Consumer Law

Question 1

What is the definition of a consumer?

Answer 1

An individual, partnership, corporation, this state, or a subdivision or agency of this state who seeks to acquire by purchase or lease, any goods or services, except the term does not include a business consumer that has assets $25 million or more, or that is owned or controlled by a corporation or entity with assets of $25 million dollars or more.

Question 2

When may the DTPA be properly waived?

Answer 2

1. waiver is in writing and signed by the consumer.
2. Consumer is not in a significantly disparate bargaining position; AND
3. Consumer is represented by legal counsel in seeking or acquiring the goods the goods or services.
   * * Must be represented by legal counsel, otherwise it is void.

Question 3

When are attorneys & doctors NOT exempt from the DTPA?

Answer 3

Does not apply to:

1. An express misrepresentation of material fact that cannot be characterized as advice, judgment, or opinion
2. A failure to disclose information in violation of section 17.46(b)(24)
3. An unconscionable action or course of action that cannot be characterized as opinion, judgment, or advice.
4. Breach of an express warranty that cannot be characterized as advice, judgment, or opinion.

Question 4

When does the DTPA not apply to large sales?

Answer 4

Sales in amounts exceeding $100,000 so long as they are signed by consumer and an attorney is representing the consumer.–[I.e. Does not apply to house purchases]

Question 5

Under what 4 conditions can the Plaintiff collect for mental anguish and damages?

Answer 5

1. The use or employment by any person of a false, misleading or deceptive act or practice that is:
   a) Laundry List
   b) Relied on by a consumer to the consumer’s detriment
2. A breach of an express or implied warranty
3. Any unconscionable action or course of action by any person OR
4. The use or employment by any person of an act or practice in violation of Chapter 541 Insurance Code.

Question 6

What four elements are required for a “Failure to Disclose” claim under the DTPA?

Answer 6

1. The defendant knew information regarding the goods and services;
2. The information was not disclosed
3. There wan an intent to induce the consumer to enter into the transaction;
4. The consumer would have entered into the transaction on the same terms had the information been disclosed.

Question 7

Under the DTPA, what is the definition of “unconscionability”

Answer 7

An act or practice, which to a consumer’s detriment, takes advantage of the lack of knowledge, ability, experience, or capacity of the consumer to a grossly unfair degree.

Question 8

Who is exempt from the DTPA?

Answer 8

Business-Consumers making over $25 Million

Question 9

What does section 17.49(c) of the DTPA provide?

Answer 9

Shall not apply to a claim of damages for professional services that specifically entail judgment, advice, opinion, or similar skill. I.e. Lawyer, Accountant, etc.

Question 10

What does section 17.49(e) provide?

Answer 10

Does not apply to Personal Injury claims including mental anguish. (EXCEPT: situation where auto mechanic knowingly put the wrong brakes on a car and it caused the driver to get into an accident.

Question 11

May a breach of warranty claim be brought under the DTPA?

Answer 11

Yes. DTPA does not create any warranties, but if seller creates them, then consumer may sue under the DTPA to recover against this warranty.

Question 12

Who may a consumer NOT assert an implied warranty claim against under the DTPA

Answer 12

Remote Manufacturers or Professional services

Question 13

What must be contained in a settlement offer under the DTPA?

Answer 13

(i) An amount of money or other consideration reduced to its cash value (settlement in kind), as settlement of the consumer’s damages;
(ii) An amount of money to compensate the consumer for the consumer’s reasonable fees incurred as of the date of the offer.

Question 14

What does the rejection of a reasonable settlement offer do to the plaintiff under a DTPA claim if the court finds for an amount similar.

Answer 14

Limits a consumer’s recovery.

Question 15

What is the statute of limitations for a claim under the DTPA

Answer 15

2 Years after the date on which the false, misleading, or deceptive act or practice occurred.

Question 16

What is the causation standard for a claim under the DTPA?

Answer 16

A producing Cause. A producing cause is a substantial factor which brings about the injury and without which the injury would not have occurred.

Question 17

What is the cap on the amount a consumer may be awarded for mental anguish?

Answer 17

No more than three times the actual damages

Question 18

What are Economic damages?

Answer 18

Compensatory damages for pecuniary loss, including costs of repair and replacement. Compensatory Damages include: medical expenses property damages, lost income.

Question 19

What is required to recover for mental anguish damages?

Answer 19

Jury/Judge must determine the producer committed their actions knowingly.

