Given the following case, can you respond to the questions that
follow: A debtor defaults on debts owed to 11 creditors for a total
of $100,000, all debts being unsecured, the largest individual debt
being a $20,000 non-federally subsidized/guaranteed student loan, the
smallest being $5,000 credit card debt, the rest being credit lines
and credit cards of varying sizes. No fraud has been committed. The
debtor ordered two additional credit cards from ONE of the debtor's
credit card companies, in the name of two associates -- the two
aforementioned credit cards in the name of two associates were
activated but never used.

1) A collector calls from the card company that has issued three
cards and asks for Debtor, Name of Associate #1 on card, or Name of
Associate #3 on card to call back. Can Associates #1 and #2 be named
in a lawsuit? Do Associates #1 and #2 have any responsibility in any
action, or can their credit be damaged without having their social
security numbers?

2) If court action is taken against Debtor for all 11 debts, assume
that judgements are granted. What is the subpoena/investigative
authority of claimant creditors leading up to and after judgements are
granted in this case? Can they subpoena phone records, investigate
family members, etc.?

"Michelle" <michelle9384@yahoo.com> wrote in message
news:44c52fca.0311200849.3a2f5f26@posting.google.c om... Given the following case, can you respond to the questions that follow: A debtor defaults on debts owed to 11 creditors for a total of $100,000, all debts being unsecured, the largest individual debt being a $20,000 non-federally subsidized/guaranteed student loan, the smallest being $5,000 credit card debt, the rest being credit lines and credit cards of varying sizes. No fraud has been committed. The debtor ordered two additional credit cards from ONE of the debtor's credit card companies, in the name of two associates -- the two aforementioned credit cards in the name of two associates were activated but never used. 1) A collector calls from the card company that has issued three cards and asks for Debtor, Name of Associate #1 on card, or Name of Associate #3 on card to call back. Can Associates #1 and #2 be named in a lawsuit?

Anybody can be named.
Do Associates #1 and #2 have any responsibility in any action,

Not unless they used the card or signed a contract with the credit card
issuer.
or can their credit be damaged without having their social security numbers?

Unlikely. If a credit report is made, it will be invalid and therefore can
be cleared.
2) If court action is taken against Debtor for all 11 debts, assume that judgements are granted. What is the subpoena/investigative authority of claimant creditors leading up to and after judgements are granted in this case? Can they subpoena phone records, investigate family members, etc.?

Yes.

McGyver

>Subject: Civil Subpoena/Investigative AuthorityFrom: michelle9384@yahoo.com (Michelle)Date: 11/20/2003 8:49 AM Pacific Standard TimeMessage-id: <44c52fca.0311200849.3a2f5f26@posting.google.com>Given the following case, can you respond to the questions thatfollow: A debtor defaults on debts owed to 11 creditors for a totalof $100,000, all debts being unsecured, the largest individual debtbeing a $20,000 non-federally subsidized/guaranteed student loan, thesmallest being $5,000 credit card debt, the rest being credit linesand credit cards of varying sizes. No fraud has been committed. Thedebtor ordered two additional credit cards from ONE of the debtor'scredit card companies, in the name of two associates -- the twoaforementioned credit cards in the name of two associates wereactivated but never used.1) A collector calls from the card company that has issued threecards and asks for Debtor, Name of Associate #1 on card, or Name ofAssociate #3 on card to call back. Can Associates #1 and #2 be namedin a lawsuit? Do Associates #1 and #2 have any responsibility in anyaction, or can their credit be damaged without having their socialsecurity numbers?

There is no obligation to give a collector any information whatsoever.
2) If court action is taken against Debtor for all 11 debts, assumethat judgements are granted. What is the subpoena/investigativeauthority of claimant creditors leading up to and after judgements aregranted in this case? Can they subpoena phone records, investigatefamily members, etc.?

Most credit card companies have a clause like this in the contract to extend
credit: "The client accepts joint and several liability with any additional
cardholders for all obligations arising from the use of additional cards."

The doctrine of "joint and several liability" can be very helpful to
plaintiffs. When Defendant 1 has no money to pay the judgment, i.e., he is poor
and thus "judgment proof," while Defendant 2 is a wealthy individual or
corporation, you can apply the doctrine to Defendant 2 who is then required to
pay not only his share of the judgment, but Defendant 1's share as well.

So it would appear to me that, if the credit card company has such a clause in
their contract, the additional card holders are bound by the "joint and several
liability" doctrine. If there is a suit, they could be named as defendants and
information could be subpoened about them (not prior to judgment but before).
But don't the additional cards already have the names of the other parties on
them?

If I were party #1, the original card holder, I would not wait for any possible
lawsuits but see a bankruptcy attorney for advice ASAP. Even if party #1 were
able to ward off any problems with the company who issued the three cards by
continuing to make payments to them, let's say party #1 still cannot meet the
other debts.
There is nothing to keep the other creditors from taking party #1 to court if
the debt is sufficiently large to warrant their own legal costs.

Disclaimer: I am not an attorney. This is for discussion purposes only and
should not be construed as legal advice. For legal advice, it is best to
consult an attorney.



"THE EXODUS CHRONICLES: Beliefs, Legends & Rumors from Antiquity Regarding the
Exodus of the Jews from Egypt" by Marianne Luban
You'll never think about the Biblical Book of Exodus in the same way again!
http://www.geocities.com/scribelist/Exodus2.html

On 20 Nov 2003 20:32:30 GMT, marianneluban@aol.comnospam (MarianneLuban)
in misc.legal, wrote the following:

SITUATION:
Given the following case, can you respond to the questions thatfollow: A debtor defaults on debts owed to 11 creditors for a totalof $100,000, all debts being unsecured, the largest individual debtbeing a $20,000 non-federally subsidized/guaranteed student loan, thesmallest being $5,000 credit card debt, the rest being credit linesand credit cards of varying sizes. No fraud has been committed. Thedebtor ordered two additional credit cards from ONE of the debtor'scredit card companies, in the name of two associates -- the twoaforementioned credit cards in the name of two associates wereactivated but never used.
Most credit card companies have a clause like this in the contract to extendcredit: "The client accepts joint and several liability with any additionalcardholders for all obligations arising from the use of additional cards."The doctrine of "joint and several liability" can be very helpful toplaintiffs. When Defendant 1 has no money to pay the judgment, i.e., he is poorand thus "judgment proof," while Defendant 2 is a wealthy individual orcorporation, you can apply the doctrine to Defendant 2 who is then required topay not only his share of the judgment, but Defendant 1's share as well.So it would appear to me that, if the credit card company has such a clause intheir contract, the additional card holders are bound by the "joint and severalliability" doctrine. If there is a suit, they could be named as defendants andinformation could be subpoened about them (not prior to judgment but before).But don't the additional cards already have the names of the other parties onthem?

I don't have the original poster's message, but this response is
addressed to him/her only:

Joint liability attaches in credit card situations only if the other
parties have indeed signed the credit agreement. For an agreement to be
joint and several, then it must be signed by all parties. If a lender
says all partners are jointly liable for a debt, and any should believe
this is not the case, they should ask for a copy of the original
agreement. If not all of them have not signed it, then those parties are
normally not liable for the debt. An allegation of fraud is not
required, merely that the credit card company does not have their
averred signatures that the remaining partners agreed to become liable
for the debt.

Thus, hypothetically, if a business partner orders credit cards in his
name and that of his 3 other partners, who never signed the credit
agreement (and can prove this), then the remaining 3 partners are likely
not liable for the original partner's debt default (this depends a LOT
on the language of the partnership agreement as to the disposition of
debt). In the specific situation you have described above, merely
activating a credit card does not impute actual assumption of debt
liability since that ALONE cannot be assumed the activation was done by
any of the other partners.

The concept of "joint and several liability," where other parties become
totally responsible for the debt actions of a partner, is also under
attack in many states in the US in business situations, where it is
proposed rather than parties be subjected to arbitration or other forms
of mediation on a debt to determine the _actual liability for debt
incurred by each of the parties, rather than all remaining partners
being liable for the entire debt_. This is particularly true in such
areas as construction, environmental damages, corporate and employee
liability, etc. See, for example, New York State's concerns on the
limitation of joint and several liability:

http://www.bcnys.org/whatsnew/2003/0305senn.htm

in business in NY, (actual contract):

http://www.impactenvironmental.com/generalterms/indemnification.htm

Pennsylvania's response to the limitation of joint and several
liability:

http://www.mddailyrecord.com/pub/3_241_law/saturdaycolumns/140125-1.html

Mississippi's law in respect to the limitation of joint and several
liability:

http://www.mscode.com/free/statutes/85/005/0007.htm

and even federal moves to limit the concept in regards to terrorism
activities:

www.house.gov/judiciary_democrats/ hr3210litigationmemo112901.pdf

There may be other arguments which would limit debt liability of a
partner where purposeful intent to harm (the company) economically by a
defaulting partner can be shown as well, for example. I'll leave that
to others to describe, though.

