On December 6, 2018, the Court of Appeals of Washington published Fireside Bank v. Askins. This case reviewed provisions of Washington's Collection Agency Act (CAA) at RCW 19.16.250 and the federal counterpart, the federal Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692-1692o.
The CAA and FDCPA constitutes Washington state's effort to regulate debt collection practices by in-state and out-of-state collection agencies. For instance, those who make collection efforts in this state must be licensed, RCW 19.16.110, and also must not violate a lengthy list of prohibited debt collection practices. RCW 19.16.250. Among the prohibited practices are efforts to attempt to collect “any sum other than allowable interest, collection costs or handling fees expressly authorized by statute.” RCW 19.16.250(21). Violations of these two statutes are actionable under the Washington Consumer Protection Act (CPA). RCW 19.86.020, RCW 19.16.440.
In addition, a violation of any of the practices prohibited by RCW 19.16.250 results in the creditor losing its right to collect any costs or interest, and limits collection to only the original judgment principal. RCW 19.16.450.
In this case, Askins, the debtor, claimed that the creditor's attorney communication with their own attorney, should be considered a communication under the CAA. Indeed, many of the violations of RCW 19.16.250 are related to “communications” regarding a debt. RCW 19.16.250(8), (9), (11), (13), (14), (15), (16), (17), (18)
The Washington Court of Appeals held, however, that communications between attorneys are not subject to the CAA. They noted that federal courts have reached the same conclusion under the FDCPA. “The purpose of the FDCPA is to protect vulnerable and unsophisticated debtors from abuse, harassment, and deceptive collection practices.” Guerrero v. RJM Acquisitions LLC, 499 F.3d 926, 938 (9th Cir. 2007). This federal case held that when the creditor ceases contact with the debtor, and instead communicates exclusively with an attorney hired to represent the debtor in the matter, the FDCPA's strictures no longer apply to those communications.
Therefore, while communication may be in violation of RCW 19.16.250(21), it is not actionable if the communication is simply between a creditor's attorney and debtor's attorney.
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