The USA Consumer Law - Assignment Example

Name Course Tutor Date USA Consumer Law PART 1 A 1. Which of the following is not a requirement for certifying a class action? 1. Commonality 2. Typicality 3. Economy 4. Numerosity 5. Adequacy of representation 2. The economic loss rule is a judicially created rule that: 1. Requires claims for pure economic loss must be brought in contract not tort 2. Limits tort claims to only economic loss 3. Prohibits recovery of mental anguish damages for breach of contract 4. Requires that claims for economic loss must be brought in tort not contract 5. None of the above 3. Which of the following is not a prerequisite for a credit card holder to assert claims and defenses he would have against the merchant, against the credit card company? 1. The transaction must be over $50 2. The consumer must make a good faith effort to settle with the merchant 3. The transaction must be in the consumer’s state or within 100 miles of his home. 4. The consumer must report it to the credit card company within ten days. 4. The statute of limitations for a breach of warranty in Texas is: 1. I year. 2. 2 years 3. 3 years 4. 4 years 5. Which of the following is not a good under the Texas Deceptive Trade Practices Act? 1. A car 2. A house 3. Stocks and bonds 4. A dog 6. The term “caveat emptor” means: 1. Let the buyer beware 2. You must disclose 3. Empty promises 4. Seller is responsible 7. The “lodestar” method is used to compute? 1. Damages for mental anguish 2. Damages for pain and suffering 3. Damages for economic loss 4. Damages for attorneys’ fees 3 8. Which of the following is not a credit bureau in the United States? 1. Experian 2. TransUnion 3. American 4. Equifax 9. Under the Fair Debt Collection Practices Act, a debt collector may: 1. Never call a consumer at work 2. Call a consumer no more than once a day at work 3. Not call a consumer once the consumer tells the debt collector that the employer does not allow such calls 4. Call a consumer at work any time he wants 10. Which of the following is not included within the term actual damages? 1. Cost to repair a product 2. Lost income 3. Pain and suffering 4. Lost profits 5. None of the above. 11. The term “upside-down” means that the consumer: 1. Owes more than her house is worth 2. Was tricked into buying the house by the seller 3. Is so confused that she could not protect herself 4. All of the above 12. Which of the following is not a basis for challenging an arbitrator’s decision in court: 1. Fraud 2. Evident partiality 3. Misconduct 4. Disregard of the law 5. None of the above 13. Which of the following is not a billing error under the Fair Credit Billing Act? 1. A charge for goods not received 2. A charge for goods that are defective 3. A charge for more than the contract price 4. A charge for a bill that was paid the prior month 5. None of the above 4 14. Which of the following involves a voluntary dispute resolution process that is not binding unless the parties agree: 1. Arbitration 2. Mediation 3. Negotiation 4. All of the above 5. More than one of the above 15. In an action for breach of warranty, which of the following damages may not be recovered: 1. Damages for mental anguish 2. Attorney’s fees 3. Damages for the cost to repair a defective product 4. Damages for medical bills 5. More than one of the above 16. The Fair Debt Collection Practices Act would not apply to which of the following? 1. A company that collects a debt owed to a plumber for fixing a house toilet 2. An attorney suing to collect a debt owed Visa 3. A company collecting a debt owed Visa 4. Visa collecting its own debts 5. More than one of the above 17. For a misrepresentation under the Texas Deceptive Trade Practices Act, which of the following type of damages may not be recovered: 1. Attorney’s fees 2. Economic damages 3. Damages for mental anguish 4. Punitive damages 5. Damages for pain and suffering 18. The Texas Deceptive Trade Practice Act requires notice be sent to the defendant how many days before a lawsuit is filed? 1. 60 2. 50 3. 40 4. 30 19. Which of the following recently has been enacted into law in the U.S.? 1. Credit CARD Act 2. Arbitration Fairness Act 3. Consumer Financial Protection Agency Act 4. More than one of the above 5. All of the above 5 20. Which of the following is not an appropriate standard by which to evaluate the constitutionality of punitive damages under the U.S. Constitution? 1. Net worth of the defendant 2. Ratio to the amount of damages awarded 3. Degree of reprehensibility of defendants conduct 4. Sanction for similar misconduct PART B True/False Explain You answer should be typed. For each of the following questions, state whether the statement is true or false, and then explain your answer in two sentences or less. Your answer should look as follows: 1. True. Explain the reason why it is true. 1. If a father buys a toy for his son, the son may be a consumer under the Texas Deceptive Trade Practices Act? T/F True. Any good received as a gift or that are paid for by another are still acquired by purchase. this therefore means that a child is a consumer with respect to services paid for by the parent. 2. A good way to prevent identity theft is to review a copy of your credit report? T/F True. As stated by the FTC and law enforcements official this is one of the ways to prevent identity theft. However, to obtain this, one need not to call the credit reporting companies. 