SB1099sam001 102ND GENERAL ASSEMBLY

Sen. Jacqueline Y. Collins

Filed: 2/22/2022

10200SB1099sam001 LRB102 04923 BMS 36311 a

AMENDMENT TO SENATE BILL 1099

AMENDMENT NO. ______. Amend Senate Bill 1099 by replacing everything after the enacting clause with the following:

"Section 1. Short title. This Act may be cited as the Consumer Legal Funding Act.

Section 5. Definitions.

"Advertise" means publishing or disseminating any written, electronic, or printed communication, or any communication by means of recorded telephone messages or transmitted on radio, television, the Internet, or similar communications media, including film strips, motion pictures, and videos, published, disseminated, circulated, or placed before the public, directly or indirectly, for the purpose of inducing a consumer to enter into a consumer legal funding.

"Charges" means the fees, as set forth in Section 25, to be paid to the consumer legal funding company by or on behalf of the consumer above the funded amount provided by or on behalf of the company to an Illinois consumer pursuant to this Act.

"Consumer legal funding" or "funding" means a nonrecourse transaction in an amount that does not exceed $500,000 in which a company purchases and a consumer transfers to the company an unvested, contingent future interest in the potential net proceeds of a settlement or judgment obtained from the consumer's legal claim; if no proceeds are obtained from the consumer's legal claim, the consumer is not required to repay the company the consumer legal funding amount or charges.

"Consumer legal funding company" or "company" means a person or entity that enters into a consumer legal funding transaction with an Illinois consumer. "Consumer legal funding company" does not include:

(1) an immediate family member of the consumer;

(2) a bank, lender, financing entity, or other special purpose entity:

(A) that provides financing to a consumer legal funding company; or

(B) to which a consumer legal funding company grants a security interest or transfers any rights or interest in a consumer legal funding; or

(3) an attorney or accountant who provides services to a consumer.

"Consumer" means a natural person who has a pending legal claim and who resides or is domiciled in Illinois.

"Director" means the Director of Financial Institutions.

"Division" means the Division of Financial Institutions of the Department of Financial and Professional Regulation.

"Funded amount" means the amount of moneys provided to, or on behalf of, the consumer in the consumer legal funding. "Funded amount" does not include charges.

"Funding date" means the date on which the funded amount is transferred to the consumer by the consumer legal funding company either by personal delivery; via wire, ACH, or other electronic means; or mailed by insured, certified, or registered United States mail.

"Immediate family member" means a parent; sibling; child by blood, adoption, or marriage; spouse; grandparent; or grandchild.

"Legal claim" means a bona fide civil claim or cause of action.

"Resolution amount" means the funded amount plus the agreed-upon charges that are delivered to the consumer legal funding company on the resolution date.

"Resolution date" means the date the resolution amount is delivered to the consumer legal funding company.

Section 10. Contract requirements; right of rescission.

(a) All consumer legal fundings shall meet the following requirements:

(1) the contract shall be completely filled in when presented to the consumer for signature;

(2) the contract shall contain, in bold and boxed type, a right of rescission, allowing the consumer to cancel the contract without penalty or further obligation if, within 14 business days after the funding date, the consumer either:

(A) returns to the consumer legal funding company the full amount of the disbursed funds by delivering the company's uncashed check to the company's office in person; or

(B) mails, by insured, certified, or registered United States mail, to the address specified in the contract, a notice of cancellation and includes in the mailing a return of the full amount of disbursed funds in the form of the company's uncashed check or a registered or certified check or money order; and

(3) the contract shall contain the initials of the consumer on each page.

(b) The contract shall contain a written acknowledgment by the attorney retained by the consumer in the legal claim that attests to the following:

(1) to the best of the attorney's knowledge, all the costs and charges relating to the consumer legal funding have been disclosed to the consumer;

(2) the attorney is being paid on a contingency basis pursuant to a written fee agreement;

(3) all proceeds of the legal claim will be disbursed via either the trust account of the attorney or a settlement fund established to receive the proceeds of the legal claim on behalf of the consumer;

(4) the attorney is following the written instructions of the consumer with regard to the consumer legal funding; and

(5) the attorney has not received a referral fee or other consideration from the consumer legal funding company in connection with the consumer legal funding, nor will the attorney receive such fee or other consideration in the future.

