Spears v. Brennan, 49A02-0003-CV-169.

• Decision Date: 26 March 2001
• Docket Number: No. 49A02-0003-CV-169.,49A02-0003-CV-169.
• Citation: 745 N.E.2d 862
• Parties: Greg A. SPEARS, Appellant-Plaintiff, v. Timothy L. BRENNAN, Appellee-Defendant.
• Court: Indiana Appellate Court

745 N.E.2d 862

Greg A. SPEARS, Appellant-Plaintiff, v. Timothy L. BRENNAN, Appellee-Defendant.

No. 49A02-0003-CV-169.

Court of Appeals of Indiana.

March 26, 2001.

Clifford W. Shepard, Consumer Protection Law Offices, Indianapolis, IN, Attorney for Appellant.

Thomas J. Grau, Carol A. Nemeth, White & Raub, Indianapolis, IN, Attorneys for Appellee.

OPINION

NAJAM, Judge.

STATEMENT OF THE CASE

Greg A. Spears challenges the trial court's entry of summary judgment in favor of attorney and debt collector Timothy R. Brennan on Spears' complaint alleging violations of the Fair Debt Collection Practices Act ("the FDCPA" or "the Act"), 15 U.S.C. § 1692 et seq. Spears presents four issues for our review, which we restate as:

1. Whether Brennan misrepresented the amount of attorney's fees to which he was entitled for the collection of Spears' debt in violation of 15 U.S.C. §§ 1692e(2)(B) and 1692f(1).

2. Whether Brennan's debt collection notice to Spears complied with 15 U.S.C. § 1692g(a).

3. Whether Brennan violated 15 U.S.C. § 1692g(a) when he scheduled two hearing dates on the debt collection claim and obtained a default judgment against Spears within the thirty-day debt validation period.

4. Whether Brennan violated 15 U.S.C. § 1692g(b) when he obtained a default judgment against Spears after Spears had notified Brennan in writing that he was disputing the debt and before Brennan had mailed verification of the debt to Spears.

We affirm in part, reverse in part and remand for further proceedings.

FACTS AND PROCEDURAL HISTORY

On September 30, 1994, Spears obtained a loan from American General Finance, Inc. ("American General") in the amount of $2,561.59. The consumer credit contract executed by Spears contained the following collection costs provision:

If you don't make any payment when it is due, you will pay us reasonable amounts permitted by law which we spend trying to collect what you owe or trying to take, foreclose or sell the security. You will also pay our reasonable attorney's fees, if referred to an attorney who is not our salaried employee, including any for appeals as permitted by law.

Record at 17 (emphasis added). When Spears stopped making the loan payments, American General retained Brennan to collect the unpaid contract balance.

On October 24, 1996, Brennan sent a debt collection notice¹ to Spears that read:²

RE: Creditor: American General Finance, Inc.

Balance: $2,918.47 less applicable rebates

Dear Mr. Spears:

This communication is from a debt collector and is an attempt to recover a debt owed to the above named Creditor[;] any information obtained will be used for that purpose. Verification of the debt or the name and address of the original Creditor, if different than the above, will be provided upon written request to this office within thirty (30) days[;] otherwise the debt will be assumed valid.

Record at 33. On October 30, 1996, Brennan filed a notice of claim against Spears on behalf of American General in small claims court, seeking recovery of the $2,918.47 unpaid contract balance and $972.82 in attorney's fees, for a total judgment of $3,891.29. Brennan's notice of claim further stated:

THIS IS AN ATTEMPT TO RECOVER YOUR DEBT OWED TO [AMERICAN GENERAL][;] ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE. VERIFICATION OF THE DEBT, OR, THE NAME AND ADDRESS OF THE ORIGINAL CREDITOR, IF DIFFERENT THAN THE ABOVE, WILL BE PROVIDED UPON WRITTEN REQUEST TO THIS OFFICE WITHIN 30 DAYS[;] OTHERWISE THE DEBT WILL BE ASSUMED VALID. A REQUEST FOR INFORMATION WILL NOT RESULT IN A DELAY OF LEGAL PROCEEDINGS.

Record at 16. The small claims court set the debt collection claim for hearing on November 13, 1996, and in the notice of claim ordered Spears to appear on that date.

Spears retained attorney Clifford Shepard to represent him in the debt collection claim on November 12, 1996, on which date counsel moved to continue the hearing. The small claims court granted the motion for continuance, and Shepard subsequently agreed with Brennan by telephone to reschedule the hearing for November 27, 1996. Also on November 12, Shepard sent Brennan a letter informing him that Spears "disputes your debt collection-related allegations, denies the same, and demands strict proof and verification thereof. This dispute, denial, and demand are made in accordance with federal law." Record at 21.

