Motion for summary judgment against creditor (bank or debt buyer)?

Can a consumer sued on a debt file a motion for summary judgment against the bank (or the bank's assignee)?  
 
Sure, but probably not without an attorney, unless the defendant is himself an attorney, or is well-versed in civil procedure. As a basic principle, motions for summary judgment are not the exclusive province of plaintiffs, even in debt suits. But that does not mean that all such motions are created equal, not to mention that they have an equal chance of success.

First, there are two types of motions, and they serve different purposes and have different requirements: No-evidence motion and traditional motion for summary judgment. Second, some types of motions are much more popular in debt litigation than others, -- and much more successful than others, statistically speaking.

Plaintiffs will typically only file traditional motions for summary judgment, seeking a money judgment based on one cause of action, or on several that they invoke as alternative bases for judgment. There are occasional exceptions: Sometimes a plaintiff will also target an affirmative defense raised by the defendant, either by no-evidence motion or on the merits. A single motion that encompasses both types is called a hybrid motion for summary judgment or a combined motion for summary judgment. -- > Summary judgment terminology and acronyms. 

Consumer and debt defense attorneys may file either type of motion (or both) on behalf of defendants, depending on their general litigation strategy for different plaintiffs, and the characteristics of a specific case.

Some defense attorneys will first send discovery requests to the Plaintiff’s counsel to see what evidence they will readily produce, and then customize their no-evidence motion accordingly. That said, many defense attorneys do not file motions for summary judgment at all, and may not even respond to a motion directed at their client, but request a continuance and try to settle the case before it comes to a hearing, or a trial.

OTHER CLASSIFICATIONS OF SUMMARY JUDGMENT MOTIONS 

No-evidence motions and traditional motions are based on different subsections of the summary judgment rule, have different requirements, and serve different purposes. But the distinction of these two types is not the only way to categorize summary judgment motions.

FINAL VS. PARTIAL

Additionally, motions for summary judgment can be distinguished based on whether they seek to resolve the entire case (motions for final summary judgment); or only a part of the case (partial summary judgment). In cases involving more than just one Defendant, a motion for summary judgment might involve only two parties, or all of them. At the minimum, there will always be two parties involved: the party that files the motion (movant) and the party that is being targeted by the motion (the nonmovant).

SHORT-HAND JARGON FOR MSJs BASED ON WHICH PARTY FILES THEM 

Finally, motions for summary judgment are also denominated based on who files them, and abbreviations are often used by lawyers and their staff, as well as by court personnel. A motion filed by the Plaintiff is a PMSJ (or a P’s MSJ); one by the Defendant a DMSJ (D’s MSJ). These acronyms are generic in the sense that they do not identify the nature or the motion or its basis. They only identify the movant (and, by implication, the non-movant, at least in a case in which there is only one, and thus no ambiguity).

This blog post will compare and contrast no-evidence and traditional summary judgment motions filed by Defendants, rather than summary judgment motions filed against them by debt collection attorneys on behalf of creditors, which will be covered elsewhere.

NO-EVIDENCE MOTION FOR SUMMARY JUDGMENT AGAINST CREDITORS AND DEBT-BUYERS 

The no-evidence motion is simpler. It allows the defendant to ask the court to dismiss the Plaintiff’s case for lack of evidence on one or several elements of the Plaintiff’s cause of action. Technically, the result sought is a take-nothing judgment on the merits rather than a dismissal, but the distinction is not always clearly made even by lawyers.

The decision which element to attack on lack-of-evidence grounds requires an examination of the Plaintiff’s pleading. Debt collection attorneys almost always plead breach of contract, which is the obvious theory since the breach of the terms of a credit agreement is involved. But many plead additional theories in the alternative. In order of popularity: Account Stated and open account, and quantum meruit. Unjust enrichment and promissory estoppel are also seen occasionally.

Each cause of action has several essential elements, and any one can be challenged as lacking evidentiary support. As would-be movant for no-evidence summary judgment, the defendant or her attorney would have to identify these elements, which are not always set forth expressly in the plaintiff’s petition, and then decide which one(s) to target with the no-evidence motion. If the element(s) on which the no-evidence motion for summary judgment is not expressly identified, the motion is formally defective and the court is free to deny it without further ado.