(c) If the acknowledgment required in subsection (b) is not completed by the attorney retained by the consumer in the legal claim, the contract shall be null and void. The contract remains valid and enforceable if the consumer terminates the initial attorney or retains a new attorney with respect to the legal claim.

Section 15. Consumer legal funding company prohibitions. A consumer legal funding company shall not:

(1) pay or offer to pay commissions, referral fees, or other forms of consideration to any attorney, law firm, medical provider, chiropractic physician, or physical therapist or any of their employees for referring a consumer to the company;

(2) accept any commissions, referral fees, rebates, or other forms of consideration from an attorney, law firm, medical provider, chiropractor, or physical therapist or any of their employees;

(3) intentionally advertise materially false or misleading information regarding its products or services;

(4) refer, in furtherance of an initial consumer legal funding, a customer or potential customer to a specific attorney, law firm, medical provider, chiropractor, or physical therapist or any of their employees; however, if a customer needs legal representation, the company may refer the customer to a local or State bar association referral service;

(5) fail to supply a copy of the executed contract to the attorney for the consumer;

(6) knowingly provide funding to a consumer who has previously assigned or sold a portion of the consumer's right to proceeds from his or her legal claim without first making payment to or purchasing a prior unsatisfied consumer legal funding company's entire funded amount and contracted charges, unless a lesser amount is otherwise agreed to in writing by the consumer legal funding companies, except that multiple companies may agree to contemporaneously provide funding to a consumer if the consumer and the consumer's attorney consent to the arrangement in writing;

(7) receive any right to nor make any decisions with respect to the conduct of the underlying legal claim or any settlement or resolution of the legal claim; the right to make such decisions shall remain solely with the consumer and the attorney in the legal claim; or

(8) knowingly pay or offer to pay for court costs, filing fees, or attorney's fees either during or after the resolution of the legal claim using funds from the consumer legal funding transaction.

Section 20. Satisfaction of the contract. A consumer legal funding company shall require the resolution amount to be set as a predetermined amount, based upon intervals of time from the date of origination of the funding through the date of resolution of the legal claim, and not be determined as a percentage of the recovery from the legal claim.

Section 25. Fees.

(a) The fee charged by a consumer legal funding company to the consumer shall be calculated as not more than 18% of the funded amount, assessed on the outset of every 6 months.

(b) In addition, a consumer legal funding company may charge a document preparation fee not to exceed $75, which may be deducted from the funded amount. This fee is to be used to defray the ordinary cost of opening, administering, and terminating a consumer legal funding.

(c) A consumer legal funding company shall not collect any additional fees unless otherwise specified in this Act.

(d) No fees shall extend past 42 months after the funding date.

Section 30. Disclosures. All consumer legal funding contracts shall contain the disclosures specified in this Section, which shall constitute material terms of the contract. Unless otherwise specified, the disclosures shall be typed in at least 12-point bold-type font and be placed clearly and conspicuously within the contract as follows:

(1) On the front page under appropriate headings, language specifying:

(A) the funded amount to be paid to the consumer by the consumer legal funding company;

(B) an itemization of one-time charges;

(C) the total amount to be paid by the consumer to the company, including the funded amount and all charges; and

(D) a payment schedule to include the resolution amount, listing dates, and the amount due at the end of each 6-month period from the funding date, until the date the maximum amount due to the company by the consumer to satisfy the amount due pursuant to the contract.

(2) Pursuant to the provisions set forth in paragraph (2) of subsection (a) of Section 10, within the body of the contract: "Consumer's Right to Cancellation: You may cancel this contract without penalty or further obligation within 14 business days after the funding date if you either:

(A) return to the consumer legal funding company the full amount of the disbursed funds by delivering the company's uncashed check to the company's office in person; or

(B) mail by insured, certified, or registered United States mail, to the company at the address specified in the contract, a notice of cancellation and include in such mailing a return of the full amount of disbursed funds in the form of the company's uncashed check or a registered or certified check or money order."

(3) Within the body of the contract: "The consumer legal funding company shall have no role in deciding whether, when, and how much the legal claim is settled for, however, the consumer and consumer's attorney must notify the company of the outcome of the legal claim by settlement or adjudication before the resolution date. The company may seek updated information about the status of the legal claim but in no event shall the company interfere with the independent professional judgment of the attorney in the handling of the legal claim or any settlement thereof."

