Delaware courts order debt buyers to submit detailed proof with every collection lawsuit

The Chief Judge of the Court of Common Pleas in Delaware has issued an administrative directive that requires debt buyers to submit detailed proof with each collection lawsuit. The order mandates that debt buyers include the name of the original creditor, the last four digits of the account number, the name of the debt buyer purporting to currently own the debt, a complete list of every prior owner of the debt, and an itemized breakdown of the balance sought. Debt buyers are also required to attach a copy of the original contract and the complete chain of assignments from the original creditor to the current debt buyer. If a debt buyer fails to include the required information and documents, the directive gives the court the power–on its own initiative–to dismiss the debt buyer’s lawsuit.

These requirements may seem like common sense, but debt buyers often obtain judgments without submitting any proof that: (a) the consumer owes the debt; and (b) that the debt buyer is the rightful owner of the debt. This usually happens when the consumer fails to properly respond to the lawsuit, which happens in the majority of debt buyer lawsuits.

The Minnesota legislature has flirted with bills that require debt buyers to submit similar proof with their lawsuits, but as far as I know, Delaware is the first state where the judiciary has taken this matter into their own hands.

ADMINISTRATIVE DIRECTIVE NO. 2011-1 OF THE CHIEF JUDGE OF THE COURT OF COMMON PLEAS FOR THE STATE OF DELAWARE | March 16, 2011 (PDF)