Legal Question in Credit and Debt Law in California

Fair Debt Collection Practices--Fees
Back in 2000, my brother had a roommate who incurred a $720 Pac Bell phone bill. The bill was my brother's responsibility because the bill was in his name, but he didn't have the funds to pay for it and therefore didn't.

Back in August 2002, he received notice from a collections agency that the bill was up to $920. He ignored the bill. Late last week, the collections agency sent him notice via registered mail that his bill is now in excess of $1600 due to interest of 10%/mthly., legal fees, etc. Is that legal?

In reading the past posts, it sounds as though the only legal way for a collections agency to pursue interest and legal/other fees is through a written contract signed by the consumer. My brother didn't sign any paperwork with regard to initiating phone service, so can the collection agency claim those fees (i.e., is there an inferred agreement that can be enforced)? If not, what is my brother's recourse?

He told the agency he is willing to immediately pay the amount of the original debt ($720), even a nominal amount in addition to the original debt. They said they'd knock $400 off, giving him the option to pay $1200+ or go to court. Please help!

Asked on 1/21/03, 6:33 pm

Larry Rothman Larry Rothman & Associates

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Re: Fair Debt Collection Practices--Fees

There must be some breakdown for costs, principal and attonrey fees. Please contact Mary at our office for free consulation.

Answered on 1/21/03, 7:31 pm

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