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Rigsby v. American Credit Counselors, Inc.

Court of Appeals of Mississippi

April 4, 2017


          DATE OF JUDGMENT: 05/10/2016




         EN BANC.

          WILSON, J.

         ¶1. Glory Rigsby, an elderly Gulfport resident on Social Security disability, alleges that she is the victim of a "debt relief scheme" perpetrated by American Credit Counselors Inc. ("ACCI"), a Florida corporation with its principal place of business in Boca Raton, Florida. Rigsby filed a complaint against ACCI in county court, alleging that she had paid ACCI more than $1, 000 and received nothing in return. ACCI moved to dismiss the complaint based on a forum selection clause contained in its "Program Guidelines, " which Rigsby had received and signed. The county court granted ACCI's motion to dismiss, and the circuit court affirmed. For the reasons discussed below, we hold that ACCI's forum selection clause is unenforceable. Therefore, we reverse and remand the case to the county court.


         ¶2. On August 23, 2013, Rigsby entered into an "Agreement" with Henry Portner P.C. ("Portner P.C."), a New Jersey professional corporation with its offices in Coconut Creek, Florida. Henry Portner ("Portner") is a Florida attorney who is not licensed to practice in Mississippi. He is the president and "managing attorney" of Portner P.C. The Agreement refers to Rigsby as the "Client" and to Portner P.C. as the "Law Firm" or the "Attorney." The Agreement provides in part:

1.Retention of Services. Subject to the terms and conditions set forth herein, Client hereby requests that Attorney provide information, recommendations, and an action plan regarding Client's current debt obligations, with the express understanding that Attorney does not hold himself out for representation on any issues involving the interpretation and/or application of any specific state law. At all times, Law Office shall employ counsel licensed in Mississippi, to facilitate the achievement of client objectives. In addition, Client understands that Attorney may use associate attorneys, legal assistants and other third parties (supervised by Attorney at all times) to assist in rendering services under this Agreement. If Attorney identifies an FDCPA violation for which client desires representation, Attorney shall provide said representation at no out of pocket cost to Client. In the event of a settlement, Attorney shall be entitled to forty percent (40%) of the remaining settlement, along with reimbursement for any costs advanced by Attorney.
2. Attorney Fees. Client shall pay Law Office Seventy Five Dollars ($75.00) upon [C]lient's receipt and implementation of Attorney's analysis and recommended action plan. Attorney shall provide a specific action plan consistent with [C]lient's goals. Client shall also pay a monthly retainer fee equal to Twenty Nine Dollars ($29.00) per month for so long as this Agreement remains in effect. Said fee is to keep Law Office on retainer and include ongoing representation and supervision of any recommended action plan. Ongoing monthly retainer is optional and [C]lient may discontinue representation at any time. . . .
3. Attorney-Client Relationship. Henry Portner, P.C. is a Florida based law office and is not associated with any governmental agency. Other than as specifically provided herein, Attorney is not providing any other services to the Client. Particularly, this Agreement does not include any legal representation before any tribunal, including federal or state courts of any jurisdiction or representation in front of any governmental agency. Trial, or other state, federal, or governmental issues shall require Client to execute a separate Retainer Agreement. On such issues, Attorney may, but is not obligated to, refer Client to another attorney considered "Of Counsel" who is licensed in Mississippi or to independent counsel of Client's choosing in his/her state. It is clearly understood and agreed between the parties hereto that Attorney shall not pay any of Client's creditors nor assume any debts on behalf of Client.
. . . .
5. Arbitration Agreement/Jurisdiction. Law Office and Client hereby agree to settle any and all claims, disputes or controversies arising out of or relating to the employment of Attorney herein by final and binding arbitration before a neutral Arbitrator, pursuant to the rules of the American Arbitration Association. Any determination by the Arbitrator shall be final and binding. To the extent it may be necessary, the final and binding decision of the Arbitrator may be filed with a court of competent jurisdiction. The parties agree that any arbitration brought with respect to this Agreement shall be brought exclusively in The State of Florida, County of Palm Beach, and the parties irrevocably submit to the jurisdiction of Palm Beach County, Florida.

Rigsby signed the Agreement and was given a one-page "Outline of the Proposed Action Plan." The plan called for Rigsby to pay $116 per month for forty-eight months to pay off about $4, 000 in unsecured debt to creditors such as Wal-Mart, Old Navy, and Chevron.

         ¶3. On or about September 10, 2013, Rigsby signed a document provided by ACCI entitled "Program Guidelines" that provides in part:

REASON FOR THIS PROGRAM: The Client(s) have certain ongoing financial obligations to certain creditors and desire ACCI to assist in obtaining an effective Debt Management Program ("Program"). ACCI will provide certain payment plans, work-ups, negotiations, counseling and other services.
1. SERVICES OFFERED: By joining this Program, you authorize ACCI and its authorized agents, to discuss your financial information and negotiate with any of your listed creditors. You will deliver the monthly payments under the Debt Management Program to ACCI by[] automatic withdrawal (ACH), money-order, electronic fund transfer or other forms of payment acceptable to ACCI. ACCI shall forward your monthly payments as disclosed under the Program to your creditors. Your monthly payment has been established in the amount of $116 per month consisting of 7 creditor(s) based upon the information furnished by you . . . . Payments shall begin on 10/06/13 and be payable on the 6th day of each and every month thereafter until the Program is full satisfied.
2. REPRESENTATIONS BY YOU: . . . ACCI shall not be responsible for any garnishments, judgments, liens, repossessions, lapse/cancellation in insurance coverage, or any other direct or indirect or ...

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