3. In an American jury trial, the jury decides issues of fact and law? T/F True. It is the obligation of the judge to instruct the jury as to the applicable law governing the case in order to guide him to arrive to a just verdict. 4. It is easier to recover damages under a producing cause standard than a proximate cause standard? T/F True. This is due to the fact that in proximate cause which ina direct sequence produces the complained of and without which such injuries would not have happened at all. 5. If you buy something online, it is better to use a credit card than a debit card? T/F True. A debit card links directly to a checking account and therefore one is potentially vulnerable. 6. A business may prevent a consumer from filing a class action by including properly worded arbitration clause? T/F True. Companies are having clauses worded to prevent consumers from bringing class actions against them. This happens though the form contracts received regarding credit cards which always include arbitration clauses prohibiting on class actions. 7. In Texas, strict Products Liability, 402A, applies to only the consumer or the user? T/F True. It propagates for uniform interpretation of seller liability for harm caused by defective products. 8. A consumer has the right to a free copy of her credit report once a month? T/F False. Federal law guarantees every consumer the right to one free credit report every 12 months and this is from the major credit bureaus, Equifax, Experian and Trans Union. 9. Any business may be a consumer under the Texas Deceptive Trade Practices Act? T/F True. As defined in section 17.45 (10) meaning that an individual partnership, or corporation attained trough purchase or lease, any goods or a service for commercial or business use is a business consumer. 10. “UDAP” means “You Don’t Attack Professors”? False. It’s a statue or unfair and deceptive acts, practices, statue to protect consumers. QUESTION A Deceptive trade practices act is meant to protect the consumer from being exploited in any form of trade or commerce they are engaging in. The law protects them from any forms of misleading, false or any deceptive tactics they might face when trying to get any from s of goods or services being rendered to them. Deceptive trade practices act renders any forms of false, misleading as well as deceptive acts or practices against the consumer when conducting or engaging in any form of trade or commerce as un lawful and punishable by the law. The act is also supposed to protect the consumer form misleading information they might receive form other persons other than the owner about the goods or services they are intending to purchase. It also goes ahead to protect the consumers from immpersonification of ownership by other persons who are not the legitimate persons entitled to carry out the trade or commerce they are willing to get involved in. Deceptive trade practices act also gives the consumers the right to be fully informed about a particular goods or services they are willing to purchase and the true state, standards they are in to be disclosed to them before they are able to make the purchase (Munneti, 322iii). In this case, the consumer who is Casey, went ahead to be duped into purchasing of a house in which the neighbor reports that murder had taken place in not a while ago and that the seller of the house had for a very long time tried to sell it with no success until Casey came along. Casey was not given full information about the previous condition of the house and what had transpired previously in the house and the possible reasons why the seller was willing to sell the house to her. The neighbor says the house was spilled with blood and the only thing done was the painting of the house. Casey’s neighbor reported how grievous the murder was and this frightened her more and she was much stressed, could not sleep and this eventually made her to lose her job. Casey in this case is protected by the deceptive trade practices act which clearly caters for the rights of the consumers when violated. In this case both the seller and the neighbor could be charged due to exhibiting unlawful behavior that goes against the act (Munneti, 322iii). Under the deceptive trade practices act, the seller was supposed to have fully informed the consumer (Casey) the condition that the house was in before being sold to her. This would have included all activities which had occurred in the house previously such as the murder claims that the neighbor puts forward and also any other forms of repairs where they were done and possibly why they were done. In this case the seller failed to offer the full information with regard to the murder that was alleged to have taken place in the house. The seller will also be held responsible for making Casey to have a lot of stress as a result of finding out the previous condition of the house and what resulted after her getting to know what transpired in the house previously which included Casey having nightmares and distracted at her job and eventually resulting in her losing her job eventually (Munneti, 322iii). In this case, the seller will also will be guilty of giving out false information about the house in the advertisements which should have ensured that the consumer was aware of the condition of the house before even signing the agreement forms or contract. Violation of the act by the seller was done when he or she went