Discover Bank v. Deborah Breen (2011)

MEMORANDUM OF DECISION

On January 20, 2011, the plaintiff, Discover Bank, filed a two-count complaint against the defendant, Deborah Breen, seeking collection of the unpaid balance on a line of credit extended to the defendant from the plaintiff.¹  According to the plaintiff, on or before July 31, 2010, the defendant became indebted to the plaintiff for $9,070.90 for charges and/or cash advances incurred on the defendant's credit account.   The plaintiff alleges that, despite demand, the balance remains unpaid and the defendant failed, and continues to fail, to make payment.   The complaint further alleges that the plaintiff mailed, delivered, sent or otherwise transmitted periodic account statements to the defendant, which set forth all of the charges and credits applicable to the account as well as the balance due.   The plaintiff alleges that the defendant received and held these statements for an unreasonable time with no known protest or known notice of defects to the plaintiff as to the charges and amounts due.   Moreover, according to the plaintiff, the final statement transmitted to the defendant, indicating a balance due and owing, was accepted and held by the defendant for an unreasonable time without protest or notice of defect.

On February 24, 2011, the defendant filed the present motion to dismiss the plaintiff's complaint in its entirety on the ground that the court lacks subject matter jurisdiction.²  The defendant also submitted a memorandum of law in support of her motion along with evidentiary support.³  On March 3, 2011, the plaintiff filed a memorandum of law in opposition to the motion to dismiss.   Thereafter, on May 23, 2011, the plaintiff filed a supplemental memorandum of law in opposition to the motion to dismiss along with evidentiary support.⁴

The matter came before the court on the May 23, 2011 short calendar.

II

DISCUSSIONAMotion to Dismiss Standard

“A motion to dismiss ․ properly attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court.”  (Internal quotation marks omitted.)  Bacon Construction Co. v. Dept. of Public Works, 294 Conn. 695, 706, 987 A.2d 348 (2010).  “A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction.”   (Internal quotation marks omitted.)  Wilcox v. Webster Ins., Inc., 294 Conn. 206, 213, 982 A.2d 1053 (2009).  “Pursuant to the rules of practice, a motion to dismiss is the appropriate motion for raising a lack of subject matter jurisdiction.”  St. George v. Gordon, 264 Conn. 538, 545, 825 A.2d 90 (2003).  “Subject matter jurisdiction [implicates] the authority of the court to adjudicate the type of controversy presented by the action before it ․ [A] court lacks discretion to consider the merits of a case over which it is without jurisdiction ․ The objection of want of jurisdiction may be made at any time ․ [a]nd the court or tribunal may act on its own motion, and should do so when the lack of jurisdiction is called to its attention ․ The requirement of subject matter jurisdiction cannot be waived by any party and can be raised at any stage in the proceedings.”  (Internal quotation marks omitted.)  Burton v. Commissioner of Environmental Protection, 291 Conn. 789, 802, 970 A.2d 640 (2009).  “Once the question of subject matter jurisdiction has been raised, cognizance of it must be taken and the matter passed upon before [the court] can move one further step in the cause;  as any movement is necessarily the exercise of jurisdiction.”  (Internal quotation marks omitted.)  Schaghticoke Tribal Nation v. Harrison, 264 Conn. 829, 839 n.6, 826 A.2d 1102 (2003).

“Trial courts addressing motions to dismiss for lack of subject matter jurisdiction pursuant to § 10–31(a)(1) may encounter different situations, depending on the status of the record in the case ․ [L]ack of subject matter jurisdiction may be found in any one of three instances:  (1) the complaint alone;  (2) the complaint supplemented by undisputed facts evidenced in the record;  or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts ․ Different rules and procedures will apply, depending on the state of the record at the time the motion is filed.”   (Citation omitted;  internal quotation marks omitted.)  Conboy v. State, 292 Conn. 642, 650–51, 974 A.2d 669 (2009).