The No-Evidence MSJ Rule in Texas

If the motion meets the requirements as to proper form, it must be filed and served on the opposing counsel using one of the method of service specified in Rule 21a. Regular first class mail (not certified or registered) is not a proper method of service. The motion must also be accompanied by a proposed order granting it. The motion must then be set for hearing (either oral hearing or submission), with at least 24 days of notice to the other attorney. Even if no court appearance is involved because the motion is presented by submission, a submission date must be set and noticed because that submission date controls the deadline for the other party to file a response. Such a response is due 7 days prior to either hearing date or submission date, whichever applies. In some jurisdiction, a setting-order (“fiat”) may be needed to set the date. In others, a party’s attorney may be permitted to pick a date for oral hearing or submission. (They choice may be restricted to a particular day of the week, or several days but not all, and time will typically be standardized, e.g. 9am docket call).

If the opponent – the non-movant with respect to the Defendant’s no-evidence motion – does not respond to it, the court must grant the motion. If the plaintiff responds, and files evidence to prove the movant wrong with regard to the no-evidence contention regarding a specific element, the court must determine whether the evidence is sufficient to allow the Plaintiff to survive the motion. If the judge determines that it is not sufficient, the Defendant wins and the case is over, assuming all causes of action were attacked in the no-evidence motion so that nothing else remains to be ruled upon.  

TRADITIONAL MOTION FOR SUMMARY JUDGMENT BY THE DEBTOR 

The procedural requirement for a traditional motion are the same (service and notice), but a traditional motion requires evidence to support it, and it cannot be granted merely because the opponent ignores it and does not respond to it.

Instead, the defendant, as movant for traditional judgment, must prove either that the Plaintiff has no case, or that the Plaintiff’s claim is barred under the statute of limitations, the statute of frauds, or some other type of affirmative defense. If the basis for the traditional motion is an affirmative defense, the defendant must prove it. Like causes of action for the Plaintiff, the affirmative defenses also require proof on several essential elements, and the Defendant must prove all such elements under the summary judgment standard in order to prevail.

Traditional motions for summary judgment are much more demanding than no-evidence motions because of the proof requirements, assuming they are warranted at all.

The most common affirmative defense is limitations, which generally bars debt claims if four years or more have passed since the default. But the starting point for the running of limitations may be subject to some dispute for a variety of reasons that are the subject matter of another blog post. -- > statute of limitations and accrual of claim for limitations purposes.

Additionally, some types of loans do not have a statute of limitations at all because federal law overrides (preempts) state laws to the contrary -- > Private and guaranteed
student loans; -- > Federal preemption

EFFECT OF DENIAL 

If a motion for summary judgment is denied, the case is not over. Nor does such a denial preclude the same party from filing a second (improved) motion, or an amended motion. The judge may deny a motion for summary judgment without giving a reason, but may provide some clues at the oral hearing, if there is one, about the problems with the motions. The issue will most often have to do with the supporting evidence.
A motion could also be denied because the evidence is not admissible. But most evidentiary objections are waived if the opposing party does not make them. Therefore, it will be much less common for the judge to deny a motion for summary judgment on admissibility-of-evidence grounds, rather than for reason of insufficient evidence (unless the nonmovant files objections).

Generally, a summary judgment cannot be reversed for error in the admission of evidence (such as defects in affidavit or lack of affiant qualifications) if the non-movant did not raise the matter in the trial court and did not get a written ruling on the objection(s). -- > Objection to summary judgment evidence; -- > motions to strike summary judgment affidavit; -- > error preservation for purposes of appeal.

