An interesting class action lawsuit from Miami-Dade County was recently dismissed. The name of the plaintiff was changed in this entry because this was a local case and we do not want to bring unnecessary attention to the litigant, who may well appeal the decision. The essential facts of the case are as follows. The Miami-Dade Clerk is authorized by law to charge collection fees when collecting debts under certain circumstances, for debts owed to the Clerk. The Clerk then hired a debt collection company to collect from members of the public on the Clerk’s behalf. One member of the public, Bob Jones was charged a 40% collection fee, the fee being assessed at the time that they first sought to collect the debt. Normally when contracts or statutes collect fees they provide for a reasonable amount of money to be paid based on the time spent trying to collect money, not simply increasing the debt by a certain amount. Mr. Jones then sued the clerk and the debt collector, essentially arguing that they tried to collect money not owed in that since the debt collector had only just started working, they had not run up enough of a bill to justify a 40% fee.
The relevant statute of Florida Statute 28.246(6), the operative language is “collection fee, including any reasonable attorney’s fee, paid to any attorney or collection agent retained by the clerk may be added to the balance owed in an amount not to exceed 40% of the amount owed at the time the account is referred to the attorney or agent for collection.”
The opinion is reasonable but I feel fails to properly consider certain critical language in the statute, though this was not sufficiently raised by Mr. Jones. The statute provides for a payment of up to 40% of the amount owed, only if it was “paid to any attorney or collection agent”. Several attorneys in our firm have debt collection experience in the past and based upon our time as debt collectors and our time fighting them, there is virtually no possibility that the Miami-Dade County Clerk paid a debt collector a significant amount upfront to collect upon an account, nearly all debt collectors are given a portion of the sums collected upon success and not paid a substantial amount upfront. It is entirely possible that the Clerk contracted with a debt collector to pay them something up front, but it would not be enough to cover 40% of each account. Which would mean that the statute is inapplicable in the first place.
The Court also considered whether or not the Clerk of Court and the debt collector were immune because of sovereign immunity and in a decision helpful to local consumer-protection attorneys found that they were not.
Click for more on the FDCPA and consumers fighting back against debt collectors, you can find other stories on our blog.
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This document has been provided for informational purposes only and is not intended and should not be construed to constitute legal advice. Please consult your attorney in connection with any legal issues related to the matters discussed in this article as the applicability of state, local, and federal laws may vary.
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