Student Number ___17318717 U.S. Consumer Law Winter 2011 Dean Richard M.

Alderman University of Houston Law Center
After you complete this exam, you will submit it through Moodle. All answers must be placed on the exam.

The exam has a total of 100 points, and is divided into two parts. Part I is multiple choice and true/false. Each question is worth one point, for a total of thirty points. Clearly mark the answer that you believe is the most correct for Part IA. You can do this by marking the correct answer in bold or underline.

Instructions

Part II is worth a total of 70 points. Point values for each of the three questions are indicated at the beginning of the question. Be sure to limit your answer to the number of words stated in each question. Your answer should be double space. And written in the space following the question. Remember, you have 30 days to complete this exam. Take time to review and proof read and edit your answers. Always assume that federal and Texas law applies, unless the question indicates otherwise. Please be sure you have the entire exam. It has 10 pages.

1

1. The U.S. Supreme Court held that state unconscionability law cannot be used to establish a per se ban on class action waivers in arbitration clauses because: 1. Arbitration is federal law and states can’t change it 2. The state law interferes with arbitration 3. Class actions are a matter of federal law and cannot be affected by state laws 4. Arbitration is more effective than a judicial lawsuit

[Mark the best answer in bold or underline]

Part I A Multiple Choices One Point Each 20 Points

2. The economic loss rule is a judicially created rule that: 1. Requires claims for pure economic loss must be brought in contract not tort 2. Limits tort claims to only economic loss 3. Prohibits recovery of mental anguish damages for breach of contract 4. Requires that claims for economic loss must be brought in tort not contract 5. None of the above

3. Which of the following is not a prerequisite for a credit card holder to assert claims and defenses he would have against the merchant, against the credit card company? 1. The transaction must be over $50 2. The consumer must make a good faith effort to settle with the merchant 3. The transaction must be in the consumer’s state or within 100 miles of his home. 4. The consumer must report it to the credit card company within ten days. 5. None of the above 4. The statute of limitations for a breach of warranty in Texas is: 1. I year. 2. 2 years 3. 3 years 4. 4 years

2

A “fee-shifting” statute is one that. Cost to repair a product 2. Under the Fair Debt Collection Practices Act. None of the above. Shifts the burden of proof to the other party 3. Oil 4. Not call a consumer once the consumer tells the debt collector that the employer does not allow such calls 4. Call a consumer no more than once a day at work 3. 1. A dog 8. Equifax 7. Lost profits 5. Lost income 3. A car 2. Call a consumer at work any time he wants 10. Which of the following is not a credit bureau in the United States? 1. a debt collector may: 1. Experian 2. Lost profits 2. Was flooded with facts she couldn’t understand 2. More than one of the above 5. Trans Union 3. Was tricked into buying the house by the seller 3. I used the term “soft damages” to include: 1. Medical bills 4. Cost to repair 3. Owes more than her house is worth 3 . Which of the following is not a good under the Uniform Commercial Code (UCC)? 1. Never call a consumer at work 2. In class. Pain and suffering 5. A house 3. Which of the following is not included within the term actual damages? 1. Shifts attorney’s fees to the other party 2. Shifts jurisdiction to another court 4. The term “under-water” means that the consumer: 1. Pain and suffering 4. American 4. Shifts damages from one defendant to another 9. 11.6. Is so confused that she could not protect herself 4.

