Proving a credit card debt can actually be a tricky thing if you have serious opposition.  But collection lawyers have a few tricks up their sleeves that you may encounter.  One of the worst is a discovery device called “Requests for Admissions.”

What is a request for admissions?

A Request for Admissions is a written demand that you admit or deny specific factual assertions made by the adverse party.  So how is it different from just denying the allegations in a complaint?  Well, the rules say that you can get in trouble for denying things that the other side later proves to be true.  Furthermore, screwing around with a request for admissions can give the court reason to sanction you for doing so.  Sounds scary.

But what does it mean in reality?  The specifics depend on your state, but usually it means that if you deny something that you’re later shown to have had no basis for denying, you can be made to pay the other side’s attorney fees – in addition to whatever judgment they’re entitled to.  Sounds even scarier.  But it isn’t.  Like most discovery sanctions, it is usually pretty lame in reality.  To illustrate why, I’ll use an example.

Bubba is sued by Capital One – the most aggressive credit card company I know of – for $20,000 (plus interest, plus court costs, plus attorneys fees) on a business card that he used for his plumbing business.  Bubba denies the allegations in the Complaint, and so Capital One sends some Interrogatories and Requests for Admissions.  Now let’s look at two possible scenarios: One where Bubba answers honestly that he owed at least part of the alleged debt, and another where he just flat out denies everything.

In scenario A, Bubba admits part of the debt, Capital One moves for summary judgment based on their affidavits and his admissions, and gets a judgment for $20,000 plus court costs, plus attorney’s fees, plus interest – something like $22,000.

In scenario B, Bubba sends a two page letter telling Capital One that he doesn’t know the answer to most of their questions and denies all of the Requests for Admissions.  Capital One gets angry at him and comes to court prepared.  Bubba shows up and loses at trial because he doesn’t know what he’s doing.  Capital One gets a judgment, but this time they add the costs of the attorney’s fees that they incurred by his failure to admit what they later proved at trial.  So now they get a judgment for $20,000 plus court costs, plus attorney’s fees, plus interest PLUS what?  Plus the portion of the attorneys’ fees that can be traced back to his failure to admit everything.  So instead of a $22,000 judgment, he now faces something like a $22,500 judgment.

The fact is, credit card contracts give the credit card company the right to collect attorneys’ fees and interest at their super high rate anyway.  So the amount of heat that the Requests for Admissions penalty isn’t nearly what it would be at, say, a personal injury trial.  I’m not telling anyone to make bad faith denials of any discovery request.  I just want you to understand that, like many things you may face when dealing with the credit card industry, the truth isn’t quite as scary as some would have you believe.