3rd Circuit Rules Lawyer Violated Fair Debt Collection Practices Act

KAYMARK v. Bank of America, NA, Court of Appeals, 3rd Circuit 2015 – Google Scholar.

This is a case filed under the fair debt collection practices act. An attorney, acting on behalf of Bank of America, filed a foreclosure lawsuit against Kaymark. Kaymark brought a claim against the attorney and other parties under the FDCPA alleging that the lawyer violated the Act by seeking recovery of legal fees that had not as of yet been incurred.

This is the court’s discussion of the allegation:

“Kaymark alleges that the $1,650 in attorneys’ fees, $325 in title report fees, and $75 in property inspection fees (or $2,050 total) were not actually incurred as of July 12, two months before the foreclosure action was filed on September 13.Kaymark also alleges that the fees were improperly calculated on a fixed basis. Appellees retort that fixed fees are contemplated under the FNMA servicing guide, which sets the maximum foreclosure fee, or cap, for attorneys’ fees at $1,650. SeeApp. 85a-86a.”

The 3rd circuit held that those allegations were a misrepresentation and were sufficient to state a claim under the FDCPA.

FDCPA litigation is conducted on the basis of very technical violations of the statute. Here, there was no allegation that Kaymark actually had to pay the legal fees or that he suffered any real harm.

In sum, another inadvertent scrivener’s error has provided the foundation for an FDCPA lawsuit.

Edward X. Clinton, Jr.