SJ-RELATED TOPICS AND BLOG POSTS:

Motions for Summary Judgment in Debt Collections Cases - General Overview
Different types of summary judgment motions and related terminology
Plaintiff’s motion for summary judgment (PMSJ) in a debt collection case
Summary judgment standards for no-evidence and traditional motions
Partial summary judgment and (non) finality
The summary judgment rule
Appellate review of summary judgments
Appeals from summary judgment orders that are not final (interlocutory appeal) 

Motions for Summary Judgment (MSJ) filed by Plaintiffs and Defendants in Credit Card Debt Collection Cases

Motions for Summary Judgment in Debt Collection Cases

WHAT IS A MOTION FOR SUMMARY JUDGMENT?

A summary judgment is a disposition of case without trial that ends the case either for good (final summary judgment) or disposes of some issues but not all ends the case only with respect to one defendant if there are several defendants (partial summary judgment, also called "interlocutory"). The vehicle to obtain such a disposition is a motion for summary judgment. 

MOTION FOR FINAL SUMMARY JUDGMENT VS. MOTION SEEKING PARTIAL RELIEF

A summary judgment motion may seek partial relief only, or target one defendant where two or more are being sued, but the more common scenario in debt collection cases is a motion that ask the court to resolve the case in its entirety. Such a motion is called a motion for final summary judgment, although it may not be titled as such. The way the motion is names does not control; the substance is more important.   

TRADITIONAL MSJ VS. NO-EVIDENCE MOTION

Motions for summary judgment can be filed by the Plaintiff or by the Defendant. Under the Texas Rules of Civil Procedure, there are two types of summary judgment motions: traditional motions for summary judgment (sometimes called matter-of-law motions) and no-evidence motions.

A motion for no-evidence summary judgment is filed by the opponent of the party that seeks affirmative relief (in the form of a money judgment) or the opponent of the party that seeks to win with an affirmative defense. Stated differently, a no-evidence motion is filed against the party that has the burden of proof on an issue. Defendants may file such a motion to challenge the evidentiary basis of the Plaintiff’s causes of action while the plaintiff may file such a motion to dispose an affirmative defense the defendant has asserted in his or her answer, such as a limitations defense. 

The motion is called no-evidence motion for a reason. When filing such a motion, the movant avers that the other party has no evidence on one or more elements on which that party has the burden of proof, thereby forcing the nonmovant to show otherwise. It is essential that the element (or elements) be expressly identified in the motion. It is not enough to merely reference the Plaintiff’s theory or theories of recovery. 

If the party against whom the no-evidence motion is filed does not come forth with competent evidence on the challenged element, the motion must be granted.  If the nonmovant does not respond at all, the movant wins by default. The traditional motion, by contrast, cannot be granted by default. This is a key difference between the two types of motions. Other aspects of the summary judgment procedure, however, are identical.

TIME TABLE FOR ALL MOTIONS FOR SUMMARY JUDGMENT

All motions for summary judgment must be served at least 21 days before the hearing or submission date so as to give the nonmovant adequate time to prepare a response. Depending on the method of service, three day may have to be added. As a practical matter, at least 30 days should be allowed.

Some attorneys file and serve the motion with a hearing notice, others do not. In courts or counties in which a fiat (order) is required to set a hearing, it may not be possible for the hearing notice to be served at the same time, because the date may not be immediately known. A date may have to be requested from the clerk, sometimes by phone or by mail. 

A motion for summary judgment may simply be filed without notice of hearing accompanying it, but in order to obtain a ruling on it, the movant must set it for hearing, or request that the clerk or judge do so.  If such a motion is not set for a hearing, the non-movant has no duty to respond, although it may still be wise to do so. 

A summary judgment motion does not necessarily have to be set for an oral hearing. It may be ruled upon by submission if the particular court, or the local rules, provide for this option. But in the case of submission without oral hearing,  a notice of the date of submission is still required because the date set for the hearing or submission controls the deadline for filing a response. If there were no such notice, the opponent would not know when such response is due.

Notices relating to summary judgments can be confusing to unrepresented litigants who have filed an answer. They may not appreciate the difference between trial and summary judgment, and may end up disregarding a notice relating to a summary judgment motion because they believe their case will be called on the day of trial. Sometimes creditors' attorneys file to give proper notice altogether. 

