Author Archives: Jorge Pereira, Esq.

About Jorge Pereira, Esq.

I was born in Portugal and raised in Bethlehem after immigrating with his family to the Lehigh Valley at the age of 2. I attended Rutgers University, New Brunswick graduating with B.A. in Political Science and a minor in Psychology. After graduating with honors from Rutgers University, I attended Rutgers-Newark Law School. While at Rutgers-Newark Law School, I was part of Appellate Moot Court, Urban Legal Clinic and the Animal Rights Clinic. Upon graduating Rutgers-Newark Law School Law, I initially practiced at a small boutique law firm in Newark, New Jersey but always maintained a desire to return to his home in the Lehigh Valley. I spent the last eighteen years working in civil litigation and personal injury law firms in the Lehigh Valley. For the last sixteen years, I has worked at an Allentown law firm, The Law of Business, P.C. f/k/a Douglas M. Marinos & Associates, P.C. focusing on business divorce, corporate law, creditor’s rights and general civil litigation. I am a member of the Pennsylvania and New Jersey bars and admitted to practice in the United States District Court of Pennsylvania for the Eastern District and the United States District Court of New Jersey. I have litigated cases throughout the Courts of Common Pleas of Eastern Pennsylvania from Susquehanna County to Philadelphia County and represented both debtors and creditors in the United States Bankruptcy Court for the Eastern and Middle District of Pennsylvania. As counsel for Sovereign Bank, I wrote the appellate brief in the precedent setting decision in the matter of Sovereign Bank v. Schwab, 414 F.3d 450 (3rd Cir. 2005). I am an avid cigar smoker and a founding member, board member and former officer of the Lehigh Valley Cigar Club, a non-profit social club with over 200 members dedicated to protecting and promoting the enjoyment of cigar smoking in the Lehigh Valley.I played Rugby for ten years on the men’s team of the Lehigh Valley Rugby Football Club, becoming a captain of the men’s team, and President of the club. I own a commercial building in the historical district of Main Street, Bethlehem where my business partner and I own a hair salon, Hair Studio Main.

U.S. Supreme Court Finds That An Unauthorized Driver In Lawful Possession of Rental Car Has A Right To Privacy

On May 14, 2018, the United States Supreme Court held that people who borrow rental cars from friends are afforded the same protections against unlawful searches as the authorized driver. In the matter of Terrence Byrd v. United States, 2018 WL 2186175, the Supreme Court justices unanimously held “ the mere fact that a driver in lawful possession or control of a rental car is not listed on the rental agreement will not defeat his or her otherwise reasonable expectation of privacy”.

In September of 2014, Pennsylvania State Troopers pulled over a car driven by Terrence Byrd. Byrd was the only person in the rental car which had been rented by his fiancée, Latasha Reed in Wayne, New Jersey. Reed rented the car with Byrd present but failed to list Byrd as authorized driver on the rental agreement. The rental agreement specifically stated that “PERMITTING AN UNAUTHORIZED DRIVER TO OPERATE THE VEHICLE IS A VIOLATION OF THE RENTAL AGREEMENT.”

Shortly after Reed rented the car, Byrd returned with the car to his home in Patterson, New Jersey to get his belongings and later departed in the car alone for Pittsburgh, Pennsylvania. After driving three hours, Byrd was stopped by Pennsylvania Troopers on Rt. 81, near Harrisburg, Pennsylvania.

The Troopers became suspicious of Byrd because he was driving with his hands at the “10 and 2” position on the steering wheel, sitting far back from the steering wheel, and driving a rental car. Based on these observations, the Troopers decided to follow Byrd and, a short time later, stopped him for a possible traffic infraction.

In the course of the traffic stop the troopers learned that the car was rented and that Byrd was not listed on the rental agreement as an authorized driver. The Troopers discovered that Byrd had identification under two different possible alias. The Troopers further discovered that Byrd had prior convictions for weapons and drug charges as well as an outstanding warrant for a probation violation in New Jersey. Byrd then revealed he had a “blunt” in the car and offered to retrieve it for them. The Troopers declined Byrd’s offer and continued to seek consent to search the car, though they stated they did not need consent because he was not listed on the rental agreement. The Troopers began a thorough search of the car and trunk. In the trunk, the Troopers found a laundry bag containing body armor and found 49 bricks of heroin.