HTH.

Regards --

Katherine Griffis-Greenberg, J.D.

(Formerly University of Alabama at Birmingham
UAB Options/Special Studies

Now: Doctoral Program [Egyptology]
Oxford University, UK)

DISCLAIMER:

Not a practicing attorney, and no attorney-client relationship
is created. This response is for discussion purposes only. It
isn't meant to be legal advice. If you wish legal advice, seek
out an attorney in your own state who is familar with your
state's laws and applications thereof.

"McGyver" <Greyprof@msn.com> wrote in message news:<bpiumr$1mjk87$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311200849.3a2f5f26@posting.google.c om... Given the following case, can you respond to the questions that follow: A debtor defaults on debts owed to 11 creditors for a total of $100,000, all debts being unsecured, the largest individual debt being a $20,000 non-federally subsidized/guaranteed student loan, the smallest being $5,000 credit card debt, the rest being credit lines and credit cards of varying sizes. No fraud has been committed. The debtor ordered two additional credit cards from ONE of the debtor's credit card companies, in the name of two associates -- the two aforementioned credit cards in the name of two associates were activated but never used. 1) A collector calls from the card company that has issued three cards and asks for Debtor, Name of Associate #1 on card, or Name of Associate #3 on card to call back. Can Associates #1 and #2 be named in a lawsuit? Anybody can be named. Do Associates #1 and #2 have any responsibility in any action, Not unless they used the card or signed a contract with the credit card issuer. or can their credit be damaged without having their social security numbers? Unlikely. If a credit report is made, it will be invalid and therefore can be cleared. 2) If court action is taken against Debtor for all 11 debts, assume that judgements are granted. What is the subpoena/investigative authority of claimant creditors leading up to and after judgements are granted in this case? Can they subpoena phone records, investigate family members, etc.? Yes. McGyver


Regarding your answer to Question 2, does that authority have to be
granted by a judge or magistrate? What is the likelihood of these
investigations actually taking place given the non-government funded
expense against a maximum debt of a relatively mere $20,000? What
would be the argument that those subpoenas should be granted to
investigate phone records, interview relatives, etc., given that the
original debts were all unsecured and the debtor ostensibly simply
exercised lack of financial prudence?

>Subject: Re: Civil Subpoena/Investigative AuthorityFrom: Katherine Griffis-Greenberg egylist@griffis-consulting.comDate: 11/20/2003 1:47 PM Pacific Standard TimeMessage-id: <au9qrvsed7vpqju1td8kpmupn75uvh43fp@4ax.com>On 20 Nov 2003 20:32:30 GMT, marianneluban@aol.comnospam (MarianneLuban)in misc.legal, wrote the following:SITUATION:Given the following case, can you respond to the questions thatfollow: A debtor defaults on debts owed to 11 creditors for a totalof $100,000, all debts being unsecured, the largest individual debtbeing a $20,000 non-federally subsidized/guaranteed student loan, thesmallest being $5,000 credit card debt, the rest being credit linesand credit cards of varying sizes. No fraud has been committed. Thedebtor ordered two additional credit cards from ONE of the debtor'scredit card companies, in the name of two associates -- the twoaforementioned credit cards in the name of two associates wereactivated but never used.Most credit card companies have a clause like this in the contract to extendcredit: "The client accepts joint and several liability with any additionalcardholders for all obligations arising from the use of additional cards."The doctrine of "joint and several liability" can be very helpful toplaintiffs. When Defendant 1 has no money to pay the judgment, i.e., he ispoorand thus "judgment proof," while Defendant 2 is a wealthy individual orcorporation, you can apply the doctrine to Defendant 2 who is then requiredtopay not only his share of the judgment, but Defendant 1's share as well.So it would appear to me that, if the credit card company has such a clauseintheir contract, the additional card holders are bound by the "joint andseveralliability" doctrine. If there is a suit, they could be named as defendantsandinformation could be subpoened about them (not prior to judgment butbefore).But don't the additional cards already have the names of the other partiesonthem?I don't have the original poster's message, but this response isaddressed to him/her only:

Why? Isn't this a discussion group? Do you really want to be in the position
of giving legal advice only to the person who originally asked for it? I would
doubt that.
Joint liability attaches in credit card situations only if the otherparties have indeed signed the credit agreement. For an agreement to bejoint and several, then it must be signed by all parties. If a lendersays all partners are jointly liable for a debt, and any should believethis is not the case, they should ask for a copy of the originalagreement. If not all of them have not signed it, then those parties arenormally not liable for the debt.

I don't think it's that simple. Judging from the OP's message, family members
were involved--not the business partners you refer to below. Let's say parties
1 & 2 just get married. The wife's credit is good and her husband's is bad and
so she gets a credit card in her name only. After that, she requests an
additional card, without telling anybody that the additional card is actually
for her husband. (in fact, I don't even think banks do this anymore--just hand
out additional cards without signatures) Can it really be true that only the
wife is thereafter responsible for payment on that credit card debt? It seems
to me that the only parties, in such instances, who are exempt from "joint and
several liability" on the account are those under the age of 18.

An allegation of fraud is notrequired, merely that the credit card company does not have theiraverred signatures that the remaining partners agreed to become liablefor the debt.
In the specific situation you have described above, merelyactivating a credit card does not impute actual assumption of debtliability since that ALONE cannot be assumed the activation was done byany of the other partners.

Why do you think a cardholder would ask for additional cards for people who
didn't want them or want to activate them? There is only one account. If it
is in trouble, for some reason, "additional cards" are not going to help the
person who originally took out the credit card. Activating the other cards is
not going to mean getting any more credit or being able to make further
purchases. And yet the collector for the card company was asking for
information about the other card holders. Doubtless, the collector had some
objective in mind--even though the additional cards were never used but
activated.
DISCLAIMER:Not a practicing attorney, and no attorney-client relationshipis created. This response is for discussion purposes only. Itisn't meant to be legal advice. If you wish legal advice, seekout an attorney in your own state who is familar with yourstate's laws and applications thereof.

Ditto.

"THE EXODUS CHRONICLES: Beliefs, Legends & Rumors from Antiquity Regarding the
Exodus of the Jews from Egypt" by Marianne Luban
You'll never think about the Biblical Book of Exodus in the same way again!
http://www.geocities.com/scribelist/Exodus2.html

Katherine Griffis-Greenberg <egylist@griffis-consulting.com> wrote in message news:<au9qrvsed7vpqju1td8kpmupn75uvh43fp@4ax.com>... On 20 Nov 2003 20:32:30 GMT, marianneluban@aol.comnospam (MarianneLuban) in misc.legal, wrote the following: SITUATION:Given the following case, can you respond to the questions thatfollow: A debtor defaults on debts owed to 11 creditors for a totalof $100,000, all debts being unsecured, the largest individual debtbeing a $20,000 non-federally subsidized/guaranteed student loan, thesmallest being $5,000 credit card debt, the rest being credit linesand credit cards of varying sizes. No fraud has been committed. Thedebtor ordered two additional credit cards from ONE of the debtor'scredit card companies, in the name of two associates -- the twoaforementioned credit cards in the name of two associates wereactivated but never used.Most credit card companies have a clause like this in the contract to extendcredit: "The client accepts joint and several liability with any additionalcardholders for all obligations arising from the use of additional cards."The doctrine of "joint and several liability" can be very helpful toplaintiffs. When Defendant 1 has no money to pay the judgment, i.e., he is poorand thus "judgment proof," while Defendant 2 is a wealthy individual orcorporation, you can apply the doctrine to Defendant 2 who is then required topay not only his share of the judgment, but Defendant 1's share as well.So it would appear to me that, if the credit card company has such a clause intheir contract, the additional card holders are bound by the "joint and severalliability" doctrine. If there is a suit, they could be named as defendants andinformation could be subpoened about them (not prior to judgment but before).But don't the additional cards already have the names of the other parties onthem? I don't have the original poster's message, but this response is addressed to him/her only: Joint liability attaches in credit card situations only if the other parties have indeed signed the credit agreement. For an agreement to be joint and several, then it must be signed by all parties. If a lender says all partners are jointly liable for a debt, and any should believe this is not the case, they should ask for a copy of the original agreement. If not all of them have not signed it, then those parties are normally not liable for the debt. An allegation of fraud is not required, merely that the credit card company does not have their averred signatures that the remaining partners agreed to become liable for the debt. Thus, hypothetically, if a business partner orders credit cards in his name and that of his 3 other partners, who never signed the credit agreement (and can prove this), then the remaining 3 partners are likely not liable for the original partner's debt default (this depends a LOT on the language of the partnership agreement as to the disposition of debt). In the specific situation you have described above, merely activating a credit card does not impute actual assumption of debt liability since that ALONE cannot be assumed the activation was done by any of the other partners. The concept of "joint and several liability," where other parties become totally responsible for the debt actions of a partner, is also under attack in many states in the US in business situations, where it is proposed rather than parties be subjected to arbitration or other forms of mediation on a debt to determine the _actual liability for debt incurred by each of the parties, rather than all remaining partners being liable for the entire debt_. This is particularly true in such areas as construction, environmental damages, corporate and employee liability, etc. See, for example, New York State's concerns on the limitation of joint and several liability: http://www.bcnys.org/whatsnew/2003/0305senn.htm in business in NY, (actual contract): http://www.impactenvironmental.com/generalterms/indemnification.htm Pennsylvania's response to the limitation of joint and several liability: http://www.mddailyrecord.com/pub/3_241_law/saturdaycolumns/140125-1.html Mississippi's law in respect to the limitation of joint and several liability: http://www.mscode.com/free/statutes/85/005/0007.htm and even federal moves to limit the concept in regards to terrorism activities: www.house.gov/judiciary_democrats/ hr3210litigationmemo112901.pdf There may be other arguments which would limit debt liability of a partner where purposeful intent to harm (the company) economically by a defaulting partner can be shown as well, for example. I'll leave that to others to describe, though. HTH. Regards -- Katherine Griffis-Greenberg, J.D. (Formerly University of Alabama at Birmingham UAB Options/Special Studies Now: Doctoral Program [Egyptology] Oxford University, UK) DISCLAIMER: Not a practicing attorney, and no attorney-client relationship is created. This response is for discussion purposes only. It isn't meant to be legal advice. If you wish legal advice, seek out an attorney in your own state who is familar with your state's laws and applications thereof.

