Fair Debt Collection Practices Act, the Bona Fide Error Defense and Legal Judgment Errors
By Janet Flaccus · October 9, 2010 · 2010 Ark. L. Notes
In categories: Debtor/Creditor
I could not let Law Notes get published without mentioning another Supreme Court case. This case, Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA et al., examined the bone fide error defense in the Fair Debt Collection Practices Act (hereinafter FDCPA). Carlisle came down April 21, 2010 so it is very new to me. The bonafide error defense is a subject on which I wrote in 2001. If a debt collector violates the Act, the bone fide error defense is the only defense that can protect them from liability. In that article I argued that the bonafide error defense should apply to legal judgment errors when the law is not clear but not apply when the law is clear. This approach was adopted by the Seventh, Tenth and Sixth circuit courts of appeal. The Sixth Circuit case is the one that the Supreme Court took. In this case a lawyer in the firm filed a foreclosure action and sent a summons with the validation notice information included. This is the validation notice that the debt collector must send to the debtor within five days after the initial communication. The statute specifies what must be included in the validation notice. Filing a law suit is not considered an initial communication because of a recent change to the statute.