---
name: mi-consumer-debt
description: >
  This skill should be used when defending a Michigan consumer against a debt-collection lawsuit
  (typically by a debt buyer or collection agency, usually in District Court). Triggers include
  "sued for a debt Michigan", "debt collector Michigan", "Michigan RCPA MCL 445.251", "debt buyer
  Michigan", "time-barred debt Michigan", "FDCPA Michigan", "Michigan collection agency license",
  "36th District Court debt", "Midland Credit Michigan", "Portfolio Recovery Michigan", "LVNV
  Funding Michigan", "Michigan Regulation of Collection Practices Act", "Michigan Consumer
  Protection Act debt", "MCL 339.901 collection agency", "statute of limitations credit card
  Michigan", "MCL 600.5807", "chain of title Michigan debt", "set aside default judgment Michigan
  debt". Subject-matter bundle covering the federal FDCPA / Regulation F / FCRA layer, the Michigan
  Regulation of Collection Practices Act (MCL 445.251 et seq.), the Michigan Occupational Code
  Article 9 collection-agency licensing regime (MCL 339.901 et seq.), the Michigan Consumer
  Protection Act (MCL 445.901 et seq.) and its judicially narrowed regulated-conduct exemption,
  chain-of-title doctrine under Michigan UCC Article 9, the SOL framework, and the District Court
  forum.
version: 0.1.0
---

# Michigan Consumer-Debt Defense

> **NOT LEGAL ADVICE.** This subject-matter bundle describes a procedural and substantive framework
> for Michigan consumer-debt cases, not legal advice and not strategic advice for any specific case.
> Outcomes are fact-specific; the choice of defenses, claims, motions, and discovery belongs to the
> litigant (and any counsel the litigant retains). Statute numbers, dollar thresholds, and day counts
> change — verify every citation against the current Michigan Compiled Laws (legislature.mi.gov) and
> the Michigan Court Rules before filing, and consult a licensed Michigan attorney.

Use this bundle when a Michigan consumer has been sued by a **debt collector** — typically a **debt
buyer** (Midland Credit Management, Portfolio Recovery Associates, LVNV Funding, Jefferson Capital,
Cavalry SPV, etc.) or a **collection agency** acting for an original creditor. The dominant forum is
the **District Court**; see "Forum" below.

## The Michigan consumer-debt landscape

Michigan layers a federal regime over a Michigan-specific one. A distinctive feature: Michigan has
**two** state collection statutes that reach collectors differently — the **Regulation of Collection
Practices Act (RCPA)**, MCL 445.251 et seq., whose prohibited-acts section (MCL 445.252) binds a
**"regulated person"** (defined at MCL 445.251(1)(g) to include first-party collectors such as an
employee collecting for one employer in the employer's name, and chartered banks / savings-and-loans /
credit unions collecting their own claims), making it **broader than the FDCPA** in that respect; and
the **Occupational Code, Article 9**, MCL 339.901 et seq., which **licenses third-party collection
agencies and debt buyers** through LARA and supplies the prohibited-practices / civil-liability rules
for licensees.

**Federal layer.** **FDCPA**, 15 U.S.C. §§ 1692-1692p — the workhorse for debt-buyer defense and
counterclaims; reaches **third-party** collectors and debt buyers, generally **not** original
creditors. **Regulation F**, 12 C.F.R. pt. 1006 — CFPB rule implementing the FDCPA (eff. Nov. 30,
2021; call-frequency, validation-notice, time/place rules). **FCRA**, 15 U.S.C. §§ 1681 et seq. —
furnisher / re-aging / dispute issues. Federal text lives in the shared corpus; cross-reference
`../mi-law-references/references/federal-debt-laws/` (symlinked into `claude-legal-federal-laws`).

**Michigan layer.** **RCPA** — MCL 445.251 to 445.258 (prohibited practices § 445.252; damages
§ 445.257). **Occupational Code Article 9** — MCL 339.901 et seq. (collection-agency definition,
LARA licensure). **MCPA** — MCL 445.901 et seq., with the regulated-conduct exemption at MCL 445.904.
**Michigan UCC Article 9** — MCL 440.9101 et seq. (assignments / chain of title).

