Nance v. Ulferts

• Court: U.S. District Court — Northern District of Indiana
• Writing for the Court: Allen Sharp
• Citation: Nance v. Ulferts, 282 F.Supp.2d 912 (N.D. Ind. 2003)
• Decision Date: 19 August 2003
• Docket Number: No. 2:02CV0166 AS.,2:02CV0166 AS.
• Parties: David E. NANCE, Plaintiff, v. Martin R. ULFERTS, and William F. Herrbach, Defendants.

282 F.Supp.2d 912

David E. NANCE, Plaintiff, v. Martin R. ULFERTS, and William F. Herrbach, Defendants.

No. 2:02CV0166 AS.

United States District Court, N.D. Indiana, Hammond Division.

August 19, 2003.

COPYRIGHT MATERIAL OMITTED

Michael P McIlree, McIlree and McIlree, Valparaiso, IN, Clifford W Shepard, Attorney at Law, Indianapolis, IN, for plaintiff.

Randy Harmon Wyllie, Wieser and Sterba, Schererville, IN, Philip E Kalamaros, Hunt Suedhoff Kalamaros LLP, SB/IN, South Bend, IN, for defendant.

Philip E Kalamaros, Hunt Suedhoff Kalamaros LLP, SB/IN, South Bend, IN, for counter-claimant.

Michael P McIlree, McIlree and McIlree, Valparaiso, IN, Clifford W Shepard, Attorney at Law, Indianapolis, IN, for counter-defendant.

MEMORANDUM AND ORDER

ALLEN SHARP, District Judge.

This matter is before the Court on Defendants', Martin R. Ulferts ("Ulferts"), and William F. Herrbach ("Herrbach"), motion for summary judgment in their favor and against Plaintiff on all counts set forth in Plaintiff's Complaint. This matter is also before the Court on Plaintiff's, David E. Nance, ("Nance"), cross-motion for partial summary judgment against Defendants, Ulferts and Herrbach ("Defendants"). Plaintiff is moving for summary judgment on Count 1 of Plaintiff's Complaint and on Defendants' affirmative defense that any violations of the Fair Debt Collection Practices Act, ("FDCPA") 15 U.S.C. § 1692, et seq. by the Defendants was the result of a bona fide error. Nance requests that his cross-motion for partial summary judgment be granted on the grounds that Defendants, Ulferts and Herrbach, violated 15 U.S.C. §§ 1692e, 1692e(2)(A), 1692e(2)(B), 1692e(10), 1692f, 1692f(1), 1692g(a) and 1692g(a)(1). Nance also moves that Defendants' motion for summary judgment be denied for failure to establish the requirements of 15 U.S.C. § 1692k(c).

I. Background

Nance entered into a loan with Loans Til Payday, Inc. on February 16, 2001. When Nance allegedly failed to repay the loan, Loans Til Payday, Inc. employed Ulferts, with the Law Offices of William F. Herrbach, to assist in collecting the monies owed due to the alleged defaulted loan and alleged dishonored check. A letter, dated April 18, 2001, from Mr. Ulferts and Mr. Herrbach ("Defendants") to Nance was the only written or oral communication ever sent regarding the debt allegedly owed to Loans Til Payday, Inc. The loan entered into by Nance held an interest rate of 72%. The Indiana Supreme Court in Livingston, et al. v. Fast Cash USA, Inc., 753 N.E.2d 572 (Ind.2001), held that the minimum loan finance charged permitted by I.C. § 24-4.5-3-508(7) when charged by a licensed supervised lender ... is limited to 36% by I.C. § 24-4.5-3-508(2). As part of Mr. Nance's transaction with Loans Til Payday Inc., he was required to give them a postdated check as payment on the Consumer Loan Agreement.

These facts are what brings us to the present motions at hand. The Defendants have moved for summary judgment in their favor and the Plaintiff, Nance, has filed a cross-motion for summary judgment. Nance claims that the Defendants violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. The Defendants claim however that any violation that occurred was the result of a bona fide error. The Defendants claim that at the time of the April 18, 2001, correspondence, Ulferts reasonably believed that such correspondence was in compliance with both current Indiana State law and federal law governing the recovery of damages for check deception and pursuant to the terms of the Deferred Presentment Agreement.

II. Standard of Review

Summary judgment is proper if the pleadings, depositions, answers to interrogatories and admissions on file, together with any affidavits, show that there exists no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. FED.R.CIV.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Bragg v. Navistar Int'l Trans. Corp., 164 F.3d 373 (7th Cir.1998). Celotex addressed the initial burdens of the parties under Rule 56, and Anderson addressed the standards under which the record is to be analyzed within the structure of Rule 56.

