How to Get Legally Financially Screwed? - Legal Question

Okay, stick with me… this may take a little explaining.

I recently viewed all three of my credit reports and was dismayed to find out that there was a $3000 outstanding court ruling against me. Thinking back and asking around, I came up with the following:

Several years ago, with the help of a friend (we’ll call him Nick since that’s his name), I started up a single-owner business. Nick acted as a consultant and accountant for me, but never was an employee. He also had a business on the side, building computers and often helped me by providing me with funds for my business.

One time, he build a computer for a college guy for about $3000. Nick wanted to give me the money to help fund my business, so he signed the check over to me, and I cashed it in my business’ name. However, it became apparent that Nick’s customer was not satisfied with the computer and eventually wanted a refund. Nick refused to do this on the basis that all sales were final. There’s more to that portion of the story, but I don’t think it’s relevant here.

At the end, the customer decided to sue Nick, but was unable to do so since Nick didn’t have any listed address and was unable to serve him. Frustrated with this turn of events, the customer turned and sued me, on the basis that I cashed the check and therefore was responsible for the sale of the computer. I would have disagreed on the idea that I never entered into a contract with him, either verbal or written. In fact, I have never met the guy.

Well, by this time, my business license had expired, and I was 500 miles away at college. The sherriff ended up personally delivering papers to my grandfather, who never told me about them under the assumption that since I wasn’t phsyically served, no case could be brought against me.

Apparently the fact that it was served to a family member was good enough. The case was brought against me and since I didn’t know about it and I was away at college, I never showed up. Because of this, the ruling was automatically in favor of the plaintiff for the full amount.

Nick’s customer got his money from the state (California, BTW) and an outstanding balance was placed on one of my credit reports. It has not even been attempted to be collected; I have never been notified of the details of the ruling. I’m guessing that the customer is happy and the $3000 has been well spent, as well as getting to keep the computer.

IMO, I was in no way legally responsible for this problem, so I would like to go about getting this decision either reversed or removed from my credit report. Obviously, Nick’s customer is not going to give up the money and the computer (a pentium 66 system) is nowhere near $3000 now, even if he did have it and could return it. The clerk at the county that I talked to said that since I was served (via my grandfather) and since I did not show up, I was guilty. I would not be able to appeal it or anything of the sort.

So, I turn here, to the SDMB, for your help. Is there a way for me to get out of this mess?

Epilogue before the credits role: I broke my friendship off with Nick, for various reasons that I will not go into here. Last I heard, he was still moving from friend’s house to friend’s house, while preaching at a Greek Orthodox church, living of what little money they pay him. I hope that I never see him again.

I hate to say it but I think your SOL. Serving notice to a family member is allowed. You missed your court date, plaintiff wins. No luck there. Even if you could appeal such a thing I’d imagine the filing period for an appeal has LONG since passed.

You may try counter-suing the guy who took you for $3,000 but that may not be worth it even if it could work.

The best I can say is to dispute the claim on your credit record. There are books on this stuff you might want to check out. There are a variety of technicalities to remove items from a credit report.

One last thing…how the hell did the guy collect $3,000 from the State of California? Since when did states start paying on other people’s debts only to act as a collection agency on their behalf (and apparently not a very good collection agency at that)? Nice waste of taxpayer money…

The clerk I talked to said that there was no appeal. But I keep thinking that there has to be a way to fix this. I’m assuming, of course, that I wouldn’t have had to pay should I have actually shown up in court. Based on the information, what do you think? Would I have been found financially responsible?

If I wasn’t, I keep thinking that this was a miscarriage of justice… of course there are a lot worse problems out there, but I have a hard time paying someone money for something that I was in no way responsible. My mind starts churning about ways that this could be used to take advantage of other people.

I can’t prove to you that he did recieve the money. The clerk I talked to said that that is what would have happened. As to how reliable the clerk was, I do not know. The clerk didn’t tell me that he defintely did get the money: I might be a little happier if I knew he didn’t.

I frankly have no plans to pay it off. I’ve already paid off one of Nick’s other problems that somehow got on my credit report (I cosigned for a cellular phone that he bought on credit… silly me).

I think the best you can hope for is to write a letter to be placed with your credit file. Then I would have a nice long talk with grandpa.

No, there aren’t. The credit agencies work for credit grantors, not you. Only the credit grantor can remove an item from a credit report. In Skott’s case, the item in question is a public record (judgement). The only way to remove this type item is to have the public record changed and re-reported. Not bloody likely.

As a consumer you have the right to append a message to the credit report explaining why you think the entry is wrong.

What the law is regarding cases like this differs from state to state and depends on the law in the state where the judgment was entered. In Ohio for example, you could attempt a Civil Rule 60(B) motion, which allows relief from a final order or judgment for mistake, inadvertence, surprise or excusable neglect or any other reason justifying relief from the judgment. While generally Courts are reluctant to reopen closed cases, it might be worth a shot. Good luck.