## The RCPA — Michigan's broad first-party reach

The **RCPA** (MCL 445.251 et seq.) is the Michigan analog to the FDCPA, but its prohibited-acts
section (MCL 445.252) binds a **"regulated person"** — defined at MCL 445.251(1)(g) as a person whose
collection activities are confined and directly related to operating a business other than a
collection agency, including a regular employee who collects for one employer in the employer's name,
and state/federally chartered banks, savings-and-loans, and credit unions that collect their **own**
claims. Because "regulated person" thus reaches first-party / in-house collectors, the RCPA can apply
where the FDCPA generally does **not**. (Third-party collection agencies and debt buyers are instead
governed by the Occupational Code Article 9 prohibited-practices rules — see below.)

- **Prohibited practices** — MCL 445.252 enumerates communicating in a misleading or deceptive
  manner, simulating judicial process, misrepresenting the legal status/rights/consequences of a
  debt, harassing or abusive collection methods (with the 8 a.m.–9 p.m. call-time rule), and the like.
  Map the collector's conduct to the specific subsection.
- **Civil liability** — MCL 445.257: an injured person "may bring an action for damages or other
  equitable relief" and recover **actual damages or $50.00, whichever is greater**. For a **willful**
  violation the court may assess a civil fine of **not less than 3 times the actual damages, or
  $150.00, whichever is greater**, and **shall award reasonable attorney's fees and court costs** to a
  prevailing petitioner. (Verify the current figures and the willfulness standard.)

The treble-plus-mandatory-fees structure makes a well-founded RCPA counterclaim a real settlement
lever. The Occupational Code (below) is the parallel regime for *licensed third-party* collectors;
the two overlap and one course of conduct can implicate both — identify which actor is which.

## Occupational Code Article 9 — the licensing defense

**MCL 339.901 et seq.** licenses **collection agencies** (defined at MCL 339.901 to include a person
"directly engaged in collecting or attempting to collect a claim owed or due or asserted to be owed
or due another," and persons furnishing collection forms/systems). A **debt buyer** collecting on
purchased accounts is generally acting as a collection agency for licensing purposes — confirm
against the current definition.

- **Licensure through LARA** — a third-party collection agency / debt buyer must hold a Michigan
  collection-agency license. Check the LARA licensee lookup for the plaintiff and its servicer.
- **Licensing as a defense / pressure point** — an **unlicensed** collector or debt buyer violates
  Article 9. Whether that **voids** the debt or only exposes the collector to penalties / an
  unfair-practice theory is **not automatic** — verify current case law before arguing the plaintiff
  lacks capacity to sue or the judgment is void. Treat lack of license as evidence of an unfair
  practice and a settlement lever, not a guaranteed merits defense.

## The MCPA and its narrowed scope — read before pleading

The **MCPA** (MCL 445.901 et seq.) offers broad remedies on paper, but the Michigan Supreme Court has
sharply **narrowed** its reach through the **regulated-conduct exemption** at **MCL 445.904(1)(a)**,
which exempts "[a] transaction or conduct specifically authorized under laws administered by a
regulatory board or officer acting under statutory authority of this state or the United States."

- In ***Smith v Globe Life Insurance Co***, 460 Mich 446 (1999), and ***Liss v Lewiston-Richards,
  Inc***, 478 Mich 203 (2007), the Court read the exemption to ask whether the **general transaction**
  is authorized/regulated — not whether the specific misconduct is — exempting large swaths of
  **licensed/regulated lending and financial-services conduct** from the MCPA.
- **Takeaway:** the MCPA often does **NOT** reach collection on a **licensed/regulated** loan or
  credit product. Do **not** reflexively plead an MCPA claim for ordinary collection on regulated
  credit — it is vulnerable to dismissal under the exemption. The **FDCPA**, the **RCPA** (MCL
  445.252), and the **Occupational Code** prohibited-practices rules are the right vehicles for
  collection-conduct claims. Verify there is no intervening authority before any categorical
  statement.

