Facing a Debt Lawsuit? Here’s how to avoid going to court

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Courts in New Mexico are launching a statewide program in September that uses technology to help people resolve consumer debt lawsuits faster and avoid going to court.

“It’s called online dispute resolution (ODR),” said Barry Massey, public information officer for the New Mexico Courts Administration Office. “We believe it’s faster, cheaper and a more convenient alternative to traditional hearings or trials.”

The type of eligible lawsuits would include a hospital suing for unpaid medical bills or a bank seeking payment in court for credit card debt, he said.

Chief Justice Angie Schneider of New Mexico's 12th Judicial District sees benefits for all parties in the online dispute resolution process.

“There have been approximately 31,000 of these cases filed statewide over a 12-month period from April 2018 to April 2019, in district courts and lower courts,” he said. .

In New Mexico, a plaintiff, the person pursuing a case, files in district court if it is a civil case involving less than $ 10,000, and in district court, if it is This is more, he explained.

“It all depends on the amount of debt in these cases that someone is trying to collect,” he said.

The process

Both parties to the lawsuit negotiate through the system using their own email, but not as occasional email exchanges, rather like a Turbo Tax form, Massey said.

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“This will give you a series of questions and you will fill in some blanks,” he said. “You can do it on your smartphone or your laptop, your iPad, whatever. Wherever you have internet access, you can use this system anytime of the day, 24/7. There is great flexibility for the parties.

“The accused person could do it at 10 pm after work and put their children to bed. The lawyers representing (the applicant) could deal with this during their normal working hours. You don’t have to do it at the same time, there is no face-to-face meeting. The accused does not have to sit across from someone like a lawyer and feel intimidated.

Judge’s point of view

Providing a means for two parties in a debt case to potentially resolve the issue without going to court has many advantages, said Chief Justice James M. Hudson, Division VI of the 5th Judicial District, which includes the counties of Lea, Eddy and Chaves, and 11 judicial divisions.

“From the perspective of the 5th Judicial District, one thing to keep in mind is how big we are,” he said on Monday. “With Chaves, Eddy and Lea County, the area covers over 14,700 square miles, the equivalent of Connecticut and Massachusetts. You are dealing with an extremely wide area and you are dealing with the kind of case that usually involves self-represented litigants.

“I think providing them with a way to try to resolve something without going to court can potentially be of great benefit to everyone, to them, to the people suing and also to the courts. We resolve things quickly and in a way that then allows the courts to deal with other cases pending before them. “

“I think this could be a very good tool as part of the judiciary’s efforts to advance judicial excellence,” he said.

Over a one-year period from April 2018 to 2019, more than 5,200 eligible-type cases were filed in the 5th judicial district, he said, adding that this represents nearly 20 cases per day.

“On average in the 5th Judicial District, each judge will probably open and close about 1,400 cases per year,” said Hudson. You try to deal with it, but in a way that also helps people. If we can do it, then we do our job better. “

Chief Justice Angie Schneider of the 12th Judicial District which covers Lincoln and Otero counties stressed that the program is optional and no one will be denied the right to appear before a judge.

The 12th Judicial District Court is in Carrizozo, an hour's drive from many communities in Lincoln County.

But over time and public exposure, she hopes the ODR turns into a solid program that frees up judges’ time to perform their duties more effectively. She pointed out that many cases, such as criminal charges, abuse and neglect cases and remand hearings have strict statutory deadlines involved, which often pushes back civil consumer debt cases.

“It’s not fair, it’s not fair to people. Their issues are just as important as anyone else,” she said. “The hope is that it will reduce that workload a bit.”

Another factor especially in Lincoln County is that the district court is about an hour’s drive from many communities, she said.

“It may take a whole day away from work or your little kids,” Schneider said. “I see this all the time in court. Fifty dollars in gasoline can be two weeks of groceries. That’s a lot of money for a lot of people and driving to Carrizozo can be prohibitive.

