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Nonsuit vs Dismissal in a Debt Collection Lawsuit

What is a Nonsuit in a Debt Collection Case?

A nonsuit is when the plaintiff (the debt collector suing you) voluntarily dismisses or drops the lawsuit against you. This can happen at any point before the plaintiff has finished presenting all their evidence in court.In debt collection cases, the most common reason a plaintiff takes a nonsuit is because they realize they don’t have enough evidence or documentation to prove you actually owe the debt. Maybe they lost the paperwork showing the original debt agreement, or the records got jumbled when the debt was sold to multiple buyers.Other times, the plaintiff might take a nonsuit if you raise a solid legal defense that makes them think they’ll lose at trial – like if the statute of limitations has expired on the debt. Rather than risk an outright dismissal with prejudice (meaning they can never sue again), they‘ll cut their losses with a nonsuit.The key thing about a nonsuit is that it’s voluntary on the plaintiff‘s part. The judge doesn’t order it – the debt collector chooses to drop the case themselves, often because the evidence isn’t strong enough to win.Here’s a Reddit thread where someone describes showing up for their debt collection hearing and the plaintiff voluntarily dismissed:

“When my name was called, the judge asked the plaintiff what they want to do, and they filed a motion to dismiss the case without prejudice.”

So in that situation, the debt collector basically gave up and walked away from the lawsuit for some reason.

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Nonsuit Without Prejudice vs With Prejudice

There are two types of nonsuits in debt cases:

Nonsuit Without Prejudice
This is the most common type. It means the plaintiff is voluntarily dismissing the current lawsuit, but reserves the right to re-file the same lawsuit against you again later on.So if new evidence surfaces, or they get their documentation in order, they can turn around and sue you again over the same debt. The statute of limitations clock keeps ticking during the nonsuit period.

Nonsuit With Prejudice
This is much rarer. It means the plaintiff is barred from ever suing you again over this particular debt. The case is permanently closed.Debt collectors almost never voluntarily dismiss with prejudice, because that prevents them from ever trying to collect that debt from you through the courts again.A with prejudice nonsuit usually only happens if the judge forces it as a sanction against the debt collector‘s misconduct or because a key defense like statute of limitations has run out. But plaintiffs virtually never do this voluntarily.So in summary, if you‘re on the receiving end of a nonsuit without prejudice, it means the current lawsuit is over but you could be sued again later for the same debt. If it’s with prejudice, you‘re in the clear for good on that particular debt.

What is a Dismissal in a Debt Case?

A dismissal is when the court terminates and closes the entire lawsuit, rather than just the plaintiff voluntarily dropping it via a nonsuit.There are two main ways a debt lawsuit gets dismissed:

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  1. The plaintiff requests dismissal
  2. The judge dismisses on their own or by your request

So dismissals can be either voluntary (by the plaintiff‘s choice) or involuntary (against the plaintiff’s wishes).

Voluntary Dismissal by Plaintiff

This is basically the same as a nonsuit – the debt collector is choosing to drop and terminate the entire lawsuit. The difference is just the wording and procedure.With a nonsuit, the plaintiff files a simple “notice of nonsuit” to drop the case. With a voluntary dismissal, they file a formal “motion/request for dismissal” that has to be signed off by the judge.The reasons are the same as a nonsuit – lack of evidence, your defenses seem strong, the case seems unlikely to succeed at trial, etc. The debt collector is preemptively ending the lawsuit.Like with nonsuits, voluntary dismissals by the plaintiff can be either:

  • Without prejudice (they reserve the right to re-file later)
  • With prejudice (the case is permanently terminated)

Dismissals with prejudice are still extremely rare for the same reasons – debt collectors virtually never voluntarily give up their right to pursue the debt forever.

Involuntary Dismissal by the Court

This is where the judge dismisses the case over the plaintiff‘s objections, usually based on a motion or request from you (the defendant).There are many potential reasons the court might dismiss the lawsuit, including:

  • Statute of limitations has expired on the debt
  • Lack of legal standing/proof that plaintiff owns the debt
  • Failure to prosecute/undue delays by the plaintiff
  • Fraud or misconduct by the plaintiff
  • Valid legal defenses or counterclaims raised successfully

So rather than a voluntary choice by the debt collector, this is a forced termination of the case by the court’s authority when the plaintiff‘s lawsuit is found to be improper or invalid in some way.Involuntary dismissals can be either with or without prejudice as well. With prejudice means the case is permanently dead and can‘t be refiled. Without prejudice leaves open the possibility of the plaintiff re-filing properly if they can cure the defects in their case.Whether it‘s voluntary or involuntary, with or without prejudice, a dismissal is a full termination of the current lawsuit by court order. It’s not just the plaintiff dropping the case themselves like a nonsuit.

