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A way around the debtor’s prison ban

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* A close friend of mine has a warrant out for his arrest for this very reason. He doesn’t even really owe the money, but he was too broke to hire an attorney because he’s unemployed and he was too embarrassed to tell me what was going on until it was too late. Now, he’s basically just waiting to get popped. Not good at all

It’s illegal in Illinois to throw a debtor in jail for not being able to pay, but some creditors are getting around that. A collection agency can file a lawsuit which might require a court appearance. If the debtor doesn’t appear at the hearing, a warrant can be issued for their arrest.

Illinois Attorney General Lisa Madigan said in some cases, the court notices aren’t being served.

“We hear time and again from the legal aid lawyers who ultimately find out often about these people when they’re in jail that people didn’t even know there was a lawsuit against them, let alone a judgment had been entered,” Madigan said.

People have been stopped for minor traffic violations, but then arrested and sent to jail after police found the warrant in their file. Legal aid attorneys have said this is more of an issue in rural parts of the state. Madigan said it often happens to people with little to no income, and they usually don’t know their exemption rights as a debtor. The amount owed is usually a small amount. Money used to bail the debtor out of jail often goes directly to the creditor.

Kevin Kelly with the Illinois Creditors Bar Association said creditors don’t want to send people to jail. He said members of his organization don’t issue warrants unless it’s an extreme situation. […]

Madigan said more could be done to prevent debtors from needlessly being jailed. She said courts around the state need to be certain they have accurate information to serve legal notices. She also said her office is investigating creditors that could be abusing the law. Her office has sued six creditors since 2006.

Oy.

posted by Rich Miller
Monday, Dec 12, 11 @ 9:01 am

Comments

  1. I had no idea this was even possible.

    I assumed if you didn’t show up, a creditor could just ask for a summary judgement. That way, they could get liens, garnishments, etc.

    How can you even get a summary judgement, much less an arrest warrant, in cases where is no proof of service?

    Better yet, who are the judges issuing these warrants? Voters might like to know.

    Comment by wordslinger Monday, Dec 12, 11 @ 9:15 am

  2. ===Better yet, who are the judges issuing these warrants?===

    Yeah. And it might (or might not) surprise you to know that my friend is being chased by a Spfld hospital.

    Comment by Rich Miller Monday, Dec 12, 11 @ 9:24 am

  3. There’s always been a potentially very nasty element in the collections business. Another good example where the unfettered “free market” will not self-correct and operate appropriately, without good regulation.

    Comment by walkinfool Monday, Dec 12, 11 @ 9:25 am

  4. How literally Dickensian of these creditors/collection agencies.

    Comment by In 630 Monday, Dec 12, 11 @ 9:39 am

  5. It’s called a body attachment, and even the Illinois Attorney General’s office has been known to use them on more than one occasion.

    Spending an hour or so at the Sangamon County small claims call is a real eye opener. The judge is pretty much going to do what the plaintiff’s lawyer asks him/her to do if the defendant isn’t there to defend himself.

    Rich, if possible, your friend should contact the plaintiff’s attorney asap and enter into a settlement arrangement, which includes lifting the body attachment.

    I’m not a lawyer. I just work for ‘em.

    P.S. I once knew someone who got sued by a Springfield hospital for not paying. The insane thing was, she was an employee of the hospital.

    Comment by Cheswick Monday, Dec 12, 11 @ 9:43 am

  6. I’m glad Lisa is going after these people. It sickens me that we are using our criminal justice system as a tool of the creditors.

    Comment by ChicagoR Monday, Dec 12, 11 @ 9:48 am

  7. I covered courts for a lot of years and never saw a judge issue an arrest warrant for failure to appear in a civil dispute that had not yet been adjudicated.

    Outside of criminal cases, the most extreme I ever saw were judges who would issue arrest warrants for slumlords for failing to appear at hearings to show cause why they hadn’t complied with JUDGEMENTS to secure properties considered a public danger.

    So a Springfield hospital, a corporation, can get a judge to have you arrested for failure to appear in a civil dispute?

    That’s clout. That’s incredible. People fail to appear in civil disputes every day in this country without such extreme measures.

    I’d like to know who the judge was who signed your buddy’s warrant, how often he does that sort of thing and what, exactly, he has to say for himself.

    Comment by wordslinger Monday, Dec 12, 11 @ 9:58 am

  8. I’m not at all surprised it’s a hospital after your friend. I spent a couple of days in a hospital recently and my part, after Blue Cross, is rapidly approaching $2500. I got one large bill from the hospital and probably a dozen smaller bills from various departments and doctors. I’m not sure I’m done paying yet, and I’m a little frightened of the idea my fabulous (not)PO will lose a few and suddenly I’ll be in court for non-payment of a bill or two I never received.

    Comment by Cheryl44 Monday, Dec 12, 11 @ 10:10 am

  9. “There’s always been a potentially very nasty element in the collections business. Another good example where the unfettered “free market” will not self-correct and operate appropriately, without good regulation. ”
    Wrong. This problem starts and ends with the judges. Creditors have no power except what the court gives them.

