Our BC Lawyer knew I was disabled & on a limited income.

We were attempting to downsize & a well known Realtor gave us a name of what we later found out to be an unlicensed broker. The broker told us we had financing and to go ahead with the sale of our house. The Realtor sold our home in four days. At the end of the month the broker told us we did not qualify for financing. The broker's manager gave us a name of a lawyer and it was recommended we do not close on the sale. After following this recommendation our Realtor & purchasers took legal action.

Our lawyer charged us over $30,000 suggesting we can win on "Specific Performance". What they failed to tell us is that we would still have to pay damages to the purchaser.

Our lawyer was very green, charged us for things she did not know, duplicating services & finally a Sumary Trial which never took place.

The law firm has since parted company with her and we have used all of our resources. We have used this lawfirm in the past. The Lawyer we always used has now discharged himself due to our ability to pay off the loan. My wife was notified at work via email and I do not qualify for legal aide.

Since we intend to pay his invoice we have many questions regarding the frivolous charges by a new lawyer.

We are in te process of filing a complaint with Consumer Protection BC.

I already have found a lawyer in Winnipeg and we have a court date on January 19th I believe it is it is though the University of Manitoba Law clinic tI took all the documents I had on this I showed them all the letters and stuff and I told them this is what we owe. I also had to pay a $200 I guess you call it a fee and so we will see what they do when they hear from my lawyer

It will disappear in 2010, or least it is supposed to, if the collection agency doesn't send phoney dates into the bureaus. If they do, you'll have to show the credit bureaus some evidence that it ORIGINALLY went into default in 2004 (or whatever the exact date was).

The negative credit reporting period of a debt has nothing to do with its limitation period, the latter being a measure of how long the creditor can file a court claim. They both happen to be 6 years in Manitoba. You live in Ontario where the limitation period is 2 years for debts that went into default after Jan1. 1, 2004 - as yours did. But since the transaction occurred in Manitoba, it will be governed by Manitoba law.

If you make a payment or provide a signed written acknowledgement of it, you will restart the 6 year limitation period all over again every time you do. That's why it's always advisable to keep negotiations with collection agencies to the telephone. Even over the phone, a collection agent or a collection lawyer will invariably tell you:

"This call is being recorded (to blackmail you). You've just acknowledged the debt and restarted the limitation period all over again so we can and will sue you if you don't pay up."

This old schtick, besides being boring and annoying, is an insult to intelligence. And yet Mark Silverthorn's old buddies still peddle it endlessly. Many also swear you can REVIVE as well as RENEW the limitation period on an unsecured debt by acknowledging it verbally as well in writing. That's a favorite of collection lawyer, David Pomer of Pomer & Boccia. Maybe in some US states you can, but not in Canada.

Anyhow, if you want to negotiate a settlement, tell them over the telephone to send you a SIGNED written agreement. The signature should be from someone other than the company janitor. It must be comprehensive and use wording to the effect, "in full payment of" OR "in final settlement of." Or something similar. The agreement must also guarantee you a release along with the final payment which, of course, a properly worded settlement inherently does. Collection agents know you need this to show the credit bureau and so often they'll often trick you into making what you think is a final payment and never send you the release because they intend to get more down the road.

I can pretty well guarantee if you send them $600, BEFORE you have a signed offer in your hands, after you send it in, you'll see nothing except another bill from them within 3 to 6 months for another $2000, along with another round of threatening letters and phone calls to your employer.

For a debt this old, if you owed them $450, 4 years ago. With 16% interest, that amounts to about $815 by now. But since the debt is very old, the most they should expect is 25%, so I'd offer them no more than $200 AFTER receipt of a signed final offer.

However, under Manitoba Law, If they're claiming $1900, the 300% excessive claim penalty amounts to ($1900- $815) x 300% = $3255 less amount actually owed ($815) = $2440.00. If those numbers are correct, they actually owe you over $2400. So they should be quite happy to escape with nothing when you think about it.

But the problem is you don't have a complete set of invoices and receipts for the account. And if you send the collection agency a demand under Section 16 of the Manitoba Protection Act for accounting statements, they'll say something like, "Ahah, you've just acknowledged the debt and restarted the limitation period." Well, don't worry. If they refuse to respond to requests over the phone, simply send them unsigned written demands for accounting statements for the debt they are seeking payments for.

And so it's up to you what you do. You can do nothing and they surely won't sue you. OR

You can try to arrange a reduced settlement over the phone, but only after receipt of a signed written clear agreement. OR

You can sue them for harassment for up to $10K in Kenora Small Claims Court for violating the Ontario Collections Act rules OR

You can sue them in Winnipeg Small Claims Court for illegal harassment at work PLUS the 300% penalty.