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Key Differences Between Nonsuits and Dismissals

So in summary, the main differences are:Nonsuit

  • Voluntary action by plaintiff only to drop/discontinue the lawsuit
  • Can happen anytime before plaintiff rests their case
  • No court approval required, just a notice of nonsuit filed


  • Can be voluntary (plaintiff chooses) or involuntary (court orders)
  • Formal motion and court approval required
  • Terminates the entire lawsuit, not just a discontinuation
  • Plaintiff has very little control if it’s involuntary

While the terminology gets used interchangeably sometimes, those are the technical distinctions between a nonsuit and dismissal in a debt collection lawsuit.From the defendant’s perspective, a dismissal with prejudice is the best outcome, as it prevents the debt collector from ever re-filing that same lawsuit again. A nonsuit or dismissal without prejudice at least gets rid of the current case, but leaves open the possibility of being sued again later over the same debt.

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What Happens After a Nonsuit or Dismissal?

So let‘s say the debt collector’s lawsuit against you ends in a nonsuit or dismissal without prejudice. The current case is over, but they reserved the right to potentially re-file later. What can you expect?In an ideal scenario for the debt collector, they’ll go back and gather more documentation or find new evidence to support their claim that you owe the debt. They’ll re-file the lawsuit with this additional proof before the statute of limitations expires.However, that‘s a best case scenario that doesn’t always happen. Debt buyers often have very little information to begin with beyond a spreadsheet listing the debt. If their first lawsuit failed for lack of proof, it‘s unlikely they‘ll be able to seriously re-file quality documentation later.More commonly in practice, a nonsuit or dismissal without prejudice is often the end of the road for that particular debt. The debt collector gives up and moves on to prioritize cases they have a better chance of winning.

So while you can’t completely rule out being sued again later, often a nonsuit or dismissal without prejudice ends up being the final conclusion of that debt collection effort against you.Of course, the debt itself may still be outstanding from the original creditor’s perspective. But at least for that particular collection lawsuit, the plaintiff seems to have thrown in the towel.If it does get re-filed, you‘ll have to go through the same response process again – filing an answer, raising any defenses like statute of limitations or lack of proof, requesting dismissal if appropriate, and preparing for a potential trial.But in many situations, once a debt case is dismissed without prejudice, the debt collector simply moves on. The potential to re-file is there, but doesn’t always get exercised in reality.

Defenses to Raise to Get a Dismissal

Since an involuntary dismissal by the court is the ideal outcome for the defendant in a debt collection lawsuit, it’s important to understand some of the most common defenses and arguments you can raise to try getting the case dismissed.Here are some of the top defenses to consider:

Statute of Limitations Expired

Every state has a statute of limitations that sets a time limit for how long a creditor has to file a lawsuit over a particular debt. Once that time period expires, you can raise the statute of limitations as an affirmative defense to get the case dismissed.The statute of limitations ranges from 3-10 years depending on the state and type of debt. It typically starts running from either the date of your last payment, or the date the debt was charged off by the original creditor.Calculating the statute correctly is crucial, as the debt collector will obviously argue the clock hasn’t run out yet. Factors like state laws, debt type, and any missed/restarted payments can make it tricky.But if you can prove the statutory time limit has passed, it’s one of the strongest grounds to get a dismissal with prejudice – meaning the debt collector can never sue you for that debt again.

Lack of Standing/Proof of Ownership

For a debt collector to have legal standing to sue you over a debt, they must be able to prove they actually own the debt and have the right to pursue it. This is surprisingly common given how many times debts get resold between different buyers.If the debt collector suing you can‘t produce the actual contract showing they purchased the debt, you can argue they lack standing. The case should be dismissed since they can’t prove their status as a real party of interest.This defense gets trickier if the debt was resold multiple times, as then there’s a longer chain of title for the debt collector to establish. But at minimum, they need proof of the debt sale that gives them the right to collect from you.

Violation of Fair Debt Collection Laws

Both state and federal laws like the Fair Debt Collection Practices Act (FDCPA) set strict rules for how debt collectors must behave when attempting to collect a consumer debt.If you can prove the debt collector violated these laws – for example, by harassing you or making misleading statements – you may be able to get the case dismissed on those grounds. At minimum, you‘d have leverage to negotiate a settlement or counter-sue for FDCPA violations.Common violations include continuing collection efforts after receiving debt validation requests, discussing the debt with third parties, making repeated calls, or misrepresenting the amount owed or their identity.

