I ran across a fairly recent case decided by the Tennessee Court of Appeals, In re Estate of David Larry Letsinger (Case No. E2016-00144-COA–R3-CV, November 29, 2016). It is a good lesson for your member credit unions when they have to file a claim in a deceased member’s estate, e.g., balance due on loan made by decedent. They need to follow the “letter of the law.”
In this case the decedent died without a will. His wife served as administrator of his estate, and the required notice was sent to decedent’s creditors, including the Credit Union. The Credit Union filed a claim against the decedent’s estate for the balance due on a credit card issued to the decedent. Attached to the claim were a copy of the last credit card statement and the credit card application signed by the decedent. The administrator of the estate filed an exception to the claim contending that the Credit Union failed to comply with Tenn. Code Annot. Sections 30-2-307 and 32-2-310. The trial court denied the Credit Union’s claim, ruling that the Credit Union failed to comply with Section 30-2-307(b) by not filing an itemized statement of the claim. Section 30-2-307(b) provides as follows:
“(b) When any claim is evidenced by a written instrument, the instrument or a photocopy of the instrument shall be filed; when due by a judgment or decree, a copy of the judgment or decree certified by the clerk of the court where rendered shall be filed; and when due by open account, an itemized statement of the account shall be filed; and every claim shall be verified by affidavit of the creditor before an officer authorized to administer oaths, which affidavit shall state that the claim is a correct, just and valid obligation of the estate of the decedent, that neither the claimant nor any other person on the claimant’s behalf has received payment of the claim, in whole or in part, except such as is credited thereon, and that no security for the claim has been received, except as thereon stated.”
The Court specifically rejected the Credit Union’s contention that the monthly credit card statement attached to the claim constituted the required “itemized statement.” The decision of the trial court was upheld by the Court of Appeals, albeit on different grounds. Courts do not always apply the law so strictly, but the best practice is to follow the letter of the law, and then you know your claim will be upheld. There are other requirements of TCA Section 30-2-307 that a credit union must comply with, e.g. 30-2-307(c), which requires the claim to be filed in triplicate. This case only addressed the requirement of filing an itemized statement when the claim is based on an open account.
[x_alert heading=”About the Author” type=”info”]David Kesler, with Miller & Martin PLLC, defends employers in employment litigation and arbitrations. He has represented a number of national and international corporate clients in employment litigation in state and federal courts throughout the country. David has been lead counsel at all stages of the litigation, including discovery, summary judgment, bench and jury trials, and appellate argument. He regularly represents employers in the investigation and defense of charges of discrimination filed with the Equal Employment Opportunity Commission (“EEOC”) and comparable state agencies, including preparation of position statements in response to charges, participation in on-site interviews and negotiation of conciliation agreements. Mr. Kesler frequently counsels employers in employment decisions, including hiring, promotions and terminations, and drafts employment contracts and separation agreements. He also assists clients in drafting employment policies and generally in complying with the various federal, state and local statutes and regulations affecting the employment relationship. He can be reached at [email protected][/x_alert]