692f further provides:
A debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section:

(1)    The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.
15 U.S.C. § 1692f(1).
    In his consumer credit contract with American General, Spears agreed to pay “reasonable attorney’s fees” incurred by the company for the collection of any unpaid contract balance. Record at 17. In the notice of claim subsequently filed on behalf of American General, Brennan sought $972.82 in attorney’s fees, equal to one-third of the principal amount of Spears’ $2,918.47 debt. The attorney’s fees requested were added to the judgment against Spears for a total money judgment of $3,891.29. Brennan conceded in response to a request for admissions that he regularly seeks a one-third contingent fee for his debt collection services, and he admitted that he did not spend more than two hours preparing the notice of claim against Spears. Consequently, Spears asserts that Brennan violated the foregoing provisions of the FDCPA “by misrepresenting the amount of attorney’s fees to which he was entitled.” Brief of Appellant at 14. Spears argues that “[a]lthough . . . Brennan believes multiplying the principal [unpaid contract] balance by one-third . . . is a reasonable fee, . . . this method [is] inappropriate.” Brief of Appellant at 15.
    Brennan responds that, regardless of whether a one-third contingent fee was in fact reasonable in the debt collection case, he did not “mispresent” the amount of attorney’s fees to which he was entitled simply “by requesting attorney’s fees in the amount of approximately one-third . . . of the principal loan balance.” Brief of Appellee at 6 (emphasis in original). Brennan points out that Spears “did not avail himself of the opportunity to challenge the reasonableness of the amount of [attorney’s] fees by . . . appealing the [small claims] court’s judgment” on the debt collection claim and argues that Spears “cannot now challenge the award of attorney[’s] fees by asserting a claim under the FDCPA.” Brief of Appellee at 6. We agree with Brennan.
    This court held in Valparaiso Technical Inst., Inc. v. Porter County Treasurer, 676 N.E.2d 416 (Ind. Ct. App. 1997), that a contingent fee agreement in a collection case that is the product of a bargain between the attorney and client is presumed to be reasonable as between them. Id. at 420 (citing Waxman Indus., Inc. v. Trustco Dev. Co., 455 N.E.2d 376, 382 (Ind. Ct. App. 1983)). We explained that where such a fee is subtracted from the amount recovered, the third-party debtor is unaffected by the fee agreement. Id. We noted, however, that it is an entirely different matter when the fee is added to the judgment against the debtor, as was the case here. Under such circumstances, the debtor has a direct pecuniary interest in how the fee is determined. Id. Thus, a one-third contingent fee that is reasonable when deducted from a client’s recovery may be unreasonable when added to a debtor’s judgment. Id. As this court observed in Waxman:
A contingent fee, even between an attorney and his client, is not enforceable unless it is founded upon a prior agreement. It then follows inexorably that a contingent fee contract of the obligee on an instrument with his attorney cannot be enforced against the party obligor who has merely agreed in the instrument to pay a “reasonable attorney fee” for the fundamental reason that the obligor has never agreed or has never even been consulted concerning the arrangement.