Improper Service or Lack of Jurisdiction

In some cases, you can argue the court lacks jurisdiction over you for the debt lawsuit, or that you were improperly served with the summons and complaint to begin with.Jurisdiction issues could include suing you in the wrong state or county for where the debt was incurred or where you live. Service issues may be a problem if the papers weren’t delivered to your proper address or by an authorized process server.These are more technical defenses, but can provide grounds for a dismissal if the debt collector didn‘t follow proper procedures for establishing jurisdiction and notifying you correctly.

Prove the Debt Was Discharged or Paid

If you have documentation showing the debt in question was legally discharged, such as through bankruptcy, you can get the case dismissed on those grounds. The debt collector has no legal right to pursue a discharged debt.Similarly, if you can prove with receipts or statements that the debt was already paid off or settled previously, that should result in a dismissal. The debt collector doesn’t have a case if the amount is no longer actually outstanding.

File Bankruptcy During the Lawsuit

As a last resort, you can get the debt lawsuit dismissed by filing bankruptcy during the proceedings. This triggers an automatic stay that halts all debt collection efforts.The case would be dismissed, at least temporarily while the bankruptcy case plays out. And if you receive a discharge that wipes out the debt, the dismissal would effectively become permanent and with prejudice.Of course, bankruptcy has major credit implications, so this is an extreme solution. But it does provide a way to get out of an active debt collection lawsuit if you’re otherwise out of options.Those are just some of the most common defenses and arguments for getting a debt lawsuit dismissed by the court. The key is having documentation and evidence to back up your claims, not just making allegations.If successful, you can get a court order dismissing the case with prejudice – giving you a full and permanent victory where the debt collector can never sue you again over that debt.

When to Settle vs Seek Dismissal

While a dismissal with prejudice is the ideal outcome, it’s not always possible or realistic. Debt collectors wouldn’t keep filing lawsuits if they got dismissed all the time.So when does it make more sense to negotiate a settlement rather than seeking outright dismissal? Here are some scenarios where settling may be preferable:Weak Defenses
If you don’t have strong legal grounds for dismissal – for example, the statute of limitations is still open and the debt collector seems to have solid documentation – fighting the case may be an uphill battle. Settling reduces your risk.Lack of Documentation
Even if the debt is legitimately yours, if you don’t have paperwork to counter the collector‘s evidence, dismissal becomes very difficult. Settling avoids a likely judgment against you.Partial Debt is Valid
In some cases, the debt amount or terms may be disputed, but you likely owe at least a portion of what the collector is suing for. Settling for that amount avoids further litigation.Desire to Avoid Bankruptcy
If you’re considering bankruptcy to get the lawsuit dismissed, but want to avoid that outcome, settling may be preferable to preserve your credit.Nuisance Value
Even if you‘re confident of dismissal, settling for a low nuisance value (e.g. $100-500) can make sense if it’s cheaper and easier than fighting the case through trial.The key factor is evaluating your realistic odds of outright dismissal based on the evidence and legal arguments on both sides. If dismissal seems unlikely, settling allows you to pay a reduced portion and move on.It avoids a judgment that allows the debt collector to pursue wage garnishment or bank levies. And it prevents further litigation costs and hassles for both parties.Of course, any settlement needs to be on terms you can realistically afford. And you want to get the debt collector’s agreement in writing that the settlement amount resolves the debt fully, so they can‘t come after you again later.But in many debt collection lawsuits, settlement ends up being a reasonable compromise when dismissal isn‘t a viable option. Just be sure to negotiate firmly based on your leverage and defenses.

How to Respond to a Debt Lawsuit

So what’s the best way to respond if you’ve been served with a summons for a debt collection lawsuit? Here are some tips:First, don‘t ignore it! That‘s the worst thing you can do, as it will likely lead to an automatic default judgment against you.Review the complaint carefully and mark all deadlines for filing a formal answer/response. This is usually 20-30 days from receiving service.During this time, evaluate the validity of the debt being claimed. Do you recognize it as yours? Was it discharged in bankruptcy? Has the statute of limitations expired?If you have legitimate defenses, raise them in a formal answer filed with the court. Cite any violations of debt collection laws, jurisdictional issues, or problems with the plaintiff‘s standing.Include any documentation or exhibits supporting your position, like credit reports, payment histories, or bankruptcy paperwork.If you need more time, you can request an extension for your answer deadline. Or in some cases, you may be able to file a motion to dismiss prior to answering the complaint based on clear grounds like statute of limitations.But don’t delay too long. If you miss the deadlines to respond, you lose by default.This is also a good time to consult an experienced debt collection defense attorney, at least for advice if you can’t afford full representation. They can review your situation and defenses to maximize your chances of dismissal.And if dismissal seems unlikely based on the evidence, an attorney can negotiate a reasonable settlement on your behalf while protecting your rights.The main thing is not to stick your head in the sand! Respond promptly and raise every possible defense. That’s your best shot at getting the debt lawsuit dismissed entirely.

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