I disagree with one poster's view regarding "The client accepts joint
and several liability with any additional cardholders for all
obligations arising from the use of additional cards." I believe that
means not that cardholder #2 (as differentiated from contractually
bound, agreement-signing cardholder #1, #2 is simply a named
cardholder) is jointly and severally liable, but rather that
cardholder #1 ("the client") is jointly and severally liable for the
purchases of cardholder #2. The key to this is that it refers to "the
client" who signed the original agreement, not a subsequently
concurrent "cardholder," who has a card ordered in the cardholder's
name by the client.

Katherine Griffis-Greenberg <egylist@griffis-consulting.com> wrote in message news:<au9qrvsed7vpqju1td8kpmupn75uvh43fp@4ax.com>... On 20 Nov 2003 20:32:30 GMT, marianneluban@aol.comnospam (MarianneLuban) in misc.legal, wrote the following: SITUATION:Given the following case, can you respond to the questions thatfollow: A debtor defaults on debts owed to 11 creditors for a totalof $100,000, all debts being unsecured, the largest individual debtbeing a $20,000 non-federally subsidized/guaranteed student loan, thesmallest being $5,000 credit card debt, the rest being credit linesand credit cards of varying sizes. No fraud has been committed. Thedebtor ordered two additional credit cards from ONE of the debtor'scredit card companies, in the name of two associates -- the twoaforementioned credit cards in the name of two associates wereactivated but never used.Most credit card companies have a clause like this in the contract to extendcredit: "The client accepts joint and several liability with any additionalcardholders for all obligations arising from the use of additional cards."The doctrine of "joint and several liability" can be very helpful toplaintiffs. When Defendant 1 has no money to pay the judgment, i.e., he is poorand thus "judgment proof," while Defendant 2 is a wealthy individual orcorporation, you can apply the doctrine to Defendant 2 who is then required topay not only his share of the judgment, but Defendant 1's share as well.So it would appear to me that, if the credit card company has such a clause intheir contract, the additional card holders are bound by the "joint and severalliability" doctrine. If there is a suit, they could be named as defendants andinformation could be subpoened about them (not prior to judgment but before).But don't the additional cards already have the names of the other parties onthem? I don't have the original poster's message, but this response is addressed to him/her only: Joint liability attaches in credit card situations only if the other parties have indeed signed the credit agreement. For an agreement to be joint and several, then it must be signed by all parties. If a lender says all partners are jointly liable for a debt, and any should believe this is not the case, they should ask for a copy of the original agreement. If not all of them have not signed it, then those parties are normally not liable for the debt. An allegation of fraud is not required, merely that the credit card company does not have their averred signatures that the remaining partners agreed to become liable for the debt. Thus, hypothetically, if a business partner orders credit cards in his name and that of his 3 other partners, who never signed the credit agreement (and can prove this), then the remaining 3 partners are likely not liable for the original partner's debt default (this depends a LOT on the language of the partnership agreement as to the disposition of debt). In the specific situation you have described above, merely activating a credit card does not impute actual assumption of debt liability since that ALONE cannot be assumed the activation was done by any of the other partners. The concept of "joint and several liability," where other parties become totally responsible for the debt actions of a partner, is also under attack in many states in the US in business situations, where it is proposed rather than parties be subjected to arbitration or other forms of mediation on a debt to determine the _actual liability for debt incurred by each of the parties, rather than all remaining partners being liable for the entire debt_. This is particularly true in such areas as construction, environmental damages, corporate and employee liability, etc. See, for example, New York State's concerns on the limitation of joint and several liability: http://www.bcnys.org/whatsnew/2003/0305senn.htm in business in NY, (actual contract): http://www.impactenvironmental.com/generalterms/indemnification.htm Pennsylvania's response to the limitation of joint and several liability: http://www.mddailyrecord.com/pub/3_241_law/saturdaycolumns/140125-1.html Mississippi's law in respect to the limitation of joint and several liability: http://www.mscode.com/free/statutes/85/005/0007.htm and even federal moves to limit the concept in regards to terrorism activities: www.house.gov/judiciary_democrats/ hr3210litigationmemo112901.pdf There may be other arguments which would limit debt liability of a partner where purposeful intent to harm (the company) economically by a defaulting partner can be shown as well, for example. I'll leave that to others to describe, though. HTH. Regards -- Katherine Griffis-Greenberg, J.D. (Formerly University of Alabama at Birmingham UAB Options/Special Studies Now: Doctoral Program [Egyptology] Oxford University, UK) DISCLAIMER: Not a practicing attorney, and no attorney-client relationship is created. This response is for discussion purposes only. It isn't meant to be legal advice. If you wish legal advice, seek out an attorney in your own state who is familar with your state's laws and applications thereof.

I disagree with one poster's view regarding "The client accepts joint
and several liability with any additional cardholders for all
obligations arising from the use of additional cards." I believe that
means not that cardholder #2 (as differentiated from contractually
bound, agreement-signing cardholder #1, #2 is simply a named
cardholder) is jointly and severally liable, but rather that
cardholder #1 ("the client") is jointly and severally liable for the
purchases of cardholder #2. The key to this is that it refers to "the
client" who signed the original agreement, not a subsequently
concurrent "cardholder," who has a card ordered in the cardholder's
name by the client.

On 20 Nov 2003 19:51:08 -0800, michelle9384@yahoo.com (Michelle) in
misc.legal, wrote the following:
Katherine Griffis-Greenberg <egylist@griffis-consulting.com> wrote in message news:<au9qrvsed7vpqju1td8kpmupn75uvh43fp@4ax.com>... On 20 Nov 2003 20:32:30 GMT, marianneluban@aol.comnospam (MarianneLuban) in misc.legal, wrote the following: SITUATION:>Given the following case, can you respond to the questions that>follow: A debtor defaults on debts owed to 11 creditors for a total>of $100,000, all debts being unsecured, the largest individual debt>being a $20,000 non-federally subsidized/guaranteed student loan, the>smallest being $5,000 credit card debt, the rest being credit lines>and credit cards of varying sizes. No fraud has been committed. The>debtor ordered two additional credit cards from ONE of the debtor's>credit card companies, in the name of two associates -- the two>aforementioned credit cards in the name of two associates were>activated but never used.Most credit card companies have a clause like this in the contract to extendcredit: "The client accepts joint and several liability with any additionalcardholders for all obligations arising from the use of additional cards."The doctrine of "joint and several liability" can be very helpful toplaintiffs. When Defendant 1 has no money to pay the judgment, i.e., he is poorand thus "judgment proof," while Defendant 2 is a wealthy individual orcorporation, you can apply the doctrine to Defendant 2 who is then required topay not only his share of the judgment, but Defendant 1's share as well.So it would appear to me that, if the credit card company has such a clause intheir contract, the additional card holders are bound by the "joint and severalliability" doctrine. If there is a suit, they could be named as defendants andinformation could be subpoened about them (not prior to judgment but before).But don't the additional cards already have the names of the other parties onthem? I don't have the original poster's message, but this response is addressed to him/her only: Joint liability attaches in credit card situations only if the other parties have indeed signed the credit agreement. For an agreement to be joint and several, then it must be signed by all parties. If a lender says all partners are jointly liable for a debt, and any should believe this is not the case, they should ask for a copy of the original agreement. If not all of them have not signed it, then those parties are normally not liable for the debt. An allegation of fraud is not required, merely that the credit card company does not have their averred signatures that the remaining partners agreed to become liable for the debt. Thus, hypothetically, if a business partner orders credit cards in his name and that of his 3 other partners, who never signed the credit agreement (and can prove this), then the remaining 3 partners are likely not liable for the original partner's debt default (this depends a LOT on the language of the partnership agreement as to the disposition of debt). In the specific situation you have described above, merely activating a credit card does not impute actual assumption of debt liability since that ALONE cannot be assumed the activation was done by any of the other partners.
<snip>I disagree with one poster's view regarding "The client accepts jointand several liability with any additional cardholders for allobligations arising from the use of additional cards." I believe thatmeans not that cardholder #2 (as differentiated from contractuallybound, agreement-signing cardholder #1, #2 is simply a namedcardholder) is jointly and severally liable, but rather thatcardholder #1 ("the client") is jointly and severally liable for thepurchases of cardholder #2. The key to this is that it refers to "theclient" who signed the original agreement, not a subsequentlyconcurrent "cardholder," who has a card ordered in the cardholder'sname by the client.

