Spencer v. Hendersen-Webb, Inc.
| Decision Date | 16 December 1999 |
| Docket Number | No. Y-98-3649.,Y-98-3649. |
| Citation | 81 F.Supp.2d 582 |
| Parties | Kerry L. SPENCER v. HENDERSEN-WEBB, INC., Robert L. Kilberg, Zimlin & Kilberg, Rupp & Associates, Inc., and Frances Flores |
| Court | U.S. District Court — District of Maryland |
J. Steven Lovejoy, Towson, MD, and David R. Breschi, Towson, MD, for Plaintiff.
Jerrold A. Thrope, Baltimore, MD, Lawrence S. Greenwald, Baltimore, MD, and Kristine A. Crosswhite, Baltimore, MD, for Defendant Hendersen-Webb, Inc.
Mary Malloy Dimaio, Towson, MD, for Defendants Rupp and Associates, Inc., Frances Flores, Robert Kilberg, and Zimlin & Kilberg.
This case is before the Court on cross-motions for summary judgment. The Plaintiff, Kerry L. Spencer ["Spencer"], filed a complaint in the Circuit Court for Baltimore City on September 25, 1998, alleging that Hendersen-Webb, Inc. ["Hendersen"] defamed her credit and violated the Maryland Consumer Debt Collection Act ["MCDCA"], and Robert L. Kilberg ["Kilberg"], Zimlin & Kilberg, Rupp and Associates ["Rupp"], and Frances Flores ["Flores"] defamed her credit and violated various provisions of the Federal Fair Debt Collection Practices Act ["FDCPA"] and the MCDCA in their efforts to collect a debt arising from a residential lease. The case was removed to this Court in October 1998. Defendants' Motions to Dismiss were denied by marginal order on December 7, 1998. After discovery, Spencer filed a motion on August 23, 1999, seeking summary judgment on her statutory claims. The Defendants filed oppositions and cross-motions for summary judgment. Hendersen moved for summary judgment on Spencer's MCDCA and defamation claims and the other Defendants moved for summary judgment on Spencer's defamation claims.
Summary judgment is proper "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R.Civ.P. 56(c). A "genuine" dispute about a material fact exists "if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
The party seeking summary judgment bears the initial burden of showing that there is an absence of evidence to support the non-moving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). In response, the non-moving party "may not rest upon the mere allegations or denials of the adverse party's pleadings, but ... must set forth specific facts showing that there is a genuine issue for trial." Fed. R.Civ.P. 56(e); Anderson, 477 U.S. at 248, 106 S.Ct. 2505; Sylvia Dev. Corp. v. Calvert County, 48 F.3d 810, 817 (4th Cir. 1995). Failure to demonstrate a genuine issue for trial will result in summary judgment. Strag v. Board of Trustees, 55 F.3d 943, 951 (4th Cir.1995). The mere existence of a scintilla of evidence in support of the non-movant's case is insufficient; there must be evidence on which the jury could reasonably find for the non-moving party. Anderson, 477 U.S. at 252, 106 S.Ct. 2505. The non-movant's evidence, however, is to be believed and all justifiable inferences are to be drawn in the non-movant's favor. Id. at 255, 106 S.Ct. 2505.
On May 28, 1993, Spencer and William T. Taylor ["Taylor"] signed a contract to rent 10212H Sunnylake Place for one year, beginning July 1, 1993, at $504 per month. The lease was signed by Taylor, Spencer, and a representative of Hendersen-Webb, Inc., as Agent for the owner, Lakecrest Apartments Limited Partnership.
The events surrounding the lease are disputed. Apparently, Kerry Spencer's mother — Vycky Spencer — signed a lease for 10212H Sunnylake Place on February 24, 1993, approximately three months prior to the Spencer-Taylor lease. See Pl.'s Motion for Partial Summary Judgment ex. 2. The Vycky Spencer lease indicates that she paid a $250 security deposit to Hendersen and that the lease would run from June 1, 1993, through May 31, 1994. Id. According to Spencer, her mother was building a house which was ready for occupancy in May 1993. By securing new tenants for the apartment — Kerry Spencer and Taylor — Vycky Spencer was able to break her lease. Id. at 3. Spencer claims that her mother relinquished the security deposit by signing it over to her. See id. at 3, ex. 7. Hendersen, however, points out that the Spencer-Taylor lease does not indicate that they paid a security deposit. In addition, Hendersen contends that Vycky Spencer received a refund of the security deposit and deposited it in her bank account. See Hendersen's Cross-Motion for Summary Judgment at 6, ex. 2.
