Though judgments are generally valid for years, failing to renew a judgment properly is one of the easiest ways to turn a collectible account into an uncollectible one. A recently decided case by the Ninth Circuit Court of Appeals provided a stark reminder that there is no room for error in the process when it comes to renewing judgments.
In Miller v. Crisis Collection Mgmt., 22-16819 (9th Cir. Nov 20, 2023), a debt collector obtained a judgment against a consumer in 1997 and allegedly renewed it in 2003, 2009, 2015, and 2021. In 2022, the consumer filed a class action against the debt collector, claiming the debt collector failed to follow specific mailing and timing requirements necessary to renew the judgment and had made the same mistakes regarding the judgments of other consumers.
Specifically, the consumer alleged that because the debt collector mailed the affidavit associated with the 2009 renewal too early, the right to renew the judgment was forfeited. In response, the debt collector moved to dismiss the complaint, arguing that the statute governing renewals does not prohibit early mailing. The District Court agreed with the debt collector. It dismissed the action, reasoning, “It would be absurd to punish defendants for being too diligent in notifying [the consumer] of the renewal.”
The consumer appealed, and the Ninth Circuit disagreed with the District Court’s decision. The Nevada law at issue states that notice of the renewed judgment must be mailed to the consumer “within 3 days after filing the affidavit.” The Ninth Circuit reasoned that reading the statute to allow an early mailing would render parts of the phrase “within 3 days after filing the affidavit” superfluous; thus, mailing the affidavit early invalidated the 2009 judgment renewal.
This case illustrates how difficult it can be to comply with the minutia in varying state laws. It can feel overwhelming to create policies and procedures that address accounts and consumers nationwide. When it comes to judgment renewals, mistakes can be costly, and this case is an excellent reminder to check and recheck judgment renewal policies and ensure your vendors that renew judgments are doing the same.
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