Waxman, 455 N.E.2d at 381. Accordingly, without “other objective evidence of reasonableness[,]” a contingent fee cannot be added to a judgment against a third party. Valparaiso Technical Inst., 676 N.E.2d at 420-21; see also Venture Enters. v. Ardsley Distr., 669 N.E.2d 1029, 1034 (Ind. Ct. App. 1996) (holding that contingency fee agreements are not controlling as to third parties).
    Here, Brennan sought a one-third contingent fee of $972.82 for the collection of Spears’ debt to American General, an amount “presumed to be reasonable” as between Brennan and American General. See Valparaiso Technical Inst., 676 N.E.2d at 420. Contrary to Spears’ apparent position, Brennan was not prohibited as a matter of law from seeking a contingent fee, but he was required to present “other objective evidence of reasonableness” in order for the attorney’s fees to be added to the judgment against Spears. See id. (observing that award of attorney’s fees as percentage of money judgment against third party for collection of delinquent real property taxes is not per se unreasonable).
    Moreover, as Brennan suggests, “the determination of the reasonableness of the amount of attorney[’]s fees requested in the notice of claim was a decision for the small claims court.” Brief of Appellee at 7. The small claims court awarded the full amount of attorney’s fees requested by Brennan, and Spears’ subsequent claim of misrepresentation under the FDCPA is tantamount to a collateral attack on that award. See Zsamba ex rel. Zsamba v. Community Bank, Abilene, Kansas, 63 F. Supp. 2d 1294, 1300 (D. Kan. 1999) (concluding that debtors could have informed state court of ownership dispute of collateral prior to entry of default judgment in debt collection action; observing that plaintiffs were using FDCPA claim as collateral attack on state court order giving bank possession of and right to sell collateral to satisfy debt). If Spears had wanted to challenge the propriety of the small claims court’s award of attorney’s fees, he should have moved to set aside the default judgment on the debt collection claim or appealed from that determination. An action under the FDCPA is not the proper remedy.
    We hold, therefore, that Brennan did not violate 15 U.S.C. §§ 1692e or f(1) when he merely requested $972.82 in attorney’s fees in his debt collection claim against Spears. The trial court’s entry of summary judgment on this issue is affirmed.

Issue Two: Debt Collection Notice
    Next, we address Spears’ claim that Brennan’s debt collection notice failed to comply with 15 U.S.C. § 1692g(a). That provision governs the verification rights of consumers and requires debt collectors, at the outset, to send consumers a written notice containing the following information:
(1)    the amount of the debt;
(2)    the name of the creditor to whom the debt is owed;
(3)    a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector;
(4)    a statement that if the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and
(5)    a statement that, upon the consumer’s written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor.
 

