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Supreme Court Affirms Judgment for Defendant in Collection Action

In Unifund CCR Partners v. Daniel Zimmer, 2016 VT 33 (March 11, 2016), the Vermont Supreme Court affirmed the trial court’s decision entering judgment for the defendant in an action for collection.

Issue: Unifund is a debt buyer, and in 2013, asserted the right to judgment against defendant for charged-off debt totaling $2453.22 for a credit card account in defendant’s name opened with Citibank. Unifund argued that it was entitled to collect the debt based on limited assignments from Citibank to Pilot Receivables Management, LLC (Pilot), from Pilot to Unifund CCR LLC (UCL), and from UCL to Unifund. The trial court held that the documents regarding the assignments were inadmissible hearsay. The trial court also found that even if the documents had been admissible, Unifund did not have standing. On appeal, Unifund argued that the documents were admissible as business records, that the assignment of the collection right was sufficient for standing, that Unifund established the terms of the contract between defendant and Citibank, and that Unifund “demonstrated a basis to recover for unjust enrichment.”

Holding: With regard to the contractual claim, the Court found that the trial court was within its discretion in holding that the assignment documents were unreliable because of the chain of title. The Court did not address whether the documents would have been enough to establish Unifund’s standing, since the Court affirmed the trial court’s inadmissible hearsay finding. With regard to the unjust enrichment claim, the Court agreed with the trial court, finding that the same evidentiary problems from the contractual claim applied to the unjust enrichment claim as well. The Court found that Unifund did not establish standing for the unjust enrichment claim, since its only evidence was the inadmissible assignment documents.

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