Business is a large and complex field. Properly managing a business can sometimes be too much for someone to handle. Questions may abound. What do I have to do to sue? Do I have to domesticate a judgment in New Jersey? What do I do if a close partner company shuts down while still owing money to my business?

Businesses shut down for many reasons, whether a business cannot survive the bad economy, poor management, or it is simply a bad business. One outcome of a business shutting down could be that the business files for Chapter 11 Bankruptcy. But where does that leave the lending or creditor party? If a business has claimed bankruptcy there are statutes in affect making it difficult for creditor’s to collect money owed to them by the delinquent party. When dealing with debt collection, it is important to understand those statutes and the options you have as an owed party. As a Union New Jersey business law firm, The Jayson Law Group LLC, is dedicated to helping you understand your rights and fight for what is owed to you.

When approaching an attorney about creditor’s rights after a failed business deal, it can be helpful to know a bit about Chapter 11 Bankruptcy. Firstly, Chapter 11 is most utilized by businesses as opposed to individuals (but individuals can also apply for Chapter 11). With most instances of Chapter 11, the debtor maintains operation of the business and instead, is considered a debtor in possession. The debtor in possession is subject to the jurisdiction of the court, which often calls for business restructure.  Sometimes this includes being able to reject a current contract and put litigation on hold with an automatic stay.

The Newark business lawyers at The Jayson Law Group LLC, can assist in protecting creditor’s rights against the potential harm of Chapter 11 statutes. For instance, the most common avenues include: Searching out a chance in the reorganization planning for creditors to vote against the confirmation and thus possibly regain their assets from the debtor. Additionally, a prepackaged bankruptcy plan can be agreed upon between creditor and debtor, benefiting both parties. Even, determining your securities can make a difference in your case. Call the Union, New Jersey business lawyers at The Jayson Law Group LLC today to protect your rights as a creditor and successful business.

In Part 1 of this article, we read about civil litigation that followed an accident in which an injured victim of a personal injury case was initially denied compensation because the driver was not on the car owner’s insurance policy and the policy was therefore, voided. The insurance company’s declaratory action regarding the victim’s compensation was denied. Keep reading to find out what happened in the appeal. Continue reading →

All automobile owners in New Jersey must carry insurance.  Under New Jersey Statute 39:6A-3 the insurance must include a minimum of $15,000.00 per person, $30,000.00 per accident and $5,000.00 for property damage.  But what happens if an automobile owner fraudulently applies for and receives insurance?  If that car owner has an accident, is the insurance company still liable to cover the mandatory minimums?  According its recent decision in Citizens United Reciprocal Exchange v. Perez, A-3100-11T1 (App. Div. Sept. 13, 2013) The Superior Court of New Jersey Appellate Division finds that the insurance company is liable to cover the mandatory minimums. Continue reading →

The New Jersey Judiciary has been busy lately with cases about cellphones.  First there was the Supreme Court of New Jersey ruling in State v. Earls, No. A-53-11 (N.J. Sup. Ct. 2013), which held that an individual has a right to privacy regarding cell-phone location information.  More recently, in Kuber v. Best, No. A-1128-12T4 (N.J. Super App. Div. 2013) (Not Approved for Publication without the Approval of the Appellate Division),  the Superior Court of New Jersey Appellate Division decided whether “as a matter of civil common law whether one who is texting from a location remote from the driver of a motor vehicle can be liable to persons injured because the driver was distracted by the text.” (Id. 4).  In other words, can a person be liable for texting a driver and then the driver has a traffic accident.