15 U.S.C. § 1692g(a)(1)-(5); Walker v. National Recovery, Inc., 200 F.3d 500, 501 (7th Cir. 1999). Debt collection notices sent to consumers must not confuse them about the verification rights established by the FDCPA. Walker, 200 F.3d at 501; Marshall-Mosby v. Corporate Receivables, Inc., 205 F.3d 323, 326 (7th Cir. 2000) (noting that key consideration is that unsophisticated consumer is to be protected against confusion, whatever form it takes). Indeed, the Act “leaves no room for deviation in the language of the . . . notice.” Jang v. A.M. Miller & Assoc., 122 F.3d 480, 482 (7th Cir. 1997).
    Here, Brennan’s debt collection notice stated that “[v]erification of the debt . . . will be provided upon written request to this office within thirty (30) days[;] otherwise the debt will be assumed valid.” Record at 33. Spears alleges that this notice violated 15 U.S.C. § 1692g(a) in three respects: (1) it failed to inform Spears that he could dispute a portion of the debt; (2) it failed to inform Spears adequately that he had thirty days from the date of receipt to dispute the debt; and (3) it imposed an invalid requirement that Spears dispute the debt in writing. We address each alleged violation in turn.
    Spears initially contends that Brennan’s debt collection notice violated 15 U.S.C. 1692g(a)(3) because it failed to inform Spears that he could dispute any portion of the debt. He cites the Ninth Circuit’s decision in Baker v. G.C. Servs. Corp., 677 F.2d 775, 778 (9th Cir. 1982), where the court held that, based on the clear language of the statute, “Congress clearly required the notice to inform the debtor that he could dispute any portion of the debt.” The Baker court concluded that absent a specific directive that a debtor may dispute not just the entire debt but any portion thereof, “[a] debtor who does owe a valid obligation to the creditor but could dispute finance charges, interest, or have some valid defense, might not be put on notice that he could dispute these additional charges.” Id. Brennan, in turn, relies on the Sixth Circuit’s opinion in Smith v. Transworld Sys., Inc. 953 F.2d 1025 (6th Cir. 1992), for the proposition that it is “implicit” within the meaning of a notice advising a debt may be disputed “that the claim can be wholly, or partially challenged.” Id. at 1028-29.
    While recognizing these competing authorities, we need not decide whether a debt collection notice must explicitly inform the consumer he can dispute any portion of a debt within thirty days of receiving the notice because we conclude, as a matter of law, that Brennan’s notice did not adequately advise Spears he could dispute the debt to American General at all. In so doing, we observe that Brennan’s debt collection notice is virtually identical to the notice in Baker. The Baker court declared that the notice “barely informs the debtor that he may even dispute the entire debt[,]” much less any portion thereof. Baker, 677 F.2d at 778. In particular, while both notices contain a statement that verification of the debt will be provided if requested in writing, as required by 15 U.S.C. § 1692g(a)(4), the only statement that refers remotely to a dispute regarding the validity of the debt, as required by 15 U.S.C. § 1692g(a)(3), is the sentence “otherwise the debt will be assumed valid.” Record at 33; see Baker, 677 F.2d at 778. Further, before concluding that it was “implicit” in a debt collection notice that a claim can be wholly or partially challenged, the court in Smith specifically noted that the notice at issue there “adequately informs the reader that the debt must be disputed, if at all, within thirty days[.]” Smith, 953 F.2d at 1029. Unlike the notices in this case and in Baker, the notice in Smith unequivocally informed the debtor that “All portions of this claim shall be assumed valid unless disputed within thirty days of receiving this notice[.]” Id. In evaluating the tendency of language to confuse or mislead, we look not to the most sophisticated consumers but to the unsophisticated consumer. Pettit v. Retrieval Masters Creditors Bureau, 211 F.3d 1057, 1060 (7th Cir. 2000). The language of Brennan’s debt collection notice was insufficient on its face to put Spears on notice that he could dispute the validity of the debt, as required by 15 U.S.C. § 1692g(a)(3).
    We also conclude that Brennan’s debt collection notice did not adequately inform Spears that he had thirty days from his receipt thereof to dispute the validity of the debt and, thus, failed to comply with 15 U.S.C. § 1692g(a)(3). The debt collection notice advised Spears only that he must seek verification of the debt “within thirty days[;] otherwise the debt will be assumed valid.” Record at 33 (emphasis added). It is unclear from the face of the notice whether Spears had thirty days from the date the notice was sent, October 24, 1996, or the date it was received, to seek verification of the debt. See Cavallaro v. Law Office of Shapiro & Kreisman, 933 F. Supp. 1148, 1154 (E.D.N.Y. 1996) (holding that notice advising debtor should dispute debt within thirty days from date of “this notice” rather than within thirty days of receipt of notice violated FDCPA). This facial confusion is compounded by the fact that Brennan’s notice of claim, filed in small claims court on October 30, 1996, contains an identical advisement that “VERIFICATION OF THE DEBT . . . WILL BE PROVIDED UPON WRITTEN REQUEST TO THIS OFFICE WITHIN THIRTY DAYS[;] OTHERWISE THE DEBT WILL BE ASSUMED VALID.” Record at 16 (emphasis added).
    Finally, Spears maintains that Brennan’s notice advising him that “verification of the debt . . . will be provided upon written request” imposed an invalid requirement that he dispute the validity of the debt to American General in writing. Record at 33. Without deciding whether the FDCPA prohibits a debt collector from requiring a debtor to dispute the validity of a debt in writing, we determine only that Brennan did not violate the FDCPA by advising Spears that verification of the debt would be provided if requested in writing. 15 U.S.C. § 1692g(a)(4) clearly requires that a debt collector’s notice contain a statement that verification of the debt will be provided if requested in writing within thirty days of receipt of the debt collection notice. Brennan properly advised Spears of this verification right under the FDCPA.    
    We thus hold that Brennan’s debt collection notice failed, as a matter of law, to comply with 15 U.S.C. § 1692g(a) and, specifically, with 15 U.S.C. § 1692g(a)(3). It did not adequately advise Spears of his right to dispute the validity of the debt or of his right to do so within thirty days from receipt of the debt collection notice. We therefore reverse the trial court’s entry of summary judgment in favor of Brennan on this issue.

