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Unfair and Deceptive Acts and Practices: 8.8.9 Miscellaneous Household Products

The sale of overpriced pots and pans, represented to help prevent heart disease and promote infant health, is a UDAP violation.816 The FTC has settled cases dealing with allegations that a photoprocessing package offered consumers was virtually worthless and an unacceptably bad bargain,817 and that a company misrepresented the performance of athletic shoes.818 Other FTC consent orders deal with misrepresentations dealing with ultrasonic flea collar

Unfair and Deceptive Acts and Practices: 12.3.1 Introduction

Although courts often distinguish between types of damages, there is not always a clear dividing line. Direct or general damages are those directly and immediately resulting from the unfair or deceptive act or practice and pertain directly to the goods or services involved in the transaction. For example, if a used car dealer sells the consumer a defective automobile, the decreased value of the automobile is direct damages.

Fair Debt Collection: 15.7.6 Other Potential Tort Claims

A few states, including Georgia, Louisiana, New Mexico, and Texas, recognize a tort action for unreasonable collection methods.525 Kansas and Colorado recognize a cause of action for wrongful garnishment.526 Georgia and Hawaii recognize a cause of action for wrongful foreclosure.527

Fair Debt Collection: 15.7.8 Tort Claims Against Governmental Entities

Where state officials are involved, a tort claim may be cast as a civil rights violation.541 Ordinary tort actions against governmental creditors will, however, raise special problems: the consent to suit found in state tort claims acts generally excludes certain collection activities, such as tax collection, and the complexities of municipal liability law are beyond the scope of this treatise.542

Fair Debt Collection: 15.8 Attorney’s Liability to Third Parties for Collection Negligence and Other Torts

Collection attorneys can be held liable under the Fair Debt Collection Practices Act to debtors against whom they prosecute claims.543 Attorneys can also generally be held liable to opposing parties for intentional torts,544 but common law rules may insulate the attorney from liability to consumers for damages caused by negligent debt collection acts.545 Thus, a collection attorney who negligently files suit against or levies on the home of the wro

Fair Debt Collection: 15.9 Liability of Principals, Officers

The liability of the creditor for acts of a collection agency, which often possesses inadequate capital, should always be investigated. This liability generally turns on the level of control the creditor exercised over the collector’s activities.557 A creditor may also be liable for negligently hiring a collector, even if the collector is an independent contractor.558

Unfair and Deceptive Acts and Practices: 11.9.1 Introduction

Constitutional challenges to UDAP statutes are rarely successful. The fundamental notion that UDAP statutes and regulations can provide a right of action with flexible remedies for unfair or deceptive sales conduct is unchallengeable. Nevertheless, consumer litigants need to be familiar with constitutional UDAP issues because intransigent merchants may raise constitutional defenses in order to complicate, confuse, or postpone UDAP actions.

Home Foreclosures: 5.2.2 Judicial Foreclosure

In less than half of the states, mortgages are always foreclosed by judicial action, either because of state law requirements or local custom. In these states, the lender must file an action in court, usually in the county where the property is located, to obtain a judicial decree authorizing a foreclosure sale.

Home Foreclosures: 5.2.3 Non-Judicial, “Power of Sale” Foreclosure

In thirty states and the District of Columbia, foreclosing lenders are permitted to sell the mortgaged property at a foreclosure sale without filing a court action.11 In these jurisdictions, foreclosures are accomplished by the lender’s exercise of the “power of sale” contained in the mortgage (or deed of trust).

Home Foreclosures: 5.3.3 Renewing and Tolling the Statute of Limitations

Lenders may attempt to avoid statute of limitation problems by arguing that a limitation period that otherwise expired was renewed. Courts employ a variety of terms to characterize this type of legal claim. According to some courts, a lender may “waive,” rescind,” or “abandon” a prior acceleration. In more recen.t terminology, certain actions may “de-accelerate” or “decelerate” a loan that was previously accelerated.98 It is questionable whether a mortgage lender can unilaterally revoke acceleration at all.

Home Foreclosures: 5.5.1 Overview

Before a legally valid foreclosure sale can take place, there must be a valid mortgage between the parties, a default by the borrower, proper foreclosure procedure, and no cure (if permitted) or redemption by the borrower.176 This section and Chapter 9, infra, will outline various legal challenges which the homeowner may mount to the foreclosure—including challenging t

Collection Actions: 10.2.13.3 Department of Health and Human Services

The debt collection regulations of the Department of Health and Human Services (HHS) are similar to the joint regulations.294 They authorize administrative offset, credit bureau reports, installment payment agreements, tax intercepts, administrative wage garnishment, transfer to the Treasury Department for centralized collection, offset against federal employees’ salaries, compromise of debts, suspension and termination of collection activities, and referral to collection agencies.

Collection Actions: 10.2.13.5 Department of Veterans Affairs

The debt collection regulations of the Department of Veterans Affairs (VA)307 permit disclosure to a credit reporting agency that an individual owes an obligation to the United States.308 The VA regulations regarding administrative offset set forth additional standards for collection efforts.309 They explicitly state, however, that the Department’s failure to comply with the standards shall not be available as a defense to any debtor.

Collection Actions: 10.2.13.6 Department of Agriculture

The collection of loans owed to the Department of Agriculture is governed by rules reflecting the provisions of the Claims Collection Act.324 In early 2008, the Department overhauled these rules.325 The agency must give the debtor written notice thirty days before exercising administrative offset, explaining the proposed action and the method of obtaining review.326 The debtor may request, in writing, a review of the agency’s determination that the

Consumer Banking and Payments Law: 3.7.3 Wrongful Dishonor

A drawee bank has no acceptor’s liability on a check unless it has accepted the check by signing it.398 But the drawee bank does have an obligation to the drawer to pay any check that is properly payable.399 If the drawee bank refuses to pay a check that is properly payable and covered by funds in the customer’s account, the check is wrongfully dishonored.400

Consumer Banking and Payments Law: 3.7.4 Access to Cancelled Checks

A depositor who has drafted a check may need a copy of the paper check, such as for proof of payment, tax purposes, or litigation, or to verify whether a check was altered or the drawer’s signature was forged.427 This section covers the rules regarding access to paper checks, copies of paper checks and substitute checks under Check 21.428

Consumer Banking and Payments Law: 3.8.1 Introduction

The drawee bank can take on the obligation of the acceptor by signing the check. The more common way for a drawee to become obligated to pay a check is to make final payment on the check. This usually occurs by the drawee holding onto the check beyond the time for dishonoring (bouncing) the check.445 This section discusses the forward check collection process, including how and when the drawee bank is deemed to have made final payment on the check.

Consumer Banking and Payments Law: 3.8.2.1 Automated Check Collection

Check processing in this country is highly automated, and most checks are never examined by a human being. Rather, they are processed by machines that can read the MICR code at the bottom of the check. Only some checks are pulled for human inspection. These might include checks for which there are insufficient funds or checks that are somehow physically damaged. Most banks will also pull a sampling of random checks and large checks over an amount that varies from day to day.