This alleged debt stemmed from the repossession of a car that our client had from about 2004. In these scenarios the car is sold at auction and then the owner is responsible for whatever the deficiency balance is. Credit Acceptance Corporation, a debt buyer, bought this particular debt and decided to sue our client. They retained Stephen Einstein & Associates to sue and obtain a judgment against our client. Stephen Einstein & Associates were able to obtain a default judgment against our client for approximately $17,000.
The default judgment was obtained in this case because our client moved out of New York into Maryland. Thus, when he was sued, he had no actual notice of the lawsuit or that a judgment was being enforced against him. The client did have a New York bank account which was frozen almost 10 years later which is why he contacted Lebedin Kofman LLP.
We immediately spoke with the General Counsel of Credit Acceptance who had Stephen Einstein contact us and agree to vacate the judgment against our client as they knew we would file a motion to vacate under CPLR 317 and 5015. The debt itself had accrued to about $24,000 at this point but we were able to achieve an out-of-court settlement for $4,500 to have the case discontinued with prejudice.