AB898: Bill Text

AB898,36,23 (3) Misdemeanors. Any person who willfully and knowingly violates s. 430.408 (2) or any provision of ss. 430.401 to 430.407, other than those provisions described in subs. (1) and (2), may be fined not more than $2,000, imprisoned for not more than 6 months, or both.

AB898,37,4 430.902 Civil actions and defenses. (1) Liability generally. Except as provided under subs. (2) to (8), a rental-purchase company that violates any provision of this chapter is liable to a lessee that is damaged as a result of that violation for the costs of the action and, notwithstanding s. 814.04 (1), for reasonable attorney fees as determined by the court, plus an amount equal to the sum of the following:

AB898,37,6 (a) The actual damages, including any incidental and consequential damages, sustained by the lessee as a result of the violation.

AB898,37,10 (b) An amount equal to 25 percent of the total amount of payments necessary to acquire ownership of the rental property under the lessee's rental-purchase agreement, except that liability under this paragraph may not be less than $100 nor more than $1,000.

AB898,37,14 (2) Temporary relief; injunctions. The administrator may bring a civil action to restrain, by temporary or permanent injunction, a merchant from violating any provision of this chapter, or from engaging in false, misleading, deceptive, or unconscionable conduct, in rental-purchase transactions.

AB898,37,19 (3) Liability; certain violations. Except as provided in subs. (4) and (5), if a rental-purchase agreement violates s. 430.503, the lessee may retain the rental property under the rental-purchase agreement without obligation to pay any amount and may recover any amounts paid to the rental-purchase company under the rental-purchase agreement.

AB898,38,6 (4) Class action. (a) In the case of a class action, a rental-purchase company that violates this chapter is liable to the members of the class in an amount equal to the actual damages incurred by the class. The total statutory damages for all lessees whose recovery is computed under sub. (1) (b) relating to statutory damages may not exceed $500,000 plus the costs of the action and, notwithstanding s. 814.04 (1), reasonable attorneys' fees as determined by the court. In determining the amount to award under sub. (1) (b), the court shall consider, among other relevant factors, the amount of actual damages sustained by the members of the class, the frequency and persistence of the violations by the rental-purchase company, the resources of the rental-purchase company, the number of persons damaged by the violation, the presence or absence of good faith on the part of the rental-purchase company, and the extent to which the violation was intentional.

AB898,38,11 (b) Notwithstanding par. (a), no class action may be maintained for conduct proscribed in ch. 430 unless the conduct has been found to violate ch. 430 at least 30 days prior to the occurrence of the conduct involved in the class action by an appellate court of this state or by a rule promulgated by the division, specifying with particularity the act or practice in question.

AB898,38,13 (c) At least 30 days before commencing a class action for damages, a party must do all of the following:

AB898,38,15 1. Notify the rental-purchase company against whom an alleged cause of action is asserted of the alleged claim or violation.

AB898,38,17 2. Demand that the rental-purchase company correct, or otherwise remedy, the basis for the alleged claim.

AB898,38,22 (d) The notice required in par. (c) shall be in writing, and shall be sent by certified or registered mail, return receipt requested, to the rental-purchase company at the place where the transaction occurred, the company's principal place of business within the state, or, if neither will effect actual notice, the department of financial institutions.

AB898,39,2 (e) Except as provided in par. (g), no action for damages may be maintained under this section if an appropriate remedy, which shall include actual damages and may include penalties, is given, or agreed to be given within a reasonable time, to such party within 30 days after receipt of such notice.

AB898,39,5 (f) Except as provided in par. (g), no action for damages may be maintained under this section upon a showing by a rental-purchase company against whom the alleged claim or violation is asserted that all of the following exist:

AB898,39,7 1. All lessees similarly situated have been identified, or a reasonable effort to identify such other lessees has been made.

AB898,39,9 2. All lessees identified under subd. 1. have been notified that, upon their request, the rental-purchase company shall make the appropriate remedy.

AB898,39,11 3. The remedy requested by the lessees has been or in a reasonable time will be given.

AB898,39,15 4. The rental-purchase company has ceased from engaging, or if immediate cessation is impossible under the circumstances, the rental-purchase company will, within a reasonable time, cease to engage in any acts on which the alleged claim is based.

AB898,39,20 (g) An action for injunctive relief may be commenced without compliance with par. (c). Not less than 30 days after the commencement of an action for injunctive relief, and after compliance with par. (c), the lessee may amend his or her complaint without leave of court to include a request for damages. Paragraphs (e) and (f) shall apply if the complaint for injunctive relief is amended to request damages.

AB898,40,2 (h) As soon as practicable after the commencement of an action brought as a class action, the court shall determine by order whether it is to be so maintained. An order may be conditional, and may be altered or amended before the decision on the merits. If the court determines that the action may not be maintained as a class action, it shall allow the action to proceed on behalf of the parties appearing in the action.

AB898,40,6 (i) In any class action, the court shall direct to the members of the class the best notice practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort. The notice shall inform each class member that:

AB898,40,8 1. The court will exclude him or her from the class if he or she so requests by a specified date.

AB898,40,10 2. The judgment, whether favorable or not, will include all members who do not request exclusion.

AB898,40,12 3. Any member who does not request exclusion may enter an appearance through his or her counsel.

AB898,40,18 (j) The judgment in an action maintained as a class action under this section, whether or not favorable to the class, shall include and describe those whom the court finds to be members of the class. The judgment in an action maintained as a class action, whether or not favorable to the class, shall include and specify or describe those to whom the notice provided in par. (i) was directed, and who have not requested exclusion, and whom the court finds to be members of the class.

