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LegalGems, Lawyer
Category: Consumer Protection Law
Satisfied Customers: 10484
Experience:  Research Attorney; Private Practice; Attorney Mentor; Mediator
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My daughter is an online student with student loans. She

Customer Question

My daughter is an online student with student loans. She changed some classes , and though she had requested that any overpayments apply to the next semester, the company handling the matter, sent her a check to her old college campus mailbox that has not been valid since 2010. They are refusing to investigate the matter because the form they sent her to complete not only an affidavit portion where she verifies her identity, but has a paragraph that states she is waiving all claims against them, including legal fees. She signed the form, but had marked off the waiver of responsibility. They didn't contact her about it, but when she called to make sure they got it, she was told that they declined to investigate because she altered the form. Is it legal for them to require a waiver of responsibility to get them to investigate and try to get the check voided and recut? Time is passing and she does not want to be on the hook to repay over $10500 for a check that someone else may have gotten and cashed.
JA: What state are you in? It matters because laws vary by location. Has anything been filed or reported?
Customer: We live in Maryland, but the school is in Va. She was residential for most of her undergrad then went to online. I don't know in what state the company that handles loan refund operates.
JA: You can process your own refund by going to the Order History page and clicking on the "How do I get a refund" link below the amount paid for your question.
Customer: I'm sorry, I don't understand. You asked about the states, then said something about processing my own refund. The refund for her tuition changes was processed by the company and sent to a wrong address. Now they want her to absolve them of all responsibility before they will investigate. Is this legal?
JA: Anything else you want the lawyer to know before I connect you?
Customer: Only that the company is stating that it is her fault because they sent her an email asking how she wanted a refund and she was trying to verify through the school that it was a legit company since she didn't know who they were and she did not want a refund, but credit toward her next semester.
JA: You can process your own refund by going to the Order History page and clicking on the "How do I get a refund" link below the amount paid for your question.
Customer: Hello? Am I still waiting, or is there something I should be doing on my end?
Submitted: 1 year ago.
Category: Consumer Protection Law
Expert:  LegalGems replied 1 year ago.

Hello! I will be reviewing your question and posting a response momentarily; if you have any follow up questions please respond here. Thanks!

Expert:  LegalGems replied 1 year ago.

Thank you for your patience as I reviewed the information the automated process obtained (and I apologize for the misunderstanding towards the end of that exchange)

This must be very upsetting for you and your daughter;

If the waiver of all claims was not signed, then the company can not cite that as a basis for refusing to assist, as that would penalize a person for not signing the waiver.

Further, presumably the waiver is written so that it waives any other claims-not a waiver of the money for which the waiver was being signed; that would give rise to a person arguing that the waiver was signed under duress, in order to get the very sum under discussion.

A company has a duty to exercise due diligence, and if they did not verify a current address before sending out a check, and failed to follow explicit instructions, the company can be liable for negligence.

Negligence is defined as a failure to perform with the level of care that someone of ordinary prudence would have exercised under the same circumstances. The behavior usually consists of actions, but may consist of omissions when there is some duty to act. This cause of action has 5 elements: the existence of a legal duty to exercise reasonable care; a failure to exercise reasonable care; harm caused by the negligent conduct; physical harm of actual damages; and proximate cause (reasonably foreseeable damages).

The original contract should discuss how to handle disputes (often times arbitration is required); if the original contract cannot be located one can look to see if the terms and conditions are posted online. If arbitration is not required, then one can sue to recover money damages; given the amount it is outside the realm of small claims court.

Before suing, it is standard to first write a formal demand letter, with all of the relevant dates, and the basis for the claim (ie non receipt of refund), along with a date by which compliance will be expected. Then if there is no resolution, one would need to proceed with a negligence lawsuit to recover the money. It may be possible to allege breach of contract if the lender is in breach of the contract- ie failed to refund the money per the terms of the contract (the contract would need to be reviewed to determine if mailing it to the original address was a breach; or the student could argue that the contract was modified by subsequent instructions as contracts can be amended based on changed circumstances (ie relocation)

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Information provided is for educational purposes only. Consultation with a personal attorney is always recommended so your particular facts may be considered. Thank you and take care.

Expert:  LegalGems replied 1 year ago.

Hi- just checking in to see if you needed clarification on any of the above information. If so please post here (there is no additional charge for this) and I will do my best to get you the requested information.

Thank you!