Consumer Law on Bar
1) Consumer law of twelve thirty-minute essay questions (on the third day).
2) All past exams at bar examiner website and all past consumer essays are in handount.
3) Consumer law includes:
b. DTPA Tie-in statutes
c. Texas and Federal debt collection acts
d. Insurance Law
LEARN FOUR TEMPLATES
1) Standard plain vanilla DTPA
a. July 1999, Feb 2000, July 2000, Feb 2001, Feb 2003, Feb 2005, Feb 2006
2) Texas Debt Collection Act
a. Feb 2002, July 2002, Feb 2004 (& DTPA), July 2005 (& DTPA)
3) Texas Insurance Code
a. Feb 2002, July 2004 (& DTPA)
4) Tie-in statute/DTPA
a. July 2003 (Home Solicitation Act)
DTPA CAUSES OF ACTION 17.50
1) False, misleading, or deceptive act or practice that is
a. specifically enumerated in statute [the laundry list] b. and relied on by consumer to the consumer’s detriment
2) breach of an express or implied warranty
3) any unconscionable action or course of action by any person;
4) violation of Insurance Code ch. 541
TILA [Truth in Lending Act] 1) Requires clear disclosure of interest rates and other credit terms (“finance charges”)
2) But does not regulate rates themselves
3) Right of rescission (“cooling off period”) for certain transactions
1) Federal Reserve Board’s administrative regulations that implement TILA
15 USC § 1640
1) Actual damages
2) Attorneys fees
3) Statutory penalty [see Koons v. Nigh below] [KOONS v. NIGH] Nigh sued Koons, a car dealership, under TILA, the Truth in Lending Act. Nigh sought uncapped recovery of twice the finance charge, an amount equal to $24,192.80. Koons Buick urged a $1,000 limitation on statutory damages under § 1640(a)(2)(A)(i).
[SECTION 1640] à Civil liability
(a) Individual or class action for damages; amount of award; factors determining amount of award. Except as otherwise provided in this section, any creditor who fails to comply with any requirement imposed under this chapter [15 USCS §§ 1631 et seq.], including any requirement under section 125 [15 USCS § 1635], or chapter 4 or 5 of this title [15 USCS §§ 1666 et seq. or 1667 et seq.] with respect to any person is liable to such person in an amount equal to the sum of–
(1) any actual damage sustained by such person as a result of the failure;
(2) (A) (i) in the case of an individual action twice the amount of any finance charge in connection with the transaction, (ii) in the case of an individual action relating to a consumer lease under chapter 5 of this title [15 USCS §§ 1667 et seq.], 25 per centum of the total amount of monthly payments under the lease, except that the liability under this subparagraph shall not be less than $ 100 nor greater than $ 1,000, or (iii) in the case of an individual action relating to a credit transaction not under an open end credit plan that is secured by real property or a dwelling, not less than $ 200 or greater than $ 2,000; or
ISSUE: Who is correct, the seventh or the forth circuit?
þ SEVENTH CIRCUIT: Under Mars, the seventh circuit has previously held that damage recovery under clause (i) and (ii) are both capped
ines that the intent was to cap damage recovery.
DTPA [THREE ELEMENTS] CONSUMER [STANDING] (1) SEEK OR ACQUIRE
(2) PURCHASE / LEASE
a. Privity not a consideration
b. Standing establish by relationship to transaction, not a contractual relationship with defendant
(3) GOOD OR SERVICES: The goods or services purchased or leased must form the basis of the complaint
a. GOODS: Tangible chattels or real property purchased or leased for use
b. SERVICES: Work, labor, or service purchased or leased for use, including services furnished in connection with the sale or repair of goods.
(4) MUST FORM THE BASIS OF THE BARGAIN
GOOD FAITH [see Martin v. Lou Poliquin / Holeman v. Landmark] (1) [This good faith analysis only applies when goods are not actually purchased / leased] (2) SUBJECTIVE INTENT: Presents himself to the seller as a willing buyer with the subjective intent or specific “objective” of purchasing.
(3) CAPACITY: Possesses at least some credible indicia of the capacity to consummate the transaction.
(1) Cannot have more than $25,000,000 in assets for a plaintiff
(1) SECTION 17.50(a) à LAUNDRY LIST
(2) BREACH OF AN EXPRESS OR IMPLIED WARRANTY
UNCONSCIONABLE ACTION OR COURSE OF ACTION