The initial burden is on the moving party to demonstrate, "with or without supporting affidavits," the absence of a genuine issue of material fact and that judgment as a matter of law should be granted in the moving party's favor. Celotex, 477 U.S. at 324, 106 S.Ct. 2548 (quoting FED.R.CIV.P. 56); Larimer v. Dayton Hudson Corp., 137 F.3d 497 (7th Cir.1998). A question of material fact is a question which will be outcome determinative of an issue in the case. The Supreme Court has instructed that the facts material in a specific case shall be determined by the substantive law controlling the given case or issue. Anderson, 477 U.S. at 248, 106 S.Ct. 2505. Once the moving party has met the initial burden, the opposing party must "go beyond the pleadings" and "designate `specific facts shows that there is a genuine [material] issue for trial.'" Id. The nonmoving party cannot rest on its pleadings, Weicherding v. Riegel, 160 F.3d 1139 (7th Cir.1998); Waldridge v. American Hoechst Corp., 24 F.3d 918 (7th Cir.1994); nor may that party rely upon conclusory allegations in affidavits. Smith v. Shawnee Library Sys., 60 F.3d 317, 320 (7th Cir.1995).

During its summary judgment analysis, the court must construe the facts and draw all reasonable inferences in the light most favorable to the nonmoving party. Bombard v. Fort Wayne Newspapers, Inc., 92 F.3d 560 (7th Cir.1996). Furthermore, it is required to analyze summary judgment motions under the standard of proof relevant to the case or issue. Anderson, 477 U.S. at 252-55, 106 S.Ct. 2505.

III. Analysis

Plaintiff contends that Defendants committed their various torts when they attempted to collect the amount purportedly due pursuant to a returned check which was tendered as security for the payment by the Plaintiff to Loans Til Payday, Inc. on a payday loan Plaintiff had obtained from them. Specifically, Plaintiff contends that Defendants failed to state or otherwise misrepresented the amount of the purported debt owed to Loans Til Payday Inc. by Plaintiff by seeking to collect any amount. Additionally, to the extent Defendants were entitled to collect some amount, that Defendants misrepresented the amount which they were entitled to collect and the remedies available for a returned check which was tendered as a payment on a loan which was governed by the Indiana Uniform Consumer Credit Code, ("IUCCC") I.C. § 24-4.5-1-1, et seq.

The crux of the arguments made by Plaintiff and Defendants seem to focus on Nance claiming a violation of the FDCPA and the Defendants asserting that if a violation occurred they should be absolved from liability for their violation(s) of the FDCPA pursuant to the bona fide error defense. While many of the arguments in these two motions overlap, in the interest of clarity, which has not necessarily been afforded to this Court by the parties, this Court will attempt to address the Plaintiff's cross motion and all that it entails foremost.

Nance, in his cross-motion for partial summary judgment, requests that partial summary judgment be granted on the grounds that Defendants violated 15 U.S.C. §§ 1692e, 1692e(2)(A), 1692e(2)(B), 1692e(10), 1692f, 1692f(1), 1692g(a) and 1692g(a)(1). Nance also moves for denial of the Defendants' motion for summary judgment on the grounds that they failed to establish the requirements of 15 U.S.C. § 1692k(c).

This Court feels it necessary to first address some initial matters. It seems to be undisputed that Ulferts was a debt collector as defined under 15 U.S.C. § 1692a(6). Similarly, there does not seem to be a dispute that Herrbach, who employed Ulferts and benefitted from his efforts, also met this criteria. Moreover, it has been held by the Seventh Circuit on more than one occasion that the FDCPA utilizes the principals of vicarious liability. See Miller v. McCalla, Raymer, Padrick, Cobb, Nichols, and Clark, LLC, 214 F.3d 872, 876 (7th Cir.2000); Pettit v. Retrieval Masters Creditors Bureau, Inc., 211 F.3d 1057, 1059 (7th Cir.2000).

A. 15 U.S.C. §§ 1692f and 1692f(1)

Mr. Nance seeks vindication for what he alleges is Defendants' violation of §§ 1692f and 1692f(1) which provides:

A debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section:

(1) The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.

15 U.S.C. §§ 1692f and 1692f(1).

B. 15 U.S.C. §§ 1692e, 1692e(2)(A), 1692e(2)(B), and 1692e(10)

Mr. Nance also alleges that Defendants' violated 15 U.S.C. §§ 1692e, 1692e(2)(A), 1692e(2)(B), and 1692e(10), which provides in pertinent part:

A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section:

* * *

(2) The false representation of—

(A) the character, amount, or legal status of any debt; or

(B) any services rendered or compensation which may be lawfully received by any debt collector from collection of a debt.

* * *

(10) The use of any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer.

15 U.S.C. §§ 1692e, 1692e(2)(A), 1692e(2)(B), and 1692e(10).

Nance's claims for violations of §§ 1692e and 1692f seem to go hand in hand and therefore will be address together. Nance's basic argument is that...