Credit: Atstock Productions/Adobe Stock Appeals Court: Law Firm's Debt Collection Activities for Client Aren't Subject to Consumer Loan Law
"We hold that a law firm that prepares promissory notes or undertakes debt collection activity on behalf of a HOA client is not subject to the MCLL because it is not a 'lender' that is 'engaged in the business of making loans' under the provisions of the MCLL," Judge Brynja M. Booth wrote on behalf of the 7-1 majority. "Rather, a law firm is in the business of providing legal or debt collection services to its client."
August 15, 2022 at 03:43 PM
5 minute read
Addressing a certified question from the U.S. District Court for the District of Maryland, a majority of the Maryland Court of Appeals held that a law firm that engages in debt collection activities on behalf of a client is not subject to the provisions of the Maryland Consumer Loan Law.
Nagle & Zaller, a Columbia, Maryland, firm that provides legal services and debt collection services for homeowner associations, was retained by them in negotiating and drafting promissory notes with homeowners that memorialized repayment terms of delinquent assets.
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