Debtor Defense Guide: Using Discovery to Build Your Case

When facing a lawsuit, mastering the discovery phase is a critical strategy for debtor defense. By utilizing Discovery tools like interrogatories, you shift the burden of proof back onto the creditor, forcing them to verify their claims under oath.

This process does more than just uncover missing documentation or errors; it creates a procedural timeline that allows you to buy essential time and build your case toward a favorable mediation settlement.

By Alexander Hernandez, J.D., Professor, and Author of Consumer Bankruptcy Law (Routledge).

Key Takeaways for the Discovery Process

• Using Your Legal Rights: Discovery transforms your role from a defendant simply “waiting for a judgment” to an active participant who is scrutinizing the creditor’s evidence.
• Interrogatories Are Under Oath: Because Interrogatories must be answered under penalty of perjury, they force creditors to be precise and could weaken a case significantly.
• Lack of Documentation: Using Requests for Production forces the creditor to prove they actually own the debt. For third-party debt buyers, the inability to produce the “chain of title” or the original contract is often the turning point for a defense.
• The Delays of Discovery: Engaging in the discovery process naturally extends the litigation timeline. The extra time can be essential for debtors to prepare for a potential bankruptcy filing.
• Discovery and Mediation: Discovery is the “investigation” that fuels your negotiation. If the creditor is unable to provide documents or there are errors in the creditor’s claims, you enter Mediation with the upper hand, making a reduced settlement far more likely.

Don’t Just Defend, Discover: Turning the Tables on Creditors with Smart Legal Tactics

Facing a lawsuit can be intimidating, feeling as if you are mismatched, as you get sued by a major corporation and have to represent yourself in a legal battle against an experienced lawyer.

Too many times, debtors fail to react, only making the situation worse. Yesterday’s article focused on the issue of consequences when a lawsuit is ignored, and the creditor puts a lien on your home. A prior article discussed the debt defense in proving that the creditor legally owns the debt and can sue you. But today’s article goes one step further by discussing the legal process of Discovery.

This simple legal tactic not only helps you defend yourself but also allows you to gain crucial time and uncover weaknesses in the creditor’s case.

This is where Discovery comes in. Filing a timely response buys you essential breathing room, but Discovery helps you prepare your defense and may even help pave the way for a favorable settlement through mediation.

What is Discovery, and Why Does it Matter to You?

In legal terms, Discovery is the formal process of exchanging relevant information between parties in a lawsuit. It’s designed to prevent surprises at trial and ensure everyone has a fair shot. For a debtor, however, it’s a powerful tool.

Buying More Time. Legal Strategy: Discovery isn’t an instant process nor automatic. It involves specific deadlines for questions, responses, and document production, often stretching over several months. This isn’t just “legal stalling.” Discovery is standard in any legal matter, and it’s your legal right. It also allows you to gain valuable time to assess your options, gather your own information, and prepare.

Uncover the Truth: Does the other side actually have all the paperwork? Is their math correct? Discovery forces them to put their cards on the table, and could put the creditors’ case at risk of a dismissal if they don’t have the required documents.

Build Leverage to Settle Your Debt: When the other side has to work hard, spend time and money on legal fees, and potentially reveal weaknesses in their case, they become much more open to negotiating a reasonable settlement.

How Discovery Works. The Steps You Need to Know

Here are the primary tools you can use during the Discovery phase:

Interrogatories: Asking the Right Questions

Interrogatories are written questions that the opposing party must answer in writing, under oath. Think of them as a deposition on paper. Unlike a conversation or a casual inquiry, these responses carry the same legal weight as testimony given in a courtroom, and providing false information can result in perjury charges.

For a debtor, interrogatories are a primary tool for “fact-finding,” as they force the creditor to provide specific details regarding the account’s history, the calculation of interest, and the identities of individuals with knowledge of the case. By requiring the opposition to verify their claims in writing, interrogatories effectively pin the creditor down to a specific version of the facts, which can later be used to highlight inconsistencies during a trial or mediation.

The Strategic Advantage of Interrogatories: Crafting responses to specific questions forces the creditor to dedicate a significant amount of time and resources to finding the answers. If their records are disorganized or incomplete, this process quickly exposes their legal weaknesses. In addition, responding to interrogatories often requires them to seek extensions, pushing back other deadlines in the case.

Requests for Production (RFP): Show Me Proof!

A Request for Production is a formal demand that the opposing party provide copies of specific documents relevant to the case.

For example, standard requests include, but are not limited to:

• Producing a copy of the original signed contract or agreement.
• Producing the account statements.
• Producing proof that the debt was legally transferred and that the Plaintiff owns the debt.

The Strategic Advantage of Request to Produce: Many debt buyers struggle to produce a copy of the original contract or a complete “chain of title” proving they legally own the debt. If they can’t produce these crucial documents, it significantly weakens their case and can even lead to a motion to dismiss.

Professor’s Note: The clerk’s office should have templates for Interrogatories and Request to Produce available to you. If not, worst case scenario, the law library, although most universities offer access to their library and forms online.

Requests for Admission (RFA): Make The Creditor Admit or Deny Key Facts

Request for Admissions are written statements that the opposing party must either admit or deny. If they fail to respond within the allowed time, the statements are often automatically considered “admitted.”

Requests for Admissions are great for confirming or forcing a denial of specific facts. They are distinct from interrogatories because the questions in an RFA are created by the party, while Interrogatories are standardized templates.

When there is an admission in a Request for Admission, or even a failure to respond, it becomes a factual truth in the case, eliminating the need to prove it at trial. This can be incredibly powerful in defending your case.

From Discovery to Mediation

Once the Discovery phase is complete, there might be an offer to settle the case. Otherwise, the case proceeds to Mediation.

The Potential for Increased Leverage: By forcing the creditor to invest time and money, and potentially uncovering weaknesses in their case, such as missing documents or a lack of proof that they own the debt, you’ve shifted the balance of power. They now have more to lose by going to trial.

Realistic Expectations: Discovery provides both sides with a clearer picture of the strengths and weaknesses of their case. This makes mediation a more appealing, cost-effective, and predictable path to resolution than continuing the fight in court.

A Win-Win Scenario: Often, a creditor who initially wanted 100% of the alleged debt will be willing to settle for a significantly reduced amount through mediation, especially when faced with the risk and expense of further litigation. This benefits a debtor because the offer might be more affordable and even offer an opportunity to avoid bankruptcy.

The Professor’s Conclusion

Discovery provides a procedural roadmap to a stronger defense and a potentially better outcome. By filing a response to the petition or complaint, you’re taking control, building leverage, and working towards a resolution that favors you.

Colleges and universities can purchase my bankruptcy law textbook directly from Routledge Publishing. Paralegals and students who are buying single copies can do so via Amazon Books. To access my YouTube channel, click this link.

You can learn more about filing for bankruptcy and the bankruptcy petition via this link. Information on the bankruptcy court system, contact information for trustees, and your state’s exemptions can be found here. The federal bankruptcy exemptions are listed here. The latest version of the 341 Meeting of the Creditors can be found here.

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