Under the Texas rules, responses to motions for summary judgment are due seven (7) days prior to date of the hearing (or “hearing by submission”). Make that eight (8) to avoid any argument as to how the days should be counted backwards from the hearing or setting date. 

If the deadline is missed, a motion for leave to file late should be filed if the non-movant wants the court to consider the belated response and any accompanying evidence. If the defendant misses the summary judgment proceeding altogether, it may be time to figure out how to move for reconsideration or prepare an appeal from a summary judgment. 

A traditional summary judgment (money judgment for the creditor) can be appealed on the basis that the summary judgment evidence was insufficient even if no response was filed. But see -- > Pitfalls and traps when appealing pro se --> Sample appellate briefs. 

If lack of notice was an issue, however, if may be necessary to file a motion for new trial because the defendant will have to prove that there was no notice, and that will generally require an evidentiary hearing. ---> Motion for New Trial  

Alternatively, the nonmovant could move for a continuance (--> motion for continuance) or a reset of the hearing.

A motion for continuance would also be appropriate if the nonmovant needs additional time to procure documents or if an affidavit is needed to oppose the summary judgment motion that cannot be timely obtained. Generally, the movant for a continuance or reset should be prepared to show that the missing affidavit or materials could not be procured earlier despite reasonable diligence, or that the other party stonewalled and failed to produce documents in the course of discovery even though they were specifically requested and no valid objection was asserted in the first instance, or that the objection was not sustained by the court.  

TRADITIONAL MOTION FOR SUMMARY JUDGMENT

MSJ Filed By the Plaintiff

Attorneys of original creditors and other debt plaintiffs typically file motions for summary judgment, hoping to avoid the need for trial and the hassle of having to show up with live witnesses. Such motions may not even require a court appearance by attorney if the court in which the case is pending entertains such motions upon submission or on a walk-in basis. 

A traditional motion for summary judgment must expressly state the cause of action on which moneydamages are sought, or the grounds for attacking a specific affirmative defense, or several such defenses. --> Creditor causes of action in Texas. 

A plaintiff moving for summary judgment on its own claims must establish all elements of a valid cause of action as a matter of law. This is a higher standard than the preponderance-of-the-evidence standard that applies at trial. Additionally, the court is not supposed to make credibility determinations, weigh evidence, or resolve contradictions in the evidence before it. If those a present, the motion should be denied and the case should go to trial. 

The evidence for summary judgment purposes comes in the form of summary judgment affidavits and documentary exhibits, for the most part. The exhibits will typically be attached to an affidavit. Sometimes they marked with letters (Exhibit A, Exhibit B, Exhibit C), other times with numbers; or a combination of letters and numerals;  sometimes they are not marked at all. 

Occasionally, the motion for summary judgment will be based on deemed admissions, or will invoke the deemed admissions rule in addition to being supported by documentary exhibits attached to an affidavits.    

MSJ Filed By Defendants

Defendants in debt suits can file motions for summary judgment, (click link to subsequent post on this topic) but this is not a very common practice. Some consumer attorneys file no-evidence motions, but in light of the huge number of debt collection cases on court dockets and the incidence of attorney representation, a Defendant's Motion for Summary Judgment (DMSJ) is a rare animal, statistically speaking. 

Pro se defendants generally do not know how to file such summary judgment motions, and attorneys for Defendants will calculate the chances of such a motion being successful and will likely conclude that the likelihood of prevailing is low, or that such a motion would be frivolous altogether. Under Rule 11, a baseless motion can result in sanctions, in addition to making the attorney look bad. 
  
There are, nevertheless some obvious exceptions.

If the debt claim is stale and appears to be barred by the statute of limitations, a traditional motion seeking to prove that the plaintiff’s claim is time-barred may be warranted. (--  > Defendant’s motion for traditional summary judgment on affirmative defense, such as the applicable statute of limitations).

