May 16, 2019
We have spoken in the past about counter suits and the various reasons that they can occur, but this article will go a bit deeper into how we work to help prevent them. First, it is important to note, that about 80% of our collections are done in house and no attorney is every involved. For most agencies, 30% to 35% of the collections will be given in attorney fees for outside counsel. We do not have that problem because of our in-house counsel that is included in the initial fee; this is one of the ways that we provide an additional safety net for you.
At any point in time, our company is dealing with about four hundred active lawsuits and three counter suits. Notice, our counter suits account for about 3% rather than the standard 10% of other companies. This is because we work hard to watch for situations that may lead to counter suit and advise our clients on how to avoid them. Sometimes, we can see them coming from a mile away and those are generally ones that involve employees with harassment issues or other serious matters. Occasionally, we will have ones that come across our desk that should not even be qualified for a counter suit. The most important piece of advice we can give is to be aware of the risks of a lawsuit. In almost every situation, a counter suit comes back because the lawyers will say they do not owe you and that your lawsuit is not viable; this is a very common affirmative defense, and generally the first thing that any lawyer will file, because it is difficult to claim on errors and omissions.
The most common counter suit that we see is when there is some frivolous lawsuit and they want you to pay their attorney’s fee. Our company works hard to avoid these situations by reviewing any lawsuits at least twice before sending them to the litigating attorney. In our process of reviewing the case, we look to see if something similar could have happened in the past and we will recommend you do not sue in situations that could come back worse for you than the person you are suing. The worst scenario is if the counter suit comes because of something they could have been internally handled, and that is where real problems begin because if you answer the complaint, they have an affirmative defense.
We recommend that the best way to handle any collections problems is to go through an agency first, rather than a lawyer, because it has less liability. We have never had a client sued during a collection that went through our agency, but by going straight to a lawsuit there is always a risk of counter suit. We cannot make predictions on counter suits, so it is always best to avoid putting yourself at risk for one. One general rule that we follow, and now pass along to you, is that if you are concerned when you turn a collection over to us that the debtor is threatening to sue, unless it is coming from an actual attorney, the threat is baseless. Vice versa, we have seen situations where an attorney was already involved before any threat was made which tipped us off that the client was preparing to counter suit.
The best advice we can give is to always try and avoid going to a lawsuit in any collections situation. Let our agency help you avoid the possibility of a counter suit, and if you have any further questions contact Samantha Cole at samantha@aercollections.com.
Quote 1: About 80% of our collections are done in house and no attorney is every involved.
Quote 2: Our company works hard to avoid these situations by reviewing any lawsuits at least twice before sending them to the litigating attorney