Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
55 Cards in this Set
- Front
- Back
|
What is needed for a waiver to be effective under the DTPA?
|
1) Be in writing
2) Be conspicuous: 10-pt or greater type, and bold 3) State: "I waive my rights under the Deceptive Trade Practices - Consumer Protection Act, Section 17.41 et seq., Business & Commerce Code, a law that gives consumers special rights and protections. After consultation with an attorney of my own selection, I voluntarily consent to this waiver." 4) Be signed by the consumer who is: - In a similar bargaining situation with the seller; and represented by an attorney. |
|
|
What are the most commmon prohibited practices under Ch. 541?
|
Misrepresentation of an insurance policy;
False advertising regarding the business of insurance; Misrepresentating to a claimant a material fact or policy provision relating to the coverage at issue; Failing to attempt in good faith to effectuate a prompt, fair, and equitable settlement once liability has become reasonably clear; or refusal to pay a claim without conducting a reasonable investigation. |
|
|
what are the requirements and exceptions for an "as is" clause in a contract to be sufficient to bar a DTPA claim?
|
The "as is" clause must be:
1) freely negotiated; 2) between similarly sophisticated parties; 3) part of the basis of the bargain; and 4) In an arms length transaction Exceptions: - it was procured by fraud or fraudulent inducement; - The seller impaired the buyer's ability to inspect the goods; or - the clause is merely boilerplate in a contract of adhesion. |
|
|
What are the elements of a private cause of actino under Ch. 541?
|
1) The P is a person
2) The D is a person 3) Actionable conduct - The D committed either: - A violation of the DTPA laundry list; or - A violation of ch. 541 4) The D's violation was a producing cause of 5) actual damages to the P |
|
|
Is mere puffery actionable under the DTPA?
|
Yes under the laundry list.
|
|
|
How can the implied warranty of merchantability be modified or disclaimed?
|
It can be disclaimed in writing by specifically mentioning the IWOM, and the modification or disclaimer has to be conspicuous [brought to the consumer's attention prior to purchase]
- Words such as "as is" or "with all faults" will be effective disclaimers of the IWOM if done conspicuously. |
|
|
Other the violations of the laundry list, what are other deceptive trade practices [misrepresentations]?
|
Misrepresentation of repairs: KNOWINGLY making false or misleading statements of fact concerning the need for parts, replacement, or repair service.
Warranty Fraud: Representing that a guarantee or warranty confers or involves rights or remedies which it does not have or involve. Misrepresenting work performed: Representing that work or services have been performed on, or parts replaced in, goods when the work or services were not performed or the parts were not replaced. |
|
|
How can the implied warranty of fitness for a particular purpose be modified or disclaimed?
|
It can be excluded or modified in writing, and it must be conspicuous.
|
|
|
what is the effect of a disclaimer under the DTPA?
|
If there is an effective disclaimer or limitation with respect to the warranty, the DTPA will give it effect.
If the result of the disclaimer is that there is no breach of the warranty because it was effectively disclaimed, then, the DTPA will not provide a remedy for breach of that warranty. |
|
|
What are the 5 differences between the TDCA and the FDCPA?
|
1) The TDCA applies to both debt collectors and 3rd party debt collectors
2) The TDCA has provisions relating to credit bureaus; the FDCPA does not 3) The TDCA requires that 3rd party debt collectors and Credit bureaus obtain and file with the Secretary of State a $10,000 surety bond before doing business in Texas 4) The TDCA's prohibitions and prescriptions in its lists are exclusive while the FDCPA list is non-exclusive. 5) The TDCA provides for criminal liability in addition to civil liability; criminal liability is not available under the FDCPA. |
|
|
What are the remedies under Ch. 541?
|
Actual damages - a prevailing P may be awarded actual damages. The actual damages available under the insurance code are broader than the "economic damages" available under the DTPA.
Additional discretionary damages - dependent upon a finding that the D's conduct was committed knowingly or intentionally. [up to a judge/jury] - There is a mandatory provision for the recovery of reasonable and necessary attorney's fees incurred by the person in bringing that claim. |
|
|
How does one get standing under the DTPA?
|
The P must be a consumer.