Agreed: for example, Cardholder #1, under American Express terms
(although I believe this would be the wording for any credit card
company as well), is considered the _primary_ cardholder and the
agreement between he/she and American Express is that the primary
assumes the responsibilities for the debts incurred by Cardholder #2,
who may or may not sign the application form (it differs by companies,
even today). The reference for Cardholder #2 is normally
"supplemental/additional cardholder."

Now, in the situation"...wife's credit is good and her husband's is bad
and so she gets a credit card in her name only. After that, she
requests an additional card, without telling anybody that the additional
card is actually for her husband..." is illustrative of the above
situation. The debt is _still_ totally hers for a number of reasons.
For one, she, as the primary cardholder, got the additional card by
_her_ requesting it, and with that, she also contractually agreed to
assume the responsibility to make full payment for all debts incurred on
the card.

She cannot later deny the liability to make payment for the husband's
debts in the particular instance, merely because the husband uses the
card to incur debt. The credit contract is between the wife and the
credit card company, and without direct _explicit_ agreement between the
husband and the credit card company, he is not legally obligated to pay
his portion of the credit card debt without legal change in status to
the contrary.

By "legal change in status," I mean that if the wife divorces the
husband, she normally will have her divorce judgment to avow that the
husband's continued use of the card _after_ the divorce is final is not
a debt owed by her (which is why you still see such legal notices of
repudiation of debt incurred by a divorced spouse). The creditor (in
the case of my hypothetical, American Express) is put on notice at that
point that the wife is no longer liable for the (now ex-) husband's
debts, and this legally can change their contractual agreement.

After such notice, American Express may do a number of things: a) they
may continue allowing the ex-spouse to use the card and make all credit
ratings afterward based ONLY on his use. For this, AmEx will normally
require a new agreement between themselves and the secondary cardholder,
thus cutting out recourse to the primary cardholding spouse. Thus, if he
continues to have "bad credit" use with the card, then the credit card
company may discontinue the use of his card and hold _alone_ his credit
rating responsible for only those debts he so incurred _after_ the
divorce; or b) without the assurance of payment from the now divorced
primary cardholder, a credit card company, such as AmEx, may discontinue
use of the credit card for the supplemental cardholder #2 immediately
after notice.

However, there is an additional glitch with the thinking here:

IF the second credit card is acquired in the way detailed in the above
example (i.e., the wife's credit is good and husband's is bad, and she
acquired the card for him using her credit status alone, _*without
informing the credit card company the card was for her husband, and
husband's credit status was in disarray*_), an argument _might_ be made
by the credit card company that they were induced to produce a second
card for the supplemental holder under less than honest circumstances by
the _primary cardholder_, and as such, this may not relieve the wife of
the husband's debt, even via divorce. This action would be part of a
"failure to disclose" certain facts to the credit card company by the
primary cardholder (such as who is using the credit card, their status
to the primary cardholder, and for what reasons).

By this, the credit card company _could_ make the claim that fraud was
used to acquire the second card. As such, the primary cardholder could
not later disavow her responsibility for payment by claiming "innocent
spouse" status as to her spouse's debts.

In other words, a spouse who is a "primary" cardholder (relying upon
his/her credit rating) who arranges for a supplemental card for a spouse
with bard credit - KNOWING he/she has bad credit (which is demonstrable
by credit reports contemporaneous with the application, imputed
knowledge to the primary credit cardholder that the credit application
was taken out for that specific purpose to by-pass credit review of the
supplemental cardholder's credit status). IOW, the primary cardholding
may claim she took the card out as a "gift" for another, but if it can
be shown by the credit card company she was imputed to know of the
other spouse's bad credit status in doing so, she cannot later claim
"innocent spouse" situation (as in not knowing the charges he made were
also debts owed by her as well) to eschew her/his obligation to make
repayment for the errant spouse under the original credit card
agreement.

The usual situation which is seen to occur, and in fact, was discussed
most recently on misc.legal, is that a spouse/partner takes out credit
_totally in the name of the other_ without their knowledge (thus,
fraud), and creates debt in the other spouse/partner's name. Obviously,
if the spouse who has been so used has not signed the agreement, then
his/her liability is usually limited to only the debts he/she personally
may have incurred by the credit card use, IF she/he can show fraud was
in place. Even so, he/she likely cannot eschew _all_ debts if the credit
card was used by him/her (or possibly even if he/she was never in
possession of the credit card), but there may be a limit to the
liability.

However, if the spouse signed the agreement, either as primary or
secondary cardholder, and agreed to the provisions of being equally
liable for the debt, then joint and several liability stands, under
present law.

However, there is a move to limit liability (particularly for tax
situations) under an "innocent spouse" claim. To wit:

http://www.unclefed.com/TxprBoR/1998/report10.html
Title III. Taxpayer Protections & Rights
C. Relief for Innocent Spouses & for Taxpayers Unable to
Manage their Financial Affairs Due to Disabilities

[Effective: January 1, 1998]

"Relief from liability for tax, interest and penalties is available for
'innocent spouses' in certain circumstances. To qualify for such relief,
the innocent spouse must establish: (1) that a joint return was made;
(2) that an understatement of tax, which exceeds the greater of $500 or
a specified percentage of the innocent spouse's adjusted gross income
for the preadjustment (most recent) year, is attributable to a grossly
erroneous item of the other spouse; (3) that in signing the return, the
innocent spouse did not know, and had no reason to know, that there was
an understatement of tax; and (4) that taking into account all the facts
and circumstances, it is inequitable to hold the innocent spouse liable
for the deficiency in tax. The specified percentage of adjusted gross
income is 10 percent if adjusted gross income is $20,000 or less.
Otherwise, the specified percentage is 25 percent.

The proper forum for contesting the Secretary's denial of innocent
spouse relief is determined by whether an underpayment is asserted or
the taxpayer is seeking a refund of overpaid taxes. Accordingly, the Tax
Court may not have jurisdiction to review all denials of innocent spouse
relief."

This regulation assumes, of course, full lack of knowledge by the
"innocent spouse" where she/he did not know there were material
misrepresentations on the tax statement (or in theory, on a credit
application) which would cause them to become liable for the erring
spouse's fraudulent activities.

If the person claiming "innocent spouse" status as to liability for the
debt is the _primary_ claimant and is the one who made false claims (or
failed to disclose all pertinent information to the credit card company,
as noted above), I suspect the tax courts (and credit card companies)
would view such claims rather suspiciously.

HTH.

Regards --
--
Katherine Griffis-Greenberg, J.D.

(Formerly University of Alabama at Birmingham
UAB Options/Special Studies

Now: Doctoral Program [Egyptology]
Oxford University, UK)

DISCLAIMER:

Not a practicing attorney, and no attorney-client relationship
is created. This response is for discussion purposes only. It
isn't meant to be legal advice. If you wish legal advice, seek
out an attorney in your own state who is familar with your
state's laws and applications thereof.

"Michelle" <michelle9384@yahoo.com> wrote in message
news:44c52fca.0311201605.6dcc72ee@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message
news:<bpiumr$1mjk87$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311200849.3a2f5f26@posting.google.c om... Given the following case, can you respond to the questions that follow: A debtor defaults on debts owed to 11 creditors for a total of $100,000, all debts being unsecured, the largest individual debt being a $20,000 non-federally subsidized/guaranteed student loan, the smallest being $5,000 credit card debt, the rest being credit lines and credit cards of varying sizes. No fraud has been committed. The debtor ordered two additional credit cards from ONE of the debtor's credit card companies, in the name of two associates -- the two aforementioned credit cards in the name of two associates were activated but never used. 1) A collector calls from the card company that has issued three cards and asks for Debtor, Name of Associate #1 on card, or Name of Associate #3 on card to call back. Can Associates #1 and #2 be named in a lawsuit? Anybody can be named. Do Associates #1 and #2 have any responsibility in any action, Not unless they used the card or signed a contract with the credit card issuer. or can their credit be damaged without having their social security numbers? Unlikely. If a credit report is made, it will be invalid and therefore
can be cleared. 2) If court action is taken against Debtor for all 11 debts, assume that judgments are granted. What is the subpoena/investigative authority of claimant creditors leading up to and after judgments are granted in this case? Can they subpoena phone records, investigate family members, etc.? Yes. McGyver Regarding your answer to Question 2, does that authority have to be granted by a judge or magistrate? What is the likelihood of these investigations actually taking place given the non-government funded expense against a maximum debt of a relatively mere $20,000? What would be the argument that those subpoenas should be granted to investigate phone records, interview relatives, etc., given that the original debts were all unsecured and the debtor ostensibly simply exercised lack of financial prudence?