The evidence was turned over to federal authorities, who charged Byrd with distribution and possession of heroin with the intent to distribute in violation of 21 U. S. C. §841(a)(1) and possession of body armor by a prohibited person in violation of 18 U. S. C. §931(a)(1). Byrd moved to suppress the evidence as the fruit of an unlawful search. The United States District Court for the Middle District of Pennsylvania denied the motion, and the Court of Appeals for the Third Circuit affirmed.

The Court of Appeals recognized that a “circuit split exists as to whether the sole occupant of a rental vehicle has a Fourth Amendment expectation of privacy when that occupant is not named in the rental agreement”; but it noted that Circuit precedent already had “spoken as to this issue . . . and determined such a person has no expectation of privacy and therefore no standing to challenge a search of the vehicle.”

In its Opinion, the Supreme Court recognized that one who owns and possesses a car, like one who owns and possesses a house, almost always has a reasonable expectation of privacy in it, but it is more difficult to define and delineate the legitimate expectations of privacy of others. The Court stated that a person does not always need to have a recognized common-law property interest in the place searched to be able to claim a reasonable expectation of privacy in it.

On the other hand, the Supreme Court also noted that legitimate presence on the premises of the place searched, standing alone, is not enough to accord a reasonable expectation of privacy, because it “creates too broad a gauge for measurement of Fourth Amendment rights.”

The Supreme Court explained that “[l]egitimation of expectations of privacy by law must have a source outside of the Fourth Amendment, either by reference to concepts of real or personal property law or to understandings that are recognized and permitted by society. The Supreme Court further noted that the two concepts in cases like Byrd’s case are often linked. “One of the main rights attaching to property is the right to exclude others,” and, in the main, “one who owns or lawfully possesses or controls property will in all likelihood have a legitimate expectation of privacy by virtue of the right to exclude.”

In rejecting the Government’s position that only authorized drivers of rental cars have expectations of privacy in those vehicles, the Court saw no reason why the expectation of privacy that comes from lawful possession and control and the attendant right to exclude would differ depending on whether the car in question is rented or privately owned by someone other than the person in current possession of it.

The central inquiry was whether Byrd had lawful possession of the car.  The Court reasoned that under some circumstances ‘wrongful’ presence at the scene of a search would not enable a defendant to object to the legality of the search. A car thief would not have a reasonable expectation of privacy in a stolen car. However, Byrd was a permissive driver of the rental car and therefore, had the right to exclude others and a reasonable expectation of privacy.

The Supreme Court vacated the judgment of the Court of Appeals and remanded the case to further consider two of the Government’s arguments: that one who intention- ally uses a third party to procure a rental car by a fraudulent scheme for the purpose of committing a crime is no better situated than a car thief; and that probable cause justified the search in any event.

Attorneys arguing on behalf of Byrd argued that 115 million car rentals take place annually in the United States and if the government won, police would have an incentive to pull over a rental car driver who commits a traffic violation because police will know they can search the car if the driver isn’t on the rental agreement.

Advertisements

Leave a comment

Filed under Constitutional Law, Uncategorized

The 3rd Circuit holds debtors may sue creditors who offer to settle time-barred debt under the FDCPA.

Recently, the United States Court of Appeals for the Third Circuit, rendered an opinion in the class action, Michelle Tatis vs. Allied Interstate, LLC: John Does 1-25, No. 16-4022, clarifying whether time-barred offers from creditors to settle old obligations violated the Fair Debt Collection Practice Act (“FDCPA”). On appeal, the 3rd Circuit reversed a decision by the United States District Court for the District Of New Jersey granting Defendant’s Motion To Dismiss suit. Plaintiff, Michelle Tatis, commenced a class action suit against Defendant, Allied Interstate, LLC, alleging that a collection letter sent by Allied offering to settle her time-barred debt violated the FDCPA’s prohibition against using “any false, deceptive, or misleading representations or means in connection with the collection of any debt.” See 15 U.S.C. § 1692e. Tatis had a ten year old debt of $1,289.86 owed to Bally Total Fitness which Allied sought to collect by sending a letter offering to settle the obligation for pennies on the dollar.