On behalf of all the lawyers on the board: If you have a legal question, the first thing you should tell us is what state you are in. Laws usually differ. Civil procedure technicalities are always different from state to state.

If you happen to be in Illinois, I could give you a great answer to your question. As it would be useless to you if you aren’t in Illinois, I’m not going to do so, as it would be(probably) a waste of time.

I will say this, though. Getting legal advice from court clerks is something you should avoid. That *doesn’t *vary from state to state.

Yes and no. On the whole Dr. J is correct and cleaning your credit record can be a bitch. If it were easy to clear it would negate the usefulness of the credit reporting agencies. I had to write three separate letters to have TRW (I think…it was awhile ago now) mark an unpaid bill as paid (which still left it on my record but creditors are happier to see it was eventually paid in full).

Still, there are certain things a credit grantor must do if they want the mark on your record to stick. For instance, if they never tried to collect on the debt then I believe the record may be cleared. For example, I lend you $100 which you say you will pay back. Five years later I think, “Hey, Dr. J never paid me back! I’m gonna screw his credit record!” Obviously this is oversimplified (TRW and the other agencies wouldn’t even talk to me IRL). Still, it illustrates that creditors just can’t willie-nillie mark up your credit report. They certainly hold most of the cards but us regular schmos still have a few rights left.

I agree you got screwed. IANAL but it sure seems as if they would have lost had you been there to fight the case. Basically your friend skipped one part by not cashing the check himself and then paying you. If this was the case then there is absolutely no way the plaintiff would have even known you existed. I don’t see how Nick signing the check to you makes any difference.

Random, I read it to mean it was in California.

I’m pretty sure that I mentioned that I was in California, although maybe in an offhand manner. Sorry for any confusion.

>> the first thing you should tell us is what state you are in.
In a state of utter desperation?

Okay, so to bring this up again… I found out that although I was approved for a car loan, I can’t go through with it until this judgement has been paid off. That is, I have to pay the $3015 (the CU officer let me know the exact amount) to the county. With my car on its way (I ordered it), I’m really starting to get towards the end of my rope.

There’s absolutely nothing I can do?

I can’t contest it, right? I was “legally” served and even if I wasn’t, it’s been to long ago (3/96) to do anything about.

Can I sue the guy sued me? Is that at all possible? Is there anyway way out of this… Sonoma County, California… judgement? Anything I can do?

Either way, I guess I have to pay for now, right? Shit.

Maybe desperation is right.

skott: i really now don’t understand. Why do you owe the COUNTY? And, why do you think that paying this judgement off will help your credit report? (it usually won’t- in fact, it could make it worse). Spell it out for us, there is a judgement against you, reported by the County, but in FAVOR of a private individual, right? So, you owe nothing to the County, and the County will remove the judgement from your record if you satisfy the judgement, or will it still stay on, but notated as “satisfied”? How long ago was this? If the County will take off the judgement, if the J is satisfied, all you gotta do is get the guy you owe the money to, to agree that he is 'satisfied", and all is hunkey dory. So, go to him, explain the situation, and make the following offer: you will pay him amount “X” ($500?) in complete settlement of the Judgement, if he agrees he is satisfied, and so informs the County. Otherwise, you will be forced to sue HIM in small claims court, and then he cannot win (he, at best, could break even, or you could win, so you owe 0). Based on those alternatives (and ya gotta be nice here, be diplomatic), I cannot imagine the guy not leaping at a chance to turn a worthless judgement into a fast $500.

Yes, I see the California reference now in the OP. Guess I read it too quickly. I have no idea what the time limits are for vacating a judgment in California. Almost certainly you are too late, though. Assuming valid service, the limit would be 2 years in Illinois.

As it was explained to me, the plaintiff was paid by the county after the judgement. The county would then collect from me the full amount. However, as noted above court clerks aren’t always accurate, so I will be looking into this further, based on your suggestions.

Well, because I applied for a car loan and was told that I would rejected if I had not taken care of this judgement on my credit report. I don’t see how taking care of it would make my credit worse.

The judgement was in March of 1996.

I hope this is true… I will have to research it to see whether I have this option. Thank you for your advice!

Skott, this makes no sense to me and I strongly suspect you are quite confused. I cannot imagine the county would pay off the plaintiff on your behalf and I think most probably you’ve got it all mixed upand need to see an attorney IRL. Whatever you get here is pretty much worthless opinions based on worthless information. It seems to me you would do well to go and tell your story to a real lawyer. He can probably ask you the right questions to get the facts straight and then give you sound advice. Here you are wasting your time. Just MHO.

I speculate that the county sheriff has been empowered to collect the debt from the defendant. At that time, the county will pay the plaintiff (less the sheriff’s collection fee).

Municipalities don’t pay plaintiffs from their own funds. How could they budget for this? If municipalities really paid plaintiffs, can you imagine the flood of lawsuits by con-men??? All you would need is an accomplice (posing as a family member) to accept the summons.