ahead to advertise the house with the basic intent of getting away from the house in which his or her mother had been murdered in and this could have not met the demands of Casey who wanted to purchase a house in which she could be comfortable, have no nightmares and in fact being able to excel in life such `as in the job she was having. The seller also violated the act by not giving the actual facts of information concerning the repairs that had taken place which in this case would have made the consumer to be aware of what might have transpired at the house. violated of the act by the seller was also done when he or she claimed in the advertisement that the house was in a great condition which did not match with the previous activities that might have transpired since the only changes that were made to the house was painting it since the advertisement for the house showed that the house was new and in an excellent condition which was not actually the case.This is because the house was basically repaired and recondition and Casey was therefore supposed to have been told that the house was not new and therefore the seller did not give the Casey the true representation of the condition or quality of the house in the advertisements that had been done concerning the house. The seller is also went against the act by going ahead to advertise the house knowing very well it would not meet the standards of the expectable public demands and also limiting the amount of information on the quality of the house so that various clients would be attracted to buy the house after getting misleading information (Munneti, 322iii). On the other hand, the neighbor could have violated the deceptive practices act due to the possibility of the neighbor offering or disclosing false information to Casey due to maybe having some disregard to the seller. The neighbor could have violated the act through passing of false information to Casey that an act of murder had taken place in the house she bought. It is this information that the neighbor disclosed if false could have gone against the original information that the owner of the house told Casey and therefore under the act could be treated as false information meant to cause misunderstanding with the original information of the seller that could have been the truth if no murder really occurred in the house. Information Casey received from the neighbor made her to have nightmares as well as distraction which eventually lead to Casey losing her job.The neighbor will be responsible for passing across false information from that given by the seller just because of blood that might have existed between them. Violation of the act by the neighbor was also done when disparaging the house of the seller by giving the false information or representation of the facts about the house that was sold to Casey. The neighbor also goes ahead to fault the act by making false claims as to why the repairs were do ne to the house and this is what lead to the discontentment of the Casey and even made her to undergo a series of nightmares and eventually being distracted` and losing her job (Munneti, 322iii). QUESTION B The fair debt collection practices act was established to be able to offer adequate protection to the consumers by the federal states by regulating the activities of the debt collectors. This act also goes ahead to protect all those who are or will be affected by the consumer transaction such as the employers, creditors, relatives or neighbors. This act protects the consumer from having his or her rights violated by the debt collectors for instance by defining the boundaries to which the debt collectors can communicate to the consumer and by outlining the various ways through which the debt collectors must conduct themselves while trying to get their debts being settled by the debtor or the consumer. In this case, both companies (RGM and GBH) went on to violate the act through the misconduct they were involved in with the aim of getting the debtor to pay back her debts (Munneti, 148). The RGM company which is collecting debt for the oven violated the rights of the debtor under the fair debt collection practices act.RGM wrote a letter to Casey and went ahead to demand that she pays in thirty days to avoid them sending a sheriff to take her to jail. RGM company also went ahead to contact the third parties which is her family and they went ahead to tell the farther that the daughter was a deadbeat. The company used misleading information as well as threatening the debtor that she will be sent for a sheriff to take her to jail if she does not promptly pay her debts within thirty days (Munneti, 148). RGM company also went ahead to violate the act by contacting third parties which in this case the communication was made to the farther and they also used abusive languages at the same time by telling him that the daughter was a deadbeat and this goes against the fair debt collection practices act which stipulates that the third parties should not be involved in the communication and should only be involved in instances when the company fails to establish the location of the debtor and this was not the case with Casey since the company had her location or whereabouts well known. The third party was also addressed with abusive terms since the daughter was referred to as a deadbeat when the farther was contacted and this is greatly prohibited in the act since