(4) Within the body of the contract, in all capital letters in at least 12-point bold-type font contained within a box: "THE FUNDED AMOUNT AND AGREED-UPON CHARGES SHALL BE PAID ONLY FROM THE PROCEEDS OF YOUR LEGAL CLAIM, AND SHALL BE PAID ONLY TO THE EXTENT THAT THERE ARE AVAILABLE PROCEEDS FROM YOUR LEGAL CLAIM. YOU WILL NOT OWE [INSERT NAME OF THE CONSUMER LEGAL FUNDING COMPANY] ANYTHING IF THERE ARE NO PROCEEDS FROM YOUR LEGAL CLAIM, UNLESS YOU OR YOUR ATTORNEY HAVE VIOLATED ANY MATERIAL TERM OF THIS CONTRACT OR YOU HAVE COMMITTED FRAUD AGAINST THE CONSUMER LEGAL FUNDING COMPANY."

(5) Located immediately above the place on the contract where the consumer's signature is required, in 12-point font: "Do not sign this contract before you read it completely or if it contains any blank spaces. You are entitled to a completely filled-in copy of the contract. Before you sign this contract, you should obtain the advice of an attorney. Depending on the circumstances, you may want to consult a tax, public or private benefits planning, or financial professional. You acknowledge that your attorney in the legal claim has provided no tax, public or private benefit planning, or financial advice regarding this transaction."

(6) The consumer legal funding company shall provide the consumer with information on accessing a financial coaching program no later than the funding date.

Section 35. Violations.

(a) Nothing in this Act shall be construed to restrict the exercise of powers or the performance of the duties of the Illinois Attorney General that he or she is authorized to exercise or perform by law.

(b) If a court of competent jurisdiction determines that a consumer legal funding company has intentionally violated the provisions of this Act with regard to a specific consumer legal funding, the consumer legal funding company shall only be entitled to recover the funded amount provided to the consumer in that specific consumer legal funding and shall not be entitled to any additional charges.

Section 40. Assignability; liens.

(a) The contingent right to receive an amount of the potential proceeds of a legal claim is assignable by a consumer.

(b) Only liens related to the legal claim, including attorney's liens, Medicare, or other statutory liens, shall take priority over any lien of the consumer legal funding company. All other liens shall take priority by normal operation of law.

(c) A consumer legal funding transaction does not constitute an assignment of a personal injury claim or chose in action.

(d) A consumer legal funding transaction does not constitute the assignment of any present right; the transaction constitutes the transfer of an unvested, contingent future interest in an amount of the potential proceeds of a legal claim or cause of action.

Section 45. Attorney prohibitions. An attorney or law firm retained by the consumer in the legal claim shall not have a financial interest in the consumer legal funding company offering consumer legal funding to that consumer. Additionally, any attorney who has referred the consumer to his or her retained attorney shall not have a financial interest in the consumer legal funding company offering consumer legal funding to that consumer.

Section 50. Effect of communication on privileges. No communication between the consumer's attorney in the legal claim and the consumer legal funding company as it pertains to the consumer legal funding shall limit, waive, or abrogate the scope or nature of any statutory or common law privilege, including the work product doctrine and the attorney-client privilege.

Section 55. Application; fees; positive net worth; new funding application.

(a) An application for a consumer legal funding license shall be in writing and in the form prescribed by the Director. An applicant at the time of making such application shall pay to the Director the sum of $300 as an application fee and the additional sum of $450 as an annual license fee, for a period terminating on the last day of the current calendar year; if the application is filed after June 30 in any year, the license fee shall be one-half of the annual license fee for such year.

(b) Before the consumer legal funding license is granted, an applicant shall prove in a form satisfactory to the Director that the applicant has and will maintain a positive net worth of a minimum of $30,000. Every applicant and licensee shall maintain a surety bond in the principal sum of $25,000 issued by a bonding company authorized to do business in this State and that shall be approved by the Director. The surety bond shall run to the Director and shall be for the benefit of any consumer who incurs damages as a result of any violation of this Act or rules adopted pursuant to this Act by a licensee. If the Director finds at any time that a bond is of insufficient size, is insecure, is exhausted, or is otherwise doubtful, an additional bond in such amount as determined by the Director shall be filed by the licensee within 30 days after written demand therefor by the Director. As used in this subsection, "net worth" means total assets minus total liabilities.