“When a trial court decides a jurisdictional question raised by a pretrial motion to dismiss on the basis of the complaint alone, it must consider the allegations of the complaint in their most favorable light ․ In this regard, a court must take the facts to be those alleged in the complaint, including those facts necessarily implied from the allegations, construing them in a manner most favorable to the pleader.”  (Internal quotation marks omitted.)   Conboy v. State, supra, 292 Conn. 651.  “In contrast, if the complaint is supplemented by undisputed facts established by affidavits submitted in support of the motion to dismiss ․ other types of undisputed evidence ․ and/or public records of which judicial notice may be taken ․ the trial court, in determining the jurisdictional issue, may consider these supplementary undisputed facts and need not conclusively presume the validity of the allegations of the complaint ․ Rather, those allegations are tempered by the light shed on them by the [supplementary undisputed facts] ․ If affidavits and/or other evidence submitted in support of a defendant's motion to dismiss conclusively establish that jurisdiction is lacking, and the plaintiff fails to undermine this conclusion with counteraffidavits ․ or other evidence, the trial court may dismiss the action without further proceedings ․ If, however, the defendant submits either no proof to rebut the plaintiff's jurisdictional allegations ․ or only evidence that fails to call those allegations into question ․ the plaintiff need not supply counteraffidavits or other evidence to support the complaint, but may rest on the jurisdictional allegations therein.”  (Citations omitted;  emphasis in original;  internal quotation marks omitted.)  Conboy v. State, supra, 292 Conn. 651–52.

B

Parties' Arguments

The defendant moves to dismiss the plaintiff's complaint on the ground that the court lacks subject matter jurisdiction because there was fraud in obtaining jurisdiction in that the plaintiff has no claim or evidence of injury, no evidence of a contract and no evidence that Discover Bank is in fact the plaintiff;  the defendant has been deprived of her due process rights;  and counsel for the plaintiff, Howard Lee Schiff, P.C., has no authority to act in this matter.

According to the defendant, after receiving a letter from Howard Lee Schiff, P.C. requesting payment payable to Howard Lee Schiff, P.C., she sent a certified letter to plaintiff's counsel requesting that the debt be properly verified pursuant to 15 U.S.C. § 1692, the Fair Debt Collection Practices Act (FDCPA).   The defendant contends that Howard Lee Schiff, P.C. ignored her request and failed to verify the debt thereby depriving the defendant of her due process rights.   According to the defendant, she has no way of knowing whether Howard Lee Schiff, P.C. is an interloper, an unwelcome and unauthorized third party.   Next, the defendant argues that she gave notice to the plaintiff that there was no evidence of a contract, stating “there was inference of inequality of obligations on the two sides of the transaction and that there was failure of consideration.”   In addition, the defendant requested certain information from the plaintiff.   According to the defendant, she “gave notice of a stated claim and the silence of [the plaintiff] is Acquiescence of the claim.”   Therefore, because the plaintiff did not challenge the defendant's claim of a lack of contract and did not validate the debt, the plaintiff submitted its complaint to the court with full knowledge that it was not valid, accurate, honest or true.   Moreover, because no one at Howard Lee Schiff, P.C. has personal knowledge of the facts of this case and the defendant disputes the claim, the complaint cannot possibly be factual.   Additionally, the defendant argues that the complaint lists “Discover Bank and DFS Services, LLC” as the plaintiff but Howard Lee Schiff, P.C. failed to notify the defendant of the name and address of the party trying to collect the alleged debt.   Consequently, according to the defendant, the plaintiff has committed fraud in obtaining jurisdiction, which deprives the court of subject matter jurisdiction.

Next, the defendant argues that the plaintiff has violated her due process rights by violating the FDCPA.   According to the defendant, she sent Howard Lee Schiff, P.C. a letter stating that the claims are not true or valid, that the plaintiff is committing a fraud on the court, and requesting that Howard Lee Schiff, P.C. cease and desist its collection activities.   The defendant contends that “[t]here can be no mistake;  the avoidance of this ․ letter shows intent to deprive the defendant of due process rights and intent to file a fraudulent claim, which strips the court of subject matter jurisdiction.”   Moreover, the defendant argues that the plaintiff has failed to answer questions posed to it in the letter and “[w]ithout providing full, complete and truthful disclosure of all the circumstances facts and transactions affecting this matter, there can be no case, collection or action, no cause of action can arise unless, out of fraud ․ [T]he blanket silence in this matter is evidence of a fraudulent scheme to hide the fact that Howard Lee Schiff, P.C. is a volunteer, intermeddler, ‘contract interloper’ an unwelcome, unauthorized third party, using their Law Firm stationary to harass and intimidate the defendant.   Their mere silence is prima facie evidence of their involvement in fraudulent inducement, misrepresentation, concealment and unjust enrichment.”   The defendant also contends that Howard Lee Schiff, P.C. extinguished the alleged debt upon purchase and any attempt to collect the alleged debt is an act of fraud.

