CHAPTER 603. REGULATION OF CONSUMER CONTRACTS CREATED BY ACCEPTANCE OF CHECK OR OTHER DRAFT
BUSINESS AND COMMERCE CODE
TITLE 12. RIGHTS AND DUTIES OF CONSUMERS AND MERCHANTS
CHAPTER 603. REGULATION OF CONSUMER CONTRACTS CREATED BY
ACCEPTANCE OF CHECK OR OTHER DRAFT
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 603.001. DEFINITIONS. Unless the context requires a
different definition, the definitions provided by Chapter 3 apply
to this chapter.
Added by Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.01, eff. April 1, 2009.
Sec. 603.002. APPLICABILITY OF CHAPTER. (a) Except as provided
by Subsection (b), this chapter applies only to a person who
solicits business in this state by mailing an individual a check
or other draft payable to that individual.
(b) This chapter does not apply to a financial institution as
defined by Section 201.101, Finance Code, or an authorized lender
as defined by Section 341.001 of that code, that sends a check or
other draft to an existing or prospective account holder
authorizing that person to access an extension of credit.
Added by Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.01, eff. April 1, 2009.
SUBCHAPTER B. REQUIRED DISCLOSURES AND NOTICES
Sec. 603.051. REQUIRED DISCLOSURE ON CHECK OR OTHER DRAFT. (a)
A person who makes an offer that the recipient may accept by
endorsing and negotiating a check or other draft shall disclose
on the check or other draft that by signing and negotiating the
instrument, the depositor agrees to pay for future goods or
services as a result of the contract.
(b) The disclosure required by Subsection (a) must be clear,
conspicuous, and located on the check or other draft next to the
place for endorsement.
Added by Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.01, eff. April 1, 2009.
Sec. 603.052. REQUIRED NOTICE OF RIGHT TO TERMINATE ACCEPTANCE
OF OFFER. (a) If an offer described by Section 603.051 includes
a free membership period, trial period, or other incentive with a
time limit, and if the offer results in a contract unless the
recipient terminates the acceptance of the offer not later than
the end of the time period, the offeror shall send notice to the
recipient, at least two weeks before debiting any account, of the
recipient's obligation to terminate the recipient's acceptance of
the offer.
(b) The notice required by Subsection (a) must be clear and
conspicuous. If the offeror bills the recipient by mailing an
invoice, the notice may be included with the invoice.
Added by Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.01, eff. April 1, 2009.
Sec. 603.053. EFFECT OF NONCOMPLIANCE. (a) An offer described
by Section 603.051 is void if the offeror:
(1) does not make the disclosure required by that section;
(2) does not send notice as required by Section 603.052, if
applicable; or
(3) provides an incentive with a time limit, including a free
membership period or trial period, that is less than two weeks in
length.
(b) A delivery of goods or services to the recipient does not
operate to form a contract between the offeror and the recipient
if:
(1) the offer does not contain the disclosure required by
Section 603.051;
(2) the offer is not followed by a notice required by Section
603.052, if applicable; or
(3) the offeror fails to honor the recipient's cancellation or
termination of the acceptance of the offer made under the terms
of the offer or as required by Section 603.052.
Added by Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.01, eff. April 1, 2009.
SUBCHAPTER C. ENFORCEMENT
Sec. 603.101. DECEPTIVE TRADE PRACTICE. A violation of this
chapter is a deceptive trade practice in addition to the
practices described by Subchapter E, Chapter 17, and is
actionable under that subchapter.
Added by Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 2.01, eff. April 1, 2009.