CAPITAL ONE BANK (USA), N.A. v. ELLIOT SAFFRAN

STARK, J. This appeal arises from a judgment that entered in favor of the plaintiff-appellee in the amount of $840.10 for a credit card debt. The defendant-appellant argues that the judgment should be reversed and vacated for the following three reasons: (1) the court erred when it denied the appellant's motion for leave to file a third amended pleading; (2) the court erred when it denied the appellant's right to a trial by a jury; and (3) the court erred as a matter of law when it held in favor of the appellee. For the reasons set forth below, the judgment is reversed in part and affirmed in part.

Procedural background. On March 18, 2013, Capital One Bank (USA), N.A. ("appellee"), filed a small claims action in Milford District Court to collect a credit card debt allegedly owed by Elliot Saffran ("appellant"). A default judgment entered against the appellant in July of 2013 in the amount of $840.10, plus interest and costs, after he failed to appear at the small claims hearing. On September 25, 2013, on the appellant's motion, the default judgment was vacated and the case was transferred to the regular civil docket and to Westborough District Court for a jury trial. The appellant's September 24, 2013 motion to vacate the default judgment and transfer the matter included a timely written demand for a jury trial that was served on the appellee.

On January 29, 2014, the appellant's motion for leave to file a first amended answer and counterclaims was allowed in Westborough District Court. In March of 2014, the appellant filed a motion for leave to file a second amended answer and counterclaims. On March 11, 2014, the court allowed the motion to file the second amended answer, but on March 14, 2014, the court dismissed the two counterclaims alleged because they did not state a claim. On May 2, 2014, the appellant filed a motion for leave to file a third amended answer, affirmative defenses, and counterclaims. This motion was denied by the court on May 15, 2014 based on the judge's determination that the amended answer, affirmative defenses, and counterclaims the defendant sought to file were nearly identical to the claims that had been previously dismissed.

On October 30, 2015, a bench trial was held in Worcester District Court. On March 3, 2017, the trial judge entered judgment against the appellant in the amount of $840.10, plus costs. The instant appeal followed.

Denial of motion for leave to file third amended pleading. The appellant argues that the court erred when it denied his motion to file a third amended answer, affirmative defenses, and counterclaims. We employ the abuse of discretion standard of review

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here. See Johnston v. Box, 453 Mass. 569, 582 (2009). "[A] judge's discretionary decision constitutes an abuse of discretion where [the appellate court] conclude[s] the judge made 'a clear error of judgment in weighing' the factors relevant to the decision, such that the decision falls outside the range of reasonable alternatives" (citation omitted). L.L. v. Commonwealth, 470 Mass. 169, 185 n.27 (2014).

"The decision to grant a motion to amend a complaint, while generally 'freely given when justice so requires,' Mass. R. Civ. P. 15(a), 365 Mass. 761 (1974), lies within the broad discretion of a trial judge." Murphy v. I.S.K.Con. of New England, Inc., 409 Mass. 842, 864 (1991). Factors such as undue delay, undue prejudice to the opposing party, or futility in the amendment would justify denial of such a motion. Mathis v. Massachusetts Elec. Co., 409 Mass. 256, 264 (1991).

In his set of counterclaims filed with his second amended answer, the appellant alleged that the appellee violated sections 1692(g) and (i) of the Federal Fair Debt Collection Practices Act ("FDCPA") by failing to verify the debt owed by the appellant and for lack of proper venue. The counterclaims were properly dismissed because the FDCPA applies only to debt collectors, and the appellee is the original creditor, and not a debt collector per the statute.

However, in his set of counterclaims filed with his third amended answer, the appellant alleged that the appellee violated the Massachusetts Debt Collection Regulations, 940 Code Mass. Regs. § 7.00, promulgated by the Massachusetts Attorney General's Office. Unlike the FDCPA, these regulations govern unfair and deceptive acts or practices of all creditors, and the appellee would therefore fall within the purview of these consumer protection regulations.