Issue Three: Thirty-day Debt Validation Period
    As discussed above, 15 U.S.C. § 1692g(a) requires a debt collector to send a debt collection notice stating, among other things, that unless the debtor disputes the validity of the debt within thirty days from receipt of the debt collection notice, the debt collector will assume the debt is valid. Johnson v. Revenue Mgmt. Corp., 169 F.3d 1057, 1058 (7th Cir. 1999). This section of the FDCPA “obliges the collector to refrain from confusing the debtor by undercutting the required notice or implying a different obligation.” Id. For example, an unelaborated demand that the debt be paid “immediately” would violate the FDCPA by implying that the debtor does not have thirty days to dispute the validity of the debt, “unless accompanied by additional reconciling language, such as that payment is due ‘immediately’ only when the debt is uncontested.” Id. at 1059. Moreover, while “the creditor is entitled to file suit [against the debtor] whenever it chooses, . . . progress in the suit may be delayed by verification.” Id.
    In this case, Brennan’s notice of claim contained an order for Spears to appear in small claims court and answer to the debt owed American General on November 13, 1996, only twenty days after the debt collection notice had been sent. Spears argues that Brennan “overshadowed, undermined, and truncated” the FDCPA-required thirty-day debt validation period when he scheduled the hearing for November 13, 1996. Brief of Appellant at 27. Brennan responds that it was the small claims court, not he, that ordered Spears to appear at the hearing, and, therefore, that he could not have violated the FDCPA. We cannot agree with Brennan.
    15 U.S.C. § 1692g(a) mandates in no uncertain terms that a debtor has thirty days to dispute the validity of a debt. Accordingly, Brennan was obligated under the Act not to infringe upon this thirty-day debt validation period. While it is true that the small claims court set the hearing on the debt collection claim for November 13, 1996, and ordered Spears to appear on that date, it was Brennan’s duty, as a debt collector under the FDCPA, to obtain a hearing date outside the thirty-day debt validation period so as not to undercut Spears’ verification rights. Having filed suit and required Spears to answer to the debt owed American General on November 13, 1996, Brennan violated the FDCPA by implying that Spears did not have thirty days to dispute the same. See Johnson, 169 F.3d at 1058.     
    Spears similarly asserts that Brennan undercut his verification rights under 15 U.S.C. § 1692g(a) when he rescheduled the small claims hearing for November 27, 1996, a date Spears alleges also falls within the thirty-day debt validation period. We observe, however, that the thirty-day debt validation period commences from the date of receipt of the debt collection notice. See 15 U.S.C. § 1692g(a)(3). Because Brennan sent the debt collection notice to Spears on October 24, 1996, the hearing, rescheduled thirty-four days after the debt collection notice was sent, could well have been scheduled outside the thirty-day debt validation period. If Spears received the debt collection notice on or before October 27, 1996, there could have been no undercutting of the thirty-day debt validation period and no violation of the FDCPA when Brennan scheduled the November 27, 1996 hearing. If, on the other hand, Spears received the debt collection notice after October 27, 1996, Brennan violated the FDCPA by scheduling the November 27, 1996 hearing on the debt collection claim and obtaining a default judgment against Spears on that date, thereby undercutting the thirty-day debt validation period.
    Nevertheless, the record is devoid of any evidence indicating when Spears received the October 24, 1996 debt collection notice from Brennan. It is well settled that the party moving for summary judgment carries the burden of establishing that there is no issue as to any material fact and that he is entitled to judgment as a matter of law. Avco Fin. Servs. Of Indianapolis, Inc. v. Metro Holding Co., 563 N.E.2d 1323, 1326 (Ind. Ct. App. 1990). The moving party must fulfill these two requirements before any burden shifts to the nonmovant. Id. The nonmovant may rest upon his pleadings until the moving party establishes no genuine factual issue exists. Id. Brennan had the burden of showing that he scheduled the November 27, 1996 hearing and obtained a default judgment against Spears outside the thirty-day debt validation period. It was therefore necessary for him to prove the date on which Spears received the debt collection notice. Having failed to meet that burden, Brennan was not entitled to summary judgment. There remains a genuine issue of material fact as to whether the hearing and default judgment on November 27, 1996, undercut Spears’ verifications rights under 15 U.S.C. § 1692g(a). The trial court’s entry of summary judgment in favor of Brennan on this issue must be reversed.
