Senate Bill No. 102
(By Senators Yoder, Humphreys, Bailey, Blatnik, Boley,
Brackenrich, Burdette, Mr. President, Chafin, Chernenko,
Claypole, Craigo, Dalton, Dittmar, Felton, Grubb, Helmick,
Holliday, Jones, Lucht, Macnaughtan, Manchin, Minard, Plymale,
Ross, Sharpe, Tomblin, Wagner, Walker, Wehrle, Whitlow,
Wiedebusch, Withers and Wooton)
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[Introduced February 22, 1993; referred to the Committee
on the Judiciary.]
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A BILL to amend and reenact sections one hundred twenty-five and
one hundred twenty-seven, article two, chapter forty-six-a
of the code of West Virginia, one thousand nine hundred
thirty-one, as amended; to further amend said article by
adding thereto a new section, designated section one hundred
twenty-nine-a; and to amend and reenact section one hundred
one, article five of said chapter, all relating to consumer
credit protection; clarifying and prohibiting abusive
telephone collection activities; prohibiting use of
deception in telephone collection activities; awarding
attorney fees to certain prevailing consumers and assessing
court costs to certain creditors; and enhancing penalties
for violations of specific provisions prohibiting abusive
collection tactics.
Be it enacted by the Legislature of West Virginia:
That sections one hundred twenty-five and one hundred
twenty-seven, article two, chapter forty-six-a of the code of
West Virginia, one thousand nine hundred thirty-one, as amended,
be amended and reenacted; that said article be further amended by
adding thereto a new section, designated section one hundred
twenty-nine-a; and that section one hundred one, article five of
said chapter be amended and reenacted, all to read as follows:
ARTICLE 2. CONSUMER CREDIT PROTECTION.
§46A-2-125. Oppression and abuse.
No A debt collector shall may not unreasonably oppress or
abuse any person in connection with the collection of or attempt
to collect any claim alleged to be due and owing by that person
or another. Without limiting the general application of the
foregoing, the following conduct is deemed to violate this
section:
(a) The use of profane or obscene language or language that
is intended to unreasonably abuse the hearer or reader;
(b) The placement of telephone calls without disclosure of
the caller's identity and with the intent to annoy, harass or
threaten any person at the called number;
(c) Causing expense to any person in the form of long
distance telephone tolls, telegram fees or other charges incurred
by a medium of communication, by concealment of the true purposeof the communication; and
(d) Causing a telephone to ring or engaging any person in
telephone conversation repeatedly or continuously, or at unusual
times or at times known to be inconvenient, with intent to annoy,
abuse, oppress or threaten any person at the called number.
(e) After being notified by a consumer to cease all
telephone calls to the consumer, the consumer's residence, the
consumer's workplace or to any telephone of any other person with
the intent of communicating directly with the consumer, a
creditor, or a debt collection agency acting on behalf of a
creditor or any other person acting on behalf of a creditor
continues to place telephone calls to those locations. A
verified recording of a consumer notifying, by telephone or other
oral means, the creditor, debt collection agency or any person
acting on behalf of the creditor is evidence of actual notice.
§46A-2-127. Fraudulent, deceptive or misleading representations.
No A debt collector shall may not use any fraudulent,
deceptive or misleading representation or means to collect or
attempt to collect claims or to obtain information concerning
consumers. Without limiting the general application of the
foregoing, the following conduct is deemed to violate this
section:
(a) The use of any business, company or organization name
while engaged in the collection of claims, other than the true
name of the debt collector's business, company or organization;
(b) The failure to clearly disclose in all communicationsmade to collect or attempt to collect a claim or to obtain or
attempt to obtain information about a consumer, that the debt
collector is attempting to collect a claim and that any
information obtained will be used for that purpose;
(c) Any false representation that the debt collector has in
his possession information or something of value for the consumer
that is made to solicit or discover information about the
consumer;
(d) The failure to clearly disclose the name and full
business address of the person to whom the claim has been
assigned for collection, or to whom the claim is owed, at the
time of making any demand for money;
(e) Any false representation or implication of the
character, extent or amount of a claim against a consumer, or of
its status in any legal proceeding;
(f) Any false representation or false implication that any
debt collector is vouched for, bonded by, affiliated with or an
instrumentality, agent or official of this state or any agency of
the federal, state or local government;
(g) The use or distribution or sale of any written
communication which simulates or is falsely represented to be a
document authorized, issued or approved by a court, an official
or any other legally constituted or authorized authority, or
which creates a false impression about its source, authorization
or approval;
(h) Any representation that an existing obligation of theconsumer may be increased by the addition of attorney's fees,
investigation fees, service fees or any other fees or charges
when in fact such fees or charges may not legally be added to the
existing obligation; and
(i) Any false representation or false impression about the
status or true nature of or the services rendered by the debt
collector or his business; and
(j) Use of deception by characterizing telephone calls, made
to a consumer, a consumer's residence, a consumer's workplace or
the telephone of any other person likely to relay telephone
messages to the consumer as emergency calls, extremely important
calls or other characterizations of the nature of the calls to
deceive the consumer into taking a telephone call.
§46A-2-129a. Court costs and attorney fees.