In the state of New Jersey, the statute of limitations to commence a debt collection action is six years. Pennsylvania has a four year statute of limitations to commence a debt collection action. What that means is that if the 6 years, or 4 years in Pennsylvania, has passed since a debtor defaulted on his/her obligation to pay his/her debt, a creditor cannot sue the debtor to recover the debt. It does not mean that a creditor cannot offer to settle and that a debtor cannot voluntarily agree to repay the debt. A debtor may voluntarily agree to repay the obligation for personal reasons or a desire to honor the obligation. However, there is no legal threat to the debtor after the statute of limitations has passed. Whether or not an offer to settle misrepresents the legal status of a time-barred obligation is the focus of the 3rd Circuit’s Opinion.

In Tatis, Allied sent a letter after the statute of limitations had run stating: “[The creditor] is willing to accept payment in the amount of $128.99 in settlement of this debt. You can take advantage of this settlement offer if we receive payment of this amount or if you make another mutually acceptable payment arrangement within 40 days . . . .”

Tatis’ complaint alleged that Tatis interpreted the word “settlement” in the letter to mean that she had a “legal obligation” to pay the debt, and the least- sophisticated debtor would hold a similar belief. Tatis claimed that letter violated several prohibitions of the FDCPA including: §1692 e(2)(A), falsely representing the legal status of debt; §1692e(5), making false threats to take legal action that cannot be legally taken; and §1692e(10) using false representations and/or deceptive means to collect or attempt to collect a debt. Allied filed a Motion To Dismiss alleging that no threat to take legal action was made to Tatis by the settlement letter.

The U.S. District Court agree with Allied and held that an attempt to collect a time-barred does not violate the FDCPA unless it is accompanied a threat of legal action. District Court stated that the use of the word “settlement” in a letter did not constitute a threat of legal action. Finally, The U.S. District Court held that because under New Jersey law partial repayment would not revive the statute of limitations, the letter could not deceive or mislead a consumer into inadvertently reviving the debt.

The 3rd Circuit in reversing the District Court focused on the remedial nature of the FDCPA and the broad prohibitions set forth in the FDCPA by Congress to curb abusive, deceptive, and unfair debt collection practices. Because of the remedial nature of the FDCPA, its language is construed broadly to protect debtors. In addition, the “least sophisticated debtor” standard is used to determine whether any debt collection practices violate the FDCPA. The “least sophisticated debtor” standard is a very low standard which does requires a plaintiff to prove that he or she was mislead, but only that the least sophisticated debtor could be mislead.

The 3rd Circuit looked at several other court decisions involving similar settlement letters which found that offers to “settle” could mislead the least sophisticated debtor to believe that debt was legally enforceable in court. The 3rd Circuit agreed with its sister courts and held that in the specific context of a debt-collection letter, the least-sophisticated debtor could be misled into thinking that “settlement of the debt” referred to the creditor’s ability to enforce the debt in court rather than a mere invitation to settle the account. The 3rd Circuit concluded that the least-sophisticated debtor could plausibly be misled by the specific language used in Allied’s letter and vacated the District Court’s order granting Allied’s motion to dismiss. However, the 3rd Circuit would not go as far as to hold that standing alone, settlement offers and attempts to obtain voluntary repayments of stale debts constitute deceptive or misleading practices. Additionally, the 3rd Circuit declined to hold that the use of the word “settlement” is “misleading” as a matter of federal law or mandate the use of any specific language. The 3rd Circuit, in keeping with the text and purpose of the FDCPA, reiterated that any such letters, when read in their entirety, must not deceive or mislead the least-sophisticated debtor into believing that she has a legal obligation to pay the time-barred debt.

What it means for creditors is that they must very careful in drafting “settlement offers” for time-barred debt. A settlement offer cannot imply that a time-barred debt is legally enforceable. The 3rd Circuit believed the word “settle” could imply “concluding or avoiding a lawsuit.” Perhaps a disclaimer that no legal action can or will be taken if the debtor choses to voluntarily repay the debt.

With regards to debtors, if the language of settlement letter would mislead an unsophisticated consumer into believing that if he or she does not settle the time-barred debt he or she may be subject to suit, then that letter may violate the FDCPA. A debtor who receives a settlement letter may bring suit against the creditor. Under the FDCPA, a debtor may sue for actual damages, statutory damages of $1,000.00 per violation, and attorney’s fees so long as the suit is commenced within a year of the violation.