    Although we reverse the trial court’s entry of summary judgment, in the interest of judicial economy we will address Brennan’s contentions, which are likely to be raised again on remand. Brennan alleges that, even assuming he scheduled the November 27, 1996 hearing on the debt collection claim and obtained a default judgment within the thirty-day debt validation period, he cannot be found liable under the FDCPA because Shepard, Spears’ attorney, agreed to the hearing date and because the default judgment was entered against Spears only after Spears and Shepard failed to appear. Stated otherwise, Brennan suggests that by consenting to a hearing date within the thirty-day debt validation period and then failing to appear on that date to answer to the debt owed American General, Spears waived any future claim under the FDCPA. Brennan does not provide, nor have we found, any authority for the proposition that consumers may waive the protections of the FDCPA. To the contrary, several courts have addressed this very issue and determined that consumers may not waive their rights under the Act.
    In Oglesby v. Rotche, No. 93-C-4183, 1993 WL 460841, at *10 (N.D. Ill. Nov. 5, 1993), and again in Blakemore v. Pekay, 895 F. Supp. 972, 983 (N.D. Ill. 1995), the district court addressed whether consumers could waive an FDCPA claim under 15 U.S.C. § 1692i, the venue section which mandates in part that a debt collector bring legal action on a debt only “in the judicial district or similar legal entity . . . in which such consumer signed the contract sued upon[.]” In Oglesby, the debtors defended themselves in the debt collection suit rather than moving for a change of venue while in Blakemore, the debtor appeared in the debt collection proceeding and consented to judgment against him on the debt. In deciding that consumers cannot waive the protections afforded by 15 U.S.C. § 1692i, the Illinois district court concluded that requiring an unsophisticated consumer to “exercise his rights under the FDCPA immediately or lose them is contrary to the basi[c] premise of the Act, which is to protect unsophisticated debtors from debt collectors who may use the legal system, about which the consumer has little knowledge, to bludgeon them into submission.” Blakemore, 895 F. Supp. at 983 (quoting Oglesby, at *10). The district court explained that 15 U.S.C. § 1692i “is . . . more in the nature of a statutory tort which is completed upon the filing of an action in an improper venue.” Oglesby, at *10.
    We believe that 15 U.S.C. § 1692g(a) is also in the nature of a statutory tort which is completed once the debt collector undercuts the thirty-day debt validation period or implies the debtor does not have thirty days from receipt of the debt collection notice to dispute the validity of the debt. Spears was not required to invoke his rights under the FDCPA during the course of the debt collection claim or risk waiving those rights altogether. An FDCPA claim “has nothing to do with whether the underlying debt is valid. An FDCPA claim concerns the method of collecting the debt. It does not arise out of the transaction creating the debt[.]” Azar v. Hayter, 874 F. Supp. 1314, 1318 (N.D. Fla. 1995) (refusing to find waiver of FDCPA claim as compulsory counterclaim to state court action on the debt because claim “does not arise out of the transaction creating the debt, and thus was not a compulsory counterclaim under state law in the action to collect the debt.”), affirmed, 66 F.3d 342 (11th Cir. 1995), cert. denied, 516 U.S. 1048 (1996). The Act makes debt collectors liable for various “abusive, deceptive, and unfair debt collection practices” regardless of whether the debt is valid. McCartney v. First City Bank, 970 F.2d 45, 47 (5th Cir. 1992). Our analysis is further consistent with the well-settled principle that the FDCPA is a strict liability statute and that a consumer need not show intentional conduct by the debt collector to be entitled to damages. See Russell v. Equifax A.R.S., 74 F.3d 30, 33 (2nd Cir. 1996); Bentley v. Great Lakes Collection Bureau, 6 F.3d 60, 63 (2nd Cir. 1993) (observing that degree of debt collector’s culpability may only be considered in computing damages). In light of the foregoing authority and the “broad remedial purpose of the FDCPA[,]” we conclude that Spears did not waive his verification rights under 15 U.S.C. § 1692g(a) when Shepard agreed to the November 27, 1996 hearing date and when he and Shephard failed to appear for the hearing. See Blakemore, 895 F. Supp. at 984.
    Accordingly, we hold that Brennan violated 15 U.S.C. § 1692g(a) when he scheduled the November 12, 1996 hearing on the debt collection claim against Spears. For this reason, the trial court’s entry of summary judgment in favor of Brennan is reversed. Additionally, we conclude that there remains a genuine issue of material fact as to when Spears received the October 24, 1996 debt collection notice from Brennan. We must therefore reverse the trial court’s entry of summary judgment on Spears’ claim that Brennan undercut his verification rights under 15 U.S.C. § 1692g(a) by scheduling the November 27, 1996 hearing and obtaining a default judgment against him on that date. Upon remand, we instruct the trial court to determine, in accordance with the principles set forth in this opinion, the date on which Spears received the October 24, 1996 debt collection notice and whether Brennan violated the FDCPA by scheduling the November 27, 1996 hearing on the debt collection claim and obtaining a default judgment against Spears within the thirty-day debt validation period.
 

