H.B. No. 2005
1-1 AN ACT
1-2 relating to avoidance of liability by correction of certain
1-3 violations of state credit law.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Article 1.06, Title 79, Revised Statutes (Article
1-6 5069-1.06, Vernon's Texas Civil Statutes), is amended by adding
1-7 Sections (4) and (5) to read as follows:
1-8 (4)(A) A person has no liability to an obligor for a
1-9 violation of this Subtitle if:
1-10 (i) within 60 days after the date the person
1-11 actually discovered the violation the person corrects the violation
1-12 as to the obligor by taking whatever actions and by making
1-13 whatever adjustments are necessary to correct the violation,
1-14 including the payment of interest on a refund, if any, at the
1-15 applicable rate provided for in the contract of the parties; and
1-16 (ii) the person gives written notice to the
1-17 obligor of the violation before the obligor has given written
1-18 notice of or has filed an action alleging the violation of this
1-19 Subtitle.
1-20 (B) For the purposes of this section, the term
1-21 "actually discovered" may not be construed, interpreted, or applied
1-22 in a manner that refers to the time or date when, through
1-23 reasonable diligence, an ordinarily prudent person could or should
1-24 have discovered or known as a matter of law or fact of the
2-1 violation in question, but the term shall be construed,
2-2 interpreted, and applied to refer to the time of the discovery of
2-3 the violation in fact. However, the actual discovery of a
2-4 violation in one transaction may constitute actual discovery of the
2-5 same violation in other transactions if the violation actually
2-6 discovered is of such a nature that it would necessarily be
2-7 repeated and would be clearly apparent in the other transactions
2-8 without the necessity of examining all the other transactions. For
2-9 purposes of this Section the giving of written notice shall be
2-10 accomplished by and on the delivery of the notice to the person to
2-11 whom the notice is directed or to the person's duly authorized
2-12 agent or attorney of record. The delivery shall be made in person
2-13 or by United States mail to the address shown on the most recent
2-14 documents in the transaction. Deposit of the notice as registered
2-15 or certified mail in a postage paid, properly addressed wrapper in
2-16 a post office or official depository under the care and custody of
2-17 the United States Postal Service constitutes prima facie evidence
2-18 of the delivery of the notice to the person.
2-19 (C) A person has no liability to an obligor for a
2-20 violation of this Subtitle if:
2-21 (i) before March 1, 1994, the person corrects
2-22 the violation as to the obligor by taking whatever actions and by
2-23 making whatever adjustments are necessary to correct the violation,
2-24 including the payment of interest on a refund, if any, at the
2-25 applicable rate provided for in the contract of the parties; and
2-26 (ii) the person gives written notice to the
2-27 obligor of the correction before the obligor has given written
3-1 notice of or has filed an action alleging the violation of this
3-2 Subtitle.
3-3 (5) The action of a person who corrects a violation of this
3-4 Subtitle as provided by Section (4) of this Article is effective as
3-5 to all persons in the same transaction, and those persons are
3-6 entitled to the same protection as that provided by Section (4) of
3-7 this Article to the person who makes the correction.
3-8 SECTION 2. The importance of this legislation and the
3-9 crowded condition of the calendars in both houses create an
3-10 emergency and an imperative public necessity that the
3-11 constitutional rule requiring bills to be read on three several
3-12 days in each house be suspended, and this rule is hereby suspended,
3-13 and that this Act take effect and be in force from and after its
3-14 passage, and it is so enacted.