More troubling issues found in township small claims court - 13 WTHR Indianapolis

More troubling issues found in township small claims court

Updated:
There are questions circling around the Decatur Township Small Claims Court. There are questions circling around the Decatur Township Small Claims Court.
Attorney Derek Johnson collects a $450 fee on judgements he wins. Attorney Derek Johnson collects a $450 fee on judgements he wins.
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DECATUR TOWNSHIP -

There are more disturbing revelations out of Decatur Township Small Claims Court, where 13 Investigates found former patients charged with high attorney fees, some two to three times higher than the balance due.

Now our investigation finds mistakes in the system, costing some money they don't even owe and affecting their credit scores.

A medical emergency at a local grocery in 2001 created a debt that just won't go away for Michael Warfield. His paperwork tells the nightmare surrounding a $500 ambulance ride that landed him in Decatur Township Small Claims Court.

"It's not right," Warfield told 13 Investigates.

Warfield says his insurance company promised to pay the bill. But in 2006, he got a summons from MedShield. The balance had not been paid. Warfield alerted his insurance company and the company paid MedShield months later.

That should have been the end of it, but it wasn't. Collections Attorney Derek Johnson sued Warfield for court costs and attorney fees.

"This bill goes back 12 years? And you got dragged into court and your wages garnished for a bill that had been paid six years ago?" asked 13 Investigates.

"Yes," said Warfield, who paid almost $500 more.

And he's still paying to this day. His credit took a hit, meaning higher fees for loans.

"What makes you the most angry about this situation?" asked 13 Investigates.

"It's not the money, it's the code of ethics. There has got to be ethics behind this," said Warfield, who wants his credit history cleaned up.

"This is bad. This is not the way jurisprudence or the judicial system is supposed to work," said Indianapolis Attorney John Deckard, who was hired by Michelle Ware.

MedShield and Johnson sued Ware for $1,100. The problem is, she didn't owe $1,100 and had the payment history to prove it.

"I had made 10 payments, all timely payments. I was still turned over to MedShield," she said in disbelief.

In fact, Ware owed just $192 and faxed her payment records to Johnson, but says he still took her to court. He lost the judgment, but she was still ordered to pay court cost and Johnson's $450 attorney fee, not to mention her out of pocket expenses for a lawyer.

"Why was it important for you to fight this?," asked 13 Investigates.

"It was important for me to fight it because I care about my credit," Ware responded.

13 Investigates sat down with Attorney Ted Waggoner, who writes for the Bar Association about questionable attorney practices and fees. He says collection attorneys have a responsibility to confirm the claim amounts are due.

"If the debtor paid off the bill before the lawsuit was filed, then the court should not impose any fees," explained Waggoner.

Warfield's lawsuit does not take into consideration the insurance company mistake. Ware said she was sued for payments she had already made.

Waggoner says, ultimately, judges are the gatekeepers to stop attorneys from what he calls "gaming the system."

"The attorney is entitled to be paid. Whether the $450 is the right number, ought to be a case-by-case decision," added Waggoner.

Our on-going investigation is prompting action. The advisory judge over Marion County Small Claims Courts is now considering new rules on attorney fees.

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