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including Elsener v. Brown, 2013 IL App (2d) 120209, discussed in Sharp Thinking No. 103 (Nov.
2013) – on doubtful grounds, while selectively relying on foreign authority.

Income Withholding Act Strictly Construed

The Income Withholding for Support Act, 750 ILCS 28, has again gone to the Illinois Supreme
Court, but this time the results were more sympathetic for Illinois employers.

Noting the “stiff statutory penalties” that the act imposes (we called them “Draconian” in Sharp
Thinking No. 3 (Jan. 2008)), the Supreme Court held that a withholding notice under the act must
include the employee’s Social Security number in order to compel a withholding duty. In dicta, it went
on to say that of the 12 requirements set forth in the act for a withholding notice, only the requirement
of a signature could be missing if the notice were to be deemed “regular on its face” and entitled to
enforcement. Schultz v. Performance Lighting, Inc., 2013 IL 115738.

Dunning Letters On Time-Barred Debts Violate FDCPA

The Fair Debt Collection Practices Act (15 U.S.C. §§ 1692 et seq.) (see Sharp Thinking Nos. 62-
64 (April-May 2012) prohibits debt collectors from sending dunning letters on debts the enforcement
of which is barred by statutes of limitations, the Seventh Circuit Court of Appeals has held.

Ruling in McMahon v. LVNV Funding, LLC, 744 F.3d 1010 (7th Cir. 2014), the court said its rule
applied regardless of whether the letter actually threatens litigation. Noting that the test is the impact
on an unsophisticated consumer, the court said “a debt collector violates the FDCPA when it
misleads an unsophisticated consumer to believe a time-barred debt is legally enforceable,
regardless of whether litigation is threatened.” It rejected decisions in other circuits holding that a
threat to sue is necessary to make the dunning letter actionable.

Appellate Panel Discounts LVNV v. Trice

LVNV Funding, LLC v. Trice, 2011 IL App (1st) 092773, holding that a judgment obtained by a
collection agency in its own name without registering under the Collection Agency Act (225 ILCS 425)
is void (see Sharp Thinking No. 65 (June 2012)), “as it currently stands does not sufficiently support”
a claim that a law firm engaged inactionable activity by pursuing a claim on behalf of such an
unregistered firm, a panel in the Appellate Court’s First District has ruled.

Gibbs v. Blitt & Gaines, P.C., 2014 IL App (1st) 123681, appears to rely both on the fact attorneys
are statutorily exempt under the act and on subsequent proceedings in Trice which it thought
deprived the original decision of considerable force. (A later decision in Trice is currently on appeal to
the Supreme Court. No. 116128.) The panel also rejected a claim that the law firm violated the
FDCPA.

- John T. Hundley, Jhundley@lotsharp.com, 618-242-0246

Brenda/SharpThinking/#114.pdf
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