Leave a comment

Filed under Consumer Advocacy, Uncategorized

Doctors and dispensaries may not advertise participation in PA’s medical marijuana program but they can educate the public.

Despite some serious concerns caused by Attorney General Jeff Sessions’ decision to abandon the Cole Memo guidelines for how the Department of Justice would treat state medical and recreational marijuana programs, the legal state programs are continuing to move forward. There is simple too much demand, interest, and money involved in the marijuana industry to put the genie back in the bottle.

Pennsylvania’s medical marijuana program is set to begin in full this year. To date, the Pennsylvania Department of Health has approved 10 grower/processors to begin operations and three dispensaries. The demand and interest is evident and hundreds of millions of dollars have been invested in Pennsylvania’s Medical Marijuana Program. Given the substantial investment in the program, you would think it would be a high priority to notify and educate interested patients on how to participate in the program. However, Pennsylvania law prohibits growers/processors and dispensaries from advertising or promoting themselves.

Moreover, certified doctors are prohibited from advertising their services to write cannabis recommendations. As marijuana is still illegal under federal law, doctors cannot prescribe medical marijuana but may write recommendations under state law. There are over 14,000 patients who have registered but only 2,300 have been certified by doctors. Additionally, physicians continued to register to participate in the program with over 625 registered, of which 326 have been certified by the state.

Given the level of interest and investment, one would think it would be a priority to notify patients on how they can participate in the program, to identify doctors who can recommend medical marijuana and to list where it can legally be purchased. Certified doctors and dispensaries are listed on the Department of Health’s website but the Department of Health has no budget for advertising the program. The Pennsylvania Department of Health believes that all the information a patient will need is on the state’s website.

Dispensaries and doctors must get creative. Under the law, there is no prohibition against educating the public about the medical marijuana program. Dispensaries and doctors can post educational blogs, youtube videos, and/or devote sections of their websites to informing people of the program. Use social media to promote the program itself but do not advertise. So long as there is no direct advertisement or publication of their participation in the medical marijuana program, participants in the program should not run afoul of the law. Instead, they may direct any prospective patients to the Department of Health’s website where the certified doctors and approved dispensaries are legally listed. Certified doctors and approved dispensaries will have to thread the needle until the law changes.

Leave a comment

Filed under Marijuana Law, Uncategorized

One company is trying to make a profit before Pennsylvania’s medical marijuana program commences.

Back in June of this year, the Pennsylvania Department of Health granted 12 medical marijuana grower/processor permits to the following companies:

Prime Wellness of Pennsylvania (Berks County)
Franklin Labs (Berks)
Pennsylvania Medical Solutions (Lackawanna)
Standard Farms (Luzerne)
Ilera Healthcare (Fulton)
AES Compassionate Care (Franklin)
Terrapin Investment Fund 1 (Clinton)
GTI Pennsylvania (Montour)
AGRiMED Industries of PA (Greene)
PurePenn (Allegheny)
Holistic Farms (Lawrence)
Cresco Yeltrah (Jefferson)

Under Pennsylvania’s Medical Marijuana Act, in order to obtain a grower/processor permit, an applicant had to pay a nonrefundable $10,000 initial application fee and along with $200,000 for the actual permit. The grower/processor also had to prove it had $2 million in capital on hand. Despite the steep price, the health department still received 177 applications for grower/processor permits and generated $1,770,000.00 in nonrefundable application fees.(The Department of state also received 280 applications for a dispensary permit which required payment of a $5,000.00 in non refundable initial application fees, or $1,400,000.)

Of the 177 applicants, only 12 grower/processor permits were issued so the demand was great. Now apparently one of the successful permit applicants is trying to sell the rights to his permit. Franklin Labs, LLC in Reading, Berks County is willing to sell 100% of Franklin Labs including the grower/processor permit for $20 million dollars. Franklin Labs also applied for a special clinical research (CR) license, and only applied for the grow permit as a backup plan. The CR license would allow the company to partner with a teaching hospital to conduct research on medical cannabis. Companies that are granted CR permit will receive permits to open a growing facility as well as six storefront dispensaries for selling oil-based cannabis products.

