PLATINUM FINANCIAL SERVICES DEFAULT JUDGMENT

A consumer contacted us after he realized that a default judgment had been obtained against him by Platinum Financial Services, a debt buyer. Platinum Financial retained the debt collection law firm of Houslanger and Associates to enforce on the judgment by finding the consumer’s employer so they could garnish his wages or levy his bank account. Houslanger did find his bank account and a small amount of funds were levied. The consumer was confused as he was never served with a lawsuit to begin with and never knew that there was an action in court against him. He also did not understand how a judgment that was 11 years old could be enforced on as he pleaded that the statute of limitations had passed. The statute of limitations argument is a common one that we hear and is usually misinterpreted.

The statute of limitations to sue a consumer on a debt matter is 6 years in New York. However, our client had already been sued and a default judgment was obtained against him, so the 6-year SOL would not be helpful unless the judgment was vacated, and the expired SOL submitted as an affirmative defense in the re-opened action. The statute of limitations on consumer debt judgments in New York is 10 years and can be renewed for an additional 10 years giving creditors the ability to enforce on a judgment for a total of 20 years. The renewal of judgments is often not completed or done inappropriately which can lead to dismissal of the debt but few consumers and attorneys review whether the judgment was properly renewed. In this matter, the judgment was actually properly renewed after the initial decade but Houslanger and Associates knew that our client was improperly served with the original lawsuit, so they agreed to vacate the judgment against our and offered to settle the matter for about 80% off of the total amount.