If suit was brought by a debt buyer, and the contract shows a different financial institution as card issuer than the one alleged in the plaintiff’s pleadings or identified as assignor in the assignment proof, it may make sense to challenge the plaintiff’s right to sue based on (want of) privity of contract and standing to sue. Since an assignee has the burden of proof with respect to the alleged assignment of the debt, the lack of privity and want of standing could also be raised by a no-evidence motion.  

TRADITIONAL SJ MOTION VS. TRIAL

There are several important differences between a summary judgment proceeding  and a trial on the merits (which in debt collection cases is almost always a bench trial, i.e. one without jury).  

The most obvious one is that a trial provides occasion for live witness testimony whereas no testimony at all can be received at a summary judgment hearing (with the exception of testimony set forth in timely filed affidavits). That said, many trials of debt collection cases are a very brief affair and either involve no witness testimony, or testimony by the defendant only if called as a witness by the plaintiff’s attorney for the purpose of eliciting admissions. 

Pro se litigants will often volunteer to give testimony "to tell their side of the story", and make themselves subject to cross-examination and impeachment, even if they were not subpoenaed as trial witnesses. Some judges will swear them in as a matter of routine without any questions asked about a subpoena. 

The other exception is attorney testimony about reasonable attorney fees (if any are sought in the case). A plaintiff’s attorney may offer testimony on such fees as an expert witness, and will be subject to cross-examination. Most pro-se litigants have no clue about how to cross-examine a witness, not to mention the plaintiff's attorney, and are not qualified to opine on attorney's fees unless they have the requisite expertise. Some creditors' attorneys are quite unreasonable when they swear to what is reasonable in their own self-serving expert opinion. Others do not seek attorneys fees at all as a matter of policy, or don't insist on them at trial. 

In the vast majority of debt collection cases that go to trial, the debt plaintiff will rely on business records filed under a business records affidavit rather than having a live witness show up to testify on behalf of the bank (or the debt buyer) in court. Most will not bother to subpoena the defendant. Many defendants do not show up anyhow, assuming they even filed an answer in the first place. 

But there is an important difference with respect to affidavits too. 

At trial, the plaintiff cannot adduce facts through a summary judgment affidavit because the rule permitting summary judgment affidavits does not apply at trial, and any testimony by an affiant that goes beyond the scope of laying the predicate for admission of business records would constitute excludable hearsay because the witness’s out-of-court statements are not subject to cross-examination. Hearsay objections may, of course, be waived by failing to make them. Therefore, attorneys for banks and debt buyers may still try to use them when the defendant does not show up for trial, or when the defendant does shows up but is not represented by attorney, and does not know which objections are available. 

The other major difference between summary judgment motions and trials is the applicable standard of proof. At trial, the standard is lower, and the court may weigh conflicting evidence and accord some evidence more weight than other. The judge may also pass judgment on the credibility of live witnesses if there are any. In other words, the trial judge gets to decide who to believe if conflicting stories are being told. A judge is also likely not to believe a witness who contradicts himself, or makes statements that conflict with what appear to be authentic documents, such as account statements with the defendant's name and address on them, particularly when those documents are filed as attachments to a business record affidavit. If a defendants contests correctness, it would be helpful to have documentary proof to back up the testimony. But if the defendant is pro se, he should make sure to study up on predicates for admissibility of documents and evidentiary objections because the attorney for the creditor will surely make objections.     

Finally, the purpose of a trial is a final resolution of the case, meaning that all issues are resolved and that the defendant wins if the plaintiff fails to prove its entitlement to judgment under the lower standard of proof that applies to trials.  An unsuccessful motion for traditional summary judgment, by contrast, does not mean that the non-movant wins the case. An order denying such a motion does not preclude a second, improved motion (if still timely under the scheduling order or similar case management plan) or a similar motion accompanied by better evidence and/or a different affidavit Even a debt plaintiff who fails to succeed with multiple successive motions for summary judgment will still have a chance to makes its case at trial.

RELATED TOPICS AND BLOG POSTS:

Can a defendant in a debt collection suit file a motion for summary judgment? - Yes, but ...
Motions for summary judgment by debt plaintiffs
The summary judgment rule in Texas courts
The summary judgment standards


Last revision: 12/8/2018