Question 20

Define Debt Collector

Answer 20

any person who uses any instrumentality of interstate commerce or the mails in any business, the principal purpose of which is the collection of any debts, who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due. The term debt includes only consumer debts, which are debts for personal, family, or household purposes.

Question 21

To Whom does the Fair Debt Collection Practices Act apply?

Answer 21

3rd Party debt collectors against a consumer

Question 22

When may the actual debtor be subject to a claim under the DTPA?

Answer 22

When they use another name and appear to be a third party collector.

Question 23

What hours may a debt collector call?

Answer 23

Between 8am-9pm

Question 24

What is a tie-in statute?

Answer 24

When a debt collector violates the TDCA, consumer may also bring a claim under the DTPA for deceptive debt collection practices.

Question 25

What is a reason for filing a tie-in statute under the DTPA

Answer 25

Allows the consumer to also claim mental anguish and collect on those damages that are not allowed under the TDCA.

Question 26

What are some examples of tie-in statutes?

Answer 26

1. Business Opportunity Act
2. Contest and Giveaway Act
3. Debt Collection Act
4. Health Spa Act–3 days to rescind
5. Home Solicitation Act–3 days to rescind
6. Credit Service Organizations
7. Removal of unauthorized vehicles from parking facility–may only be done if there is a sign.
8. Rental-purchase agreements
9. Representations as an Attorney—person is not actually an attorney
10. Manufactured Housing Standards Act
11. Motor Vehicle Commission Code
12. Timeshare Act
13. Regulation of Telephone Solicitation

Question 27

Is cumulative recovery possible regarding remedies under the DTPA?

Answer 27

If there are different acts or practices resulting in different damages, cumulative recovery is permissible.

Question 28

What damages are available when the Defendant acted Knowingly under the Texas Insurance Code?

Answer 28

Treble actual damages.

Question 29

What damages is the plaintiff entitled to if he successfully proved D violated the Texas Insurance Code?

Answer 29

Actual damages, attorneys’ fees and court costs.

Question 30

Under the Texas Debt Collection Act, what damages is a consumer entitled to?

Answer 30

Under the TDCA, the consumer is entitled to compensatory damages for pecuniary loss only.

Question 31

What are the four categories of prohibited conduct under the Texas Debt Collection Act?

Answer 31

(i) threats or coercion;
(ii) harassment and abuse;
(iii) unfair or unconscionable conduct; and
(iv) fraudulent, deceptive or misleading representations.

Question 32

Under the DTPA What damages is a prevailing consumer entitled to?

Answer 32

Economic damages, damages for mental anguish, equitable remedies, and attorneys’ fees.

Question 33

Whenever the Defendant acted INTENTIONALLY under the DTPA what is the prevailing party entitled to the recovery of?

Answer 33

Both treble economic damages and treble damages for mental anguish.

Question 34

Whenever the Defendant acted KNOWINGLY under the DTPA what is the prevailing party entitled to the recovery of?

Answer 34

Treble economic damages only.

Question 35

When may additional damages be recovered under the DTPA?

Answer 35

When the defendant acted knowingly or intentionally

Question 36

What is the definition of knowingly under the DTPA?

Answer 36

Actual awareness, at the time of the act or practice complained of, of the falsity, deception, or unfairness of the act or practices giving rise to the consumer’s claim.

Question 37

What dollar amount must a transaction be to be exempt from the DTPA?

Answer 37

A transaction or set of related transactions valued in excess of $500,000 is exempt from the DTPA. However, an important exception is a transaction or related transactions involving a consumer’s residence.

Question 38

What is the exception to the transaction cost limit for claims under the DTPA?

Answer 38

Consumer’s residence.

Question 39

What is the business threshold for exemption under the DTPA?

Answer 39

$25 Million

Question 40

Under the DTPA, which parties may be sued by consumer regarding the sale of a house?

Answer 40

The seller, the seller’s real estate agent, and the buyer’s real estate agent.

Question 41

What is required to prevail on a Breach of Warranty claim?

Answer 41

To prevail on a breach of warranty claim under the DTPA, a consumer must prove three elements: (1) that a warranty exists; (2) the scope of the warranty; and (3) that the warranty has not been disclaimed or modified. Laws outside of the DTPA govern all three elements.

Question 42

What is the causation standard for recovering damages under the DTPA?

Answer 42

Producing Cause