A consumer is someone who seeks or acquires, by purchase or lease, goods or services for use. - can be corporations, the state, or any political subdivision or state agency. |
|
|
What are the requirements for a qualifying settlement offer under the DTPA?
|
The offer must:
1) Be in writing; 2) Offer a dollar amount for damages; and 3) offer a separate amount for attorney's fees. |
|
|
What does Ch. 542 provide?
|
It provides a consumer with the ability to get a penalty for the insurance company's failure to promptly pay a claim.
|
|
|
What are the three implied warranties?
|
Implied warranty of merchantability
- Arises in a sale of NEW goods by a MERCHANT and the goods are fit for ordinary purpose. Implied warranty of fitness for a particular purpose - Arises when the seller has reason to know that a consumer has a specific purposes for which the goods are required and that the consumer is relying on the seller's skill or judgment to select or furnish suitable goods. Implied Warranty of title - The D warrants that he owns the goods he is selling. |
|
|
What are the dames recoverable under the DTPA?
|
A consumer is entitled to recover economic damages for most actionable violations of the DTPA.
The exception is a"tie-in" statute violation for which the broader "actual" damages are recoverable. |
|
|
What is unconscionability?
|
"Unconscionable action or course of action" is conduct that takes advantage of a consumer's lack of knowledge, ability, experience, or capacity to a grossly unfair degree.
- Gross unfairness must be glaring, noticeable, flagrant, complete, and unmitigated. ** A deceptive act or practice CAN be both a violation of a laundry list provision and an unconscionable action. STATE that it violates both on the exam! |
|
|
Does the DTPA apply to personal injury claims?
|
As a general rule, the DTPA does not apply to personal injury claims.
Exception:Medical expenses incurred or any lost earnings suffered as a result of the personal injury are considered economic damages and can be recovered under the DTPA. Exception: The DTPA allows recovery for mental anguish damages when the deceptive act or practice is committed knowingly or intentionally. |
|
|
What is a tie-in statute and how does it relate to the DTPA?
|
The DTPA makes it actionable conduct for a D to have violated a "tie-in" statute.
The tie-in statutes use the term treble damages, which is broader. The tie-in statute will allow the consumer to recover actual damages, not just economic damages. *Mental anguish can be recovered as actual damages under the tie-in statute. ALWAYS state the tie-in statute!!!!! |
|
|
What constitutes Goods under the DTPA?
|
Both tangible and real estate. It does not cover intangibles like stocks, bonds or pure loan transactions.
|
|
|
Is privity required under the DTPA?
|
No, a consumer need not be the one who pays money in order to "acquire" goods or services. If the consumer is the intended beneficiary of the product or service, he can still "qualify" as a "consumer" under the DTPA.
|
|
|
What is the implied warranty for services?
|
Services for the repair or modification of existing tangible goods will be performed in a good and workmanlike manner
Modification or disclaimer: The implied warranty with respect to services cannot be disclaimed or modified. |
|
|
Important to note about the TDCA
|
Tie-in statute: A violation of the TDCA is actionable under the DTPA as a tie-in statute violation. The combination of the two may allow a consumer to recover additional discretionary damages not otherwise recoverable under the TDCA.
|
|
|
Who has standing under Ch. 541?
|
The private cause of action in Ch. 542 is available to a person.
A person includes an individual, corporation, an insurance company, or any entity engaged in the business of insurance. |
|
|
Under the FDCPA, what are the definitions of Consumer, debt, and debt collector?
|
Consumer: any natural person obligated to pay a debt.
Debt: Any obligation of a consumer to pay money arising out of a transaction which is primarily for personal, family, or household purposes. Debt Collector: Any person who is in the business for the principal purpose of collecting debts; or who regularly collects or attempts to collect debts due or asserted to be owed to another. - The creditor itself is NOT included as a debt collector. |
|
|
What are the insurance company common law duties?
|
Duty of good faith and fair dealing
Standard: The insurance company has a duty to settle a claim with its policyholder when liability has become reasonably clear. To whom owed: The duty of good faith and fair dealing goes to the policyholder or the insured under the policyholder. It does not go to 3rd party claimants. Stowers Doctrine: An insurer has a common-law duty to exercise reasonable care in handling third-party liability claims against its insured. - If the insurance company acts unreasonably in settling the 3rd party claims within policy limits when it has the chance to do so, that insurance company may be held liable in damages to its own insured for the amount of excess that the insured suffers as a result of a judgment in excess of the policy limit. |
|
|
What is the definition of debt collector under the TDCA?
|
A debt collector means any person who, directly or indirectly, engaged in debt collection.
- Can include the creditors themselves - Attorneys are excluded if they are representing clients. |
|
|
What are some false or misleading communications in regards to the FDCPA?
|
A debt collector may not use any false, deceptive, or misleading representations or means in connection with the collection of any debt, such as:
- Representing that they are a member or acting with governmental authority - misrepresenting the amount or nature of any debt - falsely implying the debt collector is an attorney - implying that the failure to pay the debt is a crime or that the debtor could be sent to jail. |
|
|
Are personal injury damages awarded under the DTPA?
|
Generally, personal injury damages are not deemed as economic damages under the DTPA.