Under Pennsylvania’s Medical Marijuana Act, the issuance of a permit is a revocable privilege and any permit issued may not be transferred to any other person or location. Apparently, Franklin Labs is trying to circumvent the Act by selling of the whole company lock, stock, and barrel. The Department of Health has issued a statement saying that “no permit may be sold or transferred without approval from the Department of Health” but what about an entire company. Needless to say, this has caused some unsuccessful applicants to requests that Department of Health revoke Franklin Labs’ permit.

There is significant risk in purchasing Franklin Labs and its permit for $20 million dollars. The cost of applying for a permit during Phase II of the applications will still be $210,000.00. While there is no guarantee, the risk is still only the non-refundable $10,000.00 and whatever costs are incurred as part of the application process. While those costs could be significant, they are not likely to near $20 million dollars. Additionally, the Pennsylvania Department of Health could revoke the permit at any time or choose not to re-new it the next year. Despite the risk, Medical Marijuana is big business and it would not surprise me if an existing company in a state such as Colorado or California saw the sale of Franklin Labs as an opportunity to expand into Pennsylvania.

Leave a comment

Filed under Marijuana Law, Uncategorized

PA College towns are enforcing rental ordinances targeting student disruptive conduct.

As students return for the fall semester in many Pennsylvania universities and colleges, there are traditional welcome back parties. On campus, campus police regulates parties but off campus parties are less controlled and typically louder and wilder events. After several weekends of rowdy wild off campus parties which disturbed neighbors, led to underage drinking, fighting, arrests and saw a number of students taken to hospitals for alcohol consumption, the City of Bethlehem decided to enforce a city rental ordinance that had been on the books for almost twenty years but rarely used.

The city ordinance essential provides that a code enforcement officer may direct a landlord to evict a tenant if the tenant has been cited with three “disruptive conduct” violations within a year. The ordinance defines “disruptive conduct” as any form of conduct that is a violation of existing city ordinances and/or state law where the Police have issued a Citation and the Citation has been successfully prosecuted or a guilty plea entered before a District Justice.

The ordinance is clearly focused on controlling disruptive student behavior and is limited to regulated rental units occupied by three or more non-blood related persons, but no more than five, under the same lease agreement.

Under the ordinance, each lease agreement must include a provision notifying the tenants of the ordinance and the risk of eviction. Most lease agreements already have some provision requiring a tenant to obey all local and state ordinances but those provisions are general focused on the use of the premises in compliance with city zoning ordinances and not the conduct of the tenant.

Bethlehem’s ordinance is based on a similar ordinance from the City of Bloomsburg with was upheld by the U.S. District Courts for the Middle District Of Pennsylvania. In Bloomsburg Landlords Ass’n v. Town Of Bloomsburg, 912 F. Supp. 790 (M.D. Pa 1995), aff’d 96 F.3d 1431 (3rd Cir. 1996), the landlord association filed a complaint contending that the Bloomsburg Ordinance violated the state and federal constitutional rights of its members. The association alleged: 1) violation of their rights under Article I, Section 10(1) [Article I, Section 10(1) provides that no state shall make any law “impairing the obligation of contracts”] and the Fourth, Fifth and Fourteenth Amendments to the United States Constitution under section 1983, 42 U.S.C. § 1983 and 2) violation of their rights under Article 8, Section 1[All taxes shall be uniform, upon the same class of subjects, within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws] of the Pennsylvania Constitution.

In summary, the U.S. District Court held that: 1) the ordinance was not vague or overly broad; 2) the municipality may constitutionally regulate the number of unrelated individuals who may occupy a single family dwelling so long as as the ordinance was rationally related to a legitimate governmental interest, specifically, preventing disturbing conduct; 3) the ordinance was not a violation of the landlords’ substantive due process guarantees under the 5th and 14th amendment as it was rationally related to a legitimate governmental interest; 4) the ordinance was not a taking in violation of the 5th amendment as the ordinance substantially advances a legitimate state interests and does not deny an owner economically viable use of his land; and 5) that the licensing fee requirement of the ordinance was not a tax and not in violation of Pennsylvania’s constitutional prohibition against non-uniform taxes.

The U.S. District Court also rejected the argument that students were a protected class subject to protection from discrimination under the equal protection clause.

Other Pennsylvania cities and municipalities have similar rental ordinances, including State College, Reading, Kutztown, Allentown and Easton. In Easton, where Lafayette College is located, only two violations for disruptive behavior are required before a landlord is directed to evict the tenant.