AB898,40,21 (k) When appropriate, an action may be brought or maintained as a class action with respect to particular issues, or a class may be divided into subclasses and each subclass treated as a class.

AB898,40,24 (L) If judgment is for a class of plaintiffs, the court shall render judgment in favor of the administrator and against the defendants for all costs of notice incurred by the administrator in such action.

AB898,41,2 (m) In the conduct of actions to which this section applies, the court may make, alter, or amend orders that do any of the following:

AB898,41,4 1. Determine the course of proceedings or prescribing measures to prevent undue repetition or complication in the presentation of evidence or argument.

AB898,41,10 2. Require, for the protection of the members of the class or otherwise for the fair conduct of the action, that notice be given in such manner as the court may direct to some or all of the members of any step in the action, or of the proposed extent of the judgment, or of the opportunity of members to signify whether they consider the representation fair and adequate, to intervene and present claims or defenses, or otherwise to come into the action.

AB898,41,11 3. Impose conditions on the representative parties or on intervenors.

AB898,41,13 4. Require that the pleadings be amended to eliminate therefrom allegations as to representation of absent persons, and that the action proceed accordingly.

AB898,41,14 5. Deal with similar procedural matters.

AB898,41,18 (n) Once certified by the court under this section, a class action shall not be dismissed or compromised without the approval of the court, and notice of the proposed dismissal or compromise shall be given to all members of the class in such manner as the court directs.

AB898,41,23 (o) A rental-purchase company shall not be liable in a class action for statutory damages computed under sub. (1) (b) relating to statutory damages, unless it is shown by a preponderance of the evidence that the violation was a willful and knowing violation of this chapter. No recovery in an action under this subsection may exceed $500,000.

AB898,42,4 (p) Reasonable attorneys' fees in a class action shall be determined by the value of the time reasonably expended by the attorney rather than by the amount of recovery on behalf of the class. A legal aid society or legal services program that represents a class shall be awarded a reasonable service fee in lieu of reasonable attorneys' fees, equal in amount to the amount of the attorneys' fees as measured by this subsection.

AB898,42,7 (q) The administrator, whether or not a party to an action, shall bear the costs of notice except that he or she may recover such costs from the defendant as provided in par. (L).

AB898,42,16 (5) Defense; bona fide error. Notwithstanding any other section of this chapter, no customer shall be entitled, in an individual or class action, to recover any penalties provided under sub. (1) (b), if the rental-purchase company violating this chapter shows by a preponderance of the evidence that the violation was not intentional, and that the violation resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid these errors. A bona fide error under this subsection includes a clerical error, an error in making calculations, an error due to computer malfunction or computer programming, and a printing error.

AB898,42,25 (6) Double liability limited. The liability of a rental-purchase company under this chapter is in lieu of any liability under the federal Consumer Credit Protection Act and s. 138.09. An action by a person alleging a violation under this chapter may not be maintained if a final judgment has been rendered for or against that person with respect to the same violation under the federal Consumer Credit Protection Act or s. 138.09. If a final judgment is entered against any rental-purchase company under this chapter and the federal Consumer Credit Protection Act or s. 138.09 for the same violation, the merchant has a cause of action for appropriate relief to the extent necessary to avoid double liability.

AB898,43,4 (7) Necessary parties. If more than one lessee is a party to the same rental-purchase agreement, all of the lessees that are parties to the rental-purchase agreement shall be joined as plaintiffs in any action under sub. (1), and the lessees are entitled to only a single recovery under sub. (1).

AB898,43,9 430.903 Limitation on actions. An action brought by a lessee under this chapter shall be commenced within one year after the date on which the alleged violation occurred, 2 years after the date on which the rental-purchase agreement was entered into, or one year after the date on which the last payment was made under the rental-purchase agreement, whichever is later.

AB898,43,11 430.904 Venue. (1) Generally. The venue for a claim arising out of a rental-purchase agreement is any of the following counties:

AB898,43,12 (a) Where the lessee resides or is personally served.

AB898,43,13 (b) Where the rental property is located.

AB898,43,16 (c) Where the lessee sought or acquired the rental property or signed the document evidencing his or her obligation under the terms of the rental-purchase agreement.

AB898,43,21 (2) Change in venue. When it appears from the return of service of a summons or otherwise that the county in which an action is pending under sub. (1) is not a proper place of trial for the action, unless the defendant appears and waives the improper venue, the court shall transfer the action to any county that is a proper place of trial.

AB898,43,24 (3) Multiple defendants. If there are several defendants in an action arising out of a rental-purchase agreement, and if venue is based on residence, venue may be in the county of residence of any of the defendants.

AB898, s. 10 Section 10. Nonstatutory provisions.

AB898,44,11 (1) Submission of proposed rules governing registration of rental-purchase companies. Using the procedure under section 227.24 of the statutes, the administrator of the division of banking in the department of financial institutions may promulgate rules under chapter 430 of the statutes, as created by this act, for the period before the date on which permanent rules take effect, but not to exceed the period authorized under section 227.24 (1) (c) and (2) of the statutes. Notwithstanding section 227.24 (1) (a), (2) (b), and (3) of the statutes, the administrator of the division of banking is not required to provide evidence that promulgating a rule under this subsection as an emergency rule is necessary for the preservation of the public peace, health, safety, or welfare and is not required to provide a finding of emergency for a rule promulgated under this subsection.

AB898, s. 11 Section 11 . Initial applicability.

AB898,44,14 (1) This act first applies to rental-purchase agreements, and conduct pursuant to those agreements, that are entered into on the effective date of this subsection.

AB898, s. 12 Section 12. Effective date.

AB898,44,16 (1) This act takes effect on the 90th day after publication.

AB898,44,17 (End)