A Novation is a new agreement and is recognized in the law. The definition of Novation from
Bouvier’s 1856 law dictionary illustrates:
NOVATION, civil law. 1. Novation is a substitution of a new for an old debt. The old debt is
extinguished by the new one contracted in its stead; a novation may be made in three different
ways, which form three distinct kinds of novations.
2. , The first takes place, without the intervention of any new person, where a debtor contracts
a new engagement with his creditor, in consideration of being liberated from the former. This
kind has no appropriate name, and is called a novation generally.
Your Novation Contract substitutes a new debt (zero) and a new engagement for the one
claimed by the credit card company.
EVERY credit card company uses the novation contract process. Any time you get a Notice of
an update to the terms and conditions of your credit card agreement, this update is in fact an
offer to enter into a novation contract (a new agreement). When you use the credit card after
receiving the new update, you have agreed to the new terms. Your act of using the card is
an acceptance of the new agreement. How else could they change your credit card
agreement? Insurance companies use this also, such as when you have a claim for $20,000 for
damage and they send you $3,000.
YOUR CARD DISPUTE AND NOVATION
You can use the same process to enter into a new agreement with a card company,
under your terms and conditions, by making the company an offer, which it can accept with
an act. Simply, you send the card company a check for some amount, say $25, with the stated
condition that by accepting the check, it agrees to your new terms and conditions (your
Novation Contract). When the card company accepts the check by cashing it, it has agreed to
your new Novation Contract.
Your notice of debt dispute and Novation Contract is designed to do the following:
(1) Bind your credit card company to the terms and conditions of your Novation Contract
which include but are not limited to:
a) the cancellation of any and all prior in-force agreements;
b) its admission that the debt and all prior agreements are now paid in full;
c) its waiver of all claimed right of arbitration against you;
d) its obligation to report the account in dispute as “paid as agreed” to credit
reporting agencies; e) its agreement to not take any collection activity against you and to inform any
assignees of the account that it has agreed that the account is “paid as agreed”;
f) the requirement that it verify under oath the amount of debt you allegedly owe
in any correspondence to you; and
g) its agreement that any breach of the terms of the Novation Contract by them
will injure and damage you and that it will be liable for all damages;
(2) Upon notice, bind any and all collection agents of your credit card company and third party
collection companies to your Novation Contract;.
(3) Establish a legal basis for a claim of zero liability for the disputed credit card
(4) Establish a legal basis for declaring invalid any and all allegations of debt made against you
that are associated with the credit card account and sent through the U.S. mails;
(5) Establish a legal basis for claiming injuries and damages should the credit card company or
any collection agency breach the terms and conditions of your Novation Contract; and,
(6) Destroy any legal basis for the credit card company or any collection agent to ignore
your card dispute and Novation Contract by your:
a) choosing and using a procedure permitted and recognized by contract common
law, the Uniform Commercial Code, the Fair Debt Collection Practices Act, and the
Fair Credit Reporting Act;
b) establishing the card company’s obligation and third party collector’s obligation
to verify under oath the amount of any debt they allege you owe;
c) removing any controversy between your demand for verification of any alleged
debt and any and all presentments by third parties containing unverified
allegations of debt against you; and,
d) removing any presumption that you willfully avoided a known debt.
LEGAL CONCEPTS BEHIND THE CARD DISPUTE AND NOVATION OFFER
1. In every legal dispute, one side is considered to have the "presumption of truth" and the
other side is considered to have the "burden of proof". As an example, if a person is accused of
a crime the law presumes s/he is innocent until the accuser proves s/he is guilty of the crime
beyond a reasonable doubt.
2.In contract law, the presumption of truth says a party is presumed to have entered
into a contract (in this instance entered into by an implicating act) knowingly and
willingly and for an exchange of adequate and sufficient consideration. 3. It cannot accept the benefit of your offer without accepting the obligations of your
offer. This doctrine is set forth in cases, Aetna Inv. Corporation v. Chandler Landscape and
Floral CO., 227 Mo.App. 17, 50 S.W.2d. 195, 197 and In re Larney’s Estate, 148 Misc. 871, 266
By sending your Novation offer and notice of your card dispute:
A. Your contract is supported with adequate and sufficient consideration in the form of a check
made to your credit card company for an amount between $25.00 and $100.00;
B. You detail with clear language the consequences of the card company accepting your offer;
C. You declare the legal basis for claiming zero liability for the account or for any debt alleged
through a prior agreement once your offer is accepted; and,
D. You state the adverse consequences to the card company of any collection activity that does
not contain sworn verified proof of your obligation as a debtor.
CREDIT CARD COMPANY RESPONSES
To verify proof of your alleged debt liability, the collection entity must provide to you
verification by sworn statement of the amount of lawful money loaned to you and that the
claim, demand or request arose from a contract which supercedes your Novation Contract. It is
further noticed that pursuant to the Fair Debt Collection Practices Act, 15 U.S.C. Sec. 1601 et.
seq., and the terms and conditions of your Novation Contract, that any collection attempt by it
or any agent that does not include the verification of debt conditions will result in breach of
your Novation Contract and an admission by them that you have no liability regarding the
account in dispute.
You will probably receive a response that will constitute an invalid response, and therefore a
default and a breach of your Novation Contract, thereby setting the card company up for your
claim of damages against it.
CLEARING UP YOUR CREDIT REPORT AND LEGAL CONCEPTS BEHIND CREDIT
REPORTING BUREAUS’ FIDUCIARY DUTIES
The Big “3” credit reporting bureaus, Equifax, Experian and Trans Union, keep personal
information on your credit worthiness. They are a “third party” supplier of that information and
have not only a legal duty to assure its accuracy but a fiduciary duty as well to maintain the
information accurately. This fiduciary role is your friend. Once it is established that your credit
card company has knowingly and willingly entered into a Novation Contract with you, you have
a legal basis for requiring the bureaus to designate your account with the credit card company
“paid as agreed”.
You send out a Sworn Notice with verified evidence along with a demand to the reporting
bureaus that they must remove all negative information from their records unless the credit
card company can provide the reporting bureau with VERIFIED proof that your Sworn Notice to
it is false or inaccurate. This never happens as you have already established and shown the reporting bureau that there is no evidence available or forthcoming that would overcome and
outweigh the evidence of the Novation Contract.
As a consequence of the fiduciary duties of the reporting bureaus under common law and their
obligations under the Fair Credit Reporting Act, the credit reporting bureaus are under a legal
duty and obligation that if they receive no verified evidence to overcome and outweigh your
Sworn Notice, to designate in their records that the account with the card company is “paid as
agreed”. They must do this no later than 30 days after they receive your Sworn Notice.
This purpose and plan document is not legal advice. If you want legal advice see a lawyer,
better yet, buy a lawyer. The documents discussed here carry no warranties either express or
implied. The documents referenced herein are served upon the respondents identified in same
under your oath and seal and are sent out with your autograph attesting that the facts,
statements, claims, laws and conclusions of law cited therein are certified by you to be true to
the best of your knowledge and belief under penalty of perjury.