Defense 2: Identity Theft or Mistaken Identity
These defenses apply when you believe that the debt for which you are being sued is not your debt. Identity theft occurs when somebody steals your name and personal information and opens up credit accounts in your name. Mistaken identity occurs when you have been confused with somebody else who has a similar name or other identifying information. Remember that the burden of proof is on the plaintiff to establish that you made or authorized each and every charge. You do not have to prove that the debt is not yours. NEVER agree to a settlement if you are a victim of identity theft or mistaken identity.
Defense 3: Statute of Limitations
A statute of limitations is a time limit that a creditor has to file a lawsuit against you. It runs from approximately the last time you made a payment. In New York, the statute of limitations on a credit card debt is six years, and the statute of limitations on an auto loan or store card (like a Sears card) is four years. If it has been more than six years since you paid your credit card debt (or more than four years since you made a car payment), the statute of limitations on that debt has expired. The statute of limitations is an absolute defense -- the court must dismiss a case if the debt is past the statute of limitations. Any payment, no matter how small, can reset the statute of limitations. To be safe, NEVER make a payment if you want to assert the statute of limitations as a defense.
Defense 4: You Were Only an Authorized User
This defense may apply if you are being sued for a card that you shared with someone else. The defense hinges on the difference between a cosigner and an authorized user. If another person gave you permission to use his or her card, and you never agreed to be responsible for paying for that card, you were an authorized user. As an authorized user, you cannot be held responsible for that credit card debt. However, if you signed a credit card agreement in which you agreed to be jointly responsible with someone else for a credit card, you are a cosigner, and this defense does not apply to you. As a cosigner, you can be held responsible for the debt, even if none of the charges were yours.
Defense 5: Payment
If you have paid all or a part of the debt, and you believe you have not been credited for the payment, you can raise the defense of payment.
Defense 6: Dispute the Amount of the Debt
If you believe that the amount of the debt is incorrect, you have the right to dispute it. Remember that the plaintiff has the burden to prove that you owe the amount for which you have been sued. The plaintiff must prove that the principal, interest, collection costs, and attorneys fees are all correct, agreed to in your contract, and lawfully charged. You always have the right to insist that the plaintiff come up with your original contract, account statements, and even purchase receipts, to prove the amount of the debt.
Defense 7: No Business Relationship with the Plaintiff (lack of standing)
This is a defense that applies when the plaintiff is a debt buyer, not your original creditor. Because you never signed a contract directly with the debt buyer, you have the right to challenge the debt buyer's right to sue you (also known as "standing"). The plaintiff will not be able to prevail unless it can prove to the court that it owns your debt. To do this, the debt buyer will have to produce a contract of sale (also known as an "assignment") that mentions your debt specifically. If the debt buyer bought your debt from another debt buyer, it has to provide a chain of assignments going all the way back to the original creditor. If the debt buyer cannot or will not provide these documents, the court must dismiss the case.
Defense 8: The Plaintiff Is Not A Licensed Debt Collector
This is a defense that applies when the plaintiff is a debt buyer, not your original creditor. All debt collectors working in New York City must have a license from the NYC Department of Consumer Affairs. At the DCA website, you can perform an instant license check, to see whether the debt buyer plaintiff in your case is licensed. If not, the court should dismiss the case.
Defense 9: The Complaint Does Not Contain A License Number
This is a defense that applies when the plaintiff is a debt buyer, not your original creditor. This defense is very similar to Defense 8 above. Every licensed debt collector is required to write its license number in the complaint. If the debt buyer fails to write the license number in the complaint, the complaint should be dismissed. However, the court may allow the debt buyer to amend the complaint to include a license number.
Defense 10: Bankruptcy
If you previously declared bankruptcy, and the debt for which you are being sued was discharged as part of that bankruptcy proceeding, you do not owe it anymore. Bankruptcy is an absolute defense to a debt collection lawsuit.
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Defense 11: Collateral Was Not Sold at a Commercially Reasonable Price
This is a special defense that applies in auto loan cases. When you default on an auto loan, the bank will usually repossess the car and sell it -- often for far less than the value of the car. When the proceeds of the sale do not cover the entire auto loan, the bank may sue you for the remainder (called the "deficiency"). However, the bank cannot pursue you for a deficiency unless it obtains a fair price for the car (a fair price is known as a "commercially reasonable price"). The burden of proof is on the bank to establish that it sold the car at a commercially reasonable price. Because a bank rarely, if ever, obtains a commercially reasonable price for the car, this is a very strong defense that should be raised in every auto deficiency case.
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More Information
How to Read a Civil Court Summons (PDF)
The Basics of Defending Creditor Lawsuits
Vacating a Default Judgment
Frozen Bank Accounts
What is Exempt from Debt Collection?
Helpful Links and Resources
LawHelp/NY: attorney referrals and information for pro se litigants
New York City Civil Court: information about representing yourself in court, including contact information and court forms
The Legal Aid Society, When The Creditor Sues, What Are My Rights? (PDF)