Arbitration Claim Form - compromise

[Jalip]

What is the name of your state?ohio
Today I recieved a letter from an out of state law firm with an arbitration claim form and order of compromise for 70% of my "alleged" balance with a credit card company. It says if I do not provide a written response within 30 days, an award may be entered against me.
Whay should I do?

 

[caliber]

Respond!

Respond in writing within the time frame. If they ram the arbitration through anyway and obtain an award, you can at least have documentattion on your side should you request a reconsideration.

Do you believe you owe this? Did you dispute in writing? Did you do nothing. What's the amount?

 

[Jalip]

I sent the dispute letter/cease and desist letter by way of fax. I used the fax number on the Law firms letterhead and have confirmation that it was received. I have tried the registered letter thing in the past and had no reply - post office said no one accepted or no one declined. I am not sure what I owe, but don't think its anywhere near the $27,000 they say I owe.

 

[caliber]

Aend an objection!

Send an objection to the arbitration forum. If the attorney has forwarded you a claim then the procedure to respond should be attached. Follow the procedure and object in writing making sure that you serve(mail) all parties. begin looking for an attorney.

I am not an attorney. You are on your own. I am merely pushing you to read and ask questions--then act. Arbitration cannot commence without your consent. And you will not give them your consent. Even if their was an arbitration clause bill stuffer.

 

[Debt Guy]

I think that arbitration is a practice much abused by credit card banks. I hope that there will enough of an uproar that congress will ban the practice of a pre-dispute consent to arbitration. It is my belief that the Federal Arbitration Act did not envision a pre-dispute consent to binding arbitration.

Banks use arbitration to lower their cost and to avoid jury trials. There is no discovery in arbitration in the sense that there is in the legal system.

However, caliber is wrong on one thing. Those little stuffers in your statement where the bank inserts the arbitration language (or in the case more and more today it is in the fine print of the original credit card application) are binding on a consumer who fails to object AT THAT TIME and continues to use the card.

Thus far, courts have found these arbitration clauses to be binding on the consumer.

The arbitration organizations are kangaroo courts. Once the arbitration is complete, the creditor has an arbitration award. The creditor must now file in state court to convert that award to a judgment. Some consumers have been successful at this level in convincing a judge to not grant a judgment on the basis that you never consented to arbitration, etc. etc.

Caliber is right that you should object to the arbitration. Just don't expect to win at that level.

For more info, go to this website and search on arbitration -- www.artofcredit.com.

 

[caliber]

Case law on arbitration NJ

If the arbitration clause includes an conditional opt-out and includes wording to the effect, "if you reject this amendment... send your rejection notice...if you reject, you must pay off the outstanding balance...we reserve the right to close your account."

Most arbitration clauses include wording similar to the above and are not unconditional opt-outs. They in fact create a barrier to the card holder creating unequal bargaining power.

See Discover v Shea NJ 2001. Amendment bill stuffers are unconscionable in NJ which overrides Delaware law(where Discover wanted protection). Read about contracts of adhesion.

I believe one cannot contract away his constitutional right to a trial by jury.

If the underlying agreement is challenged and prevailed against(very difficult) then any "amendment" argument is moot.

 

[Lindsay J]

Arbitration Riders

I ran into some questions on this and some court cases that stated that the credit card co's arbitration riders were uninforcible in some cases because of the "undue financial cost that the consumer must post up front; the gist of this argument was that the consumer was at a disadvantage due to his out-of pocket costs. However, I do not know if this will apply in your case since they are wanting to got to arbitration.
Search the internet for cses involvong arbitration; you may find an answer. Lindsay J.