Can a collection agency change the settlement amount? 7 Answers as of February 05, 2011

I went to a pre-trial conference today, basically to notify the attorney representing my creditor that I had already come to a settlement with the collection's agency. The attorney called the collection's agency and verified the settlement terms, wrote up the terms on a Stipulation to Stay Entry of Judgment form, and it was signed by the judge. Tonight I receive a call from the collection's agency stating that they had made an error, and the settlement is actually more than what was stated prior. Can they do this with the document I hold signed by both their attorney and the judge?

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The Pedigo Law Corporation
The Pedigo Law Corporation | Brian T. Pedigo, Esq.
It's likely that they can not do what they're trying to do. You should get a fair debt collection lawyer to handle this issue with the collector.
Answer Applies to: California
Replied: 2/4/2011
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
No, if it was done in court and both sides signed, it is a done deal.
Answer Applies to: California
Replied: 2/4/2011
Carballo Law Offices
Carballo Law Offices | Tony E. Carballo
Normally settlement agreements (stipulations) are binding although there is a provision of the law where the Court has discretion to set aside agreements because of innocent mistakes and excusable neglect, etc. The burden is on the person claiming the mistake or neglect, particularly the attorney for the collections company. I doubt that the judge will allow the collections company to set aside the Stipulation. The collection company will probably have to live with their mistake. They should know better and be careful. If they try to collect more than the agreement says without first having the court set aside the agreement then they would clearly be in violation of federal and California fair collection practices laws and you could be entitled to compensation for that. They have to move to set aside the agreement as soon as possible but no later than within six months. The longer they wait the less the chance the court will let them out of the agreement. It will also depend on the difference between the agreement and the amount they now want.

The bigger the difference the greater the chance they will be able to get out of the agreement but the lawyer will have a lot of explaining to do why his client was not more careful and has wasted your time and the court's time. I would just start making payments as the agreement says and the more payments they accept the less the chance that they will be able to get out of the deal. Just tell the collector that a written contract is in effect and approved by the court and that they have to have the judge change it if they want and that you will get a lawyer and seek damages and attorneys' fees for their mistake if they try to set the stipulation aside. Good luck.
Answer Applies to: California
Replied: 2/4/2011
DiManna Law Office, LLC.
DiManna Law Office, LLC. | Dawn DiManna
I do not believe so, given the Attorney confirmed and the Judge has signed. You will have a good case to hold them to the original amount.
Answer Applies to: New Hampshire
Replied: 2/4/2011
Bankruptcy Law Center
Bankruptcy Law Center | Bill Zurinskas
To change the terms of the stipulation, they need to get a court order. Make sure you tender payment according to the stipulation, as well as meet all other terms of the agreement. You might want to contact an attorney that deals with Fair Debt Collection Practices Law.
Answer Applies to: Colorado
Replied: 2/4/2011
    Greifendorff Law Offices, PC
    Greifendorff Law Offices, PC | Christine Wilton
    If the Judge signed a stipulated Order for a lesser amount than what they are currently asking for or telling you is owed, ask them to put that new amount in writing to you and then take it to the Judge because the Creditor is likely acting in violation of a Court Order. Be sure the Judge signed the Order before proceeding.
    Answer Applies to: California
    Replied: 2/4/2011
    Sussman & Associates
    Sussman & Associates | Mitchell Sussman
    Not after a judge has signed off on it.
    Answer Applies to: California
    Replied: 2/4/2011
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