Bank's failure to bring a debt collection action as counterclaim did not preclude later suit to foreclose

In Bauman v. Bank of America, the Sixth Circuit was faced with a question of permissive or compulsory joinder of claims.  The Plaintiffs had brought an unsuccessful suit under the Fair Debt Collection Practices Act.  After losing that case, they filed a separate action to quiet title to the property.  In the second case, for the first time the bank filed a counter claim to collect the underlying debt.  The Plaintiffs argued that the bank should be precluded from pursuing the counter claim because they did not join it in the original action.  The court held that joinder of the underlying debt collection action was permissive and not compulsory, and therefore the bank was not prevented from filing a counterclaim in the second lawsuit.