Here is the scenario: You were detained by a store security guard or loss prevention employee for suspected shoplifting. Soon thereafter you receive a very official looking intimidating letter from a law firm or agency demanding hundreds of dollars for “civil recovery”.
A frequent question asked by clients facing a petty theft or shoplifting charges is whether they should pay the demand by the store for “costs” following an arrest. The letter you received was a “civil demand” letter oftentimes from a law firm, or a division of the store itself, that does nothing but send out these intimidating letters after a shoplifting incident, trying to get hundreds of dollars from the accused.
Indeed, the California Penal Code has a provision that allows a merchant to make a demand of up to $500 from an individual accused of shoplifting in their store to recover “damages”. Those stores sometimes contract with law firms to crank out form letters, demanding outrageous sums of money. They hope you’ll either think it will prevent criminal charges from being filed (it won’t) or that it will mean that criminal charges will be dropped (they won’t). In many cases, the store will have the accused sign an acknowledgement that they will accept and pay the requested civil demand at the time they are detained for shoplifting inside the retailer’s business. These signatures are generally obtained under duress and would have little legal weight in a Court of law.
The general consensus in the legal community is that the law firms that send these letters almost never do anything if you don’t pay. One particular firm was quoted recently saying that they send out well over a million letters a year, but rarely file any actual lawsuits. The odds are overwhelming that if you ignore their letter (and the two or three that will follow with increasing amounts demanded), they will in many instances just drop it. You see, they know that even if they were to file a small claims case against you, they likely wouldn’t get anything in a judgment or if they did, it would be far less than the hundreds of dollars they’re asking for and it just isn’t worth their time. There have been instances where the store will go so far as to place a negative entry on the accused credit report, though this is rare and probably illegal unless you agreed to pay the amount or conceded the debt in some other manner. It is much more likely they will pursue the claim against you if you signed an agreement to pay the civil recovery while being detained. They deem your signature to be an acknowledgement of the “debt” and therefore treat it as such for purposes of collection. If you did not sign any agreement to pay a civil demand they can still pursue the civil costs but it is less likely.
Are they entitled to the money? Probably not. Here is why, the store recovered the merchandise in undamaged condition and simply put it right back on the shelf to be resold. Their actual damages are almost always nothing. The store personnel involved in this situation were already on the clock, so no extra salary was paid to deal with you. Consequently, their actual damages are arguably zero.
Here is the bottom line. Paying it, should you feel compelled to, will guarantee that they won’t file that lawsuit against you or continue to hound you for the money by sending letter after letter causing you much stress and worry.
This civil demand has absolutely nothing to do with criminal charges of petty theft or shoplifting. If there is any actual restitution, you’ll be required to pay that amount (not some inflated amount) through the Court.
One thing though is for sure, if you contact the store or the law firm/collection agency seeking the money then they’ll know they’ve got you on the hook. By engaging with them in any way, either by phone or by mail), they will feel they have somebody who’s willing to pay them and they will keep up their efforts to collect from you. You could advertently say something that could be construed as an agreement to pay, turning this into a different situation.
Either pay the amount demanded, if that gives you peace of mind, or ignore them completely. Paying off the demand is not an admission of guilt. The choice is yours. The most important thing is allowing your lawyer to focus on the shoplifting charges in criminal Court.
Recently, one of my clients was confronted by a debt collector who claimed he had a signed agreement to pay the amount and therefore the “debt” is valid and will be pursued. Turned out the client did in fact sign an agreement to pay the civil costs which was weaved into the acknowledgement to stay away from the store for one year, which was signed when he was detained before the police arrived. Therefore beware of this scenario which could bolster any attempts by a future collection agency to collect the questionable “debt”.
At the end of the day, If your decision is to pay it you may want to first try to negotiate the amount by sending a letter (handwritten is fine). Specifically write that you dispute the debt and the amount, however, the check will settle the matter. Attach a check for a lesser amount, say half of what they are requesting, write “payment in full” on the check and write “see attached letter” on the check as well. This is what is called an accord and satisfaction and should resolve the issue. If they send it back you are no worse for the wear.
Here is a sample “accord and satisfaction” letter:
March 13, 2014
Dear Mr. Creditor,
This letter concerns the money you say I owe you. For the past three months I have received bills from you stating that I owe $500 for civil demand costs stemming from an incident of alleged shoplifting. I never agreed to pay these costs and feel I was unjustifiably detained and/or arrested by the store in question. It is therefore obvious that there is a good faith dispute over this amount you say is owed.
In order to settle this alleged debt, I will send you a check for $200 with the explicit understanding that if you cash that check it will constitute an accord and satisfaction. In other words, you will receive from me a check that states “cashing of this check constitutes payment in full.” If you cash this check, that check will take care of any amount you say I owe you, even though it is in dispute.
You must understand that although you send this letter you may continue to be harassed, however it may end the matter and they may close the case.