it protects the consumers from any forms of abusive language being used against them by the debt collectors (Munneti, 148). GBH on the other hand wrote a letter to Casey telling her that she would lose her house if she fails to promptly pay and they went ahead to call Casey’s mother and told her she was a bad mother because the daughter had failed to pay up her bills. In this case the debt collectors failed to observe the fair debt collection practices act which clearly limits the communication that the debt collector can make. The act limits the communication to third parties such as the parents of the consumer in this case and contact can only be made to the third parties in the eventuality that the debt collector fails to get the whereabouts of the consumer or debtor. The act also prohibits the use of harassment, oppressive as well as abusive conduct which was violated by the GBH company while collecting the debt. In this case the GBH Company went on to harass and threaten the debtor that she would lose her house if she does not promptly pay up the debt (Munneti, 148). GBH Company also went on to abuse the mother of the debtor calling her a bad mother just because the daughter has their debt. The GBH Company also violated the fair debt collection practices act which protects the clients from the collectors from using deceptive threats such as threatening the client that she would end up losing her house for failing to pay her debts promptly. The debtor collector debtor was also supposed to have send the debtor a written notice allow the debtor to either dispute the accuracy as well as the existence of the debt within thirty days which in this case she was not given the time frame of thirty days to act on the notice (Munneti, 148). When she tried communicating to the companies they both yelled at her, and called her names and went on to warn her that she would lose everything she owns if she did not pay the full amount as soon as possible. Here both companies violated the fcdpa when they yelled at the debtor and called her name that is greatly prohibited by the act which clearly refrain the debt collectors from using abusive language towards the consumers. The companies also used threats against the debtor by threatening her that she would lose everything she owns if she does not pay the amount that she owns on time which also is going against the fair debt collection practices act which prohibits the use of threats on consumers (Munneti, 148). In this case, the companies violated the fair debt collection practices act with the way they were able to address the client (Casey) as well as the third parties such as the Casey’s mother and farther. Casey was addressed in an abusive manner when she tried calling the respective companies she that she was indebted to, and was threatened by the debt collectors that she would lose her property in the eventuality of not pay up her debts on time and was also not given the mandatory thirty days as stipulated by the act to allow her to confirm that she is indebted to the respective debt companies. On the other hand, the third parties which included the mother and the farther were communicated to by the respective company which is prohibited in the act unless the contact or whereabouts of Casey were to be unknown. Her parents were also abused for her failing to pay up her dates and this violated the act too (Munneti, 148). QUESTION D Every human being is a consumer in one way or the other. When approaching the market as a consumer one expects value for his/her money in regard to the right quality, quantity, price and performance. However, in many instances the consumer is prone to harassments or cheats. There has been consumer protection acts provided by the government to protect consumers against suppliers who might be intending to cheat or harass them. When one buys certain goods, the law designates certain rights to the consumer which dictates that the goods must be satisfactory in quality whereby they must be free from faults however minor they maybe. Moreover, the goods must be fit for the purpose (Jeff Minneti, 213). In this case, they must be able to meet the purpose that they are meant for and finally they must match the verbal or written description of the goods which must be accurate. In this case Bob and Mary were coerced in to buying the cars by the sales person who insisted that the cars are one of the best on the market and all the customers having them love them while that fact was there were roaming complaints about the car brakes problem in existence. This falls under the deceptive advertisement claims and therefore the court has to allow and create a broad right of action for the injured consumers. This goes against what the law dictates towards how a trader should carry out his/her business with the consumer safety being the greatest consideration (Jeff Minneti, 179). Many states have statues which allow consumers to sue traders who are involved in prohibited practices for damages or even obtain other relief. This involves allowing rescission of proscribed transaction which mostly allows the prevailing consumers an award of attorney’s fees and this in the long run allows them protect their rights. All the state statues which allow a private cause of action allow recovery of actual damages while other allows recovery of multiple damages (Jeff Minneti, 194). By this I mean that, the trader who in this case