Jason v. National Loan Recoveries, LLC
134 A.3d 421
| Md. Ct. Spec. App. | 2016Background
- In 2008 National Loan Recoveries (a debt buyer) purchased Jason’s defaulted credit-card debt and sued him in District Court on Jan 29, 2009; judgment entered Mar 31, 2009; writ of garnishment issued in April 2009; judgment later marked satisfied Dec 13, 2011.
- At the time National Loan filed suit and obtained judgment it did not possess a Maryland collection-agency license; it obtained a license on Sept 10, 2010.
- Jason filed a (putative) class-action complaint in Circuit Court on July 30, 2013 asserting counts for declaratory/injunctive relief (voiding judgments, disgorgement of interest, costs, fees), unjust enrichment, and statutory claims under the Maryland Consumer Debt Collection Act and Consumer Protection Act.
- National Loan moved to dismiss as time-barred under the general 3-year statute of limitations (CJP § 5-101); the circuit court granted dismissal and Jason appealed.
- The Court of Special Appeals reversed dismissal of the declaratory counts and unjust-enrichment count (remanding for factual development), but affirmed dismissal of the statutory consumer-protection claims as time-barred.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a suit seeking a declaration that a judgment obtained by an unlicensed debt collector is void is time-barred | Finch and other cases permit collateral attack on a void judgment "at any time," so no limitations bar | Statute of limitations applies to affirmative suits for relief; "any time" language in Finch did not address limitations | Declaratory counts (void-judgment attack) are not barred by statute of limitations; reversal and remand |
| Whether unjust-enrichment claim is governed by 12-year specialty/judgment statute or 3-year general statute | Claim pertains to a void judgment so should qualify as an action on a judgment (12 years) or be untimed | Unjust enrichment seeking restitution is a common-law money claim subject to 3-year limit (CJP § 5-101) | Unjust-enrichment claim governed by 3-year rule; dismissal reversed because record lacks clear accrual date (remand) |
| When unjust-enrichment claim accrues (discovery/inquiry notice) | Accrual may be delayed by discovery rule or nondisclosure of licensing | Accrual at latest when suit, judgment, or garnishment put plaintiff on inquiry notice; but restitution claim accrues when defendant actually received plaintiff’s funds | Accrual follows discovery rule; here record did not show when National Loan received funds, so timeliness unresolved — remand |
| Whether consumer-debt and consumer-protection statutory claims are timely | License nondisclosure excuses/ delays accrual under discovery rule | Plaintiff was on inquiry notice no later than garnishment in April 2009; claims filed July 2013 are beyond 3 years | Statutory claims under Maryland Consumer Debt Collection Act and Consumer Protection Act are time-barred; affirmation |
Key Cases Cited
- Finch v. LVNV Funding, LLC, 212 Md. App. 748 (void judgment entered by unlicensed debt collector is void as a matter of law)
- Cook v. Alexandria Nat’l Bank, 263 Md. 147 (a void judgment may be asserted as a defense in proceedings to enforce it)
- Master Financial, Inc. v. Crowder, 409 Md. 51 (distinguishing statutory specialties from common-law remedies for statute-of-limitations purposes)
- Ver Brycke v. Ver Brycke, 379 Md. 669 (restitution/unjust-enrichment claims are actions at law subject to the general statute of limitations)
- AGV Sports Group, Inc. v. Protus IP Solutions, Inc., 417 Md. 386 (three-year statute is Maryland’s default limitations period)