The subpoena powers of the parties are granted by statute. Usually that
collection of laws can be found in the state's Civil Code or Code of Civil
Procedure, but states use different names. The subpoena powers are not
granted by the judge or magistrate. The judge makes rulings in the event of
dispute. Usually there is no penalty for an initial failure to comply with
a discovery demand. The penalty arises after the responding party fails to
comply, the requesting party files a motion to compel, the judge grants the
motion, and the responding party still doesn't comply.

It's hard to answer concerning the likelihood that the plaintiff will spend
money on discovery or investigation for a relatively small claim. Some
will, some won't. Some might sue in pro per and will not be concerned about
attorney's fees. I don't know why the plaintiff would want phone records or
want to investigate family members, or why you would object. So all I can
say is that if the information sought is not crucial, the plaintiff is
unlikely to investigate or use discovery to get it, and you are unlikely to
spend money objecting, in a small case.

McGyver

"McGyver" <Greyprof@msn.com> wrote in message news:<bplva8$1q6fos$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311201605.6dcc72ee@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message news:<bpiumr$1mjk87$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311200849.3a2f5f26@posting.google.c om... > Given the following case, can you respond to the questions that > follow: A debtor defaults on debts owed to 11 creditors for a total > of $100,000, all debts being unsecured, the largest individual debt > being a $20,000 non-federally subsidized/guaranteed student loan, the > smallest being $5,000 credit card debt, the rest being credit lines > and credit cards of varying sizes. No fraud has been committed. The > debtor ordered two additional credit cards from ONE of the debtor's > credit card companies, in the name of two associates -- the two > aforementioned credit cards in the name of two associates were > activated but never used. > > 1) A collector calls from the card company that has issued three > cards and asks for Debtor, Name of Associate #1 on card, or Name of > Associate #3 on card to call back. Can Associates #1 and #2 be named > in a lawsuit? Anybody can be named. > Do Associates #1 and #2 have any responsibility in any > action, Not unless they used the card or signed a contract with the credit card issuer. > or can their credit be damaged without having their social > security numbers? Unlikely. If a credit report is made, it will be invalid and therefore can be cleared. > 2) If court action is taken against Debtor for all 11 debts, assume > that judgments are granted. What is the subpoena/investigative > authority of claimant creditors leading up to and after judgments are > granted in this case? Can they subpoena phone records, investigate > family members, etc.? Yes. McGyver Regarding your answer to Question 2, does that authority have to be granted by a judge or magistrate? What is the likelihood of these investigations actually taking place given the non-government funded expense against a maximum debt of a relatively mere $20,000? What would be the argument that those subpoenas should be granted to investigate phone records, interview relatives, etc., given that the original debts were all unsecured and the debtor ostensibly simply exercised lack of financial prudence? The subpoena powers of the parties are granted by statute. Usually that collection of laws can be found in the state's Civil Code or Code of Civil Procedure, but states use different names. The subpoena powers are not granted by the judge or magistrate. The judge makes rulings in the event of dispute. Usually there is no penalty for an initial failure to comply with a discovery demand. The penalty arises after the responding party fails to comply, the requesting party files a motion to compel, the judge grants the motion, and the responding party still doesn't comply. It's hard to answer concerning the likelihood that the plaintiff will spend money on discovery or investigation for a relatively small claim. Some will, some won't. Some might sue in pro per and will not be concerned about attorney's fees. I don't know why the plaintiff would want phone records or want to investigate family members, or why you would object. So all I can say is that if the information sought is not crucial, the plaintiff is unlikely to investigate or use discovery to get it, and you are unlikely to spend money objecting, in a small case. McGyver

If you assume that in every case the defendant does not intend to
dispute any of the debts, and seeks only to get default judgements,
would there be any reason for a plaintiff to use discovery?

You have several issues to consider.

1- Legal liability of an authorized user.
None, unless it is a spouse in a Community Property State where SOME
amount of liability MAY attach if the creditor can prove charges on the
account were made for material improvements or benefits to jointly owned
property.

2- Credit reporting on an authorized user.
Here, there is NO restriction on reporting on an AU 's credit reports.
If the account was being reported on his/her reports while it was
current. If, however, it was NOT reported while it was current, the CC
company or collection agency can not LEGALLY report it after default.
The account MAY be disputed on the AU's credit reports, however, it may
be difficult to have it removed.

3- Collection agency activities. Here is another ballgame. Many
collection agencies operate in a reasonably legal manner, but many
others DO NOT. These will call, harass and embarrass both the debtor,
the authorized users, neighbors, family and friends.

4- Default judgments. An after judgment motion for discovery may be
filed, failure to answer truthfully may result in a contempt of Court
citation.Once a judgment has been entered, bank accounts may be
garnished, including any accounts that were used to pay on any of the
original accounts.

Y-chat@webtv.net wrote in message news:<9691-3FC0C02E-206@storefull-2371.public.lawson.webtv.net>... You have several issues to consider. 1- Legal liability of an authorized user. None, unless it is a spouse in a Community Property State where SOME amount of liability MAY attach if the creditor can prove charges on the account were made for material improvements or benefits to jointly owned property. 2- Credit reporting on an authorized user. Here, there is NO restriction on reporting on an AU 's credit reports. If the account was being reported on his/her reports while it was current. If, however, it was NOT reported while it was current, the CC company or collection agency can not LEGALLY report it after default. The account MAY be disputed on the AU's credit reports, however, it may be difficult to have it removed.


How could it be reported on the authorized users' credit reports if
the creditor has no SS# for the authorized users (and no address, no
DOB, etc.) and indeed no purchases were made with those cards?

3- Collection agency activities. Here is another ballgame. Many collection agencies operate in a reasonably legal manner, but many others DO NOT. These will call, harass and embarrass both the debtor, the authorized users, neighbors, family and friends.


It is easy to figure out how collectors get neighbor's telephone
numbers, but how do they get friends' and family's numbers?

4- Default judgments. An after judgment motion for discovery may be filed, failure to answer truthfully may result in a contempt of Court citation.Once a judgment has been entered, bank accounts may be garnished, including any accounts that were used to pay on any of the original accounts. --

>Michelle wrote:
How could it be reported on the authorized users' credit reports if the creditor has no SS# for the authorized users (and no address, no DOB, etc.) and indeed no purchases were made with those cards?
3- Collection agency activities. Here is another ballgame. Many collection agencies operate in a reasonably legal manner, but many others DO NOT. These will call, harass and embarrass both the debtor, the authorized users, neighbors, family and friends.
It is easy to figure out how collectors get neighbor's telephone numbers, but how do they get friends' and family's numbers?

When an authorized user is added to an account, something MORE than just
his/her name is given. All they need is a name and address to put an
account on a credit report.

As to how they find "friends",-- well if you ever shared a residence
with someone, their name will be in the data base.And your family would
likely be referenced in one of your applicatons, or from a prior
address.