Exception 1: Lost wages and medical expenses are economic damages and are recoverable under the DTPA Exception 2: For tie-in statutes, "actual damages" are recoverable, including personal injury damages. Exception 3: Mental Anguish. Sometimes compensation for mental anguish is recoverable through the DTPA if the DTPA violation was committed knowingly or intentionally. |
|
|
For what transactions does the DTPA not apply?
|
Transactions over $500,000 unless it is the consumer's residence; or transactions over $100,000 if the consumer is represented by an attorney unless it is the consumer's residence.
|
|
|
What is a specific requirement of the causes of action under the laundry list?
|
Reliance: For a laundry list violation to be actionable, the consumer must have relied on the deceptive act or practice to his detriment.
|
|
|
To whom does the DTPA apply?
|
It applies to consumers. It is to be liberally construed in favor of consumers.
|
|
|
what are the 4 broad areas of prohibited practices which are covered by the FDCPA?
|
3rd Party Communications
Mandatory disclosures Prohibited Acts Prohibited false or misleading communications |
|
|
What can a consumer bring a suit for under the FDCPA?
|
Actual damages
Civil penalty of up to $1,000 per case in the discretion of the court. Recovery of reasonable and necessary attorney's fees |
|
|
What types of practices does the DTPA impose liability on?
|
The DTPA imposes liability on a D who commits conduct specifically defined as trade practices which are false, misleading, or deceptive.
|
|
|
Must consideration be paid by a consumer to bring a private action under the DTPA?
|
No, a consumer need not complete the transaction in order to "seek" goods or services. As long as the consumer has a goof faith intention of completing the purchase and the objective ability to complete the transaction, the consumer has standing.
|
|
|
A bearch of what type of warranty will allow a consumer to bring a cause of action under the DTPA?
|
A breach of an expressed or implied warranty.
|
|
|
How is an expressed warranty created and can it be modified or disclaimed?
|
An express warranty is created by affirmation of fact or promise to the consumer which becomes the basis of the bargain.
- It can be a description or a sample. It does not need to be in writing nor the words "warranty" or "guarantee" need to be used. An express warranty can be excluded or modified but only if the limiting language can be harmonized with the express warranty. Thus, if it contradicts the warranty it will not be effective. *A statement about the quality or character of goods can be the basis of BOTH a laundry list violation AND an express warranty about those goods. |
|
|
Are lost profits recoverable under the DTPA?
|
Yes, but only if shown with REASONABLE CERTAINTY
|
|
|
How do the DTPA and Ch. 541, Subchapter B work together?
|
Ch. 541 prohibits unfair methods of competition and unfair or deceptive acts or practices in the business of insurance as specifically defined in Ch. 541.
- The DTPA gives consumer the right to seek relief under the DTPA for a violation of Ch. 541. - Cumulative Remedy: Recovery under the DTPA would be cumulative with any recovery under any other act or statute, including Ch. 541. |
|
|
What are the two complete defenses to a DTPA cause of action?
|
1) Written notice of third-party information: If the D gives notice to the consumer in writing at the time of transaction that the D is relying on third-party information to make the statement or representations about the goods or services, then that can be a defense to a later claim that the information was incorrect, unless the D KNEW at the time that the information was incorrect.
- must be done at the time of the transaction - Must be relying on information from a gov't agency or other third-party source. 2) Rejection of full payment settlement offer: If the consumer REJECTS a D's offer to pay the consumer all claimed damages and atorney fees within 30 days of receiving notice of the consumer's DTPA claim, the D will have no liability under the DTPA. |
|
|
Does the FDCPA preempt state law?
|
It preempts state law remedies except to the extent that there is a conflict with the federal act, and in that case, there is only preemption to the extent that the conflict with the state law is inconsistent with providing a greater remedy to the consumer.
|
|
|
What must a debt collector do when communicating with 3rd parties?
|
A debt collector is generally restricted from contacting 3rd parties for the purpose of collecting a debt without the consent of the consumer. The debt collector may, however, contact third parties in order to find/locate the consumer. In doing so, he
1) must properly identify himself 2) may not state that the consumer owes any debt 3) may not state that they are a debt collector or that they are doing a debt collection. 4) May not communicate by post card 5) Once the debt collector knows that the consumer is represented by an attorney, the debt collector may not communicate with anyone other than the attorney. |
|
|
What acts are prohibited by the FDCPA?
|
Restirctions on time and place: A debt collector should not contact a consumer at any inconvenient time or place.
