Alum wins six year legal battle for unfair debt collection

It began as a run-down apartment with a broken lock. Then, it became $140 worth of vague, unspecified damages and an exchange of frustrated emails.

After six years, it ended as a legal battle, tenant against landlord and collection agency, accumulating an award of $1.9 million dollars to the tenant in a jury trial.

Granite has not responded to multiple attempts for comment.

Alex Hustedt-Mai began graduate school at Purdue in 2016 when she started renting an apartment at McCormick Place. At the time, the property was under bank management but after resigning her lease, Hustedt-Mai learned Granite had bought her apartment.

Even before attending Purdue, she knew she did not want to lease with Granite.

“I came to an admitted students day for my program, and when we were talking about where to live and stuff, people were like, ‘Just avoid the bananas,’” she said. “They have that reputation, and the older students told us, ‘Yeah, you're not going to want to live somewhere because it can be a pain.’”

But because she had resigned before Granite took over, it was too late.

The trouble began after Hustedt-Mai moved out of the apartment in 2018. She said when she received her itemized security deposit back, it included approximately $140 worth of damages she hadn’t caused.

In fact, Hustedt-Mai and her then boyfriend had replaced the lock on the door by themselves, she said.

“The apartment was in better shape when I left than when I got there,” she said.

After emailing back and forth, Granite could not explain why or for what Hustedt-Mai owed them the money but did not let up, she said.

Tenant landlord issues are typically handled in the small claims court, but in Hustedt-Mai's case, Granite sent her bill to debt collector Hunter Warfield, whose report would impact her credit score long-term, Hustedt-Mai said.

Hustetd-Mai disputed the charges on her credit, but Warfield’s investigation found she still owed the money, so the charges remained.

If she were to apply for bank loans or a new apartment, her credit would still say she hadn’t paid her previous landlord, she said. Without action, the dispute would stay on her credit for around seven years.

That’s when Hustedt-Mai turned to Leslie Charters, the director of Purdue’s legal services. Charters, who has experience as a deputy prosecuting attorney and in the Tippecanoe County Public Defender’s office, gives legal advice to students at Purdue but is unable to represent them in court.

A majority of the legal issues students at Purdue face are landlord tenant, Charters said.

Threat of collections process is a common way landlords intimidate students into paying unnecessary or unfair charges, Charters said.

Charters was able to introduce Hustedt-Mai to Duran Keller, an attorney with expert knowledge in credit reporting and similar issues, Charters said.

In 2019, Hustedt-Mai opened a case against Granite.

“Alex was one of very few students who stood up to the landlord, and the debt collectors and the credit bureaus and just felt like she needed to do what was right,” Charters said. “It just wasn't a fair thing that was happening to her.”

Her case escalated when Hustedt-Mai refused Granite’s settlement offer that came with a non-disclosure agreement.

“I think what they do is unfair,” Hustedt-Mai said. “We weren't able to settle, because they wanted the NDA so that I wouldn't talk to people about what happened.”

Granite then brought a case against Hustedt-Mai, suing her for attorney’s fees for the entire legal process.

“I essentially freaked out and was like, ‘I can't afford to pay their attorneys,’” Hustedt-Mai said.

She attempted to send them the original money she owed, but they no longer accepted it. Granite’s case against Hustedt-Mai was later dismissed with prejudice, meaning Granite could not attempt to sue her again, she said. She said she is unsure why they dropped the case.

Hustedt-Mai’s case against Granite was then dropped due to Indiana's deceptive consumer sale act, which does not protect consumers from sales involving property. Because Hustedt-Mai's case revolved around renting land, it counted as property.

The issue with Hustedt-Mai’s credit score remained.

Around 2020, when Hustedt-Mai would complete her externship as part of her graduate program, she would need an apartment on the east coast. Because of the stain on her credit score, she had to use her fiance’s name in all the rental applications, despite living alone.

“I was taught that when you grow up, you’ve got to be strong and independent,” she said. “That’s important for me. In that moment, it was a weird conversation, and kind of embarrassing to be like, ‘Hey, by the way, I can’t do this. I need you to do it, I don’t really have another option.’”

Hustedt-Mai said it felt like her adulthood, her independence and power was taken away.

“I knew he wouldn’t say no, but to me, it felt like I had to beg,” she said.

The only way to reset her credit score would be bringing a lawsuit against Hunter Warfield, Granite's debt-collector.

The case

Hustedt-Mai’s lawsuit, which took place last June, was a jury trial that included testimonies from Granite, Warfield’s collection agency and herself, amongst others.

She faced direct examination by Keller, her attorney and cross-examination by Warfield’s.

“I felt like I didn't do anything wrong, but you can feel them trying to twist it,” Hustedt-Mai said.

In opening statements, Warfield’s legal team attempted to convince the jury that Hustedt-Mai wanted to sue them since the beginning, and was only interested in money, she said.

Their argument frustrated her because no one wants to go through a six-year legal battle, she said.

“This isn't about that. It's about making sure people know whether this is going on and they have rights and they can stand up for it,” she said. “Growing up is hard, and this makes it so much harder.”

Granite could not identify the employee who’d initially recorded the alleged charges against Hustedt-Mai, she said.

Additionally, Hustedt-Mai learned Warfield’s collection agency, based in Florida, outsourced employment from Guatemala for their credit investigation process. Employees oversaw approximately 150 cases a day, leaving very little time for actual investigation to take place, she said.

“It essentially can ruin your life, and they didn't even take the time to actually investigate to see if it (the money) was owed,” she said. “It impacts my life; it barely impacts them.”

In the end, Hustedt-Mai was awarded $1.9 million dollars. The dispute was also erased from her credit score.

“I was lucky that I had someone that could get my apartment and my car in their name. But what if you didn't have that? It could destroy your life,” Hustedt-Mai said. “You could have no place to live or not have a way to get around.”

She said there is a good chance Warfield will attempt to appeal the case soon.

“It’s a battle. The deck is stacked against people who are being asked to pay a debt they don’t feel like they owe,” Charters said.

Knowing your rights

Hustedt-Mai said the most important outcome for her was that Purdue students would know they have rights and don’t need to accept unfair treatment from rental companies and landlords. She fought hard to not take Granite’s NDA, she said.

“The collection process is terrible to have to deal with, but you do have rights in that process, and as you can see from Alex's case, you can try to enforce those rights,” Charters said. "So many students just pay unfair charges because they either don’t understand their rights, feel overwhelmed by the process or are intimidating into complying."

“It was a three-day jury trial over $140 initially,” Charters said, “but this case matters because it happens to so many people.”