## Statutes of limitations on the debt

Point to the corpus (`references/mi-statutes-of-limitations.md` and the `mi-statutes-debt` corpus) for
the authoritative, current counts — these are drift-prone. The headline rules:

| Claim | SOL | Citation |
|---|---|---|
| **Breach of written/general contract** (most credit-card debt) | **6 years** | MCL 600.5807(9) |
| **Sale of goods (UCC Article 2)** | **4 years** | MCL 440.2725 |

- MCL 600.5807(9) supplies the **6-year** default for breach of contract not otherwise specified,
  capturing **most credit-card and open-account debt**; the clock generally runs from breach / **date
  of last payment or activity** (fact-dependent — pin down the account history).
- The **4-year** UCC period (MCL 440.2725) governs the **sale of goods** and can **displace** the
  contract period where the obligation is for goods.
- **SOL is an affirmative defense** that must be **pleaded** (MCR 2.111(F)) or it is waived — raise it
  expressly in the answer. It is also a **summary-disposition ground** under **MCR 2.116(C)(7)**; a
  time-barred debt is a strong (C)(7) motion candidate.

## Chain of title / standing — Michigan UCC Article 9

A debt buyer must trace ownership from the original creditor through every intermediate buyer to
itself under **Michigan UCC Article 9** (MCL 440.9101 et seq.), with a **Bill of Sale** for each
transfer, an **Assignment** specifically identifying **this** account (account number), and
**account-level data** matching this consumer's account. A bill of sale referencing "an attached
portfolio" without the attachment, or "all accounts sold on [date]" without tying to **this** account,
is **insufficient**. Standing turns on whether the plaintiff can prove it owns this specific account.

**Business-records foundation.** To admit the account records and the assignment, the plaintiff must
lay a foundation under **MRE 803(6)** (records of a regularly conducted activity, via a custodian or
qualified witness) and **MRE 902(11)** (self-authenticating certified business records, in lieu of a
live custodian). Recurring theme: the debt buyer's affiant has **no personal knowledge** of the
*original creditor's* record-keeping and cannot lay an 803(6) foundation for another entity's records.
Probe the affiant's basis of knowledge.

## Forum — most consumer-debt suits are in District Court

Most Michigan consumer-debt suits are filed in the **District Court**, a court of limited civil
jurisdiction (claims up to the statutory district-court cap — verify the current figure). The largest
is the **36th District Court** (Detroit). The **answer clock** runs under **MCR 2.108** (the period
depends on the manner of service — confirm the current days); miss it and the plaintiff can take a
default. **Default and default judgment** are governed by **MCR 2.603** — to set aside a default
(other than for lack of jurisdiction) the defendant generally must show **good cause** *and* file an
affidavit showing a **meritorious defense** (SOL, no chain of title, FDCPA/RCPA violation), within the
rule's time limit. See `mi-36th-district` / `mi-district-courts`, `mi-first-30-days`, and
`mi-post-judgment`.

## The five fact patterns

**Pattern 1 — Debt buyer with no chain of title.** Demand the Article 9 bills of sale and
account-specific assignments tying **this** account to the plaintiff (MCL 440.9101 et seq.); challenge
the affiant's MRE 803(6)/902(11) basis of knowledge; confirm the buyer holds a LARA collection-agency
license (MCL 339.901 et seq.).

**Pattern 2 — Time-barred debt.** Last payment 6-7+ years ago; credit-card debt is on or past the
**6-year** MCL 600.5807(9) line (or 4-year UCC line, MCL 440.2725). Pin the date of last activity;
plead SOL (MCR 2.111(F)) and move under **MCR 2.116(C)(7)**.

**Pattern 3 — FDCPA validation / dispute violation.** Consumer disputed or never got a compliant
validation notice. FDCPA §§ 1692g (validation), 1692e (false/misleading), 1692f (unfair); Reg F
validation content (12 C.F.R. pt. 1006). Parallel **RCPA** claim (MCL 445.252) reaches a "regulated
person" (incl. first-party / in-house collectors) the FDCPA may not.

**Pattern 4 — Wrong amount / wrong person.** Inflated amount (unauthorized fees/interest) or mistaken
identity / identity theft. **RCPA** (MCL 445.252(e)-(f)) bars inaccurate/misleading/deceptive
statements in a collection communication and misrepresenting a debt's legal status or the parties'
legal rights; **FDCPA** §§ 1692e(2)/1692f(1) (which expressly bar misrepresenting the amount and
collecting amounts not owed); **FCRA** § 605B identity-theft block if applicable.