Issue Four: Failure to Cease Debt Collection
    Finally, we address Spears’ claim that Brennan violated 15 U.S.C. § 1692g(b) when he failed to cease collection of the debt after receiving Spears’ written notification, within the thirty-day debt validation period, that Spears was disputing the debt. 15 U.S.C. § 1692g(b) reads:
If the consumer notifies the debt collector in writing within the thirty-day period described in subsection (a) of this section that the debt, or any portion thereof, is disputed, or that the consumer requests the name and address of the original creditor, the debt collector shall cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt or a copy of a judgment, or the name and address of the original creditor, and a copy of such verification or judgment, or name and address of the original creditor, is mailed to the consumer by the debt collector.
 

15 U.S.C. § 1692g(b) (emphasis added). On November 12, 1996, nineteen days after the date of Brennan’s debt collection letter, Spears’ counsel Shepard sent Brennan a letter declaring that Spears “disputes your debt collection-related allegations, denies the same, and demands strict proof and verification thereof.” Record at 21. As such, Brennan should have ceased his debt collection efforts immediately upon receiving that letter. Instead, Brennan proceeded to obtain a default judgment against Spears on the debt collection claim before he had mailed Spears the necessary verification and, thus, violated 15 U.S.C. § 1692g(b).
    Brennan maintains, however, that there was no violation of the FDCPA because he “sent adequate verification of the debt [to Spears] in the October 30, 1996 notice of claim.” Brief of Appellee at 13. Specifically, Brennan claims that a copy of the consumer credit contract between Spears and American General attached to the notice of claim provided sufficient verification of the debt within the meaning of 15 U.S.C. § 1692g(b). We cannot agree.
    The contract in no way provides sufficient verification of the debt. A review of the document reveals that it identifies only the terms of Spears’ loan, including a 17.99% annual interest rate and the original loan amount of $2,561.59. The loan agreement contains no accounting of any payments made by Spears, the dates on which those payments were made, the interest which had accrued, or any late fees which had been assessed once Spears stopped making the required payments. Indeed, the existing unpaid contract balance at the time Brennan sent the debt collection notice was at least $350.00 more than the original loan amount. Therefore, Brennan violated 15 U.S.C. § 1692g(b) when he failed to cease collection of the debt by obtaining a default judgment against Spears after Spears had notified Brennan in writing that he was disputing the debt but before Brennan had mailed verification of the debt to Spears. We reverse the trial court’s entry of summary judgment in favor of Brennan on this issue.

