HB4676 97TH GENERAL ASSEMBLY

LRB097 19416 JLS 64669 b

97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB4676

Introduced 2/3/2012, by Rep. Esther Golar

SYNOPSIS AS INTRODUCED:

New Act

Creates the Consumer Remedies Protection Act. Provides that consumer adhesion contracts are void as a matter of public policy. Creates a private right of action for consumers whose rights are violated. Authorizes recovery of actual and statutory damages in addition to attorney's fees and costs. Defines terms.

A BILL FOR

AN ACT concerning business.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 1. Short title. This Act may be cited as the Consumer Remedies Protection Act.

Section 5. Purpose, findings, and conclusion.

(a) This Act shall be broadly construed to effect its purposes.

(b) The General Assembly finds that:

(1) for many important goods and services consumers are unable to purchase any variant of that good or service without being forced to waive important legal rights;

(2) adequate remedies for consumers provide an essential deterrent effect to prevent widespread consumer harm;

(3) consumer adhesion contracts severely limit the ability of consumers to seek adequate legal recourse when harmed;

(4) companies often use unenforceable exculpatory clauses as a means to deter consumers from bringing valid claims, including by increasing the cost to consumers of vindicating their legal rights; and

(5) consumers currently lack an economically viable method for pursuing recourse when faced with small damages.

(c) The General Assembly concludes that this Act is necessary to prevent the authors of consumer adhesion contracts from immunizing themselves from liability for widespread consumer harm.

(d) One of the fundamental public policies of this State is to protect consumers from widespread harm, and this Act shall further that policy.

Section 10. Definitions.

"Consumer" means an individual who uses, purchases, acquires, attempts to purchase or acquire, or is offered or furnished goods or services, in part or in whole, for personal, family, or household purposes.

"Consumer adhesion contract" means any form or standard contract with terms and conditions drafted by the non-consumer party, presented to consumers without the possibility for meaningful negotiation of terms.

"Limiting clause" means any contractual provision purporting to limit the scope, nature, and effect of remedies available to consumers. "Limiting clause" shall be interpreted broadly, and shall include, but is not confined to, clauses specifying: forum selection, choice of law, waiver or limitation of liability, mandatory arbitration, class action waiver, and limitation on damages.

"Prima facie demonstration" means the production of enough evidence to allow the trier of fact to infer the fact at issue and rule in that party's favor without consideration of rebuttal evidence.

"Public injury" means an action with injurious effect that is:

(1) a violation of a statute that has public interest impact;

(2) applied repeatedly to a particular consumer; or

(3) aimed at or affects consumers generally.

"Substantially superior bargaining power" means the ability to draft the terms and conditions of the consumer adhesion contract and present the contract to consumers without the realistic possibility for negotiation of terms.

Section 15. Consumer Contracts.

(a) In a dispute arising out of a consumer adhesion contract, when a party makes a good faith, prima facie demonstration that a party to the contract with substantially superior bargaining power has caused public injury, the consumer adhesion contract at issue shall be presumed void as a matter of public policy.

(b) In a dispute arising out of a consumer adhesion contract, when it is established that a party to the contract with substantially superior bargaining power has caused public injury, the consumer adhesion contract at issue shall be declared void as a matter of public policy.

(c) Any limiting clause in a consumer adhesion contract that, if enforced, would result, on its face or in practice, in a consumer having no practical and meaningful remedy shall be void.

Section 20. Private right of action.

(a) A consumer whose rights under this Act are violated may bring an action against any party benefitting from the illegal consumer adhesion contract.

(b) Upon a finding that a consumer adhesion contract or clause therein is void under to this Act, all consumers subject to the consumer adhesion contract shall be entitled to the greater of:

(1) the consumer's actual damages; or

(2) statutory damages of $10 each, subject to Section 25 of this Act.

(c) A consumer who prevails in any action brought under to this Act shall be entitled to his or her reasonable attorney's fees and costs.

Section 25. Safe harbor. If a party, within 30 days after the initiation of an action, waives those contractual provisions made unlawful under this Act, the statutory damages prescribed in subsection (b) of Section 20 shall not be awarded. For purposes of this Section, the initiation of an action includes the filing of a court case, the initiation of arbitration, or a formal demand to waive the offending contractual provisions.

Section 30. Construction. Nothing in this Act shall be construed to limit any other consumer right under state or federal law.

Section 35. Severability. The provisions of this Act are severable under Section 1.31 of the Statute on Statutes.