No communications with a consumer represented by attorney, unless the attorney consents. No calls to the consumer's place of employment once the debt collector knows that the employer objects. No harassment or abuse, including but not limited to, threatening or using violence, using profanity, publishing the consumer's debts as a list to others, or causing the telephone to ring repeatedly or continuously calling a person. |
|
|
What are the four measures of economic damages?
|
Benefit of the Bargain: Difference between the value as represented and the value as delivered.
Out of Pocket: Difference between the price paid and the value of goods or services as delivered. *The consumer can choose whether to recover under the benefit of the bargain or out-of-pocket. Cost of Repair: Cost to make the goods or services as warranted or represented. Loss of Use: Cost to rent replacement goods while the purchased goods are unavailable. |
|
|
What is the bona fide error defense?
|
It is an affirmative defense to a claim under the FDCPA if the violation was not intentional and reasonable procedures had been adopted by the debt collector to ensure the violation would not happen, but it happened despite the procedures.
|
|
|
What mandatory disclosures is the debt collector suppose to make?
|
A debt collector is required by the FDCP to provide two notices in communications, written or oral, with the consumer:
1) - Validation notice: within 5 days of contact with the consumer, a debt collector must tell the consumer in writing each of the following: - The amount owed - The name of the creditor - notice that (i) if the consumer disputes the validity of the debt, the debt collector will get verification of that debt and provide that verification to the consumer, and (ii) if the request for validation or notice that there is a dispute does not come from the consumer, the debt collector will assume the debt to be valid. 2) In the initial communication with the consumer, whether written or oral, the debt collector must inform the consumer: - he is attempting to collect a debt - any information collected will be used for that purpose - in all subsequent communications, the debt collector must remind the consumer that they are acting as a debt collector and the information |
|
|
What constitutes Services under the DTPA?
|
Labor and Repair
|
|
|
What are the elements of a private cause of action under the DTPA?
|
1) The P is a consumer
2) The D is connected to the consumer transaction 3) The D committed either: - A violation of the DTPA's list of acts or practices that are deemed deceptive (The Laundry List) - A breach of Warranty - An unconscionable action or course of action - A violation of insurance code ch. 541 - unfair or deceptive insurance practices - a violation of a tie-in statute 4) The D's violation was a producing cause; and 5) Damages to the P. |
|
|
What types of damages does the DTPA award?
|
Economic Damages: money damages
If a P can show knowingly or intentional conduct, then the DTPA permits additional remedies in addition to economic damages. - Mental Anguish - discretionary additional damages (treble damages. |
|
|
What are four of the most common laundry list provisions?
|
Subsection 5: Representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits or quantities that they do not have.
Subsection 7: Representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model if they are actually of another. Subsection 12: Representing that an agreement confers or involves rights, remedies, or obligations which it does not have or involve or which are prohibited. [Misrepresenting what is in a contract] Subsection 24: Failing to disclose information concerning goods or services which was known at the time of the transaction if such failure to disclose was intended to induce the consumer into a transaction into which the consumer would not have entered had the information been disclosed. |
|
|
What are the remedies with respect to services?
|
There can be expressed warranties with respect to services.
|
|
|
What is the pre-suit notice requirement under the DTPA?
|
A consumer must give D notice of his claims at least 60 days prior to filing suit.
The written notice must provide: - Description in reasonable detail of the consumer's specific complaint about the transaction; - a dollar amount of the damages claimed; and - a separate dollar amount of attorney's fees, if any , incurred. |
|
|
When can a consumer recover for mental anguish under the DTPA?
|
A finding of fact that the actionable conduct was committed knowingly or intentionally opens the door for mental anguish damages.
Sufficient evidence still required: To support recovery of damages for mental anguish, the consumer must still present DIRECT evidence showing the nature, degree and severity of the mental anguish which causes a substantial disruption in the consumer's daily routine. |
|
|
What are the non-complete defenses to a DTPA cause of action?
|
1) Mere breach of contract: A mere breach of contract IS NOT a DTPA violation.
- If the D simply fails to perform contractual obligations, his assurance that he would perform those obligations is a mere breach of contract. - There is no misrepresentation of fact regarding the goods or services. 2) "As is" contractual language: It has been held that accepting goods or real property "as is" can break the causal connection between any DTPA violation and the consumer's damages in certain circumstances. |