Neighbors tired of the late noise and disruptive conduct appreciate the rental ordinances. At the same time, landlords who rent to students on a seasonal basis complain that the ordinances are punitive causing loss of revenues in mid lease.

The effectiveness of the ordinances is debatable. College students are not going to stop throwing parties. However, as long as the ordinances are rationally related to protecting the public and eliminating disruptive conduct, the ordinances will continue to be enforced in Pennsylvania.

Leave a comment

Filed under Landlord/Tenant

A Pennsylvania tenant’s right to recover a security deposit.

Under Pennsylvania’s Landlord and Tenant Act of 1951, 68 P.S. ‘250.101, et. Seq., a landlord may require a security deposit to be held for tenant caused damages and possible past due rent. See 68 P.S. §250.511 and §250.512. A security deposit is not the same as rent. It is money that actually belongs to the tenant, but is held by the landlord for tenant-caused damages and sometimes past-due rent. Without the agreement of the landlord, a security deposit may not legally be used as the last month’s rent.

Pennsylvania law places a limit on the amount of a security deposit that a landlord may require. Under 68 P.S. §250.511a (a), no landlord may require a sum in excess of two months’ rent to be deposited in escrow for the payment of damages to the leasehold premises and/or default in rent thereof during the first year of any lease. During the second and subsequent years of the lease or during any renewal of the original lease the amount required to be deposited may not exceed one month’s rent. See 68 P.S. §250.511a (b). At the beginning of the second year of a lease the landlord may not keep a security deposit equal to more than one month’s rent and must return any money greater than one month’s rent still being held as a deposit. See 68 P.S. §250.511a (c) After five years the landlord cannot increase a security deposit even if the monthly rent is increased. 68 P.S. §250.511a (d).

Pennsylvania also regulates where residential security deposits must be kept and when interest payments on the security deposits must be made to the tenant. Security deposit monies in excess of $100 and held more than two years must be deposited by the landlord in an approved bank, and the tenant must be notified in writing where the bank and deposit is located. See 68 P.S. §250.511b (a). A landlord is entitled to receive as administrative expenses, a sum equivalent to one per cent per annum upon the security money so deposited, which shall be in lieu of all other administrative and custodial expenses. The balance of the interest paid shall be the money of the tenant making the deposit and will be paid to the tenant annually upon the anniversary date of the commencement of his lease. See 68 P.S. §250.511b (b).

After termination the lease or upon surrender of the lease and acceptance by the landlord of the leasehold premises, a landlord must provide a tenant with a written list of any damages to the leasehold premises for which the landlord claims the tenant is liable. Delivery of the list shall be accompanied by payment of the difference between any sum deposited in escrow, including any unpaid interest thereon, for the payment of damages to the leasehold premises and the actual amount of damages to the leasehold premises caused by the tenant. See 68 P.S. §250.512.

Reasonable wear and tear caused by a tenant’s lawful use of the lead premises is not damages. In 1979, the Pennsylvania Supreme Court officially recognized that an Warranty of Habitability that is implied in every residential lease agreement. Pugh v. Holmes, 486 Pa. 272, 405 A.2d 897 (1979). The Supreme Court decided that landlords who rent property for people to live in must make sure such property is “safe, sanitary and fit for human habitation.” A landlord’s obligations under the Warranty of Habitability cannot be taken from a tenant even if you sign a lease that says you are renting the property “as is” or that you are responsible for all repairs.

The warranty implies that the landlord has placed the rented premises in a livable conditions prior to the occupancy by the tenant; or that he will do so within a reasonable time after the occupancy of the demised residence; that the facilities will remain usable during the entire term of the lease and that the landlord will maintain the demised premises in a condition which will render the premises livable. Any repairs made necessary by reasonable wear and tear are the responsibility of the landlord. Derr v. Cangemi, 66 Pa. D & C 2nd 162 (1974).

A landlord is responsible for all normal wear and tear and must bear that cost as part of the implied Warranty of Habitability whenever he leases a property to a tenant. A landlord can not pass on normal wear and tear expenses to a tenant. Deluca v. Matthews, 2015 Pa. Dist & Cnty. Dec. Lexis 14718.

