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80C312(3) MCK

CHAPTER 601. CANCELLATION OF CERTAIN CONSUMER TRANSACTIONS

SUBCHAPTER A. GENERAL PROVISIONS

Revised Law

601.001.

DEFINITIONS.

In this chapter:

"Consumer" means an individual who seeks or acquires real property, money or other personal property, services, or credit for personal, family, or household purposes.

"Consumer transaction" means a transaction between a merchant and one or more consumers.

"Merchant" means a party to a consumer transaction other than a consumer.

"Merchant's place of business" means a merchant's main or permanent branch office or local address.

For a state or national bank or savings and loan association, the term includes an approved branch office and a registered loan production office.

(Bus. & Com. Code,

Sec. 39.001.)

Source Law

DEFINITIONS.

In this chapter:

"Consumer" means an individual who seeks or acquires real or personal property, services, money, or credit for personal, family, or household purposes.

"Consumer transaction" means a transaction in which one or more of the parties is a consumer.

"Merchant" means a party to a consumer transaction other than a consumer.

"Merchant's place of business" means a merchant's main or permanent branch office or local address.

For a state or national bank or savings and loan association, the term includes any approved branch and any registered loan production office.

Revisor's Note

Section 39.001(2), Business & Commerce Code, defines "consumer transaction" as a transaction in which one or more of the parties is a consumer.

Section 39.001(3), Business & Commerce Code, defines "merchant" as a party to a consumer transaction other than a consumer.

The revised law incorporates into the definition of "consumer transaction" the concept in the definition of "merchant" that one of the parties to the transaction is a merchant.

Revised Law

601.002.

APPLICABILITY OF CHAPTER; EXCEPTION.

This

chapter applies only to a consumer transaction in which:

the merchant or the merchant's agent engages in a personal solicitation of a sale to the consumer at a place other than the merchant's place of business;

the consumer's agreement or offer to purchase is given to the merchant or the merchant's agent at a place other than the merchant's place of business; and

the agreement or offer is for:

the purchase of goods or services for consideration that exceeds $25, payable in installments or in cash;

the purchase of real property for consideration that exceeds $100, payable in installments or in cash.

Notwithstanding Subsection (a), this

chapter does not apply to:

a purchase of farm equipment;

an insurance sale regulated by the Texas Department of Insurance;

a sale of goods or services made:

under a preexisting revolving charge account or retail charge agreement; or

after negotiations between the parties at a business establishment in a fixed location where goods or services are offered or exhibited for sale; or

a sale of real property if:

the purchaser is represented by a licensed attorney;

the transaction is negotiated by a licensed real estate broker; or

the transaction is negotiated at a place other than the consumer's residence by the person who owns the property.

(Bus. & Com. Code,

Sec. 39.002.)

Source Law

APPLICABILITY OF CHAPTER.

This

chapter applies only to a consumer transaction in which the merchant or the merchant's agent engages in a personal solicitation of a sale to the consumer at a place other than the merchant's place of business, and the consumer's agreement or offer to purchase is given to the merchant or the merchant's agent at a place other than the merchant's place of business:

for the purchase of goods or services for consideration that exceeds $25 payable in installments or in cash;

for the purchase of real property for consideration that exceeds $100 payable in installments or in cash.

Notwithstanding Subsection (a), this

chapter does not apply to:

a purchase of farm equipment;

an insurance sale regulated by the Texas Department of Insurance;

a sale of goods or services made:

under a preexisting revolving charge account or retail charge agreement; or

after negotiations between the parties at a business establishment at a fixed location where goods or services are offered or exhibited for sale; or

a sale of real property if:

the purchaser is represented by a licensed attorney;

the transaction is negotiated by a licensed real estate broker; or

the transaction is negotiated at a place other than the consumer's residence by the person who owns the property.

[Sections 601.003-601.050 reserved for expansion]

SUBCHAPTER B. CONSUMER'S RIGHT TO CANCEL TRANSACTION

Revised Law

601.051.

CONSUMER'S RIGHT TO CANCEL.

In addition to any other rights or remedies available, a consumer may cancel a consumer transaction not later than midnight of the third business day after the date the consumer signs an agreement or offer to purchase.

(Bus. & Com. Code,

Sec. 39.003.)

Source Law

CONSUMER'S RIGHT TO CANCEL.

In addition to any other rights or remedies available, a consumer may cancel a consumer transaction to which this

chapter applies not later than midnight of the third business day after the date the consumer signs an agreement or offer to purchase.

Revised Law

601.052.

NOTICE OF CONSUMER'S RIGHT TO CANCEL REQUIRED.

A merchant must provide a consumer with a complete receipt or copy of a contract pertaining to the consumer transaction at the time of its execution.

The document provided under Subsection (

a) must:

be in the same language as that principally used in the oral sales presentation;

contain the date of the transaction;

contain the name and address of the merchant; and

contain a statement:

in immediate proximity to the space reserved in the contract for the signature of the consumer or on the front page of the receipt if a contract is not used; and

in boldfaced type of a minimum size of 10 points in substantially the following form:

"YOU, THE BUYER, MAY CANCEL THIS TRANSACTION AT ANY TIME PRIOR TO MIDNIGHT OF THE THIRD BUSINESS DAY AFTER THE DATE OF THIS TRANSACTION. SEE THE ATTACHED NOTICE OF CANCELLATION FORM FOR AN EXPLANATION OF THIS RIGHT."

(Bus. & Com. Code, Secs. 39.004(a), (b).)

Source Law

NOTICE BY MERCHANT.

A merchant must provide a consumer with a complete receipt or copy of any contract pertaining to the consumer transaction at the time of its execution.

The document provided under Subsection (

a) must:

be in the same language as that principally used in the oral sales presentation;

show the date of the transaction;

contain the name and address of the merchant; and

contain in immediate proximity to the space reserved in the contract for the signature of the consumer, or on the front page of the receipt if a contract is not used, a statement in bold-faced type of a minimum size of 10 points in substantially the following form:

"YOU, THE BUYER, MAY CANCEL THIS TRANSACTION AT ANY TIME PRIOR TO MIDNIGHT OF THE THIRD BUSINESS DAY AFTER THE DATE OF THIS TRANSACTION. SEE THE ATTACHED NOTICE OF CANCELLATION FORM FOR AN EXPLANATION OF THIS RIGHT."

Revised Law

601.053.

COMPLETED CANCELLATION FORM REQUIRED.

A merchant that provides a document under

Section 601.052 must attach to the document a completed notice of cancellation form in duplicate.

The form must:

be easily detachable;

be in the same language as the document provided under

Section 601.052; and

contain the following information and statements in 10-point boldfaced type:

"NOTICE OF CANCELLATION

(enter date of transaction)

"YOU MAY CANCEL THIS TRANSACTION, WITHOUT ANY PENALTY OR OBLIGATION, WITHIN THREE BUSINESS DAYS FROM THE ABOVE DATE.

"IF YOU CANCEL, ANY PROPERTY TRADED IN, ANY PAYMENTS MADE BY YOU UNDER THE CONTRACT OR SALE, AND ANY NEGOTIABLE INSTRUMENT EXECUTED BY YOU WILL BE RETURNED WITHIN 10 BUSINESS DAYS FOLLOWING RECEIPT BY THE MERCHANT OF YOUR CANCELLATION NOTICE, AND ANY SECURITY INTEREST ARISING