The appellant's motion for leave to file his third amended answer, affirmative defenses, and counterclaims was denied based on the judge's determination that the defendant sought to file a nearly identical amended answer, affirmative defenses, and counterclaims as he did in his second amended answer and counterclaims that were previously dismissed. Because the counterclaims were not identical, and because there was no undue delay, undue prejudice to the opposing party, or futility in the amendment, the motion to assert these counterclaims should have been allowed.

Jury demand. The appellant next contends that the trial judge erred when she denied the appellant's right to a trial by a jury. Rule 38(b) of the Mass. R. Civ. P. allows a party in a civil action to demand a jury trial in writing "not later than 10 days after the service of the last pleading directed to such issue." In this case, the appellant properly demanded a trial by jury in his motion to vacate the default and to transfer the case to Westborough District Court.

Rule 39(a) of the Mass. R. Civ. P. requires that a trial "so demanded shall be by a jury, unless (1) the parties . . ., by written stipulation filed with the court or by an oral stipulation made in open court and entered on the record, consent to trial by the court sitting without a jury as to some or all of the issues or (2) the court upon motion or of its own initiative finds that a right of trial by jury as to some or all of those issues does not exist under the constitution or statutes of this commonwealth."

Here, while the docket reflects that the case was scheduled for a jury trial on October 30, 2015, there is no record before this Division explaining why the case was ultimately tried before a judge as opposed to a jury. The appellant designated his appeal as one under Dist./Mun. Cts. R. A. D. A. 8C, but without a transcript. See Rule 8C(a). It is the appellant's responsibility, however, "to include in the appendix

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an accurate and complete trial record upon which the issues presented on appeal may be satisfactorily reviewed." Harvard Univ. v. Goldstein, 1999 Mass. App. Div. 67, 68. Based solely on the appellant's bare assertion in his brief that he objected to proceeding without a jury, without a transcript of the hearing or any other documentation in the record, we cannot assess whether he was improperly denied his right to a jury trial. See Discover Realty Corp. v. David, 49 Mass. App. Ct. 535, 535 n.2 (2000), citing Connolly v. Connolly, 400 Mass. 1002, 1003 (1987). Without something in the record to support the appellant's claim, we have no basis for finding error in this regard.

Trial issues. The appellant argues that the trial judge's findings and holding are "misplaced and devoid of legal merit." "The standard of review relating to a jury-waived proceeding is well established -- '[t]he findings of fact of the judge are accepted unless they are clearly erroneous' and '[w]e review the judge's legal conclusions de novo.'" Cavadi v. DeYeso, 458 Mass. 615, 624 (2011), quoting T.W. Nickerson, Inc. v. Fleet Nat'l Bank, 456 Mass. 562, 569 (2010). It is for the trial judge to determine the credibility of the witnesses. Weiler v. PortfolioScope, Inc., 469 Mass. 75, 81 (2014).

The appellee asserted an "account stated" cause of action. "An 'account stated' is an acknowledgment of the existing condition of liability between the parties. From it the law implies a promise to pay whatever balance is thus acknowledged to be due." Chace v. Trafford, 116 Mass. 529, 532 (1875). Failure to object to the accuracy of account statements may constitute an implied assent to the account stated. Milliken v. Warwick, 306 Mass. 192, 196-197 (1940). See also Charman v. Henshaw, 81 Mass. 239, 294 (1860) ("[Assent] may indeed be inferred from the reception and retaining of the account without objection."). "Such an action lies only where there have been transactions previous to the statement of the account which create a relation of debtor and creditor." Cavanaugh Bros. Horse Co. v. Gaston, 255 Mass. 587, 590 (1926).

Here, the trial judge found that the credit card statements were mailed to the address that the appellant provided when he applied for the card, that he failed to contest any of the moneys owed, and that the statements were not returned to the sender as undeliverable. The trial judge also found that the appellant admitted to applying for and using the credit card. These factual findings are not clearly erroneous, and support the cause of action. The appellant's application for and his use of the card constituted sufficient evidence of transactions creating a debtor/creditor relationship. Further, his failure to object to the statements implied assent to the account stated.

For the reasons set forth herein, the trial court's denial of the appellant's motion for leave to file his third amended counterclaims is reversed, and the case is returned to the trial court for a trial on those counterclaims. The judgment against the appellant for $840.10, plus costs, is affirmed.