000 on her car note when she stops paying. Negotiation 4.000.500. In an action for breach of warranty under the UCC. the difference between what the car was sold for.000. $6. Damages for the cost to repair a defective product 4. At this point. NAF stands for 1. Nevada Agency for Fairness 3. Consumer owes lender $10. The lender has expenses of $500 to hold the sale. A charge for goods that are defective 3. Damages for medical bills 5. Arbitration 2. The cost of the repossession is $500. the difference between what she owed and what the car was sold for. Damages for lost profits 3.000. More than one of the above 15. Nothing. A charge for a bill that was paid the prior month 5. and what she owed 3. Which of the following involves a voluntary dispute resolution process that is not binding unless the parties agree? 1. A charge for more than the contract price 4. A charge for goods not received 2.12. Which of the following is not a billing error under the Fair Credit Billing Act? 1. None of the above 14. The lender repossesses the car. $5. consumer still owes: 1. National Association for Fairness 4 . which of the following damages may not be recovered: 1. Damages for mental anguish 2. The lender holds a sale and sells the car to a buyer for $5. More than one of the above 16. $5. National Agency for Families 5. Mediation 3. National Arbitration Fund 2. the difference between what she owed and what the car was sold for plus the cost of the repossession 4. plus all the costs 13. the car has been repossessed 2. National Arbitration Forum 4. All of the above 5.

? 1. Damages for pain and suffering 2. 30 19. which of the following type of damages may not be recovered? 1. For a misrepresentation under the Texas Deceptive Trade Practices Act. The Texas Deceptive Trade Practice Act requires notice be sent to the defendant how many days before a lawsuit is filed? 1. More than one of the above 5. Sanction for similar misconduct 5 . Ratio to the amount of damages awarded 3. 60 2. Which of the following has been enacted into law in the U.17. 40 4. Which of the following is not an appropriate standard by which to evaluate the constitutionality of punitive damages under the U. Economic damages 3. Consumer Financial Protection Bureau Act 4. Credit CARD Act 2. Degree of reprehensibility of defendants conduct 4. Damages for mental anguish 4. More than one of the above 18. 50 3.S. All of the above 20. Constitution? 1.S. Net worth of the defendant 2. Arbitration Fairness Act 3. Punitive damages 5.

if a consumer recovers economic damages of $10. A qualified entity must seek or acquire. Jury decides only issue of fact. If a father buys a toy for his son. Mark your answer in bold or underline. goods or services to be a consumer. Credit card is more secure method of payment then Debit Cards. Mental anguish Up to 3x economic damages. Here Boy is consumer under the head of Acquire. the son is not a consumer under the Texas Deceptive Trade Practices Act because he did not pay for the toy? T/F Part B True/False Explain One Point Each 10 Points Total 2. Your answer should look as follows: 1. he may recover up to a total of $40. Under the Deceptive Trade Practices Act. Voire Dire is part of the discovery process in an American trial? T/F ANS. 4. F. highlight whether the statement is true or false. If you buy something online. and shows that the defendant acted knowingly. Then explain your answer in no more than two sentences. 5. T. 1. 6 . In BOLD. by purchase or lease. Ans. In an American jury trial. Because it provides an opportunity to everyone review his own current credit history regularly.000. Ans. A good way to prevent identity theft is to review a copy of your credit report? T/F 3. F.000? T/F ANS. it is better to use a credit card than a debit card? T/F 6. T. T Explain the reason why it is true. the jury decides issues of fact and law? T/F ANS. T.For each of the following questions.

7 . F.7. 8. “UDAP” means “You Don’t Attack Professors”? T/F ANS. Because it is a process in which prospective jurors are questioned about their backgrounds and potential biases before being chosen to sit on jury. F. A bank always has the right to charge a customer an over-the-limit fee if she exceeds the agreed upon credit limit? T/F 9. T. is not a consumer for purposes of the DTPA. Federal law prohibits credit card issuers from charging you an over-thelimit fee unless you've opted-in to have over-the-limit transactions processed. In Texas. 402A. ANS. It means Unfair and Deceptive Acts and Practices laws F. ANS. Strict Product Liability Applies to the seller. Any business may be a consumer under the Texas Deceptive Trade Practices Act? T/F 10. F. strict Products Liability. applies to only the consumer or the user? T/F ANS. A “business entity” with assets of $25 million or more.

