The opinion of the court was delivered by: Sweet, D.J.,
Defendant Payco General American Credits, Inc., n/k/a OSI Collection
Service, Inc. ("Payco") has moved for summary judgment and attorneys'
fees pursuant to Fed.R.Civ.P. 56. Plaintiff Lisa Ayn Padilla
("Padilla"), an attorney proceeding pro se, has opposed the motion and
cross filed for summary judgment and "pro se attorney's fees." For the
reasons set forth below, the motions will be granted in part and denied
Padilla is an attorney who resides in New York and is admitted to
the New York bar.
The Loan, Default, and Referral to Payco
The gravamen of the amended complaint is that Payco violated various
laws while attempting to collect student loans Padilla used to finance
her college and law school education. The relationship between the
parties began when Padilla executed a series of promissory notes, which
were subsequently consolidated with Sallie Mae.*fn1 She alleges that
the notes did not include a rate of interest on the consolidated loans,
but did include provisions that simple interest would be calculated on
the unpaid principal, and that she could pre-pay principal without
penalty. In addition, the notes provided for the assessment of reasonable
collection fees in the event of her default.
Padilla alleges that the loans were improperly placed in default on
July 24, 1990, while she was attending Boston University's School of Law
Taxation Program and taking sufficient credits to warrant loan deferral.
Sallie Mae reports that Padilla defa ulted on the loan on August 31,
1991, then in the principal amount of $34,588,45. (Cline Aff.) USAF
reimbursed Sallie Mae on or about that date and referred the case to
Payco for collection on September 11, 1991. (Id. ; Apr. 27, 2001 Nash
Aff.) In October 1990, Padilla was involved in a severe car accident that
incapacitated her for a period of time thereafter, during which she made
Inaccurate Reporting of Loan Status
Although she states that she has timely paid the agreed-upon amount of
$231.97 per month since October 1993, Padilla alleges that Payco
has inaccurately reported to credit agencies her payment history.
Payco contends that it never reported any false information about
her debt to anyone. (Nash Aff. Ex. A.)
More over, Payco contends that it notified Padilla repeatedly in 1993
that monthly payments of $231.97 would be insufficient to cover even the
interest that continued to accrue, but that she persisted in sending
checks for that amount. (May 21, 2001 Nash Aff.)
Improper Contact with Third Parties
In the spring of 1997, Payco contacted Padilla at home regarding the
loans, which by June 6 had grown to $42,552.32 plus $8,116.83 in
interest. She returned the call from her workplace and requested that
Payco not telephone her, but that she would contact them. Payco
nonetheless repeatedly called her at work.
She alleges that Payco employees Ron James and Gary Wagner improperly
contacted her employer and asked the receptionist to give them
information about Padilla's salary and pay schedule. (Amd. Compl.) Her
motion alleges that Wagner told the receptionist that Padilla had
defaulted on her loan (Pltf. Opp. Br. Ex. C at 9-10), but facts alleged
in legal briefs are not appropriately considered. See, e.g., O'Brien v.
National Property Analysts Partners, 719 F. Supp. 222, 229 (S.D.N.Y.
1989) (stating that "it is axiomatic that the complaint cannot be amended
by the briefs in opposition to a motion to dismiss").
Moreover, Padilla's contention is directly contradicted by the evidence
she has submitted. When asked during her deposition to state specifically
what Payco agents said to the receptionist, Padilla stated that the
receptionist told her the following:
She said, who was this guy who was telling me all this
stuff, looking for human resources, wanted to know
whether you worked there, whether or not you got paid
regularly . . . She told me that Payco called, she
told me that whoever it was was looking for
information about me, about my position and about
payroll time, that he wanted to talk to human
resources and I think that's it.
(Pltf. Opp. Br. Ex. E at 77, 78-9.) Padilla has not submitted an
affidavit from the receptionist. Payco's records reflect that 5 although
Payco agents spoke with the receptionist on several occasions in an
attempt to reach Padilla, they did not discuss Padilla's loan in those
calls. (Apr. 27, 2001 Nash Aff.; Pltf. Opp. Br. Ex. D.*fn2) The only
entries that reflect any substantive conversation were three calls
seeking to speak to human resources on July 15 at 8:57am*fn3, 9:59
am*fn4, and 2:17 pm.*fn5
Padilla contends that Payco threatened that her default status
authorized them to renege on their agreement and to refer her case for
further collection proceedings, and to attach her paycheck and IRS
refund, if any. However, they never did so, and Padilla asserts that the
threats were made with no intention actually to carry them out, but
solely to harass her.
Demanding Post-Dated Checks
Instead, she alleges that during a telephone conversation on June 19,
Payco employee Gary Wagner demanded an additional twelve post-dated
checks for the monthly amount of $231.97 to cover the $10,000 shortfall
in exchange for refraining from further collection efforts. (Amd.
Compl.; Pltf. Opp. Br. Ex. E at 96.) Payco has no records reflecting such
a demand and notes that all of its employees were aware that such a
demand would violate Massachusetts law. (May 21, 2001 Nash Aff.) The
telephone log reflects that a Payco employee called Padilla on June 19 to
ask whether she had sent in payment in full, but she stated that she did
not have the money but thought she might be able to pay $10,000 down in
30 days if she received something in writing, but would continue to make
monthly payments. (Pltf. Opp. Br. Ex. D.)*fn6 Padilla's notes of the
June 19 conversation reflect that Payco "recommends post dated checks"
(Pltf. Opp. Br. Ex. D.)
Oral Agreement to Remit $10,000 Toward Principal
Padilla alleges that in August, 1997, she and Payco orally agreed that
she would remit $10,000 toward principal, and that Payco would remove
references to the late
payment in her credit report to reflect current
pay status, and would "zero out" attorneys' and collection fees. At the
time of this agreement, Payco allegedly refused to record it in writing
until it received the $10,000. Padilla's mother mailed a $10,000 check to
Payco the same month stating "applied to principal" on the memo line.*fn7
Padilla alleges that Payco's promise to apply the $10,000 toward
principal was a fraudulent misrepresentation, because it later refused to
honor the agreement and instead applied the $10,000 toward the overdue
interest pursuant to federal laws.*fn8
Payco, on the other hand, contends that by law it must apply payments
toward interest before principal, and that Padilla agreed to abide by
this practice when she signed the notes. Payco's records do not reflect
any agreement to apply the down payment toward principal, but do reflect
that Padilla said she wanted to pay $10,000 down on principal only and
continue paying $231 thereafter, and needed a letter to that effect
before she would make the payment. (Apr. 27, 2001 Nash Aff.; Pltf. Opp.
Br. Ex. D*fn9) Padilla's datebook notes ...