Continue reading →

On July 10, 2013 the Consumer Financial Protection Bureau (CFPB) released CFPB Bulletin 2013-07 Prohibition of Unfair, Deceptive, or Abusive Acts or Practices in the Collection of Consumer Debts.  CFPB Bulletin 2013-07 outlined some of the practices the CFBP deems to be Unfair, Deceptive, or Abusive Acts or Practices (UDAAPs) as determined by the Dodd-Frank Act and the Fair Debt Collection Practices Act (FDCPA).  Footnote 5 of CFPB Bulletin 2013-07 states that “The FDCPA also covers, as a ‘debt collector,’ a creditor who, in collecting its own debts, uses any name other than its own which would indicate that a third person is attempting to collect the debts.”  Furthermore, the Bulletin notes that “[o]riginal creditors and other covered persons and service providers involved in collecting debt related to any consumer financial product or service are subject to the prohibition against UDAAPs in the Dodd-Frank Act.”

Unfair Act or Practice

According to CFPB Bulletin 2013-07, under the D0dd-Frank Act “an act or practice is unfair when:

1. It causes or is likely to cause substantial injury to consumers;

2. The injury is not reasonably avoidable by consumers; and

3. The injury is not outweighed by countervailing benefits to consumers or to competition.” [footnote omitted].

CFPB Bulletin 2013-07 stated that to determine whether a substantial injury occurs the Bureau will look at the totality of the circumstances.  While monetary damage will be a huge factor, the Bulletin also states that “[a]lthough emotional impact and other subjective types of harm will not ordinarily amount to substantial injury, in certain circumstances emotional impacts may amount to or contribute to substantial injury.” [footnote omitted].  Furthermore, a consumer will not have to prove actual harm, if there is a significant risk of concrete harm, a consumer can prove that a collector used an unfair act or practice.

Deceptive Act or Practice

The Bulletin also describes what conduct would be a deceptive act or practice by a business according to Dodd-Frank.  The determining factors are:

1. “The act or practice misleads or is likely to mislead the consumer;

2. The consumer’s interpretation is reasonable under the circumstances; and

3. The misleading act or practice is material.” [footnote omitted].

Just like with the unfair act or practice, the CFBP will look at the totality of the circumstances to determine if the collector mislead the consumer.  CFPB Bulletin 2013-07 did note that representations and omission can constitute misleading a consumer.

CFPB Bulletin 2013-07 stated that “[t]o determine if the consumer’s interpretation of the information was reasonable under the circumstances when representations target a specific audience, such as older Americans or financially distressed consumers, the communication may be considered from the perspective of a reasonable member of the target audience.” [footnote omitted].  A further caveat to this is that if a significant minority of a group is deceived by the act or practice, then the act or practice is misleading.  If a business makes a representation that could have two meanings and one of the meanings if false, it will be deemed a violation of the Dodd-Frank Act as a deceptive act or practice.

Abusive Acts or Practices

CFPB Bulletin 2013-07 also outlined what would constitute an abusive act or practice by a business under the Dodd-Frank Act.  The factors to determine if the conduct is abusive are:

1) Materially interferes with the ability of a consumer to understand a term or condition of a consumer financial product or service; or

2)Takes reasonable advantage of –

a)    a consumer’s lack of understanding of the material risks, costs, or conditions of the product or service;

b)    a consumer’s inability to protect his or her interests in selecting or using a consumer financial product or service; or

c)     a consumer’s reasonable reliance on a covered person to act in his or her interests.” [footnote omitted].

CFPB Bulletin 2013-07 states that each of these abusive acts are judged by a separate legal standard.

Do you have Questions regarding how CFPB 2013-07 affects you?  Contact our New Jersey business attorneys, The Jayson Law Group LLC.

On July 18, 2013 the Supreme Court of New Jersey decided State v. Earls, No. A-53-11 (N.J. Sup. Ct. 2013). The court in Earls was deciding “whether people have a constitutional right of privacy in cell-phone location information.” (Id. 2). Justice Rabner, in writing for a unanimous court, acknowledged that Article I, Paragraph 7 of the New Jersey State Constitution offers more protection than the Fourth Amendment of the United States Constitution. (Id.). Furthermore, New Jersey law protects an individual’s right to privacy even if they have to give information to a third-party provider to receive the service (Id. 3, citing State v. Reid, 194 N.J. 386, 399 (2008)). Continue reading →