    Comment by Anonymous Monday, Dec 12, 11 @ 10:17 am

  10. I would like to see the AG go after the collection agencies and end some of their tactics. My experience is not as bad as your friend, but to me it is harassment and I thought that was illegal.

    I have a family member who owes some money. They do not live with me, they do not have the same phone number or address as I do. Yet I am constantly getting calls from collection agencies
    looking for them or a contact number where they can be reached. I tell the person calling that they have the wrong number, I do not have the number or the address of the person they are looking for, and please stop calling. It does no good. After I hang up a couple of weeks or days pass and then they call again. Once I convince them I am not the person they are looking for they sell the debt to another agency and the whole thing repeats itself. They have even called me at my cabin in northern Wisconsin. How they got that number or even connected it to me I do not know. These people need to be reined in and fined heavily. If you owe the money they should be able to call you, but to start calling everyone who might know you is not right.

    Comment by Irish Monday, Dec 12, 11 @ 10:17 am

  11. Rich, a little more detail is necessary for a fair discussion.

    After a collections suit is filed and served, and after the defendant fails to respond, the plaintiff can file for a default judgment (which can be vacated if the defendant ever does show up).

    Then, presuming the defendant still fails to respond or show up in court, a citation to discover assets can be filed.

    Again, if the defendant continues to avoid showing up in court, ultimately the court can enter a body attachment order (as Cheswick explained above).

    So the body attachment is not about the debt, but rather about the repeated failure to appear in court. It is used by courts in all sorts of contexts where defendants simply blow off their responsibilities to respond to legal summons — like unpaid child support.

    What is a creditor supposed to do when a debtor just ignors every legal obligation to show up in court? Creditors don’t want debtors in jail,they want repayment (even pursuant to a payment plan).

    How is a crditor to know anything about the circumstances of a debtor if s/he just blows off responding to anything?

    Your friend has not handled things responsibly, by simply blowing things off. He should do as Cheswick advises and call the plaintiff’s lawyer about a payment plan. That avenue typically works out better than your friend evidentally thinks.

    If your friend is completely without means to repay, and if he showed up in court to explain, there never would have been a body attachment order.

    Blaming the creditor is really not fair.

    Bet this discussion wouldn’t take place regarding unpaid child support. Is there something wrong now with lenders seeking repayment? In that context, is it okay to blow off court dates, etc.?

    Comment by anon Monday, Dec 12, 11 @ 10:22 am

  12. ===Blaming the creditor is really not fair.===

    When they ask for jail time, it is fair.

    Comment by Rich Miller Monday, Dec 12, 11 @ 10:36 am

  13. U think not paying a few bills are bad, lay off a few City of Chicago parking tickets and see what kind of threats and garbage you go through. Even if you did not see a ticket or a notice the collectors (law firm) harass the hell out of you.

    Comment by The Cardinal Monday, Dec 12, 11 @ 10:57 am

  14. ==How is a crditor to know anything about the circumstances of a debtor if s/he just blows off responding to anything? ==

    If you listen to the full report (see link below), one of the primary complaints is that the debtors are not being informed of the proceedings. It’s hard to show up when you don’t know there is a hearing.

    The case highlighted at the beginning of the story was about a Chicago-area woman who missed a court date in Macoupin County of which she was unaware. While the story did not specify where she owed medical bills, I suspect it was not in Macoupin County, that was where the collection agency is located.

    This is to the creditors advantage because they get the bail money with having to argue against the debtor in court.

    Full story (including the audio version): http://www.npr.org/2011/12/12/143274773/unpaid-bills-land-some-debtors-behind-bars

    Comment by Pot calling kettle Monday, Dec 12, 11 @ 11:05 am

  15. Last sentence should be: This is to the creditors advantage because they get the bail money without having to argue against the debtor in court.

    Comment by Pot calling kettle Monday, Dec 12, 11 @ 11:07 am

  16. I would be very curious to see a breakdown of the creditors in this. Payday loan and rent to own places are the easiest way to screw up when you’re on the brink of disaster (and uninformed about financial issues, which is ~60% of the population), adding arrest to the mix only bolsters the case that these are not legitimate businesses.

    Comment by Colossus Monday, Dec 12, 11 @ 11:47 am

  17. This usually happens when the debtor makes an agreement to pay and fails to pay and fails to show up in court. Madigan’s office wants the same type of arrest warrant when the debtor fails to pay child support after they reach an agreement on payment. Maybe she should stop asking the court for that too!

    Comment by blogman Monday, Dec 12, 11 @ 12:32 pm

  18. A friend of mine was toss in McHenry County Jail for non-payment of child support. All sorts of violent criminals in the same pod.

    Comment by Cal Skinner Monday, Dec 12, 11 @ 12:33 pm

  19. I’m not sure why it’s suddenly worse that they can put you in prison.

    They’ve not been serving people for ages just to get the judgments because people aren’t there to defend themselves. They find out after the fact.

