CHAPTER 421
CONSUMER TRANSACTIONS — GENERAL PROVISIONS AND DEFINITIONS
SUBCHAPTER I
SHORT TITLE, CONSTRUCTION,
GENERAL PROVISIONS
421.102 Purposes; rules of construction.
421.104 Construction against implied repeal.
421.106 Settlement of claims; agreement to forego rights; waiver.
421.107 Effect of chapters 421 to 427 on powers of organizations.
421.108 Obligation of good faith.
SUBCHAPTER II
SCOPE AND JURISDICTION
421.201 Territorial application.
421.203 Partial exclusion for governmentally insured or guaranteed transactions.
SUBCHAPTER III
DEFINITIONS
421.301 General definitions.
SHORT TITLE, CONSTRUCTION,
GENERAL PROVISIONS
421.101
421.101
Short title. Chapters 421 to
427 shall be known and may be cited as the Wisconsin consumer act.
421.101 History
History: 1971 c. 239.
421.101 Annotation
The Wisconsin Consumer Act: Territorial Considerations. Anzivino. 96 MLR (No. 3 2013).
421.102
421.102
Purposes; rules of construction. 421.102(1)
(1)
Chapters 421 to
427 shall be liberally construed and applied to promote their underlying purposes and policies.
421.102(2)(a)
(a) To simplify, clarify and modernize the law governing consumer transactions;
421.102(2)(b)
(b) To protect customers against unfair, deceptive, false, misleading and unconscionable practices by merchants;
421.102(2)(c)
(c) To permit and encourage the development of fair and economically sound consumer practices in consumer transactions; and
421.102(2)(d)
(d) To coordinate the regulation of consumer credit transactions with the policies of the federal consumer credit protection act.
421.102(3)
(3) A reference to a provision of
chs. 421 to
427 includes reference to a related rule or order of the administrator adopted under
chs. 421 to
427.
421.102 History
History: 1971 c. 239;
1979 c. 89.
421.102 Annotation
Consumer act penalties are improper when the underlying contract is tainted with illegality. Shea v. Grafe,
88 Wis. 2d 538,
274 N.W.2d 670 (1979).
421.102 Annotation
The consumer act may constitutionally regulate sales to residents by out-of-state mail order retailer. Aldens, Inc. v. LaFollette,
552 F.2d 745.
421.102 Annotation
Wisconsin consumer act — a critical analysis. Heiser, 57 MLR 389.
421.102 Annotation
Wisconsin consumer act — a freak out? Barrett, Jones, 57 MLR 483.
421.102 Annotation
Protection for consumers against unfair and deceptive business. Jeffries, 57 MLR 559.
421.102 Annotation
An overview of the Wisconsin consumer act. Stute, 1973 WBB No. 1.
421.102 Annotation
Private enforcement of consumer laws in Wisconsin. Waxman. WBB May 1983.
421.102 Annotation
Wisconsin consumer credit laws before and after the consumer act. Crandall, 1973 WLR 334.
421.102 Annotation
Usury and the time-price differential. 1975 WLR 246.
421.102 Annotation
Mandatory Arbitration of Consumer Rights Cases. Schneider & Quirk. Wis. Law. Sept. 2002.
421.103(1)(1) Unless superseded by the particular provisions of
chs. 421 to
427,
chs. 401 to
411 and the principles of law and equity, including the law relative to capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, or other validating or invalidating cause supplement
chs. 421 to
427.
421.103(2)
(2) Unless terms used in
chs. 421 to
427 are defined by particular provisions of
chs. 421 to
427, they shall have the meaning given them in
chs. 401 to
411 and
429, if they are defined in
chs. 401 to
411 and
429.
421.103(3)
(3) Unless superseded by the particular provisions of
chs. 421 to
427 parties to a consumer transaction have all of the obligations, duties, rights and remedies provided in
chs. 401 to
411 which apply to the transaction.
421.104
421.104
Construction against implied repeal. Chapters 421 to
427 being a general act intended as a unified coverage of the subject matter of such chapters, no part of
chs. 421 to
427 shall be deemed to be impliedly repealed by subsequent legislation if such construction can reasonably be avoided.
421.104 History
History: 1971 c. 239;
1979 c. 89.
421.106
421.106
Settlement of claims; agreement to forego rights; waiver. 421.106(1)(1) Except as otherwise provided in
chs. 421 to
427, a customer may not waive or agree to forego rights or benefits under
chs. 421 to
427.
421.106(2)
(2) A claim by a customer against a merchant for an excess charge, other violation of
chs. 421 to
427 or civil penalty, or a claim against a customer for default or breach of a duty imposed by
chs. 421 to
427, if disputed in good faith, may be settled by agreement.
421.106(3)
(3) A claim, whether or not disputed, against a customer may be settled for less value than the amount claimed.
421.106(4)
(4) A settlement in which the customer waives or agrees to forego rights or benefits under
chs. 421 to
427 is invalid if the court as a matter of law finds the settlement to be unconscionable at the time it was made. In this regard the court may consider the competence of the customer as measured by his or her education, ability to speak and read the language of the contract, and his or her prior consumer experience; any deception or coercion practiced upon the customer; the nature and extent of the legal advice received by the customer; and the value of the consideration.
421.106 History
History: 1971 c. 239;
1979 c. 89.