Additionally, the defendant argues that the plaintiff's complaint is insufficient because “[t]here is no competent fact witness with first hand personal knowledge to prove to the defendant or to the court that the alleged contract exists or still exists, what the alleged agreement actually was, or that the alleged contract has equality between the parties or that the alleged contract has not been satisfied by Insurance, Securitization, tax write-off etc.”   Moreover, according to the defendant, the plaintiff “makes no pleading by affidavit or otherwise that they have suffered actual loss and damage, from the defendant's actions, in amounts shown as a basis to bring this claim, to establish this fact as subject matter for the court to consider.”

Finally, the defendant argues that Howard Lee Schiff, P.C. is unauthorized to act in this case because she has revoked all power of attorney.  “Failure to answer and the silence to the defendant's claim that there was lack of consideration and inequality [the plaintiff] has acquiesced to the claim and without consideration and equality the contract is VOID and all power of attorney has been revoked.   Howard Lee Schiff, P.C. has no authority to act in regards to this matter.”  (Emphasis in original.)

In its objection to the defendant's motion, the plaintiff argues that none of the grounds raised by the defendant properly challenge the court's subject matter jurisdiction or even the defendant's due process rights.   First, the plaintiff contends that the defendant's accusations of fraud are “specious and unfounded.”   Second, the plaintiff argues that it provided the defendant with validation of the debt ⁵ and even if there was a failure to do so, such a failure does not result in a deprivation of the defendant's due process rights or a dismissal of the case for lack of subject matter jurisdiction.   Finally, Howard Lee Schiff, P.C. contends that it has authority to act on behalf of the plaintiff, the defendant's claims are “simply false, and [the] defendant has no basis for making such a claim,” and it is not a basis for a motion to dismiss.

C

Analysis

“Subject matter jurisdiction does not rest on the viability of the claims that a court is asked to adjudicate.   Subject matter jurisdiction involves the authority of a court to adjudicate the type of controversy presented by the action before it ․ A court does not truly lack subject matter jurisdiction if it has competence to entertain the action before it ․ Once it is determined that a tribunal has authority or competence to decide the class of cases to which the action belongs, the issue of subject matter jurisdiction is resolved in favor of entertaining the action ․ It is well established that, in determining whether a court has subject matter jurisdiction, every presumption favoring jurisdiction should be indulged.”  (Emphasis in original;  internal quotation marks omitted.)  Olympus Healthcare Group, Inc. v. Muller, 88 Conn.App. 296, 300, 870 A.2d 1091 (2005).

“[A] defendant cannot ․ argue that the Superior Court has no authority to hear and to decide cases concerning an alleged breach of contract.   At least since 1602, when an assembly of English judges decided Slade's Case, 4 Coke 92(b), 76 Eng. Rep. 1072, the common law has affirmed the authority of courts of general jurisdiction to provide a remedy for a claimant who has not been paid for goods delivered or services rendered ․ Our Superior Court is a constitutional court of general jurisdiction.”  (Citation omitted.)  Olympus Healthcare Group, Inc. v. Muller, supra, 88 Conn.App. 301.   A collection action “is a breach of contract action.   The Superior Court is the court of original jurisdiction for such a cause of action.”   Citibank (South Dakota), N.A. v. Albano, Superior Court, judicial district of Stamford–Norwalk, Docket No. CV 03 0198353 (June 9, 2005, Jennings, J.).

The court takes judicial notice of Citibank (South Dakota), N.A. v. Breen, Superior Court, judicial district of New Haven, Docket No. CV 11 6017487 (May 5, 2011, Wilson, J.), in which Breen, the same defendant as in the present case, moved to dismiss the plaintiff's complaint on the ground that the court lacked subject matter jurisdiction.   In that case, the court characterized Breen's arguments as follows:  “Broadly construing her memorandum of law in support of the motion to dismiss, the defendant appears to argue that:  (1) the plaintiff's complaint is legally insufficient in that it fails to adduce evidence to support its claims, (2) the court lacks subject matter jurisdiction over the action because the defendant has been deprived of her due process rights, (3) the plaintiff's attorney ․ is a third-party to the credit agreement and, thus, lacks standing to bring the present action, (4) the plaintiff has failed to comply with the defendant's request for verification of the alleged outstanding debt pursuant to the Fair Debt Collections Practices Act (FDCPA), 15 U.S.C. § 1692 et seq., (5) the plaintiff is estopped from bringing the present action, (6) the plaintiff has engaged in deceptive and fraudulent acts, (7) the underlying debt has been extinguished, (8) the plaintiff has failed to allege actual loss and (9) the underlying credit agreement is void.”  Id. The court notes that the defendant's arguments in the present case are essentially identical to those in Citibank (South Dakota), N.A. v. Breen, supra, Superior Court, Docket No. CV 11 6017487, and the court finds the well-reasoned analysis of the court in that case persuasive.