"McGyver" <Greyprof@msn.com> wrote in message news:<bpqrjo$1sachu$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311212049.714caf8a@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message news:<bplva8$1q6fos$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311201605.6dcc72ee@posting.google.c om... > "McGyver" <Greyprof@msn.com> wrote in message news:<bpiumr$1mjk87$1@ID-75195.news.uni-berlin.de>... > > "Michelle" <michelle9384@yahoo.com> wrote in message > > news:44c52fca.0311200849.3a2f5f26@posting.google.c om... > > > Given the following case, can you respond to the questions that > > > follow: A debtor defaults on debts owed to 11 creditors for a total > > > of $100,000, all debts being unsecured, the largest individual debt > > > being a $20,000 non-federally subsidized/guaranteed student loan, the > > > smallest being $5,000 credit card debt, the rest being credit lines > > > and credit cards of varying sizes. No fraud has been committed. The > > > debtor ordered two additional credit cards from ONE of the debtor's > > > credit card companies, in the name of two associates -- the two > > > aforementioned credit cards in the name of two associates were > > > activated but never used. > > > > > > 1) A collector calls from the card company that has issued three > > > cards and asks for Debtor, Name of Associate #1 on card, or Name of > > > Associate #3 on card to call back. Can Associates #1 and #2 be named > > > in a lawsuit? > > > > Anybody can be named. > > > > > Do Associates #1 and #2 have any responsibility in any > > > action, > > > > Not unless they used the card or signed a contract with the credit card > > issuer. > > > > > or can their credit be damaged without having their social > > > security numbers? > > > > Unlikely. If a credit report is made, it will be invalid and therefore can > > be cleared. > > > > > 2) If court action is taken against Debtor for all 11 debts, assume > > > that judgments are granted. What is the subpoena/investigative > > > authority of claimant creditors leading up to and after judgments are > > > granted in this case? Can they subpoena phone records, investigate > > > family members, etc.? > > > > Yes. > > > > McGyver > > > Regarding your answer to Question 2, does that authority have to be > granted by a judge or magistrate? What is the likelihood of these > investigations actually taking place given the non-government funded > expense against a maximum debt of a relatively mere $20,000? What > would be the argument that those subpoenas should be granted to > investigate phone records, interview relatives, etc., given that the > original debts were all unsecured and the debtor ostensibly simply > exercised lack of financial prudence? The subpoena powers of the parties are granted by statute. Usually that collection of laws can be found in the state's Civil Code or Code of Civil Procedure, but states use different names. The subpoena powers are not granted by the judge or magistrate. The judge makes rulings in the event of dispute. Usually there is no penalty for an initial failure to comply with a discovery demand. The penalty arises after the responding party fails to comply, the requesting party files a motion to compel, the judge grants the motion, and the responding party still doesn't comply. It's hard to answer concerning the likelihood that the plaintiff will spend money on discovery or investigation for a relatively small claim. Some will, some won't. Some might sue in pro per and will not be concerned about attorney's fees. I don't know why the plaintiff would want phone records or want to investigate family members, or why you would object. So all I can say is that if the information sought is not crucial, the plaintiff is unlikely to investigate or use discovery to get it, and you are unlikely to spend money objecting, in a small case. McGyver If you assume that in every case the defendant does not intend to dispute any of the debts, and seeks only to get default judgements, would there be any reason for a plaintiff to use discovery? There are no such assumptions. Plaintiff's attorneys wait and see what happens. After the defendant is served with a summons and complaint, there is a short time to answer, usually 30 days. If an answer is not filed, plaintiff can then expect that there will be a default judgment, and wouldn't don't do discover until after judgment, if necessary. If an answer is filed, plaintiff can expect that the defendant intends to contest the case, and plaintiff would initiate discovery. McGyver


This whole time the plaintiff's counsel is waiting to see what
happens, as you say, plaintiff is aware there is a risk that defendant
will declare bankruptcy expunging this debt. Is it logical for a
company to commit discovery resources for a maximum (albeit totally
unlikely) payoff of $20,000 when there is a high risk that a
non-income producing, assetless defendant will declare bankruptcy when
defendant feels it is in defendant's best interest?

"Michelle" <michelle9384@yahoo.com> wrote in message
news:44c52fca.0311212049.714caf8a@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message
news:<bplva8$1q6fos$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311201605.6dcc72ee@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message news:<bpiumr$1mjk87$1@ID-75195.news.uni-berlin.de>... > "Michelle" <michelle9384@yahoo.com> wrote in message > news:44c52fca.0311200849.3a2f5f26@posting.google.c om... > > Given the following case, can you respond to the questions that > > follow: A debtor defaults on debts owed to 11 creditors for a
total > > of $100,000, all debts being unsecured, the largest individual
debt > > being a $20,000 non-federally subsidized/guaranteed student loan,
the > > smallest being $5,000 credit card debt, the rest being credit
lines > > and credit cards of varying sizes. No fraud has been committed.
The > > debtor ordered two additional credit cards from ONE of the
debtor's > > credit card companies, in the name of two associates -- the two > > aforementioned credit cards in the name of two associates were > > activated but never used. > > > > 1) A collector calls from the card company that has issued three > > cards and asks for Debtor, Name of Associate #1 on card, or Name
of > > Associate #3 on card to call back. Can Associates #1 and #2 be
named > > in a lawsuit? > > Anybody can be named. > > > Do Associates #1 and #2 have any responsibility in any > > action, > > Not unless they used the card or signed a contract with the credit
card > issuer. > > > or can their credit be damaged without having their social > > security numbers? > > Unlikely. If a credit report is made, it will be invalid and
therefore can > be cleared. > > > 2) If court action is taken against Debtor for all 11 debts,
assume > > that judgments are granted. What is the subpoena/investigative > > authority of claimant creditors leading up to and after judgments
are > > granted in this case? Can they subpoena phone records,
investigate > > family members, etc.? > > Yes. > > McGyver Regarding your answer to Question 2, does that authority have to be granted by a judge or magistrate? What is the likelihood of these investigations actually taking place given the non-government funded expense against a maximum debt of a relatively mere $20,000? What would be the argument that those subpoenas should be granted to investigate phone records, interview relatives, etc., given that the original debts were all unsecured and the debtor ostensibly simply exercised lack of financial prudence? The subpoena powers of the parties are granted by statute. Usually that collection of laws can be found in the state's Civil Code or Code of
Civil Procedure, but states use different names. The subpoena powers are not granted by the judge or magistrate. The judge makes rulings in the
event of dispute. Usually there is no penalty for an initial failure to comply
with a discovery demand. The penalty arises after the responding party fails
to comply, the requesting party files a motion to compel, the judge grants
the motion, and the responding party still doesn't comply. It's hard to answer concerning the likelihood that the plaintiff will
spend money on discovery or investigation for a relatively small claim. Some will, some won't. Some might sue in pro per and will not be concerned
about attorney's fees. I don't know why the plaintiff would want phone
records or want to investigate family members, or why you would object. So all I
can say is that if the information sought is not crucial, the plaintiff is unlikely to investigate or use discovery to get it, and you are unlikely
to spend money objecting, in a small case. McGyver If you assume that in every case the defendant does not intend to dispute any of the debts, and seeks only to get default judgements, would there be any reason for a plaintiff to use discovery?

There are no such assumptions. Plaintiff's attorneys wait and see what
happens. After the defendant is served with a summons and complaint, there
is a short time to answer, usually 30 days. If an answer is not filed,
plaintiff can then expect that there will be a default judgment, and
wouldn't don't do discover until after judgment, if necessary. If an answer
is filed, plaintiff can expect that the defendant intends to contest the
case, and plaintiff would initiate discovery.

McGyver

"Michelle" <michelle9384@yahoo.com> wrote in message
news:44c52fca.0311231621.55096e99@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message
news:<bpqrjo$1sachu$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311212049.714caf8a@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message news:<bplva8$1q6fos$1@ID-75195.news.uni-berlin.de>... > "Michelle" <michelle9384@yahoo.com> wrote in message > news:44c52fca.0311201605.6dcc72ee@posting.google.c om... > > "McGyver" <Greyprof@msn.com> wrote in message news:<bpiumr$1mjk87$1@ID-75195.news.uni-berlin.de>... > > > "Michelle" <michelle9384@yahoo.com> wrote in message > > > news:44c52fca.0311200849.3a2f5f26@posting.google.c om... > > > > Given the following case, can you respond to the questions
that > > > > follow: A debtor defaults on debts owed to 11 creditors for a total > > > > of $100,000, all debts being unsecured, the largest individual debt > > > > being a $20,000 non-federally subsidized/guaranteed student
loan, the > > > > smallest being $5,000 credit card debt, the rest being credit lines > > > > and credit cards of varying sizes. No fraud has been
committed. The > > > > debtor ordered two additional credit cards from ONE of the debtor's > > > > credit card companies, in the name of two associates -- the
two > > > > aforementioned credit cards in the name of two associates were > > > > activated but never used. > > > > > > > > 1) A collector calls from the card company that has issued
three > > > > cards and asks for Debtor, Name of Associate #1 on card, or
Name of > > > > Associate #3 on card to call back. Can Associates #1 and #2
be named > > > > in a lawsuit? > > > > > > Anybody can be named. > > > > > > > Do Associates #1 and #2 have any responsibility in any > > > > action, > > > > > > Not unless they used the card or signed a contract with the
credit card > > > issuer. > > > > > > > or can their credit be damaged without having their social > > > > security numbers? > > > > > > Unlikely. If a credit report is made, it will be invalid and therefore can > > > be cleared. > > > > > > > 2) If court action is taken against Debtor for all 11 debts, assume > > > > that judgments are granted. What is the
subpoena/investigative > > > > authority of claimant creditors leading up to and after
judgments are > > > > granted in this case? Can they subpoena phone records, investigate > > > > family members, etc.? > > > > > > Yes. > > > > > > McGyver > > > > > > Regarding your answer to Question 2, does that authority have to
be > > granted by a judge or magistrate? What is the likelihood of these > > investigations actually taking place given the non-government
funded > > expense against a maximum debt of a relatively mere $20,000? What > > would be the argument that those subpoenas should be granted to > > investigate phone records, interview relatives, etc., given that
the > > original debts were all unsecured and the debtor ostensibly simply > > exercised lack of financial prudence? > > The subpoena powers of the parties are granted by statute. Usually
that > collection of laws can be found in the state's Civil Code or Code of Civil > Procedure, but states use different names. The subpoena powers are
not > granted by the judge or magistrate. The judge makes rulings in the event of > dispute. Usually there is no penalty for an initial failure to
comply with > a discovery demand. The penalty arises after the responding party
fails to > comply, the requesting party files a motion to compel, the judge
grants the > motion, and the responding party still doesn't comply. > > It's hard to answer concerning the likelihood that the plaintiff
will spend > money on discovery or investigation for a relatively small claim.
Some > will, some won't. Some might sue in pro per and will not be
concerned about > attorney's fees. I don't know why the plaintiff would want phone records or > want to investigate family members, or why you would object. So all
I can > say is that if the information sought is not crucial, the plaintiff
is > unlikely to investigate or use discovery to get it, and you are
unlikely to > spend money objecting, in a small case. > > McGyver If you assume that in every case the defendant does not intend to dispute any of the debts, and seeks only to get default judgements, would there be any reason for a plaintiff to use discovery? There are no such assumptions. Plaintiff's attorneys wait and see what happens. After the defendant is served with a summons and complaint,
there is a short time to answer, usually 30 days. If an answer is not filed, plaintiff can then expect that there will be a default judgment, and wouldn't don't do discover until after judgment, if necessary. If an
answer is filed, plaintiff can expect that the defendant intends to contest the case, and plaintiff would initiate discovery. McGyver This whole time the plaintiff's counsel is waiting to see what happens, as you say, plaintiff is aware there is a risk that defendant will declare bankruptcy expunging this debt. Is it logical for a company to commit discovery resources for a maximum (albeit totally unlikely) payoff of $20,000 when there is a high risk that a non-income producing, assetless defendant will declare bankruptcy when defendant feels it is in defendant's best interest?

