The Third Circuit U.S. Court of Appeals ruled Monday that debt collectors contacting third parties to find debtors must prove in Fair Debt Collection Practices Act cases that contact was made solely to find the debtor.
The ruling upholds a district court jury verdict against Green Tree Servicing. The company allegedly repeatedly called plaintiff Patricia Evankavitchs family members and neighbors to solicit a return call from Evankavitch.
Evankavitch had defaulted on an estimated $43,000 mortgage. She was awarded $1,000 by a jury in the U.S. District Court for the Middle District of Pennsylvania.
Green Tree had argued that debt collectors may contact third parties if they are trying to ascertain a debtor's location and that they may only do so once, according to an exception in Section 1692b of the FDCPA, which generally prohibits contact with third parties. The exception provides that debt collectors may call again if they think they have been given inaccurate information.
Green Tree argued the district court's jury instructions were improper, specifically that the defendant had the burden of proving it only sought location information.Evankavitch secured a mortgage on her home to lend money to her son. Her son made several repayments to her, but eventually stopped, according to Krause. Evankavitch relied on the repayments to pay back her debt.
Green Tree took up Evankavitch's account after she fell behind on payments. The company alleged called Evankavitch's daughter and her neighbors, Robert and Sally Heim, after being unable to reach Evankavitch.
Third Circuit Judge Cheryl Ann Krause stated: "Although Green Tree suggests otherwise, it cites little in the record that indicates that it actually attempted to discern the location of Evankavitch [through the third party calls]. Krause said the calls to the neighbors appear to have been made for the purpose of "these third parties to function as Green Tree's message service in soliciting a return call from Evankavitch.""We started our analysis with the default rule that a plaintiff bears the burden of proving her claim, but we end with the canon that, absent compelling reasons to the contrary, a party seeking shelter in an exception to a statute has the burden of proving it. We find no such compelling reasons in this case," Krause said.
"Where the consumer challenges a communication from a debt collector to the consumer herself under the FDCPA, the consumer can be expected to attach and offer into evidence a copy of a written communication. Where the communication is from a debt collector to a third party, however, the consumer will have no firsthand knowledge of the conversation, and the third party cannot reasonably be expected to keep notes about or recall in detail random calls to his or her home," Krause added.