B AND C. She has visited about 10 houses. She has nightmares about what happened in the house. Texas. She has been searching for a new house for two months. Take time to outline and edit your answer.000. “What do you mean”? The neighbor then told Casey the story of how the seller’s mother had been brutally murdered in the house. She 8 . Your grade will be based on your knowledge of the law and your application of the law to the facts. She did notice that everything had just been painted and looked like it was in very good condition. she decided to buy the house and signed a contract. the neighbor came by to visit. Recently. “I am so glad he finally sold this house. She went to see the house and spent an hour with the seller looking at the property. The advertisement said the house had “just been painted.” Casey said. and support your conclusions. You may take as much time as you want to prepare your answer but it must be limited to the number of words stated in the question. EVERYONE MUST ANSWER D Question A 20 Points Maximum 1200 words Casey Consumer just moved to Houston.” The price of the house was $200. The next day. Casey can’t even sleep in the house. What happened to his mother was terrible. Casey has never owned a house and is very excited about buying her first home. She did not talk too much with the seller because her English is not very good. Be sure to discuss all relevant law. and the seller had a real Texas accent that was hard to understand. Casey saw an advertisement for a local house that seemed perfect. and has lost her job because she has been so distracted. She didn’t ask any questions.” was a “great deal. she said.” Casey was obviously upset. “her blood had covered most of the walls of the house. The neighbor said.Point values for each of the following questions are indicated at the beginning of the question. A week after she moved in. Part II Essay Questions ANSWER ANY TWO QUESTIONS FROM A.” and was in “excellent condition. from Vietnam. much lower than most of the similar homes she visited. Your answer should be type double space. In fact. but has not found one she likes. USA.

The stores have asked her to pay. RGM wrote a letter to Casey. They psychiatrist kept Casey in the hospital for two days. GBH has used similar tactics. After hearing this. and now the matter has been turned over to debt collectors. and what damages she might be able to recover if she won a lawsuit. When she called the debt collectors to work something out. She tries to sell it. You work for a law firm that Casey contacted. they both yelled at her. On the way home. what claims Casey may have. Both collectors call at all hours of day and night and let the phone ring if she doesn’t answer. and what damages she could recover if she prevails. and can’t sleep or eat. she stopped in a local electronic store and bought a new TV for her bedroom that cost exactly the same thing as the oven. and against whom? Fully discuss the claims and the likelihood she will prevail. Casey agreed to pay $150 a month for one year to pay for the oven. but unfortunately.wants out of the house. and GBH Company is collecting the TV debt. telling her that unless she pays within 30 days. 9 Question B 20 Points No more than 1200 words . and they called her mother and told her that she was a bad mother because her daughter didn’t pay her bills. She lives in her apartment above the restaurant. What legal claims might Casey have under the Deceptive Trade Practices Act. called her names. business is not good and she cannot make the payments. they will send the sheriff to put her in jail. and told her that all they would accept is payment in full and if she didn’t pay soon she would lose everything she owns. Carey went to the local appliance store to buy an oven for her business. Discuss what law applies. GBH wrote a letter to Casey telling her that she will lose her house if she doesn’t promptly pay. RGM Company is collecting the debt for the oven. Casey is very satisfied with both the oven and the TV. Casey is very upset by all of this. The firm has asked you whether Casey has any claims against either RGM or GBH. Last month. What damages could she recover if she prevailed? Write answer here: Casey Consumer runs a small restaurant. but no one will pay more than one-half what she paid. She agreed to pay $150 a month for one year for the TV. Casey fainted and was brought to the hospital. They also called her father and told him his daughter was a deadbeat. She had to close her restaurant for several days.

