We are pleased to report to you about a recent decision from Kings County Civil Court captioned LVNV Funding LLC v. Hatzakis, 111517-10/KI. The case, in which LVNV Funding sued to collect approximately $7,000 from a consumer, was set for trial. When the parties appeared on the trial date, LVNV Funding requested an adjournment. Judge Dear did more than deny the adjournment; he dismissed the case.
LVNV’s counsel, Mel S. Harris & Associates, said it needed an adjournment to take discovery. Counsel admitted it could not, at that time, establish its prima facie case with evidence in admissible form. The Judge made short shrift of LVNV’s claim that it needed discovery, noting that LVNV had failed to make any discovery requests since issue was joined. When the Judge asked counsel the basis for commencing the lawsuit, counsel responded with what the Judge characterized as “multiple layers of hearsay.” When pressed as to good cause for the adjournment, and a good faith basis for commencing the litigation, the Mel Harris lawyer was "evasive."
What seemed to trouble Judge Dear most was the idea that creditors were using the court system as a way to “force contact with alleged debtors.” The opinion stated:
“The reason the action is commenced is to procure an in-person discussion with the alleged debtor after dialed collection efforts that include phone calls, letters and other collection tactics. By commencing a lawsuit based on multiple hearsay the creditor usually obtains a default judgment that would often times not pass muster under CPLR 3215, or an in-person settlement discussion. Either way, the plaintiff stands to gain.”
The Judge went on to point out that LVNV did not have “a scintilla of evidence” when the case started, nor, based on counsel’s statements, did it seem inclined to procure it. The Court concluded that, “Since plaintiff admitted it could not establish its prima facie case and could not assure the court that it would be able to do so on any adjourned date, the action is dismissed.”