A District Court judge in North Carolina has granted a defendant’s motion for a judgment on the pleadings in a Fair Debt Collection Practices Act case, ruling that the defendant did not violate the statute when it responded to the plaintiff’s dispute and refusal to pay with validation information.
The Background: Last October, the plaintiff received a letter from the defendant, seeking to collect on a $67 medical debt. Ten days after receiving the letter, the plaintiff responded, saying in a letter to the defendant that she refused to pay the debt. Her letter said:
Hi, my name is Mariah Diaz. I have noticed that an old dental debt has been placed in your office. I thought that my insurance woul[d] have covered this balance. I am not in possession of any other documents in support of this balance. Therefore I am not going to pay this debt. I hope you guys understand.
The plaintiff claimed that the defendant was obligated to cease all communications with her after receiving this letter. The defendant sent a letter back to the plaintiff, validating the debt by providing documents from the creditor, which the plaintiff claimed she did not have in her possession.
- The plaintiff filed suit, accusing the defendant of violating Section 1692c(c) of the FDCPA by communicating with the plaintiff after the plaintiff refused to pay the debt.
The Ruling: While the plaintiff may have indicated she was refusing to pay the debt, she also indicated in her letter that she was disputing the debt, noted Judge Max O. Cogburn of the District Court for the Western District of North Carolina. When she wrote – “I thought that my insurance would have covered this balance” – she disputed the validity of the debt, Judge Cogburn ruled.
- The plaintiff is incorrect in arguing that her refusal to pay the debt meant that the defendant could not communicate with her anymore, the judge wrote. There are exceptions to Section 1692c(c) of the FDCPA — collectors are allowed to communicate with an individual if the communication is to notify the consumer that the collector is invoking a specific remedy, such as providing validation in response to a dispute.
- Collectors have two options when a consumer disputes a debt — validate it or stop collecting. Validating the debt was therefore not a violation of the FDCPA, Judge Cogburn ruled.
