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General Assembly

 

Substitute Bill No. 6897

    January Session, 2007

*_____HB06897JUD___041307____*

AN ACT CONCERNING LIQUIDATED DAMAGES PROVISIONS IN CONTRACTS, REQUESTS FOR MORTGAGE PAYOFF STATEMENTS AND THE REPOSSESSION OF MOTOR VEHICLES IN BANKRUPTCY CASES.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective October 1, 2007) No provision in a contract for the purchase or lease of goods or services primarily for personal, family or household purposes that provides for the payment of liquidated damages in the event of a breach of the contract shall be valid or enforceable unless (1) the contract contains a statement in boldface type at least ten points in size immediately following such liquidated damages provision stating "I HAVE READ THIS LIQUIDATED DAMAGES PROVISION AND UNDERSTAND ITS MEANING", and (2) the person against whom such provision is to be enforced signs such person's name or writes such person's initials next to such statement.

Sec. 2. Section 49-10a of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2007):

(a) A mortgagee shall, upon written request of the mortgagor or the mortgagor's attorney or other authorized agent, provide a payoff statement in writing to the person requesting [such] the payoff statement on or before the date specified in such request, provided such request date is at least [ten] eight business days [from] after the date of receipt of the written request for a payoff statement. If the request for a payoff statement is made in connection with a default on the mortgage, the mortgagor's attorney may make such written request directly to the mortgagee, provided such written request contains a representation that the person requesting the payoff statement is the mortgagor's attorney and that the mortgagor has authorized the request.

(b) If the mortgagee fails to provide [such] the payoff statement on or before such request date, the mortgagee shall not be entitled to the payment of any interest on the mortgage loan which is secured by such mortgage which accrues after the expiration of such request date. If the mortgagee provides the payoff statement to the person requesting the [same] payoff statement after the expiration of such request date, interest on the mortgage loan which accrues after the receipt of [such] the payoff statement by the person who has requested it shall again be payable. The burden of proof shall be on the mortgagor with respect to the receipt by the mortgagee of the mortgagor's request for a payoff statement of the mortgage loan, and thereafter shall be on the mortgagee with respect to the receipt of the payoff statement by the mortgagor or the mortgagor's attorney or other authorized agent.

(c) The mortgagee shall not impose any fee or charge for the first payoff statement requested within a calendar year, unless the mortgagor or the mortgagor's attorney or other authorized agent requests expedited delivery of the payoff statement, agrees to pay a fee for such expedited delivery and the payoff statement is provided by the agreed upon date.

Sec. 3. Subsection (a) of section 36a-785 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2007):

(a) When the retail buyer is in default in the payment of any sum due under the retail installment contract or installment loan contract, or in the performance of any other condition which such contract requires [him] the retail buyer to perform, or in the performance of any promise, the breach of which is by such contract expressly made a ground for the retaking of the goods, the holder of the contract may retake possession thereof, except that the filing of a petition in bankruptcy under Chapter 7 of Title 11 of the United States Code by the retail buyer of a motor vehicle, or such retail buyer's status as a debtor in bankruptcy under said chapter, shall not by itself be a default or a ground for the retaking of the motor vehicle for the purposes of this subsection. Unless the goods can be retaken without breach of the peace, [it] the goods shall be retaken by legal process, but nothing [herein contained] in this section shall be construed to authorize a violation of the criminal law. In the case of repossession of any motor vehicle without the knowledge of the retail buyer, the local police department shall be notified of such repossession immediately thereafter. In the absence of a local police department or if the local police department cannot be reached for notification, the state police shall be promptly notified of such repossession.

This act shall take effect as follows and shall amend the following sections:

Section 1

October 1, 2007

New section

Sec. 2

October 1, 2007

49-10a

Sec. 3

October 1, 2007

36a-785(a)

JUD

Joint Favorable Subst.