New Tennessee Law Gives Advantage to Debt Buyers

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A new Tennessee law went into effect on July 1 that will likely make it easier for debt buyers (succeeding creditors) to prevail in lawsuits against debtors.  Debtors had often successfully relied on the defense that a debt buyer’s written record of their debt was hearsay.  Only the records of the original creditor passed the hearsay test.  If it’s inadmissible hearsay, it’s excluded at trial.  Unless the debt buyer could produce a witness from the original creditor to testify about the records, the debtor had a great advantage.

The new law states that under certain circumstances the debt buyer’s witness will be able to testify regarding the records as if they were the records of the original creditor.  The law states that these kinds of records may now be submitted under the Tennessee Rules of Evidence business records hearsay exception.  However, records may still be excluded if they “lack trustworthiness” through some indication of shoddy preparation or suspicion of source.

See the full text of Public Chapter 186 here.