DTPA – Defenses And Waivers

Johnson County insurance attorneys need to know how to use the Texas Deceptive Trade Practices Act (DTPA) to help their insurance clients. Here is some information that may be helpful.
The Texas Business & Commerce Code, Section 17.565, states clearly that the DTPA has a two year statute of limitations. This statute requires that suit “must be commenced within two years after the date on which the false, misleading, or deceptive act or practice occurred or within two years after the consumer discovered or in the exercise of reasonable diligence should have discovered the occurrence of the false, misleading, or deceptive act or practice.” Also, this limitations period “may be extended for a period of 180 days if the plaintiff proves that the failure to timely commence the action was caused by the defendant’s knowingly engaging in conduct solely calculated to induce the plaintiff to refrain from or postpone the commencement of the action.”
The only thing tricky about the above limitations is where it talks about using reasonable diligence to discover the wrong or wrongs that may have been committed. Sometimes this can be confusing.
One point that can cause confusion is that Section 17.505(a) requires a written notice be given the defendant before filing a lawsuit. However, Section 17.505(b) negates the necessity of the pre-suit notice if doing so would allow the limitations period to pass.
So what about waiver of the DTPA?
Section 17.42 tells us:
(a) Any waiver by a consumer of the provisions of this subchapter is contrary to public policy and is unenforceable and void; provided, however, that a waiver is valid and enforceable if:
(1) the waiver is in writing and is signed by the consumer;
(2) the consumer is not in a significantly disparate bargaining position; and (3) the consumer is represented by legal counsel in seeking or acquiring the goods or services.
(b) A waiver under Subsection (a) is not effective if the consumer’s legal counsel was directly or indirectly identified, suggested, or selected by a defendant or an agent of the defendant.
(c) A waiver under this section must be:
(1) conspicuous and in bold-face type of at least 10 points in size;
(2) identified by the heading “Waiver of Consumer Rights,” or words of similar meaning; and (3) in substantially the following form:
“I waive my rights under the Deceptive Trade Practices – Consumer Protection Act, Section 17.41 et seq., Business & Commerce Code, a law that gives consumers special rights and protections. After consultation with an attorney of my own selection, I voluntarily consent to this waiver.”
(d) The waiver required by Subsection (c) may be modified to waive only specific rights under this subchapter.
It is noteworthy that the Texarkana Court of Appeals in 2001, specifically held that these waiver provisions apply only to the DTPA’s so called “laundry list” violations found in Section 17.46. Other courts have ruled on this issue including the Houston Court of Appeals [14th Dist.].