421.106 Annotation
An arbitration provision explicitly prohibiting a consumer from proceeding as part of a class was unconscionable. Permitting predispute waivers of class proceedings would be contrary to the Wisconsin Consumer Act's purpose of protecting consumers from unfair practices. Cottonwood Financial, LTD v. Estes,
2010 WI App 75,
325 Wis. 2d 749,
784 N.W.2d 726,
09-0760.
421.107
421.107
Effect of chapters 421 to 427 on powers of organizations. 421.107(1)(1) Except as specifically provided,
chs. 421 to
427 prescribe maximum charges for all consumer credit transactions and displace existing limitations on the powers of creditors based on maximum charges.
421.107(2)
(2) Except as specifically provided, with respect to sellers of goods or services, lessors of goods, small loan companies, licensed lenders, consumer and sales finance companies and commercial banks and trust companies,
chs. 421 to
427 displace existing limitations on their powers based solely on amount or duration of credit.
421.107(3)
(3) Except as provided in
sub. (1),
chs. 421 to
427 do not displace limitations on powers of credit unions, savings banks, savings and loan associations or other thrift institutions whether organized for the profit of shareholders or as mutual organizations.
421.107(4)(a)
(a) Limitations on powers of supervised financial organizations (
s. 421.301 (43)), with respect to the amount of a loan to a single borrower, the ratio of a loan to the value of collateral, the duration of a loan secured by an interest in land or other similar restrictions designed to protect deposits; or
421.107(4)(b)
(b) Limitations on powers an organization is authorized to exercise under the laws of this state or the United States.
421.107 History
History: 1971 c. 239;
1979 c. 89.
421.108
421.108
Obligation of good faith. Every agreement or duty within
chs. 421 to
427 imposes an obligation of good faith in its performance or enforcement. “Good faith" means honesty in fact in the conduct or transaction concerned and the observance of reasonable commercial standards of fair dealing.
421.108 History
History: 1971 c. 239;
1979 c. 89.
SCOPE AND JURISDICTION
421.201
421.201
Territorial application. 421.201(1)
(1) Except as otherwise provided in this section,
chs. 421 to
427 apply to consumer transactions made in this state and to modifications including refinancings, consolidations and deferrals, made in this state, of consumer credit transactions wherever made.
421.201(2)
(2) For the purposes of
chs. 421 to
427, a consumer transaction or modification of a consumer transaction is made in this state if:
421.201(2)(a)
(a) A writing signed by the customer and evidencing the obligation or an offer of the customer is received by the merchant in this state; or
421.201(2)(b)
(b) The merchant induces the customer who is a resident of this state to enter into the transaction by face-to-face solicitation or by mail or telephone solicitation directed to the particular customer in this state.
421.201(3)
(3) With respect to a transaction pursuant to an open-end credit plan,
chs. 421 to
427 apply if the customer is a resident of this state and the open-end creditor or a merchant honoring a credit card issued by the open-end creditor, is a resident of this state or furnishes, mails or delivers the goods, services or credit to a resident of this state while the customer is within this state or receives a writing signed by the customer and evidencing the transaction in this state.
421.201(4)
(4) Chapter 427 applies to any debt collection activity in this state, including debt collection by means of mail or telephone communications directed to customers in this state.
421.201(5)
(5) Subchapters I and
II of ch. 425, relating to creditors' remedies, including applicable penalties, apply to actions or other proceedings brought in this state to enforce rights arising from consumer transactions or extortionate extensions of credit, wherever made, but conduct, action or proceedings to recover collateral or goods subject to a motor vehicle consumer lease shall be governed by the law of the state where the collateral or goods subject to a motor vehicle consumer lease are located at the time of recovery unless the collateral or goods subject to a motor vehicle consumer lease are owned by a Wisconsin resident, who has removed the collateral or goods from this state only for purposes of transportation to or use in the resident's employment or for temporary periods which do not exceed 15 days.
421.201(6)
(6) If a consumer transaction, or modification thereof, is made in another state with a customer who is a resident of this state when the transaction or modification is made, the following provisions apply as though the transaction occurred in this state:
421.201(6)(a)
(a) A creditor, or assignee of the creditor's rights, may collect through actions or other proceedings charges only to the extent permitted by
ch. 422; and
421.201(6)(b)
(b) A merchant may not enforce rights against the customer to the extent that the provisions of the agreement violate
subch. IV of ch. 422 or
ch. 423.
421.201(7)
(7) Except as provided in
sub. (4) or
(5), a consumer transaction or modification thereof, made in another state with a customer who was not a resident of this state when the consumer transaction or modification was made, is valid and enforceable in this state according to its terms to the extent that it is valid and enforceable under the laws of the state applicable to the transaction.
421.201(8)
(8) For the purposes of
chs. 421 to
427, the residence of a customer is the address given by the customer as his or her residence in any writing signed by the customer in connection with a consumer transaction. The given address is presumed to be unchanged until the merchant knows or has reason to know of a new or different address.
421.201(9)
(9) Notwithstanding other provisions of this section:
421.201(9)(a)
(a) Except as provided in
sub. (4) or
(5),
chs. 421 to
427 do not apply if the customer is not a resident of this state at the time of a consumer transaction and the parties then agree that the law of his or her residence applies; and
421.201(9)(b)
(b) Chapters 421 to
427 apply if the customer is a resident of this state at the time of a consumer transaction and the parties then agree that the law of this state applies.
421.201(10)
(10) Except as provided in
sub. (9), the following terms of a writing executed by a customer are invalid with respect to consumer transactions, or modifications thereof, to which
chs. 421 to
427 apply:
