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Unfair and Deceptive Acts and Practices: 12.2.3 Private Cause of Action Issues in Hawaii

In 1999, the Hawaii Supreme Court interpreted its UDAP statute as allowing a private cause of action for consumer claims of unfair and deceptive practices, but not for anti-competitive conduct.50 A 2002 legislative amendment overruled this decision, allowing consumers to bring UDAP claims for violation of both prohibitions.51 A consumer can base a UDAP claim on violation of another statute even if enforcement of that statute is committed to a state official.52

Unfair and Deceptive Acts and Practices: 12.2.7.2 Implied Causes of Action in Iowa

The substantive violations for which Iowa added an explicit private cause of action in 2009 are somewhat narrower than those in the general UDAP statute, and the private cause of action is not available against certain major entities, including banks, many other lenders, insurance companies, and many licensed professionals.83 For claims that fall in these gaps, it is important to analyze whether a private cause of action can be implied or found in other statutes.

Unfair and Deceptive Acts and Practices: 12.2.8.2 Relief Available Under UDTPA-Type Statutes

Statutes modeled after the UDTPA typically do not provide a private damage remedy, but only injunctive relief and attorney fees.97 Some may also allow rescission.98 Nevertheless, they are sometimes useful in that their scope may be broader than the state’s other UDAP statute, or their remedy of attorney fees (typically, attorney fees “may” be awarded in exceptional cases) and injunctive relief may be attractive.

Unfair and Deceptive Acts and Practices: 12.3.2.1 How Are Direct Damages Calculated: Out of Pocket, Loss of Bargain, or Cost to Repair?

UDAP statutes should be liberally construed to authorize the broadest damage remedy possible.100 Because of UDAP statutes’ remedial purpose, common law principles limiting damages between merchants are often inappropriate.101 Just as courts fashioned different rules of damages for different types of contract, equity and tort actions, they should fashion new remedial rules of damages under UDAP statutes allowing recovery of “actual” damages or “restitution.” UDAP awards should not be limited to c

Unfair and Deceptive Acts and Practices: 12.3.2.2 Loss-of-Bargain Damages

Normally, loss-of-bargain damages are more than out-of-pocket damages. For example, consider a seller’s claim that a product priced at $100 is really worth $200. If the product is actually worth $50, loss-of-bargain damages are $150 and out-of-pocket damages are $50. Since loss of the bargain is the standard measure of damages for contracts, it would be anomalous to use a lesser standard for an award under a consumer protection statute.120

Unfair and Deceptive Acts and Practices: 12.3.2.3 Cost-to-Repair Damages

Often, the consumer’s best option is to receive damages based on the cost to repair the purchased item.134 Such cost-to-repair damages are measured as the cost of making the repairs, not just the diminished value of the property left in an unrepaired state.135 Damages are the amount necessary to repair property to meet the seller’s representations.136 For example, damages for failure to complete a contract are the cost of properly fulfilling the co

Unfair and Deceptive Acts and Practices: 12.3.2.4.1 General

In some cases, restitution or out-of-pocket damages may be preferable to the consumer over other forms of damage calculations. Courts are normally generous in allowing restitution.139 Equitable defenses such as laches should not be applied to wholly defeat a restitution claim, although the court may weigh these issues along with the other equities when fashioning a remedy.140

Unfair and Deceptive Acts and Practices: 12.3.2.4.3 Restitution under California Law

The scope of restitution is particularly well-developed under the California Unfair Competition Law, one of California’s two UDAP statutes, which allows restitution but not damages. (California’s other UDAP statute—the Consumers Legal Remedies Act—allows both restitution and damages.179) The California Supreme Court defines restitution as “compelling a . . .

Unfair and Deceptive Acts and Practices: 12.3.3.1 General

Direct 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. Except possibly in Florida,208 UDAP litigants may obtain not just these direct damages, but also proximate or consequential damages—all damages foreseeably flowing from the unfair or deceptive act or practice.209 Such consequential damages are often far greater than the direct damages from the UDAP violation.

Unfair and Deceptive Acts and Practices: 12.3.3.3 Financing Costs As Consequential Damages

Financing costs that the consumer was forced to pay by reason of a deceptive sale are an important example of consequential damages that may be recovered in a UDAP suit.223 For example, where the purchase price of a defective car is found to be actual damages, interest payments attributed to the car loan are also recoverable.224 The penalty that a consumer had to pay for withdrawing retirement funds in order to pay for another contractor to complete the defendant’s botched home improvement work

Unfair and Deceptive Acts and Practices: 12.3.3.5 Lost Use of a Product or Service

An important issue concerning consequential damages is how to measure the consumer’s damages for lost use of a defective car or when a car was delivered late, or repairs were slow. Actual car rental costs can certainly be considered within the contemplation of the parties and thus are appropriate as consequential damages.234 Courts will also award the reasonable rental value of a substitute vehicle, even when there is no evidence that the consumer had in fact rented a substitute vehicle.235

Unfair and Deceptive Acts and Practices: 12.3.3.7 Attorney Fees As Consequential Damages

Often one of the greatest consequential costs to a consumer of a UDAP violation is the expense of hiring an attorney to untangle the problems caused by the deceptive practice. Most UDAP statutes authorize a prevailing consumer to recover attorney fees required to obtain the UDAP judgment, so that it will be unnecessary to recover these same costs as consequential damages. But some UDAP statutes do not do so, or make such an award discretionary with the court.

Unfair and Deceptive Acts and Practices: 12.3.3.9.1 General

An important form of consequential damages is pain and suffering or mental anguish. Authority to award “actual damages” is sufficiently broad to encompass emotional distress damages.252 In general, these damages should be available in a UDAP case at least to the same extent that they are recoverable at common law.253

Unfair and Deceptive Acts and Practices: 12.3.3.9.2 States where UDAP pain and suffering damages are never recoverable

The one exception where pain and suffering will not be available for a UDAP claim, even though such damages are recoverable at common law, is where the UDAP statute explicitly limits itself to economic damages. Only a few UDAP statutes explicitly limit the type of damages that are recoverable.254 More common is for a UDAP statute to limit recovery only to those situations where there is damage to money or property.