But whatever you do, you need to get documentation of what is actually owed on this account. This has been dragging on since Sept. 18, and you still haven't obtained the most important thing that you need. Wasting time screaming about the Supreme Court is counterproductive. This whole matter is really over a piddly $800 or so and it's consuming countless manhours which wouldn't even amount to the minimum wage if you allocated the hours everyone has spent on it.

Ray

Actually I have a angel looking out for me my hubby didnt mail the letter I gave him to mail on Thursday I found it the car on the back seat. So now then it would be better not to send the letter and have the debt disappear in 2010 right.

Well, whatever else happened, you just renewed the statute of limitations by signing the letter. Now, if you don't settle, they've got another 6 years to sue you. All they've got to do is let the interest keep compounding at 16%.

Ray

I had to bite lips till they were blue but all the letters I wrote were polite and outlined my reasons and why I am disputing the amount they claim I owe $1900 my ass. I did sent them a letter on Thursday offering a settlement to them of $600. I am awating a reply but should not be holding my breath that those aholes will settle I have still not seen any sign of the evil garishment order and my boss has not had any more words from them as of Friday have they given up I think not probally off laughing there heads off at me. I also hope if they do settle for the $600 they might adjust my credit report as so far am waiting for a new credit report

"Hell hath no fury like a woman scorned."
William Congreve (1697)

Supreme Court? Forget that. Nothing precedent setting about this case that you could get leave for (or afford). Stick to Small Claims Court.

R9? Not sure you can do much about that either. Don't forget, there still was some money owing on the account - $450 by your estimate - when it was defaulted on and interest has been legally accumulating @1.333% per month or 16% per year on the outstanding balance since. That doesn't amount to 1900 bucks though.

The negative item is supposed to stay on your 2 credit reports for 6 years after the "date of last activity". This means 6 years after it went into default with the original creditor. See my post last week explaining the details of what this term means with respect to Equifax and Transunion reports. That 6 year period remains unaffected whether you pay it off, now, ten years from now, or never.

It's hard to understand the point behind "nameuser's" question. Whether listed under the "Trades" section or the "Collections" section of the TransUnion report, it will still stay on there for 6 years total. (See a copy of the response from Tranunion's legal dept.in last week's post).

Most debts will likely only be listed under the "Trades" section of bureau reports. Nevertheless, once a debt is either assigned OR sold to a third party collection agency, like Commercial Credit Adjusters, then the agency has the option of reporting the same item under the "Collections" section.

If so, the debt is then assigned a reference number linking it to the original creditor and the collection agency must report the date that it originally went into default as well as the date they took the account over. In practice, most collection agencies only bother to do this if they purchased the debt. Therefore, it's still likely being reported only under the "Trades" section.

I don't know why "nameuser" thinks the account is a line of credit or what relevance that would be. It's true that, unlike banks etc, a small outfit like St John's Music may not report items directly to the bureaus and instead have it done through their acting collection agency. Yes, in that case, the item would probably only be listed under the "collections" section. But what's the difference? They're all treated exactly the same by creditors. An R9 is a 180 day writeoff and a 4 year old collection item is obviously an R9 writeoff too. Dead is dead. Besides, either way, the item is not supposed to come off your 2 reports until sometime in 2010.

The next issue is to determine how much you currently owe them as the conditions of the original credit agreement still legally prevail. Not that you're going to pay them but you do need to determine the amount as a reference point for writing complaints and disputes with various bodies. And so, you'll have to find some way of calculating it along with some documentation as proof. Only then can you claim the 300% penalty, which when proven, would wipe out the debt as outstanding on your credit reports because you would then be owed considerable money on balance.

When you're writing letters watch your language. Don't be calling lawyers and collection agencies "assholes" (even though everyone knows they are) and saying "you'll have their heads" and stuff like that. That's the quickest way for your complaints to be dismissed since no one will take you seriously.

Ray

I have written the credit bureaus telling them I disagree with the debt sent to collections and that is shouldnt be listed as a R9. I was told this was a R 9 and hopefully will see what is going on as I have asked for a new copy of my credit report. I was turned down for a Visa card and Visa actually told me it is cause I have a debt listed on my credit report as a R9 and they Visa told me it was those jerks. Who are not going to get away with this I am going as high up the ladder as I can I will go to the Supreme Court if I had to . Of course that wont do anything. I am interested to hear back from the letter I wrote complaining about the jerk off a lawyer.

Are you sure it is an R9 rating and not listed under "collection items" on your trans union? St John's Music, I've just never seen there financing listed as a revolving line on a bureau. Usually this type of thing would be under collection items then the agency name then the st johns music then the amount owing....

Also, will the credit bureau not allow you to add a simple "account disputed by customer" line underneath the listing on your credit??

"Aholes?" Financial Management Professional Conflict Resolution Specialists if you please.

Ray