The Court of Appeals of North Carolina has affirmed a trial court’s ruling denying a defendant’s motion to amend his answer to add counterclaims under the North Carolina Debt Collection Act in a credit card collection case.
The background: The plaintiff, a credit card lender, filed suit in state court in late 2024, seeking to collect an unpaid credit card debt from the defendant, a consumer.
- The defendant answered the complaint and filed counterclaims under the Fair Debt Collection Practices Act and North Carolina’s unfair and deceptive trade practices law, alleging the plaintiff was attempting to collect interest or fees it was not entitled to under the cardmember agreement and faulting the plaintiff for not attaching that agreement to its complaint.
- Last summer, the trial court dismissed those counterclaims for failure to state a claim.
- A couple of months later, the plaintiff provided the defendant with a copy of his updated cardmember agreement. Three weeks after receiving it, the defendant sought leave to amend his answer to raise new counterclaims under the North Carolina Debt Collection Act, again alleging the plaintiff was trying to collect interest or fees it was not entitled to collect.
- The trial court denied the motion, remarking: “This case is over a year old … and it’s just being drug out …. It does look like there is not anything new to explore …. There’s nothing new that you couldn’t have filed at the original time of the file.”
The ruling: The Appeals Court affirmed, ruling that the trial court did not abuse its discretion in denying the motion filed by the defendant, who represented himself in the case.
- Before reaching the merits, the court confirmed it could hear the appeal at all. While the order being appealed did not end the case, denying a motion to amend an answer to add a compulsory counterclaim affects a substantial right and can be appealed immediately.
- While leave to amend a pleading should be freely given when justice requires, a motion to amend can be denied for undue delay, bad faith, undue prejudice, futility, or repeated failure to cure defects, and a trial court is not required to state specific reasons for its denial.
- The undue delay was apparent from the record. The defendant could have accessed his own statements and cardmember agreement at any time and should have known his counterclaims existed when he filed his original answer.
- The amendment was also futile, because the new counterclaims were similar to causes of action the trial court had already dismissed.
- The court noted that a petition for writ of certiorari the defendant attempted to file was a “legal nullity” because he filed it with the trial court rather than with the Appeals Court.