    The only difference is that now they’re putting you in jail instead of taking your money. Why is that worse?

    Comment by Why is this worse? Monday, Dec 12, 11 @ 1:02 pm

  20. Rich,

    I wonder if your buddy’s hopsital gets a property tax exemption.

    Comment by anon Monday, Dec 12, 11 @ 1:27 pm

  21. @Cal- well, you should have told Joe Walsh to pay his child support!

    Comment by dave Monday, Dec 12, 11 @ 1:32 pm

  22. Seems over the top. Personal liberty should not be at risk for not paying bills.

    That said the personal liberty of the collection agencies (agents) should be at risk for that kind of activity.

    Comment by Plutocrat03 Monday, Dec 12, 11 @ 2:54 pm

  23. Obviously, this looks terrible. But those who are subject to a court order for a body attachment can avoid the entire process by showing up in court and stating their case on the issue. they get grabbed for blowing off their responsibilities to show up in court and let the proceeding advance.
    As for the fellow thrown in jail for not paying child support, that only happens after a judge makes a determination that the individual in question can pay but chooses not to do so. I’ve heard lots of stories of people on their way to jail suddenly coming up with the cash to pay back child support. It’s not a good idea to ignore orders to appear. It puts all the power in the hands of the opposition.

    Comment by Jim Monday, Dec 12, 11 @ 2:54 pm

  24. Irish,

    Debt collectors will try anything. A while back they were bugging me, trying to locate my ex. We were divorced about 30 years ago. I haven’t seen her since then; we live in different parts of the state.

    In violation of the law, they left messages identifying themselves as a debt collection agency. I called them back and told them I don’t have a clue where she is other than, maybe, the address they already had from 25 years ago. They claimed I was listed as her next of kin, which is a joke because I know she remarried shortly after we were divorced. After about three calls back from me and reporting them to the AG in their state, they finally stopped calling …

    Comment by Retired Non-Union Guy Monday, Dec 12, 11 @ 2:54 pm

  25. Jim,

    Reread the story. These people are NOT RECEIVING NOTICE. How can you be expected to show up in court if you have no idea that you even have court date?

    Comment by chuddery Monday, Dec 12, 11 @ 5:21 pm

  26. Not surprising when it’s a hospital involved. Often times after insurance pays there’s, whatever is left is sent straight to collection because it’s easier for the hospital to not try and collect. There’s a rather awful agency in Springfield that works almost entirely for hospitals. What makes it worse is when you go to the hospital you have 9 different bills, because the doctors, x-ray techs, etc, are all independent contractors. Somebody should look into that.

    Comment by mcb Monday, Dec 12, 11 @ 8:35 pm

  27. Actually the guy about whom I wrote is in his grave. He had a non-permanent job paying $35,000 a year when child support was set, but never earning more than $20,000 a year thereafter.

    Didn’t go to court to get the figure lowered.

    Sound familiar?

    Comment by Cal Skinner Monday, Dec 12, 11 @ 10:10 pm

  28. Collecting NSF checks, unpaid rents, or small claims is a joke. Judge let a tenant sign a payment order for $10 a month on a proven $1,800 claim for damage and past due rent (15 year payout). Tenant never paid a dime, and probably still laughing.

    Comment by Chefjeff Monday, Dec 12, 11 @ 10:25 pm

  29. It would be great to see collection agencies, attorneys and prosecutors thrown in jail for the slightest mistake…then, this would be “fair.”

    However, the law should be clear and/or changed. No civil dispute should result in someone being put in jail. This is a gross misuse of our system and at great taxpayer expense, not to mention that it doesn’t really accomplish anything by having someone who owes and cannot pay sitting in jail. The punishment doesn’t fit the crime and, well, it’s not a crime…it’s a civil dispute.

    If you are not physically served with a notice of a court appearance, you should NOT be expected to know about the court date. Even mailing a notice should not suffice.

    Our so-called judicial system is flawed, but our jail system is fully screwed up. Putting anyone in that system for these type of disputes is irresponsible. Judges that just go along with an attorney’s wish for a body attachment in absence of the defendant are also irresponsible (it’s important to note most judges…yes, I said MOST…are incompetent).

    Comment by DX Tuesday, Dec 13, 11 @ 12:10 am

  30. By the way, the last time I went to small claims court (along with a friend who had a case), I noticed that the most commonly called case was a healthcare provider (usually a hospital or large clinic) going after someone. It’s another example of how messed up our system is…no wonder some people would rather delay or avoid going to a hospital if they are sick and, then as a consequence, they may have a condition far worse later, which ends up costing everyone anyway. Thanks Rich for sharing this experience of your friend…these are the real life issues we should be fixing instead of dumping a few hundred million into the pockets of CME Group and Sears.

    Comment by DX Tuesday, Dec 13, 11 @ 12:15 am

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