or deceptive practices to collect from you. enforces the Fair Debt Collection Practices Act (FDCPA). There are following ways for Casey to act.Write answer here: Introduction: Debt Collection in United States is a big business. Americans owe trillions of dollars in consumer credit. With that much money at stake. The Federal Trade Commission (FTC). which prohibits debt collectors from using abusive.  Casey owed the money  Casey was willing to pay  Illegal collection practices and harassment by the debt collectors  As of result of illegal collection practices and harassment Casey suffered mentally as well as financially. lawyers who collect debts on a regular basis and companies that buy delinquent debts and then try to collect them. and almost $ 25 billion is on default. a debt collector is someone who regularly collects debts owed to others. Congress enacted Fair Debt Collection Practices Act (FDCPA). misleading and unfair practices are all part of the debt collectors tool box. Under the FDCPA. the nation’s consumer protection agency. which are working to protect the consumers from abusive and harassing behavior and illegal debt collection practices of debt collectors. unfair. Harassing phone calls and letters. This includes collection agencies. 10 . threats and deceptive. Facts of the case: Following are the brief facts of the case. To regulate theses abusive practices. There are many Government agencies and Laws. debt collectors become very innovative when it comes to collection.

Fourthly by causing a telephone to ring or engaging Casey in telephone conversation repeatedly and continuously with intent to annoy. Secondly it is illegal for debt collectors to make empty threats about serving people with a lawsuit or seizing their home or to harass them so as it is case with Casey. Unfair practices [15 USC 1692f] which states as follows. A debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt. Fifthly Abusive and profane language used in the course of communication related to the debt with Casey by both debt collectors is another violation of FDCPA. Thirdly the FDCPA prohibits contacting consumers by telephone outside of the hours of 8:00 a. because the Collection agencies are allowed to contact neighbors or co-workers but only to obtain location information and nothing more and revealing or discussing the nature of debts with third parties (other than the consumer's spouse or attorney)is strictly prohibited by FDCPA.m. local time so the debt collectors are here too in violates the terms of FDCPA.m.At first instance Casey can report an alleged violation of her rights and file a complaint against a debt collector. abuse. she may sue the debt collectors for harassment and illegal collection practices. to 9:00 p. Violation of Section 1692b &c of The Federal Fair Debt Collection Practices Act also the debt collectors violated the provisions of § 808. 11 . or harass her as did both the debt collecting agencies another violation of FDCPA. Sixthly the debt collectors violates the terms of FDCPA by communication with third parties like Casey’s father and mother. start by contacting her state’s Attorney General. She should file a lawsuit and take the case to court under the claim of harassment and illegal collection practices.

attorney's fees. Everyone agrees on what the law should say. Casey can file a private lawsuit in a state or federal court to collect damages (actual. The Federal Trade Commission may thus seek a variety of remedies against debt collector that violates FDCPA. From all the discussion above it is quite clear that FDCPA offers some of the strongest protection for consumers provided by any federal or state law regulating the activities of debt collectors. 12 . but there is disagreement over how the laws should be enforced. creditors. The Commission has been asked to propose new consumer laws for the country to regulate payday loans. Still others have mentioned that maybe lawsuits are not the best way to enforce the law. A violation is also considered an unfair or deceptive act or practice.000 plus reasonable attorney fees if a debt collector is proven to have violated the FDCPA. including employers. The FDCPA is a Strict liability law. Others think the best way to enforce the law is to have a large staff and allow the staff to sue to enforce the laws. in violation of Federal Trade Commission Act. and unfair and deceptive acts and practices. Question C 20 Points Maximum 1200 words You work for your country’s Consumer Law Commission. and that a licensing system should be set up to enforce the laws. and court costs) from third-party debt collectors. who are affected by violations connected with consumer transactions. private remedies provided by the Act are available to any person. including attorney’s fees. debt collection. which means that a consumer need not prove actual damages in order to claim statutory damages of up to $1.According to FDCPA a debt collector who violates the terms of FDCPA is civilly liable for damages. statutory. Some of the members of the Commission want the laws to all be enforced by private lawsuits filed by consumers. relatives. In addition. friends and neighbors.