**Pattern 5 — Unlicensed collector / debt buyer.** Plaintiff or servicer holds no Michigan
collection-agency license. **Occupational Code Article 9** (MCL 339.901 et seq.) — operating without a
license violates the Act; use as evidence of an unfair practice / settlement lever, verifying current
case law before arguing the suit or judgment is void. Pair with **RCPA / FDCPA** theories.

## Affirmative-defenses catalog

Plead all that apply in the answer (MCR 2.111(F) — defenses not pleaded are waived):

1. **Statute of limitations** — 6 years on contract (MCL 600.5807(9)) or 4 years on goods (MCL
   440.2725); summary-disposition ground under MCR 2.116(C)(7).
2. **Lack of standing / failure to prove assignment** — plaintiff cannot prove it owns this account
   (UCC Article 9).
3. **Failure to state a claim** — no chain of title or specific account terms (MCR 2.116(C)(8)).
4. **Lack of / failure of consideration.**
5. **Payment / accord and satisfaction / release / settlement** (MCR 2.116(C)(7)).
6. **Account stated** — no agreed accounting between this plaintiff and this defendant.
7. **Lack of capacity to sue** — unlicensed collection agency / debt buyer (MCL 339.901 et seq.);
   assert with the verification caveat.
8. **Identity theft** (if applicable) — FCRA § 605B block.
9. **Discharge in bankruptcy** (if applicable).
10. **FDCPA / RCPA violation** (raised as a counterclaim; also a defense theme).

See `references/affirmative-defenses.md` for the annotated catalog.

## Discovery strategy

In District Court the Michigan Court Rules' discovery provisions apply (subject to any
abbreviated-discovery rules for smaller cases — verify the venue): **Requests for Admission** (MCR
2.312) on the elements; **Interrogatories** (MCR 2.309) on chain of title, custodian identity, and
account-level data; **Requests for Production** (MCR 2.310) for bills of sale, assignments, the
original agreement, periodic statements, and electronic records; then **meet-and-confer** and a
**Motion to Compel** (MCR 2.313). The full RFP / RFA / interrogatory banks live in the references; see
`mi-discovery` for mechanics.

## Composition

- Statewide format: `mi-statewide-format`. Dominant forum: `mi-36th-district`, `mi-district-courts`.
- Answer / first response: `mi-first-30-days`, `mi-draft-motion`. Declaration: `mi-draft-declaration`.
- Proposed order: `mi-draft-order`. Notice / motion: `mi-draft-note`, `mi-draft-motion`.
- Discovery / motion-to-compel: `mi-discovery`. Set-aside / garnishment: `mi-post-judgment`.
- Deadlines: `mi-deadlines`. Pro se conventions: `mi-pro-se`. QC: `mi-quality-check`, `mi-fact-check`.

## References

- `references/fdcpa.md`, `references/reg-f.md`, `references/fcra.md` — federal layer (see
  `../mi-law-references/references/federal-debt-laws/`)
- `references/mi-rcpa.md` — RCPA (MCL 445.251-.258; practices § 445.252; damages § 445.257)
- `references/mi-occupational-code-art9.md` — Occupational Code Article 9 licensing (MCL 339.901 et seq.)
- `references/mi-mcpa.md` — MCPA (MCL 445.901 et seq.) + the MCL 445.904 exemption (*Smith v Globe
  Life* / *Liss v Lewiston-Richards*)
- `references/mi-statutes-of-limitations.md` — MCL 600.5807(9) / MCL 440.2725
- `references/chain-of-title.md` — Michigan UCC Article 9 doctrine
- `references/evidence-debt-buyer.md` — MRE 803(6) / 902(11) foundation
- `references/rfp-debt-buyer.md`, `references/rfa-debt-buyer.md`,
  `references/interrogatories-debt-buyer.md` — discovery banks
- `references/affirmative-defenses.md` — annotated catalog
- `references/online-sources-consumer-debt.md` — canonical URLs