Going to Court to Defend a Debt Collection Case

This article explains how you can answer and defend a debt collection case.

You can represent yourself in a debt collection case, or you can hire a lawyer to represent you. If you represent yourself, you must follow the same rules lawyers do. Not knowing the rules is not an excuse for not following them. Use the Guide to Legal Help to find a lawyer or legal services in your area.

Who’s Who in a Debt Collection Case

A creditor is a person or company to whom you owe money. When a creditor sues you, it is the Plaintiff in the case. After there is a judgment saying you owe money, the creditor is also called a judgment creditor.

A debt collector is someone who regularly collects debts owed to others. Collection agencies and collection lawyers are examples of debt collectors. Creditors sometimes sell debts to debt collectors rather than spend time and energy to collect debts. If a debt collector buys your debt, it becomes the creditor.

If you owe someone money, you are a debtor. If you are sued, you are the Defendant. After there is a judgment saying you owe money, you are also called the judgment debtor.

A judgment is a court decision. It can be made by a judge, a jury, a magistrate or sometimes a clerk of the court. A money judgment says a person owes another person or company a set amount of money rather than property or services.

Always Respond to Court Papers

A lawsuit starts when the Plaintiff files a complaint with the court. The complaint is the document that explains the dispute and asks for a judgment. The Plaintiff uses it to tell the court and the Defendant why the suit was filed and what it wants. The Defendant then files an answer to begin participating in the case.

You have 21 days to respond to a complaint you were personally handed. You have 28 days to respond to a complaint if you got in the mail or if you were served outside Michigan.

You can use the Do-It-Yourself Civil Answer tool to create your Answer to a Complaint.

How to Answer the Complaint

A complaint consists of a number of paragraphs. Each paragraph should be numbered.

When you answer a complaint, you respond to each paragraph one at a time.

For each paragraph, you must say that you:

• Agree with that paragraph
• Disagree with that paragraph, OR
• Don’t know whether that paragraph is true

Follow these simple rules:

• Do not agree with anything unless you know it is true;
• Do not disagree with anything unless you know it is not true;
• If you don’t know, state “I Don’t Know;”
• If a paragraph makes more than one claim, do not admit it unless you know all the claims are true;
• If you disagree with a paragraph, explain why you disagree with it. Briefly state what is wrong with the statement.

If you are being sued on an account stated or open account, you will also need to include a Defendant’s Counter Affidavit with your Answer. An account stated is a statement between a creditor and a debitor that settles the total amount of debt owed to the creditor. An open account is a sale where the goods are delivered before payment is due. Payment is paid on a specific date agreed on by the buyer and seller.

The Defendant's Counter Affidavit states that the statement of how much you owe the creditor (statement of account) is untrue or inaccurate. You must get this form notarized. Wait to sign it until you are in front of the notary. You can find a notary at the court clerk’s off or at a bank. A notary at a bank is more likely to charge a fee.

Not Answering Equals Losing the Case

If you do not respond within the time allowed, the court won’t require the creditor to prove anything. The creditor will win by default. For more information about what to do if a creditor got a default against you, see the Setting Aside a Default or Default Judgment in a Debt Collection Case toolkit.

Raising Defenses to Collection Lawsuits

When you respond to a court case by filing an Answer, you may have defenses you can tell the court about.

If you don’t tell the court about your defenses in your Answer, you can’t bring them up later.

List and explain each of your defenses in your Answer to the Complaint, after you have responded to all of the paragraphs in the complaint. You need to put your defenses under a separate heading, like “Defenses,” and include any facts to support them.

For each defense you have, you need to include a statement of facts.

To learn about some common defenses, read the article Defenses in a Debt Collection Case. Even if none of these defenses apply in your case, you may want to talk to a lawyer to find other ways to defend your case. Use the Guide to Legal Help to find a lawyer or legal services in your area.

Working Out an Agreement 

You can also try to work out an agreement with your creditor. If you and your creditor agree after you get the complaint, you can sign a Consent Judgment or agree to have the case dismissed.

It is a good idea to contact the court to see if you need to go to a hearing to tell the court about your agreement otherwise your creditor could get a default judgment against you.

Prove it in Court

If you raise any defenses, be prepared to talk about them in court.

When you’re defending a case in court, you may want to have a lawyer. A lawyer can help you raise defenses to debt collection. Use the Guide to Legal Help to find a lawyer or legal services in your area.