Haddad v. Alexander, Zelmanski, Danner & Fioritto, PLLC, No. 13-2026 (6th Cir. 2014)Annotate this Case
Haddad bought his condominium in 1991 and lived in the unit until 2005, when he began renting it out. In 2008, a law firm, representing the association, sent Haddad a notice of delinquency, stating that Haddad owed $803 in unpaid condominium assessments, $40 in late charges, and $55 in legal fees and costs. Haddad notified the firm that he disputed the amount demanded, that he had never missed a monthly dues payment, but that he had been “singled out and charged with various violations” by the management company. Correspondence continued for several months, with the amount owed increasing each month and Haddad contesting the charges. The law firm ultimately recorded a Notice of Lien, which was discharged about six months later. Haddad sued under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692, and the Michigan Collection Practices Act, alleging use of a false, deceptive or misleading representation in the collection of a debt, and continuing collection of a disputed debt before verification of the debt. The district court rejected the claims on the ground that the debt was commercial because the unit was rented when collection began. The Sixth Circuit court reversed, holding that an obligation to pay assessments arose from the original purchase and constituted a “debt” under the FDCPA. On remand, the district court granted summary judgment, finding that the firm had properly verified the debt and that the collection efforts were not deceptive or misleading. The Sixth Circuit reversed and remanded, based on failure to properly verify the debt.