Recently, the Michigan Justice for All Commission, a commission established by the Michigan Supreme Court, created the Debt Collection Work Group for the purpose to “develop data-driven recommendations to simplify and streamline processes, rules, and laws to allow people to more effectively navigate court processes so that, when appropriate, people are able to address their debt collection cases on their own without the assistance of an attorney.”
On November 16th, 2022, recommendations were published along with a report of the data supporting those recommendations. This report resulted in media outlets writing articles entitled “Lose-Lose-Lose Cases Dominate Courts” and “Debt Collection Cases Overwhelm District Court Dockets.” However, the report did not indicate that any state district court was overwhelmed by debt collection cases. Its stated purpose identifies that the report sought ways to allow individuals to defend these actions without the assistance of counsel. Ironically, the report did state that debt collection cases make up the second most number of cases in district courts after traffic cases. Still, the graph used to support this showed that traffic and criminal cases, which make up approximately 75% of the court’s docket, exceeded debt collection cases.
The report seems to have a number of issues like the above, makes conclusions based not on any data, and confirms that the data it does have may not be accurate. Still, for the most part, the recommendations do accomplish the stated goal, even if suspect on the data-driven part.
The recommendations are broken down into seven areas. To act on these findings, the Work Group recommends that policy and rules be amended to:
- Modernize service of process rules to help ensure consumers receive notice of lawsuit
- Increase complaint requirements to help ensure that plaintiff has provided sufficient evidence to support default judgment
- Create court documents and forms that consumers can easily understand and use
- Modernize and update garnishment protections to protect assets consumers need
- Improve our understanding of debt collection in Michigan through more optimized use of court records
- Engage with consumers who have faced debt collection litigation
- Develop pilot projects to find alternatives to litigation that help creditors, consumers, and courts
Many of the recommendations will require legislative actions. Others may be accomplished through amendment of Michigan Court Rules or by directives from the Michigan Supreme Court. At Weltman, we require our process servers to capture the GPS coordinates and take a picture of the premises where the service was completed. Both are recommendations and could be implemented by amending Court Rules. Although a majority of the recommendations are acceptable, many will need to be challenged.
Our team is constantly monitoring this topic. If you have additional questions, please contact Dan Best 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.