in many states. or imposed ceilings as low as $1. deceptive. also prohibit unfair or unconscionable practices. Legislation or court decisions in dozens of states have narrowed the scope of UDAP laws or granted sweeping exemptions to entire industries.Discuss the pros and cons of the various enforcement methods. we first should look into the prevailing Statutes and procedure in US and why the new Statute and procedural methods were indeed the need of an hour. Write answer here: INTRODUCTION: Before going in to the detail of recent law reforms and what should we do regarding various methods to enforce the laws. the effectiveness of UDAP laws varies widely from state to state. This following examples documents how widely and frequently those lines have been breached. Yet despite their critical role in ensuring marketplace justice and fairness. UDAP laws prohibit deceptive practices in consumer transactions and. Unfair and Deceptive Acts and Practices (UDAP) statutes in each of the fifty states and the District of Columbia constitute the main lines of defense protecting consumers from predatory. To decide on the issue we should first answers the two very important 13 . Now as the new laws have been incorporated keeping in view the lacunas of current statutes and now the only disagreement is over how the laws should be enforced. and explain which option or options you think is best and why. The holes are glaring. and unscrupulous business practices. And several states have stacked the financial deck against consumers who go to court to enforce the law themselves. Other states have placed substantial legal obstacles in the path of officials charged with UDAP enforcement. A number of states impose special procedural obstacles on consumers that can hinder or even prevent them from enforcing the UDAP statute. and finds that in almost all states significant gaps or weaknesses undermine the promise of UDAP protections for consumers.000 on civil penalties.

The one group of member wants that the laws should be implemented by private law suits i. the protection of consumer. Secondly business needs effective consumer laws to insure equal competition and that they do not lose business to others who mislead and deceive consumers. Firstly because only through effective laws can we assure that consumers are treated fairly and that products are safe and effective.  Significance of purchase: The purchase involves the hard earned money of consumer.questions the first is Why do Consumers Need Special Protection? And second is being. Individual makes enforcement decision.e.  Consequences:  Insufficient redress: Before the laws the seller provided insufficient redress to consumer and no compensation for the damages suffered by the consumer by the use of seller’s product. The answer to first question why do Consumers Need Special Protection? Lies in following points.e. why we need consumer protection laws? Because at the end of day all the hard work and efforts put in this whole exercise is done keeping in view only one aspect and i.  Insufficient information: The consumer in almost majority cases does not have the sufficient information in respect of his purchase. Now from the discussion of members of the Commission we come to the conclusion that the view of members can easily be divided in to two major’s categories. and Thirdly effective consumer laws reduce costs by bringing certainty to the marketplace and insuring prompt low cost dispute resolution. and 14 . And now we come to the question why we need Consumer Protection Laws.  Lack of expertise: Lake of expertise regarding the purchase item is also an important reason to protect the consumer.

in their point of view is that the lawsuits are not the best way to enforce the law. The litmus test of consumer protection can be gauged by following elements. but driven on the personal grievances.  Government bears cost of enforcement in all such cases.  Compensation goes to directly to injured consumer  Punishment is only of civil nature and offender is punished through punitive damages  No cost to government exchequer so good for community at large. Public Enforcement:  In case of public enforcement the Government make decisions based on “Public good”.  Decisions are often politically influenced or motivated. Below we discuss the two aspects in brief. and effect the public at large.  Any wrongful conduct may be punished civilly or criminally. Now we look closely all the view points and come up with the best possible scenario. and that a licensing system should be set up to enforce the laws. because no Government can afford to lose public support.On the other hand the other group thinks that the best way to enforce the law is to have a large staff and allow the staff to sue to enforce the laws i. as the making these laws means how can we effectively protect the consumer and provide a level playing field for all buyer and seller.  All consumers are protected equally in public enforcement as government treats everybody at equal levels.  Simplify process: 15 .e. Private Enforcement:  In case of Private enforcement Individual makes enforcement decision on its personal injury or damage.  Decision to sue in private litigation is not politically motivated or influenced.