The defendant's motion to dismiss fails to state any valid reason why the court lacks subject matter jurisdiction over the present collection/breach of contract action.  “The defendant's arguments related to the legal sufficiency of the plaintiff's suit are inappropriate on a motion to dismiss.   To the extent the defendant is arguing that the complaint is insufficient, [a] motion to strike ․ rather than a motion to dismiss, is the proper vehicle to attack the legal sufficiency of a complaint ․ To the extent the defendant is arguing that the plaintiff's evidence is insufficient, the argument is likewise premature.   A complaint need only contain a plain and concise statement of the material facts on which the pleader relies, but not of the evidence by which [it is] to be proved.”  (Citation omitted;  internal quotation marks omitted.)  Citibank (South Dakota), N.A. v. Breen, supra, Superior Court, Docket No. CV 11 6017487.

As to the defendant's argument that Howard Lee Schiff, P.C. is unauthorized to act in this matter, Howard Lee Schiff, P.C., as a representative, has filed a valid appearance on behalf of the plaintiff.   Howard Lee Schiff, P.C. is not, itself, a party to the action.   To the degree that the defendant contends that the plaintiff lacks standing, “[t]he plaintiff has alleged that it extended a line of credit to the defendant and that the defendant has defaulted thereon.   Standing requires no more than a colorable claim of injury ․ The plaintiff has pleaded facts sufficient to establish its standing to bring the present debt collection action.”  (Citation omitted;  internal quotation marks omitted.)  Citibank (South Dakota), N.A. v. Breen, supra, Superior Court, Docket No. CV 11 6017487;  see Citibank (South Dakota), N.A. v. Beckford, Superior Court, judicial district of Hartford, Docket No. CV 11 6017714 (March 1, 2011, Wagner, J.T.R.) (allegations that defendant failed to make required payments on credit card sufficient to confer standing).

“The remainder of the defendant's arguments appear to raise issues properly pleaded as special defenses and/or counterclaims.  [A] motion for dismissal is not generally granted when based on a special defense ․ Thus, the court cannot consider these arguments at this stage ․ The defendant should file an answer to include any special defenses and/or counterclaims.”  (Citations omitted.)  Citibank (South Dakota), N.A. v. Breen, supra, Superior Court, Docket No. CV 11 6017487;  see Fidelity Bank v. Krenisky, 72 Conn.App. 700, 705, 807 A.2d 968, cert. denied, 262 Conn. 915, 811 A.2d 1291 (2002) (“The purpose of a special defense is to plead facts that are consistent with the allegations of the complaint but demonstrate, nonetheless, that the plaintiff has no cause of action” (internal quotation marks omitted)).   The Superior Court is not deprived of subject matter jurisdiction by the “mere existence of a viable defense to a complaint that has properly been lodged with the court ․” Olympus Healthcare Group, Inc. v. Muller, supra, 88 Conn.App. 300.

Accordingly, the defendant's motion to dismiss is denied.

Woods, J.

FOOTNOTES

FN1. Counts one and two allege default on credit account and account stated, respectively.  “The theory of account stated is described as follows:  The delivery by the [creditor] to the [debtor] of each statement of the latter's account, with the [documentation] upon which the charges against [the debtor's account] were based, [is] a rendition of the account so that retention thereof for an unreasonable time constitute[s] an account stated which is prima facie evidence of the correctness of the account.”   (Internal quotation marks omitted.)  Citibank (South Dakota), N.A. v. Evvard, 128 Conn.App. 843, 844 n.2, 18 A.3d 682 (2011)..  FN1. Counts one and two allege default on credit account and account stated, respectively.  “The theory of account stated is described as follows:  The delivery by the [creditor] to the [debtor] of each statement of the latter's account, with the [documentation] upon which the charges against [the debtor's account] were based, [is] a rendition of the account so that retention thereof for an unreasonable time constitute[s] an account stated which is prima facie evidence of the correctness of the account.”   (Internal quotation marks omitted.)  Citibank (South Dakota), N.A. v. Evvard, 128 Conn.App. 843, 844 n.2, 18 A.3d 682 (2011).

