12 January 2022 / Michael J. Dougherty

Lancaster County, Pennsylvania: New Credit Card Diversionary Program

On December 1, 2021, the Court of Common Pleas of Lancaster County issued Administrative Order CI-21-08116, a 64-page order that transforms the manner in which credit card cases are filed and litigated in the Lancaster County Common Pleas court. The requirements of the order are effective for new cases filed after January 1, 2022, and existing cases filed before January 1, 2022, in which a default judgment has not previously been entered. The order is limited to credit card cases.
The new order mandates that a Conciliation Conference shall be held for all credit card cases unless the defendant opts out of the program. The ability to opt-out of the program is a choice limited to the defendant’s option, not the plaintiff. Before the Conciliation Conference takes place and within 30 days after service of the complaint, the court requires credit card plaintiffs to file four separate affidavits that the court must review and confirm for their compliance with the order. The failure to file these affidavits will lead to the dismissal of the case and potential sanctions against the creditor.

The Affidavits Are:

Affidavit of Documentation of Debt

This affidavit requires the creditor to produce the original credit card agreement or, if not available, the original credit card application and all amendments to the cardmember agreement. If these amendments are not available, a reason for lack of availability must be stated.  
For debt buyers, in addition to the above requirement, the creditor must produce the bill of sale and assignment from the original creditor to the current creditor. In addition, all documents must specifically reference the last four digits of the account number and the defendant’s name.

Affidavit Regarding the Identification and Nature of Debt

This affidavit requires the creditor to produce, among other data points:
  1. The date the card was opened;
  2. The date of the last purchase;
  3. The amount and date of the last payment;
  4. The balance at the time of the last payment;
  5. All post-charge off payments; and
  6. An itemization of total amount currently due by principal, finance charges, and/or fees.

Affidavit Regarding Statute of Limitations

This affidavit requires the creditor to:
  1. Identify if there is a choice of law provision in the card member agreement;
  2. State the date of the statute of limitations; and
  3. Certify the matter has been timely filed within the statute.

Affidavit of Address Verification

This affidavit requires proof that the defendant’s address was confirmed three months before the complaint was filed by:
  1. Receipt of correspondence or a call from defendant that confirms defendant’s address;
  2. A signed certified mail receipt from defendant; or
  3. The sending of a first-class mail letter to the defendant which was not returned and verification of the address using a paid subscriber-based commercial online database and confirmation from tax records or the state motor vehicle registry or a statement that neither the tax records or motor vehicle registry are available. Also, if any of the above records show an additional address for defendant for the past 12 months, a statement for the reason for using the address chosen must be given.
Once these four affidavits are filed and considered sufficient by the Credit Card Diversionary Program coordinator, the Conciliation Conference can move forward.
The creditor is required to send a representative to the Conciliation Conference. This in-person requirement for appearance can be excused if a court-approved affidavit is filed five days prior to the conference, indicating the creditor’s representative will appear by phone. This affidavit also requires the name and phone number of the representative attending by phone to be provided. In addition, that representative must remain on an open line from the time the matter is called at the Conciliation Conference until its completion. The representative must also have complete settlement authority.
It is extremely noteworthy that the order provides (if a matter is settled before the Conciliation Conference or at the Conciliation Conference) that the settlement must be memorialized in writing five days from the date of settlement and the matter must be marked settled, discontinued, and ended with prejudice. If the defendant does not fulfill the terms of the settlement, the creditor may file a petition to open the case with the court, and like all petitions, it may or may not be granted at the sole discretion of the court.
If the matter does not settle at the Conciliation Conference and the defendant does file an answer to the complaint, the matter can then proceed through the usual court arbitration process. If an answer is not filed, the creditor can move to file a default judgment. Before filing the default judgment, the creditor must re-verify the defendant’s address and file another Affidavit of Address Verification. In addition, an Affidavit of Compliance with the Diversionary Program and Entitlement to Default Judgment must also be filed.
For cases filed before January 1, 2022, where a default judgment has not already been entered, the creditor must file all the previously referenced affidavits and give notice to the defendant of the Diversionary Program and an opportunity to opt into the program.
As indicated, the Lancaster County Court of Common Pleas administrative order related to credit card cases is a departure from the requirements of the Pennsylvania Rules of Civil Procedure. Our team is constantly monitoring this new mandate. If you have any questions, please connect with Michael Dougherty at any time. 
This blog is not a solicitation for business and it is not intended to constitute legal advice on specific matters, create an attorney-client relationship or be legally binding in any way.

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Michael J. Dougherty


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