So it is safe to conclude that the best policy is to adopt is to let consumer file private law suits as it is the most effective method of ensuring the consumers rights and where Government or the consumer protection agencies think fit to make a move they should be allowed to as in the end the meaning of this whole exercise is the protection of the consumer. That it is the duty of Government to enact statute and established a constitutional body to safeguard the rights of consumer and as the time has passed on consumers are also getting not only familiar with their rights but also actively claiming them too. So the right steps should be taken to reduce the cost of increasing costs of redress.  Deter wrongful conduct: Deterring the wrongful conduct is the third most effective means of consumer protection.The most important question to consider while drafting any consumer protection law is how simple the process is for consumer protection? The simple the process greater is the value and protection of the consumer.  Substantially increasing costs: Increasing cost to avail the remedy hinders the goal of achieving consumer protection.  Fully compensate: Second most important element is how much the law or process compensate the consumer or punish the entity on wrong side of the affairs. 16 . CONCLUSION: From the above discussion it can safely be concluded that the effective consumer protection cannot be safely guarded without private and public partnership.

She had several broken ribs. and often cannot sleep well. and many customer complaints. Tempest is manufactured by Ford and has been on the market for about six months. Bob is very upset that he has lost this money. there have been many problems with the brakes on the Tempest. hitting a light pole. He is also embarrassed in front of his friends who think he was dumb to buy a Tempest. The salesperson told them that the Tempest was “one of the best manufactured new cars on the market. Bob is afraid to drive his car and sold it. One simple reason is the financial position of both parties as damages can certainly be recovered from Ford. He is really mad about the whole thing and feels like the car company cheated him. She has since gone back to work. Mary’s car was completely destroyed. while driving to work. They each paid $20.000 for their car. the likelihood they will prevail. as was her computer and briefcase. Mary was injured and hospitalized for four days. “ [In fact. what they will have to prove to win a lawsuit. But after what happened to his sister and the publicity about problems with the brakes on the Tempest.” and that “all of his customers loved it. (They do not want to sue Ford) For Bob and Mary. the brakes on Mary’s car became stuck.000 less than he would have if there had not been any bad publicity. he has not had any problems with his car. After she was released from the hospital. and what damages they each may recover if they prevail. Fortunately for Bob. fully discuss what claims they may have against Ford. Bob received $5. and the car skidded to a stop. and a broken leg as well as serious head injuries. Mary missed two weeks of work.Bob and his sister Mary each recently bought a new Tempest automobile from the local car dealer. but has not been as productive because she often has flashbacks to the accident and cannot concentrate. Write answer here: As for the first step it is essential to suggest and urge Bob and Mary to sue both Ford and car dealer both.] Last week. The doctors say it will be a year before Mary is fully recovered. Secondly according to Product Liability Act [Chapter 82] Manufacturer must indemnify any loss and Seller’s have limited liability towards Consumer and according to the rule stated 17 Question D 30 Points No more than 1200 Words EVERY ONE MUST ANSWER THIS QUESTION . Both Bob and Mary want to sue the dealer who sold them the car.

As provided in Chapter One. 1. It therefore applies to manufacturer (As in this case the Ford Co. the definition of economic damages and subsection 17. Issues to be presented: Now the issues to be presented here are. negligence and strict products liability. to any wholesale or retail dealer or distributor (the Car Dealer) and to operator of a restaurant Thirdly car dealer will put the blame on manufacturer so having both on the suit will be convenient and time saving and thirdly it is a clear case of defective product. Negligence and Strict products liability. and will continue to be asserted in product suits involving consumers. Section three. The most common situation where all of the above claims exits in the case of defective product. as DTPA applies in many cases when other causes of action will also exits. Under what Law and Principle of law the proceedings will be carried out. however. What type of damages should Marry and Bob recover? The DTPA applies in many cases when other causes of action will also exit. Who is responsible for the loss suffered by Marry and Bob? 2. The case deals with the issues of breach of warrant under Business and Commerce Code. necessary to have at least some familiarity with the claims most commonly asserted in connection with DTPA claim arising out of defective product.) of such a product.in this section 402A the term seller applies to any person engaged in the business of selling products for use or consumption. 18 . exactly the case we are dealing right now. it is not unusual to find a petition asserting a claim for misrepresentation under the DTPA. breach of warranty under the business and Commerce Code. The Texas Deceptive Trade Practice Act also applies in this. The Act still applies to such claims. Thus. It is therefore.49(e) somewhat limit the DTPA in cases involving personal injury. And if the fact no 1 is established 3.

