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Commonwealth Financial Letter on Time-Barred Debt FDCPA Class Action

Papers on Clipboard Saying "Debt Collection"

Congress passed the Fair Debt Collection Practices Act (FDCPA) to try to put an end to unfair or abusive collection practices by third-party collectors of consumer debts. The complaint for this class action alleges that Commonwealth Financial Systems, Inc. (CFS) and Pendrick Capital Partners II, LLC violate that law by not making clear that any payment on a “stale” or time-barred debt can restart the statute of limitations on that debt. 

The class for this action is

  • All individuals with addresses in Florida
  • To Whom CFS sent a collection letter trying to collect a consumer debt
  • On behalf of Pendrick,
  • Falsely stating that a partial payment “may” restart the statute of limitations,
  • Which letter was sent between December 24, 2018 and January 14, 2020.

The FDCPA requires that certain information be given to consumers about their debts and it forbids third-party debt collectors from giving false or misleading information. Among other things, consumers are supposed to have all relevant information so that they can make the best decisions possible about their debts and payments on those debts. 

In this case, plaintiff Jimmille Henderson allegedly incurred a debt to Emergency Physicians of Center Florida. The debt was a consumer debt, since it was incurred for personal, family, or household purposes. 

At some point the debt was assigned to CFS for collection. CFS sent Henderson a collection letter dated February 20, 2019, attempting to collect on the debt. At that time, the debt had become “stale,” or time-barred, meaning that the company could no longer sue Henderson to obtain payment. 

On this subject, the letter read, “The legal time limit (statute of limitations) for suing to collect this debt has expired, you may choose to make payments on the debt. Be aware: if you make a payment on the debt, admit to owing the debt, promise to pay the debt, or waive the statute of limitations on the debt, the time period in which the debt is enforceable may start again.”

According to the complaint, this is false. “Under Florida law…, the statute of limitation can only be revived by a written, signed statement.” Those who sent the letter therefore “made deceptive and misleading representations” when they stated that the statute of limitations could be restarted with just a partial payment.

The two counts pertain to the FDCPA. Count I is that debt collectors “may not use any false, deceptive, or misleading representation or means in connection with the collection of the debt.” Count II is that debt collectors “may not use any unfair or unconscionable means in connection with the collection of a debt.”

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