You are agonizing over this to an extraordinary degree. My answer said, in
short, don't worry about discovery in a small default case until after
judgment. And yet you keep asking the question, with added wrinkles. Why
are you so greatly worried about discovery? Tell us the facts and we can
advise. I think you are finding out how hard it is to get useful answers
when you keep the questions hypothetical. But anyway, here's another
answer. If a plaintiff is going to be concerned with the bankruptcy
possibility, the time to make a decision on that point is before filing
suit. If a plaintiff files suit, the plaintiff is unlikely to be concerned
about the possibility of defendant's bankruptcy until it happens. Discovery
decisions won't be made on the basis of that factor.

I could be totally wrong, but my instinct is telling me that you are worried
about some disaster that could result from discovery, which I will probably
tell you is nothing to worry about. But I can't deal with your secret fear
if you don't tell me what it is.

McGyver

"McGyver" <Greyprof@msn.com> wrote in message news:<bpth15$1rv2fb$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311231621.55096e99@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message news:<bpqrjo$1sachu$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311212049.714caf8a@posting.google.c om... > "McGyver" <Greyprof@msn.com> wrote in message news:<bplva8$1q6fos$1@ID-75195.news.uni-berlin.de>... > > "Michelle" <michelle9384@yahoo.com> wrote in message > > news:44c52fca.0311201605.6dcc72ee@posting.google.c om... > > > "McGyver" <Greyprof@msn.com> wrote in message news:<bpiumr$1mjk87$1@ID-75195.news.uni-berlin.de>... > > > > "Michelle" <michelle9384@yahoo.com> wrote in message > > > > news:44c52fca.0311200849.3a2f5f26@posting.google.c om... > > > > > Given the following case, can you respond to the questions that > > > > > follow: A debtor defaults on debts owed to 11 creditors for a total > > > > > of $100,000, all debts being unsecured, the largest individual debt > > > > > being a $20,000 non-federally subsidized/guaranteed student loan, the > > > > > smallest being $5,000 credit card debt, the rest being credit lines > > > > > and credit cards of varying sizes. No fraud has been committed. The > > > > > debtor ordered two additional credit cards from ONE of the debtor's > > > > > credit card companies, in the name of two associates -- the two > > > > > aforementioned credit cards in the name of two associates were > > > > > activated but never used. > > > > > > > > > > 1) A collector calls from the card company that has issued three > > > > > cards and asks for Debtor, Name of Associate #1 on card, or Name of > > > > > Associate #3 on card to call back. Can Associates #1 and #2 be named > > > > > in a lawsuit? > > > > > > > > Anybody can be named. > > > > > > > > > Do Associates #1 and #2 have any responsibility in any > > > > > action, > > > > > > > > Not unless they used the card or signed a contract with the credit card > > > > issuer. > > > > > > > > > or can their credit be damaged without having their social > > > > > security numbers? > > > > > > > > Unlikely. If a credit report is made, it will be invalid and therefore can > > > > be cleared. > > > > > > > > > 2) If court action is taken against Debtor for all 11 debts, assume > > > > > that judgments are granted. What is the subpoena/investigative > > > > > authority of claimant creditors leading up to and after judgments are > > > > > granted in this case? Can they subpoena phone records, investigate > > > > > family members, etc.? > > > > > > > > Yes. > > > > > > > > McGyver > > > > > > > > > Regarding your answer to Question 2, does that authority have to be > > > granted by a judge or magistrate? What is the likelihood of these > > > investigations actually taking place given the non-government funded > > > expense against a maximum debt of a relatively mere $20,000? What > > > would be the argument that those subpoenas should be granted to > > > investigate phone records, interview relatives, etc., given that the > > > original debts were all unsecured and the debtor ostensibly simply > > > exercised lack of financial prudence? > > > > The subpoena powers of the parties are granted by statute. Usually that > > collection of laws can be found in the state's Civil Code or Code of Civil > > Procedure, but states use different names. The subpoena powers are not > > granted by the judge or magistrate. The judge makes rulings in the event of > > dispute. Usually there is no penalty for an initial failure to comply with > > a discovery demand. The penalty arises after the responding party fails to > > comply, the requesting party files a motion to compel, the judge grants the > > motion, and the responding party still doesn't comply. > > > > It's hard to answer concerning the likelihood that the plaintiff will spend > > money on discovery or investigation for a relatively small claim. Some > > will, some won't. Some might sue in pro per and will not be concerned about > > attorney's fees. I don't know why the plaintiff would want phone records or > > want to investigate family members, or why you would object. So all I can > > say is that if the information sought is not crucial, the plaintiff is > > unlikely to investigate or use discovery to get it, and you are unlikely to > > spend money objecting, in a small case. > > > > McGyver > > If you assume that in every case the defendant does not intend to > dispute any of the debts, and seeks only to get default judgements, > would there be any reason for a plaintiff to use discovery? There are no such assumptions. Plaintiff's attorneys wait and see what happens. After the defendant is served with a summons and complaint, there is a short time to answer, usually 30 days. If an answer is not filed, plaintiff can then expect that there will be a default judgment, and wouldn't don't do discover until after judgment, if necessary. If an answer is filed, plaintiff can expect that the defendant intends to contest the case, and plaintiff would initiate discovery. McGyver This whole time the plaintiff's counsel is waiting to see what happens, as you say, plaintiff is aware there is a risk that defendant will declare bankruptcy expunging this debt. Is it logical for a company to commit discovery resources for a maximum (albeit totally unlikely) payoff of $20,000 when there is a high risk that a non-income producing, assetless defendant will declare bankruptcy when defendant feels it is in defendant's best interest? You are agonizing over this to an extraordinary degree. My answer said, in short, don't worry about discovery in a small default case until after judgment. And yet you keep asking the question, with added wrinkles. Why are you so greatly worried about discovery? Tell us the facts and we can advise. I think you are finding out how hard it is to get useful answers when you keep the questions hypothetical. But anyway, here's another answer. If a plaintiff is going to be concerned with the bankruptcy possibility, the time to make a decision on that point is before filing suit. If a plaintiff files suit, the plaintiff is unlikely to be concerned about the possibility of defendant's bankruptcy until it happens. Discovery decisions won't be made on the basis of that factor. I could be totally wrong, but my instinct is telling me that you are worried about some disaster that could result from discovery, which I will probably tell you is nothing to worry about. But I can't deal with your secret fear if you don't tell me what it is. McGyver

This IS a hypothetical. It is also absolutely not a waste of time to
me, if that be your conclusion, as I find the subject terribly
interesting. I am trying to be as specific as possible. Garnishing
wages, superficially searching for and seizing of real assets owned or
transferred to loved ones makes sense and is not fascinating, but
predictable. However, the idea that a small default case can lead to
discovery involving live interrogation/depositions of family members,
subpoena of phone records, bank statements, etc., is fascinating. I
think that must be part of the reason credit card company margins are
so small -- i.e., they make seemingly illogical business decisions to
expend resources pursuing small and unlikely payoffs. (Moreover, bad
debts are part of that business; in fact, those businesses wouldn't
exist if it weren't for bad debts.) Nonetheless, I understand the
picture is larger than that; they must make an example of some cases,
otherwise a particular hypothetical creditor X could get a reputation
for being easy on bad debtors. So, if you please, let it be known
that I truly appreciate the valuable, knowledgeable and experienced
posts in response to these queries.