In an action brought under the provisions of sections one
hundred twenty-three through and including section one hundred
twenty-nine of this article, the court shall award attorney fees
to a prevailing or a partially prevailing consumer defendant and
shall require that all court costs be paid by the creditor
plaintiff. In addition, in an action brought under the
provisions of sections one hundred twenty-three through and
including section one hundred twenty-nine of this article, the
court shall award a prevailing consumer plaintiff attorney fees
and shall require that all court costs be paid by the creditor
defendant.
ARTICLE 5. CIVIL LIABILITY AND CRIMINAL PENALTIES.
§46A-5-101. Effect of violations on rights of parties; limitation
of actions.
(1) If a creditor has violated the provisions of this
chapter applying to collection of excess charges, security in
sales and leases, disclosure with respect to consumer leases,
receipts, statements of account and evidences of payment,
limitations on default charges, assignment of earnings,
authorizations to confess judgment, illegal, fraudulent or
unconscionable conduct, any prohibited debt collection practice,
or restrictions on interest in land as security, assignment of
earnings to supervised lender, security agreement on household
furniture for benefit of supervised lender, and renegotiation by
supervised lender of loan discharged in bankruptcy, except for
violations of the provisions of sections one hundred twenty-three
through and including section one hundred twenty-nine of article
two of this chapter, the consumer has a cause of action to
recover actual damages and in addition a right in an action to
recover from the person violating this chapter a penalty in an
amount determined by the court not less than one hundred dollars
nor more than one thousand dollars. With respect to violations
arising from consumer credit sales or consumer loans made
pursuant to revolving charge accounts or revolving loan accounts,
or from sales as defined in article six of this chapter, no
action pursuant to this subsection may be brought more than four
years after the violations occurred. With respect to violations
arising from other consumer credit sales or consumer loans, noaction pursuant to this subsection may be brought more than one
year after the due date of the last scheduled payment of the
agreement. With respect to violations of the provisions of
sections one hundred twenty-three through and including section
one hundred twenty-nine of article two of this chapter, the
consumer has a cause of action to recover actual and compensatory
damages in addition to punitive damages in an amount equal to
three times the amount the creditor is attempting to collect.
(2) If a creditor has violated the provisions of this
chapter respecting authority to make supervised loans, the loan
is void and the consumer is not obligated to pay either the
principal or the loan finance charge. If he has paid any part of
the principal or of the finance charge, he has a right to recover
in an action the payment from the person violating this chapter
or from an assignee of that person's rights who undertakes direct
collection of payments or enforcement of rights arising from the
debt. With respect to violations arising from supervised loans
made pursuant to revolving loan accounts, no action pursuant to
this subsection may be brought more than four years after the
violation occurred. With respect to violations arising from other
supervised loans, no action pursuant to this subsection may be
brought more than one year after the due date of the last
scheduled payment of the agreement pursuant to which the charge
was paid.
(3) A consumer is not obligated to pay a charge in excess of
that allowed by this chapter, and if he has paid an excess chargehe has a right to a refund. A refund may be made by reducing the
consumer's obligation by the amount of the excess charge. If the
consumer has paid an amount in excess of the lawful obligation
under the agreement, the consumer may recover in an action the
excess amount from the person who made the excess charge or from
an assignee of that person's rights who undertakes direct
collection of payments from or enforcement of rights against the
consumer arising from the debt.
(4) If a creditor has contracted for or received a charge in
excess of that allowed by this chapter, the consumer may, in
addition to recovering such excess charge, also recover from the
creditor or the person liable in an action a penalty in an amount
determined by the court not less than one hundred dollars nor
more than one thousand dollars. With respect to excess charges
arising from consumer credit sales or consumer loans made
pursuant to revolving charge accounts or revolving loan accounts,
no action pursuant to this subsection may be brought more than
four years after the time the excess charge was made. With
respect to excess charges arising from other consumer credit
sales or consumer loans no action pursuant to this subsection may
be brought more than one year after the due date of the last
scheduled payment of the agreement pursuant to which the charge
was made.
(5) Except as otherwise provided, a violation of this
chapter does not impair rights on a debt.
(6) If an employer discharges an employee in violation ofthe provisions prohibiting discharge, the employee may within
ninety days bring a civil action for recovery of wages lost as a
result of the violation and for an order requiring the
reinstatement of the employee. Damages recoverable shall not
exceed lost wages for six weeks.
(7) A creditor has no liability for a penalty under
subsection (1) or subsection (4) if within fifteen days after
discovering an error, and prior to the institution of an action
under this section or the receipt of written notice of the error,
the creditor notifies the person concerned of the error and
corrects the error. If the violation consists of a prohibited
agreement, giving the consumer a corrected copy of the writing
containing the error is sufficient notification and correction.
If the violation consists of an excess charge, correction shall
be made by an adjustment or refund.
(8) If the creditor establishes by a preponderance of
evidence that a violation is unintentional or the result of a
bona fide error of fact notwithstanding the maintenance of
procedures reasonably adapted to avoid any such violation or
error, no liability is imposed under subsections (1), (2) and
(4), and the validity of the transaction is not affected.
NOTE: The purpose of this bill is to clarify and prohibit
abusive telephone collection activities by creditors including
prohibiting use of deception. The bill also awards attorney fees
to certain prevailing consumers and it assesses court costs to
certain defendants. Penalties for violations of certain
provisions of the consumer protection statutes are enhanced and
prevailing consumers may recover additional damages.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
§46A-2-129a is new; therefore, strike-throughs and
underscoring have been omitted.