(c) A company may not engage in the business of consumer legal funding in this State until it has received a consumer legal funding license from the Division pursuant to this Act, except any company that has a license in good standing under the Consumer Installment Loan Act as of the effective date of this Act shall be entitled to engage in consumer legal fundings under the terms of this Act so long as that company files an application for a consumer legal funding license within 60 days after the Division issuing forms for the filing of such an application until the Division fully rules on the application and either approves or denies the application for a funding license.

Section 60. Appointment of attorney-in-fact for service of process. Every consumer legal funding licensee shall appoint, in writing, the Director and his or her successors in office or any official who shall be charged with the administration of this Act as attorney-in-fact upon whom all lawful process against the licensee may be served with the same legal force and validity as if served on such licensee. A copy of such written appointment, duly certified, shall be filed in the office of the Director, and a copy of the written appointment certified by him or her shall be sufficient evidence. This appointment shall remain in effect while any liability remains outstanding in this State against the licensee. When summons is served upon the Director as attorney-in-fact for such licensee, the Director shall immediately notify the licensee by registered mail, enclosing the summons and specifying the hour and day of service.

Section 65. Investigation to determine whether to issue a consumer legal funding license. Upon the filing of an application and the payment of the fee, the Director shall investigate to determine:

(1) that the reputation of the applicant, including the reputation of the managers of a limited liability company, partners, owners, officers, or directors of the applicant, is such as to warrant belief that the business will be operated honestly and fairly within the purposes of this Act; and

(2) that the applicant meets the positive net worth requirement set forth in Section 55.

Unless the Director finds that the applicant meets these requirements, he or she shall not issue a consumer legal funding license and shall notify the applicant of the denial and return to the applicant the sum paid by the applicant as a license fee, but shall retain the $300 application fee. The Director shall approve or deny every application for a license within 60 days from the filing of the application with the fee.

Section 70. License. The license shall state the address, including city and State, at which the business is to be conducted and shall state fully the name of the licensee. The license shall be conspicuously posted in the place of business of the licensee and shall not be transferable or assignable.

Section 75. More than one license to same licensee; changing place of business.

(a) Not more than one place of business shall be maintained under the same license, but the Director may issue more than one license to the same licensee upon compliance with all the provisions of this Act governing an original issuance of a license.

(b) Whenever a licensee changes his or her place of business to a location other than that set forth in his or her license, he or she shall give written notice of the change of place of business to the Director at least 10 days before the relocation. However, if the new location is in excess of 15 miles from the previous location, the licensee shall obtain written approval from the Director before the relocation.

Section 80. Annual license fee; expenses; license expiration and reinstatement.

(a) Before December 1 of each year, a licensee shall pay to the Director and the Division must receive the annual license fee required under Section 55 for the next succeeding calendar year. The license shall expire on January 1 of the following year unless the license fee has been paid before that date.

(b) In addition to the annual license fee, the reasonable expense of any examination, investigation, or custody by the Director under any provision of this Act shall be borne by the licensee.

(c) If a licensee fails to renew his or her license by December 31, it shall automatically expire and the licensee is not entitled to a hearing; however, the Director, in his or her discretion, may reinstate an expired license upon payment of the annual renewal fee and proof of good cause for failure to renew.

Section 85. Fines; suspension or revocation of license.

(a) The Director may, after 10 days' notice by registered mail to the licensee at the address set forth in the license stating the contemplated action and in general the grounds therefor, fine such licensee an amount not exceeding $10,000 per violation or revoke or suspend any license issued under this Act if he or she finds that:

(1) the licensee has failed to comply with any provision of this Act or any order, decision, finding, rule, regulation, or direction of the Director lawfully made pursuant to the authority of this Act; or

(2) any fact or condition exists that, if it had existed at the time of the original application for the license, clearly would have warranted the Director in refusing to issue the license.

(b) The Director may fine, suspend, or revoke only the particular license with respect to which grounds for the fine, revocation, or suspension occur or exist, but if the Director finds that grounds for revocation are of general application to all offices or to more than one office of the licensee, the Director shall fine, suspend, or revoke every license to which such grounds apply.

(c) No revocation, suspension, or surrender of any license shall impair or affect the obligation of any preexisting lawful contract between the licensee and any obligor.