On November 26, 1996, Shepard again moved to continue the hearing on grounds that Brennan, on behalf of American General, "has failed or refused to provide the requested validation and verification" of the debt despite Spears' demand of the same. Record at 22. The small claims court denied the motion for continuance as untimely and proceeded with the hearing on November 27, 1996. Neither Spears nor Shepard attended the hearing, and the trial court entered a default judgment against Spears in the amount of $3,891.29.

After learning that a default judgment had been entered against Spears on the debt collection claim, Shepard contacted Brennan, who agreed not to object to a motion to set aside the default judgment. No such motion was ever filed with the small claims court. Instead, Spears filed for bankruptcy and brought an action against Brennan seeking civil liability under the FDCPA. Brennan and Spears filed cross motions for summary judgment on the FDCPA action. The trial court denied Spears' motion for summary judgment and entered summary judgment in favor of Brennan, concluding that "[a] careful consideration of the record in this cause discloses that ... Brennan, without any issues of material fact[ ], has not violated the provisions of the [FDCPA.]" Record at 164. This appeal ensued.

DISCUSSION AND DECISION

Standard of Review

Our analysis proceeds from the premise that summary judgment is a lethal weapon and that courts must be ever mindful of its aims and targets and beware of overkill in its use. Bunch v. Tiwari, 711 N.E.2d 844, 847 (Ind.Ct.App.1999). Summary judgment is appropriate only when the designated evidentiary material shows that there are no genuine issues of material fact and the moving party is entitled to a judgment as a matter of law. Id.; Ind. Trial Rule 56(C). When reviewing an entry of summary judgment, we stand in the shoes of the trial court. Sizemore v. Templeton Oil Co., 724 N.E.2d 647, 650 (Ind.Ct.App.2000). We do not weigh the evidence but will consider the facts in the light most favorable to the nonmoving party. Id. All doubts as to a factual issue must be resolved in the nonmovant's favor. Bunch, 711 N.E.2d at 848. A trial court's grant of summary judgment is "clothed with a presumption of validity," and the appellant bears the burden of demonstrating that the grant of summary judgment was erroneous. Id. (citation omitted). Nevertheless, we must carefully assess the trial court's decision to ensure the nonmovant was not improperly denied his day in court. Id.

This case also involves questions of statutory interpretation. The interpretation of a statute is a question of law reserved for the courts. Wayne Metal Prods. Co., Inc. v. Indiana Dep't of Envtl. Mgmt., 721 N.E.2d 316, 317 (Ind. Ct.App.1999), trans. denied. Appellate courts review questions of law under a de novo standard and owe no deference to a trial court's legal conclusions. Id. If the language of a statute is clear and unambiguous, it is not subject to judicial interpretation. Montgomery v. Estate of Montgomery, 677 N.E.2d 571, 574 (Ind.Ct. App.1997). However, when the language is susceptible to more than one construction, we must construe the statute to determine the apparent legislative intent. Id.

We ascertain and implement legislative intent by giving effect to the ordinary and plain meaning of the language used in the statute. Clifft v. Indiana Dep't of State Revenue, 660 N.E.2d 310, 316 (Ind.1995) (citation omitted); Newsom v. Friedman, 76 F.3d 813, 819 (7th Cir.1996) (interpreting FDCPA and observing that "[t]he plain meaning of legislation should be conclusive."); Matter of Voelker, 42 F.3d 1050, 1051 (7th Cir. 1994) (noting that if statute is unambiguous, "we must enforce the plain meaning of the language enacted by Congress."). The statute is examined and interpreted as a whole, and while the language itself is scrutinized, this court refrains from overemphasizing a strict literal or selective reading of individual words. Clifft, 660 N.E.2d at 316 (citation omitted). Finally, this court is compelled to ascertain and execute legislative intent in such a manner as to prevent absurdity and difficulty and prefer public convenience. Indiana State Teachers Ass'n v. Board of School Comm'rs of City of Indianapolis, 693 N.E.2d 972, 974 (Ind.Ct.App.1998). In so doing, we are required to keep in mind the objects and purposes of the law as well as the effect and repercussions of such a construction. Id.

The FDCPA

In enacting the FDCPA, Congress stated its findings and declared the purposes of the Act as follows:

(a) There is abundant evidence of the use of abusive, deceptive, and unfair debt collection practices by many debt collectors. Abusive debt collection practices contribute to the number of personal bankruptcies, to marital instability, to the loss of jobs, and to invasions of individual privacy.

(b) Existing laws and procedures for redressing these injuries are inadequate to protect consumers.

(c) Means other than misrepresentation or other abusive debt collection practices are available for the effective collection of debts.

* * *

(e) It is the purpose of this subchapter to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses.

Ziobron v. Crawford, 667 N.E.2d 202, 205 (Ind.Ct.App.1996) (quoting 15 U.S.C. § 1692), trans. denied. "The FDCPA is a broad statute that...