Lastly, it seems there are no laymen books on these matters. Rather,
there is a glut of bankruptcy books -- those books deal not with the
effects of judgments and likely pursuits of creditors who hold bad
debts, but rather merely deal with when to choose to and how to go
about the declaration of bankruptcy. If there are books on the other
matters above, please do inform of their titles, as it would be much
appreciated.

Much obliged,
Michelle

"Michelle" <michelle9384@yahoo.com> wrote in message
news:44c52fca.0311251224.3b1661d7@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message
news:<bpth15$1rv2fb$1@ID-75195.news.uni-berlin.de>... "Michelle" <michelle9384@yahoo.com> wrote in message news:44c52fca.0311231621.55096e99@posting.google.c om... "McGyver" <Greyprof@msn.com> wrote in message news:<bpqrjo$1sachu$1@ID-75195.news.uni-berlin.de>... > "Michelle" <michelle9384@yahoo.com> wrote in message > news:44c52fca.0311212049.714caf8a@posting.google.c om... > > "McGyver" <Greyprof@msn.com> wrote in message news:<bplva8$1q6fos$1@ID-75195.news.uni-berlin.de>... > > > "Michelle" <michelle9384@yahoo.com> wrote in message > > > news:44c52fca.0311201605.6dcc72ee@posting.google.c om... > > > > "McGyver" <Greyprof@msn.com> wrote in message news:<bpiumr$1mjk87$1@ID-75195.news.uni-berlin.de>... > > > > > "Michelle" <michelle9384@yahoo.com> wrote in message > > > > > news:44c52fca.0311200849.3a2f5f26@posting.google.c om... > > > > > > Given the following case, can you respond to the questions that > > > > > > follow: A debtor defaults on debts owed to 11 creditors
for a total > > > > > > of $100,000, all debts being unsecured, the largest
individual debt > > > > > > being a $20,000 non-federally subsidized/guaranteed
student loan, the > > > > > > smallest being $5,000 credit card debt, the rest being
credit lines > > > > > > and credit cards of varying sizes. No fraud has been committed. The > > > > > > debtor ordered two additional credit cards from ONE of the debtor's > > > > > > credit card companies, in the name of two associates --
the two > > > > > > aforementioned credit cards in the name of two associates
were > > > > > > activated but never used. > > > > > > > > > > > > 1) A collector calls from the card company that has
issued three > > > > > > cards and asks for Debtor, Name of Associate #1 on card,
or Name of > > > > > > Associate #3 on card to call back. Can Associates #1 and
#2 be named > > > > > > in a lawsuit? > > > > > > > > > > Anybody can be named. > > > > > > > > > > > Do Associates #1 and #2 have any responsibility in any > > > > > > action, > > > > > > > > > > Not unless they used the card or signed a contract with the credit card > > > > > issuer. > > > > > > > > > > > or can their credit be damaged without having their social > > > > > > security numbers? > > > > > > > > > > Unlikely. If a credit report is made, it will be invalid
and > therefore > can > > > > > be cleared. > > > > > > > > > > > 2) If court action is taken against Debtor for all 11
debts, assume > > > > > > that judgments are granted. What is the subpoena/investigative > > > > > > authority of claimant creditors leading up to and after judgments are > > > > > > granted in this case? Can they subpoena phone records, investigate > > > > > > family members, etc.? > > > > > > > > > > Yes. > > > > > > > > > > McGyver > > > > > > > > > > > > Regarding your answer to Question 2, does that authority have
to be > > > > granted by a judge or magistrate? What is the likelihood of
these > > > > investigations actually taking place given the non-government funded > > > > expense against a maximum debt of a relatively mere $20,000?
What > > > > would be the argument that those subpoenas should be granted
to > > > > investigate phone records, interview relatives, etc., given
that the > > > > original debts were all unsecured and the debtor ostensibly
simply > > > > exercised lack of financial prudence? > > > > > > The subpoena powers of the parties are granted by statute.
Usually that > > > collection of laws can be found in the state's Civil Code or
Code of Civil > > > Procedure, but states use different names. The subpoena powers
are not > > > granted by the judge or magistrate. The judge makes rulings in
the event of > > > dispute. Usually there is no penalty for an initial failure to comply with > > > a discovery demand. The penalty arises after the responding
party fails to > > > comply, the requesting party files a motion to compel, the judge grants the > > > motion, and the responding party still doesn't comply. > > > > > > It's hard to answer concerning the likelihood that the plaintiff will spend > > > money on discovery or investigation for a relatively small
claim. Some > > > will, some won't. Some might sue in pro per and will not be concerned about > > > attorney's fees. I don't know why the plaintiff would want
phone records or > > > want to investigate family members, or why you would object. So
all I can > > > say is that if the information sought is not crucial, the
plaintiff is > > > unlikely to investigate or use discovery to get it, and you are unlikely to > > > spend money objecting, in a small case. > > > > > > McGyver > > > > If you assume that in every case the defendant does not intend to > > dispute any of the debts, and seeks only to get default
judgements, > > would there be any reason for a plaintiff to use discovery? > > There are no such assumptions. Plaintiff's attorneys wait and see
what > happens. After the defendant is served with a summons and
complaint, there > is a short time to answer, usually 30 days. If an answer is not
filed, > plaintiff can then expect that there will be a default judgment, and > wouldn't don't do discover until after judgment, if necessary. If
an answer > is filed, plaintiff can expect that the defendant intends to contest
the > case, and plaintiff would initiate discovery. > > McGyver This whole time the plaintiff's counsel is waiting to see what happens, as you say, plaintiff is aware there is a risk that defendant will declare bankruptcy expunging this debt. Is it logical for a company to commit discovery resources for a maximum (albeit totally unlikely) payoff of $20,000 when there is a high risk that a non-income producing, assetless defendant will declare bankruptcy when defendant feels it is in defendant's best interest? You are agonizing over this to an extraordinary degree. My answer said,
in short, don't worry about discovery in a small default case until after judgment. And yet you keep asking the question, with added wrinkles.
Why are you so greatly worried about discovery? Tell us the facts and we
can advise. I think you are finding out how hard it is to get useful
answers when you keep the questions hypothetical. But anyway, here's another answer. If a plaintiff is going to be concerned with the bankruptcy possibility, the time to make a decision on that point is before filing suit. If a plaintiff files suit, the plaintiff is unlikely to be
concerned about the possibility of defendant's bankruptcy until it happens.
Discovery decisions won't be made on the basis of that factor. I could be totally wrong, but my instinct is telling me that you are
worried about some disaster that could result from discovery, which I will
probably tell you is nothing to worry about. But I can't deal with your secret
fear if you don't tell me what it is. McGyver This IS a hypothetical. It is also absolutely not a waste of time to me, if that be your conclusion, as I find the subject terribly interesting. I am trying to be as specific as possible. Garnishing wages, superficially searching for and seizing of real assets owned or transferred to loved ones makes sense and is not fascinating, but predictable. However, the idea that a small default case can lead to discovery involving live interrogation/depositions of family members, subpoena of phone records, bank statements, etc., is fascinating. I think that must be part of the reason credit card company margins are so small -- i.e., they make seemingly illogical business decisions to expend resources pursuing small and unlikely payoffs. (Moreover, bad debts are part of that business; in fact, those businesses wouldn't exist if it weren't for bad debts.) Nonetheless, I understand the picture is larger than that; they must make an example of some cases, otherwise a particular hypothetical creditor X could get a reputation for being easy on bad debtors. So, if you please, let it be known that I truly appreciate the valuable, knowledgeable and experienced posts in response to these queries. Lastly, it seems there are no laymen books on these matters. Rather, there is a glut of bankruptcy books -- those books deal not with the effects of judgments and likely pursuits of creditors who hold bad debts, but rather merely deal with when to choose to and how to go about the declaration of bankruptcy. If there are books on the other matters above, please do inform of their titles, as it would be much appreciated. Much obliged, Michelle

There are books on two of your subjects, out of three. On the subject of
discovery, including who can be deposed and who can be required to respond
to interrogatories, see: "Rutter: Civil Procedure Before Trial." On the
subject of collection of judgments and the various discovery avenues after
judgment, see: "Rutter: Enforcement of Judgments." Those are California
practice guides. Other states will have practice guides with different
names. I don't know of any book on the topic of what plaintiffs are likely
to do, but there probably are some. It seems to me that on that topic,
asking questions in newsgroups is a good research method.

McGyver