By Gary M. Weiner
and Robert E. Girvan, III
Weiner Law Firm, PC
Springfield, MA
The Fourth Circuit recently held in
Dubois v. Atlas Acquisitions, LLC, No. 15-1945 (4th Cir. August 25,2016) that the filing of a proof of claim based upon a time-barred debt does not violate
the Federal Debt Collection Practices Act (FDCPA)(click on the case name to read the opinion).
Congress enacted the FDCPA to
prevent debt collectors from using abusive and unfair debt collection
practices. Federal courts have
consistently held that filing lawsuits or threatening to file lawsuits debts
where the statute of limitations has run out is a violation of the FDCPA. However, the Bankruptcy Code in § 502(b)(1)
disallows claims, upon objection, of claims that are “unenforceable against the
debtor…under any agreement or applicable law.”
Therefore, the question becomes whether the filing of a proof of claim
on a time-barred debt is a violation of the FDCPA (akin to filing a lawsuit),
or whether the Bankruptcy Code provides protection for Debtors for this very
type of action. The Fourth Circuit
recently held in Dubois v. Atlas Acquisition, LLC, No. 15-1945 (4th
Cir. August 25, 2016) that filing proofs of claim based on time-barred debts
does not violate the FDCPA.