A District Court judge in Hawaii has granted a defendant’s motion for summary judgment and partially granted its motion for costs and fees in a Fair Debt Collection Practices Act case dealing with a dispute over the collection of maintenance and cable fees for an investment property and escalating attorney’s fees that were charged after the debt had been paid.
The background: The plaintiffs, a married couple from New York, purchased a condominium unit in Waikiki as an investment property in 2019. Over time, they neglected to pay the maintenance and cable fees for the property, and the homeowners association hired the defendant, a collection law firm, to collect the outstanding fees. Despite the plaintiffs’ attempts to resolve the situation, including contacting the HOA for payment details, the fees went unpaid.
- The defendant filed a foreclosure complaint in 2022 and continued to charge the plaintiffs attorney’s fees even after the maintenance and cable fees were paid in full.
- The plaintiffs filed this lawsuit in August 2023, claiming violations of the FDCPA and the intentional infliction of emotional distress due to abusive collection tactics, including the excessive attorney fees.
The ruling: Judge Micah W.J. Smith of the District Court for the District of Hawaii granted the defendant’s motion for summary judgment, ruling that the plaintiffs had not provided sufficient evidence to support their FDCPA or IIED claims. Judge Smith ruled that the debt was considered a commercial debt, given that the property was purchased as an investment, and therefore, not protected under the FDCPA. Additionally, the IIED claim failed due to a lack of evidence showing outrageous conduct or extreme emotional distress beyond the usual anxiety associated with foreclosure.
- Furthermore, the court granted the defendant’s request for attorneys’ fees related to the IIED claim, finding it frivolous, but denied the request for fees related to the FDCPA claim.