(d) The Director may issue a new license to a licensee whose license has been revoked when facts or conditions that clearly would have warranted the Director in refusing originally to issue the license no longer exist.

(e) In every case in which a license is suspended or revoked or an application for a license or renewal of a license is denied, the Director shall serve the licensee with notice of his or her action, including a statement of the reasons for his or her actions, either personally or by certified mail, return receipt requested. Service by certified mail shall be deemed completed when the notice is deposited in the United States mail.

(f) An order assessing a fine, an order revoking or suspending a license, or an order denying renewal of a license shall take effect upon service of the order unless the licensee requests a hearing in writing within 10 days after the date of service. If a hearing is requested, the order shall be stayed until a final administrative order is entered.

(g) If the licensee requests a hearing, the Director shall schedule a hearing within 30 days after the request for a hearing unless otherwise agreed to by the parties.

(h) The hearing shall be held at the time and place designated by the Director. The Director and any administrative law judge designated by him or her shall have the power to administer oaths and affirmations, subpoena witnesses and compel their attendance, take evidence, and require the production of books, papers, correspondence, and other records or information that he or she considers relevant or material to the inquiry.

(i) The costs for the administrative hearing shall be set by rule.

(j) The Division shall have the authority to adopt rules for the administration of this Section.

(k) The Division shall establish by rule and publish a schedule of fines that are reasonably tailored to ensure compliance with the provisions of this Act and which include remedial measures intended to improve licensee compliance. The Division shall also set forth the standards and procedures to be used in imposing any such fines and remedies by rule.

Section 90. Closing of business; surrender of license. At least 10 days before a licensee ceases operations, closes business, or files for bankruptcy:

(1) The licensee shall notify the Division of its action in writing.

(2) With the exception of filing for bankruptcy, the licensee shall surrender its license to the Director for cancellation; the surrender of the license shall not affect the licensee's civil or criminal liability for acts committed before surrender or entitle the licensee to a return of any part of the annual license fee.

(3) The licensee shall notify the Division of the location where the books, accounts, contracts, and records will be maintained and the procedure to ensure prompt return of contracts, titles, and releases to the customers.

(4) The accounts, books, records, and contracts shall be maintained and serviced by the licensee or another licensee under this Act or an entity exempt from licensure under this Act.

(5) The Division shall have the authority to conduct examinations of the books, records, and funding documents at any time after surrender of the license, filing of bankruptcy, or the cessation of operations.

Section 95. Investigation of conduct of business. For the purpose of discovering violations of this Act or securing information lawfully required by it, the Director may at any time investigate the fundings and business and examine the books, accounts, records, and files used therein, of every licensee and of every person, partnership, association, limited liability company, and corporation engaged in the business described in Section 5, whether such person, partnership, association, limited liability company, or corporation shall act or claim to act as principal or agent or within or without the authority of this Act. For such purpose the Director shall have free access to the offices and places of business, books, accounts, papers, records, files, safes, and vaults of such persons, partnerships, associations, limited liability companies, and corporations. The Director may require the attendance of and examine under oath all persons whose testimony he or she may require relative to such fundings or such business, and in such cases the Director shall have power to administer oaths to all persons called as witnesses, and the Director may conduct such examinations.

The Director shall make an examination of the affairs, business, office, and records of each licensee at least once each year. The Division shall by rule and regulation set the fee to be charged for each examination day, including travel expenses for out-of-state licensed locations. The fee shall reasonably reflect actual costs. The Director shall also have authority to examine the books and records of any business made by a former licensee which is being liquidated, as the Director deems necessary, and may charge the examination fees otherwise required for licensees.

Section 100. Books and records; reports.

(a) Every licensee shall retain and use in his or her business or at another location approved by the Director such records as are required by the Director to enable the Director to determine whether the licensee is complying with the provisions of this Act and the rules adopted pursuant to this Act. Every licensee shall preserve the records of any funding for at least 2 years after making the final entry for such funding. Accounting systems maintained in whole or in part by mechanical or electronic data processing methods that provide information equivalent to that otherwise required and that follow generally accepted accounting principles are acceptable for that purpose if approved by the Director in writing.