CONCLUSION
    In sum, we affirm the trial court’s entry of summary judgment in favor of Brennan on Spears’ claim that Brennan falsely represented the amount of attorney’s fees to which he was entitled for the collection of Spear’s debt, because we find no violation of 15 U.S.C. §§ 1692e(2)(B) or 1692f(1).
    We reverse the trial court’s entry of summary judgment in favor of Brennan on Spears’ claim that Brennan violated 15 U.S.C. § 1692g(a) when he scheduled the November 27, 1996 hearing on the debt collection claim and obtained a default judgment against Spears on that date. Having found the existence of a genuine issue of material fact with respect to this issue, we remand to the trial court with instructions to determine, in accordance with the principles set forth in this opinion, when Spears received Brennan’s debt collection notice and whether Brennan violated the FDCPA by scheduling the November 27, 1996 hearing and obtaining a default judgment against Spears within the thirty-day debt validation period.
    We reverse the trial court’s entry of summary judgment in favor of Brennan with respect to the remainder of Spears’ claims as identified herein. Having found, as a matter of law, multiple violations of 15 U.S.C. §§ 1692g(a) and (b), we further remand to the trial court for a determination of damages in accordance with the FDCPA. 
    Affirmed in part, reversed in part and remanded for further proceedings.
SULLIVAN, J., and BROOK, J., concur.
 

 

 

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Also known as a dunning letter.

See The American Heritage Dictionary 570 (3d ed. 1996).

 

 

 

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The record does not disclose when Spears received the debt collection notice.

 

 

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This is, of course, assuming that this contingency fee was “founded upon a prior agreement” between Brennan and American General.

See Waxman, 455 N.E.2d at 381.

 

 

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Seventh Circuit jurisprudence dictates that practices which might violate the FDCPA must be viewed from the objective standard of an “unsophisticated debtor.”

See Pettit, 211 F.3d at 1060. An unsophisticated debtor is “not as learned in commercial matters as are federal judges, . . . but neither is he completely ignorant.” Id. An unsophisticated debtor is “uninformed, naïve, or trusting.” Id. (citation omitted). The Seventh Circuit has rejected the “least sophisticated debtor” standard adopted by other circuit courts of appeal tying the debtor to “the very last rung on the sophistication ladder.” Id. (citation omitted).

 

 

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There is no evidence in the record of the date the notice was received.

 

 

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There is competing authority governing this issue.

See Brady v. The Credit Recovery Co., Inc., 160 F.3d 64, 66 (1st Cir. 1998) (interpreting related provision of FDCPA and holding that “ordinary usage of [the term] ‘dispute’ does not contemplate a writing.”); cf. Graziano v. Harrison, 950 F.2d 107, 112 (3rd Cir. 1991) (holding that “given the entire structure of section 1692g, subsection (a)(3) must be read to require that a dispute, to be effective, must be in writing.”).

 

 

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We observe additionally that, Spears did not waive his verification rights under 15 U.S.C. § 1692g(b) by failing to appear at the November 27, 1996 hearing. Like 15 U.S.C. §§ 1692g(a) and 1692i, 15 U.S.C. § 1692g(b) is in the nature of a statutory tort which is completed once the debt collector fails to cease his debt collection efforts after receiving written notification that a debtor is disputing the debt but before mailing verification of the debt to the debtor.

See Blakemore, 895 F. Supp. at 984. As discussed previously, an FDCPA claim “has nothing to do with whether the underlying debt is valid. An FDCPA claim concerns the method of collecting the debt. It does not arise out of the transaction creating the debt[.]” Azar, 874 F. Supp. at 1318.

 

 

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See 15 U.S.C. § 1692k (governing civil liability under the Act).

 

 

 

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