The latest case that baffles me by putting yet another anticonsumer twist on the nation's most progressively expsansive consumer protection law is Credit Acceptance Corp. v. Woodard, an unpublished-but-it-doesn't-matter-because-it-can-be-cited case issued by the Court of Appeals on March 6, 2012.
In Woodard, the consumer the defaulted one payment into a contract and had his collateral repossessed. The opinion doesn't say what the collateral was, which is unusual because ordinarily the Court of Appeals is oddly specific about things that don't matter, whereas here the type of collateral might be important.
Anyway, Credit Acceptance got its collateral back (opinion doesn't say how, see the foregoing which is unusual note) and sued for a deficiency and got a default judgment.
Woodard then filed a motion to reopen, arguing that she'd not been given a notice of right to cure under 425.105, Stats., and that the judgment was void. Woodard was likely wrong about the significance of the failure to give the notice vis a vis the judgment, but that didn't matter because the parties met with the judge and agreed to reopen the case, vacate the judgment, and then dismiss the case without prejudice and without admissions of liability.
(The opinion doesn't say whether Woodard got his ... collateral... back. which is unusual...etc.)
Woodard then asked for costs and fees to be awarded under the Act and under Community Credit Plan v. Johnson, reasoning that since the case was dismissed, she didn't have a deficiency, and didn't have a judgment against him, he had prevailed.
The circuit court, though, and the Court of Appeals, denied fees and costs, saying because Credit Acceptance hadn't been found to violate the WCA, Woodard did not prevail: she got a significant benefit, but not because of a violation of the WCA.
First off, nearly every single time someone walks into court, the judge will ask people if they can't just resolve this issue without a hearing. So many judges do that that I have begun to wonder if they realize that if everyone settled their case, we wouldn't need judges. We could just hire a robosigner to stamp the stipulations we submitted.
Secondly, while the Court of Appeals and circuit court here looked to Johnson to determine that there must be a violation and a significant benefit, it seems to me they overstated the must be a violation part. Woodard filed some kind of motion, asserting some kind of thing happened. Whether the Court dismissed the case with an admission of liability or not seems to me to be irrelevant: in the motion for fees and costs, the circuit court could certainly have found that the dismissal without liability was prompted by the claim of violation -- and could likely have found, for purposes of the motion, that a violation occurred. Unless the stipulation prohibited that finding, which I doubt, because a motion was filed after the stipulation was made.
Thirdly, in Footville Bank v. Harvell, the Court of Appeals concluded that an award of attorney's fees was warranted where it had reinstated jury findings that a customer under the Act had been overcharged interest; there, the customer had not paid the interest and had received the goods and services, so the interest on the amount he owed was reduced from 13-17% to 5%, but he was awarded his reasonable costs and fees despite ultimately losing, and getting a judgment of (without interest) $16,000 or so against him.
While in Footville there is no doubt that there was a finding of a violation of the WCA, is the benefit there more significant than the benefit here? A reduction of the amount owed versus (presumably) getting collateral back and having no judgment whatsoever? I think not, and Woodard will not serve the purposes of the WCA, or most judges, because after Woodard, any consumer lawyer who now stipulates to a case without either an admission of liability or the right to prove that is committing malpractice.
In other words, if I sue a creditor on a Woodard claim, I can't work it out amicably unless the creditor is willing to admit liability or pay all my client's damages and fees in the settlement. We can't leave it up to the Court to decide if the fees are reasonable, unless the creditor specifically stipulates to liability.
Which means more work, not less, for circuit courts, and which means higher fees for consumers, and ultimately higher payments by creditors who lose.
And that might happen. If the stipulation here truly was without prejudice, then Woodard might have retained his right to sue Credit Acceptance for the violation, and for converting his car, and for nonjudicial repossession, and all the other great stuff...
...if the case hadn't happened in 2008 and taken a year to decide on appeal.
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