Legal Question in Credit and Debt Law in Virginia
Disclosing intrest and late charges
Last year I owed about $2000.00 in daycare charges. I had some hardships with the death of 3 family memeber within one year and was unable to pay. The owners of the daycare decided to sue us(which is understandable)- however they increased the amount to $4700.00!! When I spoke to them to questioned this(since there were never any late fees or intrest charges disclosed at the time of enrollment) she stated that when we missed our court date her lawyer told her to tack on whatever charges she wanted to!! My husband never signed the paper which enrolled our children at the daycare but is now having his wages garnished.With court costs and garnish fees it seems will will never pay it off. Is this legal to charge late fees arbitrarily? We were told after we pay it off we can appeal? Would we have a chance to get back the monies exceeding the original amount??
1 Answer from Attorneys
Re: Disclosing intrest and late charges
Do I understand correctly that you never signed any document that provides for an award of attorneys' fees or interest???? And the judgment is against your husband even though he was not a party to the contract??? The lawyer who got that judgment should be sued for violation of the Fair Debt Collection Practices Act - he's liable to you for whatever it costs you in attorneys' fees to sue him, plus the difference between what you actually owe and the the amount of the judgment; in your husband's case, that's the entire amount of the judgment.
You can also move to have the judgment vacated for fraud on the court. The best you're going to get is a new trial date.
If they charged you interest that was not properly disclosed according to federal regulations, they're also liable to you for violation of the Consumer Credit Protection Act and the Virginia Consumer Protection Act. (If they sued on a theory of "open account" they're entitled to interest even if you didn't sign a document saying so, as long as they made the proper disclosure of the APR etc. according to Federal Law.)
You need a lawyer in your area who understands these things. Point out to the lawyer that the Virginia Consumer Protection Act, the Fair Debt Collection Practices Act and the Consumer Credit Protection Act all provide for awards of attorneys' fees if you win.
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