Eviction filing companies use technology, and the lax regulation of their business, to mass-produce eviction cases against tenants in Maryland and elsewhere. They prefer to call themselves “delinquency management” businesses. If you think that sounds like a fancy title for a debt collector, you’d be right. These companies are not attorneys, yet they draft court papers and appear in Court representing landlords. What they write in complaints and what they tell judges can have a huge impact on the lives of Maryland tenants, but there is no exam to become an eviction-filer and no specific occupational license. The Court of Special Appeals decision in Williams v. eWrit Filings, LLC, rejects the eviction filers’ arguments for still less regulation.

What Was The Issue?

eWrit argued that its business (filing and prosecuting eviction actions) was not “debt collection.”; this is important first because debt collectors must be licensed in Maryland and second because there are laws, particularly the Maryland Consumer Debt Collection Act (MCDCA), that reign in abuses by debt collectors. eWrit’s argument, if accepted, was effectively that it did not need a license but also that it was not covered by the MCDCA; this would have meant that eviction-filers were effectively outside Maryland’s consumer rights statutes.

Why Is Eviction Debt Collection?

Vast numbers of eviction cases are filed in Maryland – more than 650,000 in 2019. Yet, only 5% or less of these cases result in eviction because the threat of eviction is also a powerful tool to coerce payment, and landlords know this. People use all sorts of tools to coerce the payment of a debt from the legitimate (e.g., threats to file a lawsuit when that right actually exists) to the illegal (e.g., threats of criminal action if you don’t pay). All of those things are debt collection.

The Court of Special Appeals explains, “the plain language of the [Maryland Collection Agency Licensing Act] establishes that actions mean to collect consumer debt for others, including FTPR actions, constitute debt collection activity.” In the case of FTPRs, the Court said

[in] each FTPR complaint, eWrit alleged that Ms. Williams “is responsible to pay” $1,145 per month in rent, and then sets forth the precise amount of rent and late charges claimed. . . . We have no difficulty concluding that eWrit’s complaints, on their face, sought to collect “consumer claims” as defined in the MCALA.

eWrit’s argument that because it never sought a money judgment against Ms. Williams (because it chose not to personally serve her with the complaint – a requirement for money judgment) was rejected:

We are wholly unpersuaded by eWrit’s argument—the complaints filed against Ms. Williams unequivocally sought “possession of the property and a judgment for the amount determined to be due.”

The Court of Special Appeals also noted some other things that demonstrate that eviction-filers are covered by the licensing act:

• There is an express exemption from licensing for realtors collecting rent, strongly suggesting that anyone else collecting rent needs a license.
• In 1980, the Attorney General’s Office issued a formal opinion stating that rent collectors had to be licensed under the act.
• After the attorney general opinion, the General Assembly added the exemption for realtors but no one else, suggesting that the General Assembly agreed that all other rent collectors should be licensed.

Why Is This Important?

This ruling will make it easier to hold accountable unlicensed debt collectors who use eviction filings as a tool to obtain payment and uphold some very basic consumer rights in eviction filings. An eviction-filer (or indeed, a landlord) should not be able to demand something in an eviction case that they know they are not entitled to – such as demanding more rent than is owed or including charges that you can’t be evicted for failing to pay. The Maryland Consumer Debt Collection Act prohibits just this sort of thing by banning collectors from claiming, threatening, or attempting to enforce a right, knowing that the right does not exist.