A company choosing to sue a customer to collect unpaid debts must serve that customer with a copy of the lawsuit. Proper service might also include a subpoena to appear in court. When served with such documents, what is a consumer to do? More importantly, what does responding mean legally?
The states have different rules governing how lawsuits are served and how defendants are expected to respond. If you’re interested in knowing more about the rules in your state, check with your county court or take a look at the state bar website. For the purposes of this post, we will stick with generalities.
Time to Respond
A general rule suggests that a defendant has 30 days to respond to a debt collection lawsuit. Any legal expert would recommend contacting an attorney immediately after being served. Why? Because an attorney is the most qualified person to offer advice about how to proceed.
The experts at Utah-based Judgment Collectors say that failing to respond at all will virtually guarantee a default judgment against the consumer, followed by judgment collection. Failing to respond eliminates any chance a defendant has to dispute the alleged facts of the case.
Not an Admission of Guilt
Similar to criminal court, the plaintiff in a civil case bears the burden of proof. In other words, a plaintiff has to prove to the court that the debt in question is legitimate. It must also be proved that the defendant is responsible for paying it. All of this happens at trial. It is completely separate from the defendant’s response to document service.
Responding to a debt collection lawsuit is not an admission of guilt. It is simply an acknowledgement that the documents were received and that the defendant plans to participate in the case against him.
The reality is that a defendant has nothing to lose by responding. On the other hand, a failure to respond guarantees the defendant will lose the case. Then it’s on to collection and all of its implications.
Losing the Right to Appeal
Another very good reason for responding to a debt collection lawsuit is reserving the right to appeal should the defendant lose the case. An appeal is possible if the defendant’s attorney believes errors were made by the court, errors that led to an incorrect judgment.
For example, the defendant may contest the original debt. He may claim that either the debt is illegitimate, or it is someone else’s responsibility. But in order to appeal a judgment, the decision must first be rendered. That can’t happen if a default judgment is entered against the defendant.
In a nutshell, failing to respond will lead to a default judgment. Furthermore, a default judgment cannot be appealed. A defendant is essentially giving away his right to appeal by not participating in the process.
Default Judgments and Monetary Awards
The legal implications of not responding go beyond default judgments and losing the right to appeal. There is also money involved. We’re talking about a debt collection case here, so the monetary award starts with the original amount owed to the creditor. Courts almost always add the creditor’s court costs and legal fees. And where allowed by law, late fees and interest are added to the monetary award for every month it remains unpaid.
Ignoring the service of a debt collection lawsuit might seem like a good idea at the time, but it’s not. Ignoring service leads to a default judgment. Default judgments can’t be appealed. The defendant ends up in a losing position that could cost them dearly in the long run.