According to Spencer, Taylor made the rent payments from June to December 1993 and, when he moved out in December, agreed to pay the rent for the remainder of the lease. Pl.'s Motion for Partial Summary Judgment at 5. Spencer made no further rent payments and moved out of the apartment in February 1994. Id.
On May 9, 1998, Spencer and her new fiancé, Spencer Fell ["Fell"], entered a sales contract for a $90,000 condominium in Sparks, Maryland. On May 13, they applied jointly for a purchase money mortgage loan from Key Bank & Trust ["Key Bank"]. In processing their loan application, Key Bank ordered and obtained Spencer's credit report from Advanced Information Resources Inc. An officer at the Bank then contacted Spencer and Fell and indicated that he believed the Bank would reject the loan application because of derogatory credit information. Specifically, Spencer's report showed three delinquent balances, one of which was $2858.40 owed to Hendersen-Webb. The Bank denied the loan on May 29, 1998.
The $2858.40 recorded on Spencer's credit report reflected five months of unpaid rent at 10212H Sunnylake Place, plus $176.40 in late charges and $162.00 in court costs. Hendersen detailed these costs in a letter to Spencer dated June 10 1994. Pl.'s Motion for Partial Summary Judgment ex. 23. The letter also stated that if Spencer did not pay the debt, Hendersen would report the outstanding balance to Equifax Credit Information Services. Id. Indeed, the record indicates at least two instances where the delinquent debt was reported to credit reporting agencies. The first instance is reflected in Spencer's January 10, 1997, credit report prepared by Equifax, which indicates that Spencer owed "Hendersen" $2858.00 and that the debt was reported in "11/96." Hendersen's Cross-Motion for Summary Judgment ex. 3. The second instance appears on Spencer's May 15, 1998, credit report prepared by Advanced Information Resources, Inc., which indicates that Spencer owed $2858 to "Henderson Webb" and that debt was reported "05/98" as "still owing per: Mary 410-628-5018." Pl.'s Resp. to Defs.' Cross-Motions for Summary Judgment ex. A. Although Hendersen denies reporting these debts, Spencer alleges that Hendersen or Rupp reported the debts and that "Mary" was a Hendersen employee.
Some time before May 1998, Hendersen referred Spencer's debt to Rupp for collection. Rupp was soon contacted by Alan Thomas Fell ["Alan Fell"], Spencer Fell's father. Alan Fell telephoned Rupp and spoke with Frances Flores about his future daughter-in-law's debt. Flores said she would fax him a copy of Spencer's bill provided that he fax her Spencer's social security number. Alan Fell faxed the information on May 15, 1998, and Flores sent him a print-out of a computer screen showing Spencer's debt as generated by Rupp's computer system. The print-out indicated that Spencer owed the $2858.40 detailed above plus $428.76 for a "15% Attorney's Fee." Pl.'s Motion for Summary Judgment ex. 17. Rupp employees have admitted that the company's computer system automatically added a 15% figure for attorneys fees, but that this number was only for in-house use. Flores Dep. at 31-35; McNeal Dep. at 43-46.
Flores spoke with Spencer by phone in June 1998 and requested her mailing address. Spencer claims that she disputed the debt during the phone call and Flores offered to "cut a deal" for $2200. Flores also told Spencer that Rupp had twelve years in which to collect the debt. Flores Dep. at 25-26.
On June 19, 1998, Zimlin & Kilberg — the law firm representing Rupp — sent a letter to Spencer signed by Robert N. Kilberg. The letter noted that the firm had "been retained" by Hendersen and was requesting payment of the outstanding $2858.40. Pl.'s Motion for Partial Summary Judgment ex. 18. The letter also stated "[i]f legal action is taken, you will be responsible for attorneys fees, court costs, and prejudgment interest, as allowed by your contract." Id. Spencer admits that the letter contained the notice required by the FDCPA.
Spencer responded on June 30, 1998, by sending a letter to Kilberg disputing her debt pursuant to the FDCPA. Id. ex. 19. In particular, Spencer contended that the court costs and legal fees were invalid, and the debt claimed failed to account for her security deposit. Id.
On July 23, 1998, Flores sent Spencer a letter on Rupp letterhead indicating that Spencer owed $2858.40 to Hendersen and that Hendersen had authorized a settlement for $1858.40. Id. ex. 20. Spencer claims that Flores attached a new printout of the Rupp computer screen to this letter and that Flores had used "whiteout" to delete the $428.76 for attorneys fees. Id. at 9.
The FDCPA protects consumers from the abusive and deceptive practices employed by some debt collectors. See United States v. National Fin. Services Inc., 98 F.3d 131, 135 (4th Cir.1996). The FDCPA is a strict liability statute, see Russell v. Equifax A.R.S., 74 F.3d 30, 33 (2d...
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