FN2. The defendant is acting in a pro se, or self-represented, capacity.   “[I]t is the established policy of the Connecticut courts to be solicitous of pro se litigants and when it does not interfere with the rights of other parties to construe the rules of practice liberally in favor of the pro se party.”  (Internal quotation marks omitted.)  American Express Centurion Bank v. Head, 115 Conn.App. 10, 11 n.1, 971 A.2d 90 (2009).   Moreover, “[t]he modern trend, which is followed in Connecticut, is to construe pleadings broadly and realistically, rather than narrowly and technically ․ [T]he [pleading] must be read in its entirety in such a way as to give effect to the pleading with reference to the general theory upon which it proceeded ․” (Internal quotation marks omitted.)  Montanaro v. Gorelick, 73 Conn.App. 319, 324, 807 A.2d 1083 (2002)..  FN2. The defendant is acting in a pro se, or self-represented, capacity.   “[I]t is the established policy of the Connecticut courts to be solicitous of pro se litigants and when it does not interfere with the rights of other parties to construe the rules of practice liberally in favor of the pro se party.”  (Internal quotation marks omitted.)  American Express Centurion Bank v. Head, 115 Conn.App. 10, 11 n.1, 971 A.2d 90 (2009).   Moreover, “[t]he modern trend, which is followed in Connecticut, is to construe pleadings broadly and realistically, rather than narrowly and technically ․ [T]he [pleading] must be read in its entirety in such a way as to give effect to the pleading with reference to the general theory upon which it proceeded ․” (Internal quotation marks omitted.)  Montanaro v. Gorelick, 73 Conn.App. 319, 324, 807 A.2d 1083 (2002).

FN3. The defendant submits the following evidentiary support:  (1) A letter, dated August 6, 2010, from Howard Lee Schiff, P.C. to the defendant;  (2) a letter from the defendant, dated September 3, 2010, to the plaintiff requesting validation of the debt and answers to ninety-three questions;  (3) a cease and desist letter from the defendant to the plaintiff;  and (4) a letter from the defendant, dated February 16, 2011, to the plaintiff seeking validation and disclosure of documents..  FN3. The defendant submits the following evidentiary support:  (1) A letter, dated August 6, 2010, from Howard Lee Schiff, P.C. to the defendant;  (2) a letter from the defendant, dated September 3, 2010, to the plaintiff requesting validation of the debt and answers to ninety-three questions;  (3) a cease and desist letter from the defendant to the plaintiff;  and (4) a letter from the defendant, dated February 16, 2011, to the plaintiff seeking validation and disclosure of documents.

FN4. The plaintiff submits the following evidentiary support:  (1) A letter, dated September 13, 2011, providing validation to the defendant along with a copy of the Discover charge off statement;  (2) a letter, dated February 25, 2011, advising that additional documentation would be forwarded when received, along with a duplicate copy of the charge off statement previously provided on September 13, 2011;  and (3) additional documentation provided to the defendant, including the defendant's internet application for the credit card, monthly statements on the account, and copies of payments the defendant made on the account..  FN4. The plaintiff submits the following evidentiary support:  (1) A letter, dated September 13, 2011, providing validation to the defendant along with a copy of the Discover charge off statement;  (2) a letter, dated February 25, 2011, advising that additional documentation would be forwarded when received, along with a duplicate copy of the charge off statement previously provided on September 13, 2011;  and (3) additional documentation provided to the defendant, including the defendant's internet application for the credit card, monthly statements on the account, and copies of payments the defendant made on the account.

FN5. The plaintiff states that “[a]vailable documentation was provided to defendant in September 2010 and February 2011.   Defendant complains about what she was given, but in fact, validation of the debt is nothing more than the debt collector confirming in writing that the amount being demanded is what the creditor is claiming is owed.  Clark v. Capital Credit & Collections Services, Inc., 460 F.2d 1162, 1174 (9th Cir.2006).   Further, the undersigned wrote to defendant as recently as February 25, 2011, and expressly advised her that we were providing her with the currently available documentation, and as soon as additional documents were provided by our client, the same would be forwarded to her.   Therefore, defendant's insistence here is unreasonable and harassing.”.  FN5. The plaintiff states that “[a]vailable documentation was provided to defendant in September 2010 and February 2011.   Defendant complains about what she was given, but in fact, validation of the debt is nothing more than the debt collector confirming in writing that the amount being demanded is what the creditor is claiming is owed.  Clark v. Capital Credit & Collections Services, Inc., 460 F.2d 1162, 1174 (9th Cir.2006).   Further, the undersigned wrote to defendant as recently as February 25, 2011, and expressly advised her that we were providing her with the currently available documentation, and as soon as additional documents were provided by our client, the same would be forwarded to her.   Therefore, defendant's insistence here is unreasonable and harassing.”

Woods, Glenn A., J.