Assuming that there are valid damages, a landlord must refund the security deposit less the cost of the repairs on the list. If the landlord fails to do this, the tenant cannot be sued for any damages the landlord claims the tenant caused. In addition, if the landlord does not give the tenant this 30-day response, the tenant may sue for double the amount of the security deposit. In order to be able to sue for double the deposit, the tenant must give the landlord written notice of his or her new address once the tenant has moved out. See 68 P.S. §250.512.

Under 68 P.S. §250.512 (e), failure of the tenant to provide the landlord with his new address in writing upon termination of the lease or upon surrender and acceptance of the leasehold premises shall relieve the landlord from any liability under this section.

1 Comment

Filed under Consumer Advocacy, Landlord/Tenant, Uncategorized

Pennsylvania consumers protections under the Fair Credit Extension Uniformity Act

In previous blogs, I have discussed the protections provided consumers under the Federal Fair Debt Collection Practices Act (“FDCPA”). The FDCPA is a powerful deterrence to unscrupulous debt collectors and unlawful debt collection practices. The FDCPA is a comprehensive and reticulated statutory scheme, involving clear definitions, precise requirements, and particularized remedies. The validity of the underlying debt is not relevant or an issue under the FDCPA. There is no exception to liability for violating the FDCPA as a result of fraud on the part of the consumer. As long as the underlying obligation is a “debt” as defined b the FDCPA, the method of collections is irrelevant. The validity of the underlying debt is irrelevant as well.

The FDCPA “provides a remedy for consumers who are subjected to abusive, deceptive, or unfair trade collection practices by debt collectors.” A single violation of the Act triggers statutory liability and remedies. Under the FDCPA, a plaintiff may collect statutory damages even if he has suffered no actual damages. The FDCPA is essentially a strict liability statute, where the degree of the defendant’s culpability is relevant only in computing damages, not in determining liability.

Under the FDCPA, consumers are enforcing the FDCPA essentially acting as private attorney generals. Because consumers are acting as private attorney generals, an award of attorney fees is mandatory in an FDCPA case. That means that the FDCPA is essentially a fee shifting statute. If a consumer can demonstrates that the FDCPA has been violated, the consumer may recover actual damages, statutory, costs and attorney’s fees. The longer the lawsuit goes, the more the consumer can recover in attorney’s fees. The threat of an award of attorney’s fees is a very effective deterrent and leads to mean settlements early in litigation.

The FDCPA is not without its limitations. One of the biggest limitations of the FDCPA is that it only applies to debt collectors as defined by the FDCPA. It does not apply to creditors or assignees of the creditor when the assignment has occurred prior to the consumer’s default on the debt obligation. Attorneys acting as debt collectors are also included in the definition of debt collector under the FDCPA.

Typically when bringing a suit under the FDCPA, a consumer will name the debt collectors, and possible law firm and individual attorney hired by the creditor to collect on the debt for any violations of the FDCPA. However the creditor may not be named under the FDCPA.

From the perspective of obtaining the greatest recovery in a lawsuit, a consumer’s best option is to target the creditor as they usually have the deepest pockets. Under Pennsylvania’s Fair Credit Extension Uniformity Act (“FCEUA”), a consumer may also sue the creditor.

The FCEUA is Pennsylvania’s analogue to the FDCPA and applies to both debt collectors and creditors. A debt collector’s violation of any provision of the FDCPA constitutes a violation of the FCEUA which in turn constitutes a violation of Pennsylvania’s consumer protection law, the Unfair Trade Practices and Consumer Protection Law (“UTPCPL”). The FCEUA allows a consumer to sue the original creditor as well as the debt collector for any violations of the FCEUA. The FCEUA protections mirror the FDCPA’s protections.

The FCEUA also has a two year statute of limitations as opposed to the FDCPA’s one year statute of limitations. Finally, as the FCEUA is also a violation of the UTPCPL, a consumer may recover actual damages or statutory damages whichever is greater, costs and reasonable attorney’s fees. Under the UTPCPL, a court may also award treble damages. Again a very effective deterrent which can lead to early settlements.

Any action by a consumer for unlawful debt collection practices must include claims for violations of the FDCPA as well as the FCEUA. It allows the consumer to sue the creditor as well as include older violations.

Leave a comment

Filed under Consumer Advocacy, Uncategorized