is Ford should not make false description about the goods, sell unsafe or dangerous goods in this case being a car that has reported claims of stuck brakes. The trader is guilty of a criminal offence if he/she misleads a consumer so that he/she can take a different decision about whether or not to buy the product. This includes giving misleading information like the one given to Mary and Bob. Moreover, it is also a criminal offence to fail to give important information that affects whether or not you buy the product. This is what is referred to as a misleading omission (Jeff Minneti, 194). For the case of Mary and Bob, there are premonitions that there are very many claims that these cars are prone to brakes malfunctioning. Therefore they can opt for class actions. By this I mean that since handling these cases as individuals may result to attracting small awards of damages, a class based approach will give the appropriate incentives to bring the action. This will also imply that the attorney’s fees will be higher in this category due to economies of scale. This will also form an effective base for forcing the defendant who is Ford in this matter to comply and modify their behavior. When they file these cases individually there are higher chances that the company may willingly continue with their faulty cars business, however, when these is done throughout the state there will be a rise in the stakes and publicity surrounding the business practice. This will in the long run have the consumers who may be having such claims join up hands and take on economically powerful interest (Jeff Minneti, 188). A manufacturer who places in commerce a product rendered dangerous to life or limb by reason of some defects is liable in tort to one who sustain injury because of the defective condition. This being the case, Ford is held responsible of the injuries incurred by Mary resulting from faulty brakes. Ford is engaging in a business of selling motors vehicles and moreover distributing the type of product that harmed the plaintiff. They are therefore held responsible of any occurrence. In regard to products liability and the DTPA harm to persons or property which are commonly referred to as personal injury and property damage are incorporated for rules governing economic loss (Jeff Minneti, 189). Under section 10 of the third restatement, post sale failure to warn also provides additional cause of action under which a product liability suit may be brought. As the statues states, the manufactures are subject to liability for harm to persons or property caused by seller’s failure to provide warning after the time of sale and distribution. This therefore means that Ford is liable to injuries caused to Mary by the vehicle (Jeff Minneti, 190). It is worth noting that the law has drawn between tort recovery for physical injuries and warrant recovery for economic loss is not arbitrary. The clear distinction rests on an understanding of the nature of the responsibility a manufacture must undertake in distributing the products. He can be held responsible of the physical injuries caused by defects by requiring his good to match a standard safety defined in terms and conditions that in the long run create unreasonable risks of harm. Therefore Ford is help reliable of the damages caused by the plaintiff to the extent that these vehicles did not meet the performance expectations of the consumers (Jeff Minneti, 199). Bob suffered an economic loss and as per the uniform commercial code, there is the provision of both express and implied warranties which implies that the warranty is merchantable and that the merchantable goods are fit for the ordinary purpose for which they are used. In this case Bob sold his car at a loss due to its mechanical problems, therefore he is entitled to compensation by Ford who in the first place released a vehicle that is not merchantable due to its conditions which don’t meet the reason they are for. In connection with uniform code physical injuries to a consumer are included under strict liability (Jeff Minneti, 201). Therefore, Mary is entitled to compensation due to the harm caused by the faulty car while Bob is entitled to compensation for the loss he incurred resulted from the fault that existed in the car. This is due to the fact that the law recognizes compensation rather than punishment because punishment may result to over deterrence and overcompensation. However, there is a need to define and examine the gross negligence and identify its basic elements, determine how these elements should be applied in the context of a malfunctioned car brakes and finally convince the court that all what they are accusing Ford are true (Jeff Minneti, 197). Finally section 2.315 gives consumers warranty protection. It provides an implied warranty of fitness for a particular purpose which arises when where the seller at the time of contacting has reasons to know any particular use which the goods are required and that the buyer is relying on the seller’s skills or judgment to select or furnish suitable goods. This states that, if the manufacture has specific knowledge he is liable upon an implied warranty of fitness for a particular purpose. In this case, Ford was aware of the complaints arising form stuck brakes of their vehicles (Jeff Minneti, 204). Book cited Jeff Minneti, An overview of the United States Legal System, Stetson University: Florida, 2011 Read More