(b) Each licensee shall annually, on or before March 1, file a report with the Director giving such relevant information as the Director may reasonably require concerning the business and operations during the preceding calendar year of each licensed place of business conducted by the licensee. The report must be received by the Division on or before March 1. The report shall be made under oath and in a form prescribed by the Director. Whenever a licensee operates 2 or more licensed offices or whenever 2 or more affiliated licensees operate licensed offices, a composite report of such group of licensed offices may be filed instead of individual reports. The Director may make and publish annually an analysis and recapitulation of such reports. The Director may fine each licensee $25 for each day beyond March 1 the report is filed.

Section 105. Other businesses.

(a) Upon application by the licensee, the Director may approve the conduct of other businesses not specifically permitted by this Act in the licensee's place of business, unless the Director finds that such conduct will conceal or facilitate evasion or violation of this Act. The Director's approval shall be in writing and shall describe the other businesses which may be conducted in the licensed office.

(b) A licensee may without notice to and approval of the Director, in addition to the business permitted by this Act, conduct the following business:

(1) The business of a sales finance agency as defined in the Sales Finance Agency Act.

(2) The business of soliciting or selling any type of insurance provided that all such insurance transactions are conducted in accordance with and are regulated under the Illinois Insurance Code.

(3) The business of financing premiums for insurance.

(4) Offering and extending credit under a revolving credit plan pursuant to the Illinois Financial Services Development Act.

The Division shall adopt and enforce such reasonable rules and regulations for the conduct of business under this Act in the same office with other businesses as may be necessary to prevent evasions or violations of this Act. The Director may investigate any business conducted in the licensed office to determine whether any evasion or violation of this Act has occurred.

Section 110. Cease and desist.

(a) The Director may issue a cease and desist order to any licensee, or other person doing business without the required license, if in the opinion of the Director, the licensee or other person is violating or is about to violate any provision of this Act or any rule or requirement imposed in writing by the Division as a condition of granting any authorization permitted by this Act.

(b) The Director may issue a cease and desist order before a hearing.

(c) The Director shall serve notice of his or her action, designated as a cease and desist order made pursuant to this Section, including a statement of the reasons for the action, either personally or by certified mail, return receipt requested. Service by certified mail shall be deemed completed when the notice is deposited in the United States mail.

(d) Within 15 days after service of the cease and desist order, the licensee or other person may request, in writing, a hearing.

(e) The Director shall schedule a hearing within 30 days after the request for a hearing unless otherwise agreed to by the parties.

(f) The Division shall have the authority to prescribe rules for the administration of this Section.

(g) If it is determined that the Director had the authority to issue the cease and desist order, he or she may issue such orders as may be reasonably necessary to correct, eliminate, or remedy such conduct.

(h) The powers vested in the Director by this Section are additional to any and all other powers and remedies vested in the Director by law, and nothing in this Section shall be construed as requiring that the Director must employ the power conferred in this Section instead of or as a condition precedent to the exercise of any other power or remedy vested in the Director.

(i) The cost for the administrative hearing shall be set by rule.

Section 115. Rules and regulations. The Division may adopt and enforce such reasonable rules, regulations, directions, orders, decisions, and findings as the execution and enforcement of the provisions of this Act require, and as are not inconsistent therewith. In addition, the Division may adopt rules in connection with the activities of licensees that are necessary and appropriate for the protection of consumers in this State. All rules, regulations, and directions of a general character shall be sent electronically to all licensees.

Section 120. Judicial review. All final administrative decisions of the Division under this Act, all amendments and modifications of final administrative decisions, and any rules adopted by the Division pursuant to this Act shall be subject to judicial review pursuant to the provisions of the Administrative Review Law.

Section 125. Injunction; civil penalty; costs. If it appears to the Director that a person or any entity has committed or is about to commit a violation of this Act, a rule adopted under this Act, or an order of the Director, the Director may apply to the circuit court for an order enjoining the person or entity from violating or continuing to violate this Act, the rule, or order and for injunctive or other relief that the nature of the case may require and may, in addition, request the court to assess a civil penalty up to $1,000 along with costs and attorney's fees.

Section 130. Severability. If any clause, sentence, provision or part of this Act or its application to any person or circumstance is adjudged to be unconstitutional or invalid for any reason by any court of competent jurisdiction, that judgment shall not impair, affect, or invalidate other provisions or applications of this Act, which shall remain in full force and effect thereafter.

Section 999. Effective date. This Act takes effect upon becoming law.".