“I hope this will provide better access to justice and judicial resolution. The trick is to spread the word. It is also up to our clerks when a case is filed to inform people. The courts must really keep doing this awareness so people know what’s available. “

No additional costs beyond settlement are associated with the ODR program, she said.

“And they have the option within the first two weeks to request a mediator and it’s also free of charge,” Schneider said.

“In a huge percentage of these collection actions the defendant represents himself and he acknowledges in his response that he owes money. They are just trying to figure out how to pay it back. That fixes that and they don’t make him lose their money. time to come to court Being in a courtroom for most people causes a lot of anxiety and being alone is scary.

Something is needed

“One of the things that is going on in New Mexico and all over the courts, more and more people in these civil cases are representing themselves,” Massey said. “We assume that they cannot afford lawyers or that they live in a place where there are not many lawyers or no legal aid group to help them. For those kinds of people, we hope it will help them navigate the system more easily.

“You don’t have to go to court. because there is no face to face meeting with (a lawyer) saying that I am going to make your life difficult.

Debt cases can have serious consequences for the person being sued, he said.

“If they ignore (the case) and don’t file a response, which is necessary, the creditor’s next step is to ask the court for a default judgment, which means they win, because you don’t. not responded, ”Massey said. “Once that happens, the creditor can apply to the court for an order requiring reductions in a person’s paycheck to repay the debt. You can imagine the damage to their credit rating.

“We hope that fewer people will ignore these lawsuits if we make it easier. At least they have a chance of finding something they feel is right.

Origin of the system

“This technology is starting to find its way into courts across the country,” Massey said. “There are a few courts in other states that have pilot programs in place, but the best I can determine we are the first state with a statewide online dispute resolution program for all of its courts for a specific type of civil case. “

Some courts in the Salt Lake, Utah area use the system for small claims, not just consumer debt. A Nevada court that includes Las Vegas uses online dispute resolution for divorce cases, Massey said.

“It’s starting to get traction,” he said. “It was used. The real inspiration comes from the private sector, from e-commerce companies like E-Bay and PayPal. They have been using this stuff for many years to resolve issues between buyers and sellers that they are negotiating. They offer that sort of thing if a buyer is not happy with something they just bought.

Courts can be slow to adopt the technology, he acknowledged.

“But what we do know is that the (court) process is confusing and (the courts) can be intimidating,” Massey said. “Who wants to go to court? Anybody.

“It’s one way we think we are making ourselves more user-friendly. People certainly want to use technology in all of their other business transactions, so why not in their dealings with the courts. Everything is voluntary. If one of the two parties does not want to participate, nothing will happen.

Limits

The online dispute resolution option is only available for a limited period at the start of a trial, he noted.

“After filing a complaint, the first thing a defendant should do is file a response,” Massey explained. “It’s a page that says (the defendant) got the lawsuit and denies the claim. This happens in these cases no matter what, but once it does, the case is then transferred to the ODR referral system for 30 days. “

The first step would be for the complainant who brought the case to receive an email saying this is the ODR and they are starting to make an offer to the other party, Massey explained. If interested, the applicant fills out the form and clicks submit and the offer goes to the other side. The defendant answers certain questions and could submit a counter-offer or suggest a payment plan and accept the offer. This response is returned. The process could take a while, Massey said.

“If they needed help, they could ask for a trained online mediator,” he said. “The courts have long offered person-to-person mediation, with the help of a third person, and it’s a variation that tries to defuse the situation.

But if no resolution is found or if both parties do not take advantage of the ODR, the case will go to court and be dealt with as normal, he said.

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“If you can get settled within that 30-day period, you don’t have to do anything,” he said.

“Nobody shows up in court. The program will prepare a settlement document which will be automatically filed by the computer system. The clerk will table and do his part. The parties never have to appear before a judge.

Success depends on the willingness of both sides to try it out and be flexible, he said.

“We’ll donate the tool and see if people use it,” Massey said.

Journalist Dianne Stallings can be reached at [email protected]



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