” Negligence is established by providing a duty. The doctrine of “strict products liability” is incorporated into Restatement (Second) of Torts. As in this case the car manufacturer has the duty towards consumers that the car will be defect free and safe to drive and there is no proximate damage. The rule is one of the strict liability. 402A. a breach of that duty and “proximately caused damages”. Section 402A. Negligence and Strict Product Liability. even though he has exercised all possible care in preparation and sale of the 19 . Examples include liability imposed upon the manufacturer of an exploding bottle. and the seller or manufacturer of an unsafe food product. or to his property. (2) The rule stated in Subsection (1) applies although (a) the seller has exercised all possible care in the preparation and sale of his product. if (a) the seller is engaged in the business of selling such a product. SPECIAL LIABILITY OF SELLER OF PRODUCT FOR PHYSICAL HARM TO USER OR CONSUMER (1) One who sells any product in a defective condition unreasonably dangerous to the user or consumer or to his property is subject to liability for physical harm thereby caused to the ultimate user or consumer. The most common causes of action asserted in a case involving defective product are “Warranty.Product liability is the term used to refer to that area of law dealing with injuries arising from a defective product. and (b) the user or consumer has not bought the product from or entered into any contractual relation with the seller. This section states a special rule applicable to sellers of products. the seller of the car (as in this case). making the seller subject to liability to the user or consumer. Section 402A states the responsibilities of seller as follows. S. and (b) it is expected to and does reach the user or consumer without substantial change in the condition in which it is sold.

Secondly the most common causes of action asserted in a case involving defective product are “Warranty.product. Business of selling: The rule stated in this section the term seller applies to any person engaged in the business of selling products for use or consumption. The section deals with the negligence liability of suppliers of chattels. Although it was originally intended to apply only to products with latent manufacturing defects. for convenience of reference and comparison with other sections dealing with negligence. From the above discussion it is quite clear that the Marry and Bob can sue the Manufacturer and Dealer firstly under Texas Deceptive Trade Practice Act (DTPA) there was a product defect and every according to definition of Product Defect under DTPA a product is defective if it is unreasonably dangerous and unfit for its ordinary purpose. It established a standard under which a manufacturer was to be held strictly liable if its product was sold in a “defective condition unreasonably dangerous to the user. And the accident to Mary’s car and other complaint the Ford and Car dealer has about the car are an ample proof of the fact that the Tempest was a defect product which was unreasonably dangerous and unfit for its ordinary purpose.” as the case with Marry and Bob to whom a defective product with proximity of damages was sold and later they suffer the proximate damages. § 402A has also formed the basis for finding manufacturers liable for design defects and for failure to warn. Negligence and Strict Product Liability.50(b)  Consumer may recover: ◦ Economic damages 20 .” They can sue for following damages  Section 17. to any wholesale or retail dealer or distributor and to operator of a restaurant. It therefore applies to manufacturer of such a product.

and the  Attorney Fees ◦ “Which is reasonable and necessary”: Must be awarded on an hourly basis.◦ If “knowingly” as that condition is satisfied by the fact that Ford and Car dealer has had a large number of complaints regarding the defect in Tempest so they can recover   Mental anguish Up to 3x economic ◦ If intentionally that fact proves with the fact that the car dealer and Ford hide the information which under law they were bound to “Disclose”. and as it is proved to the extent of Marry it cannot be said Bob’s daily routine was disrupted. From the above discussion it is pretty much certain that the Bob and Marry will succeed in their law suit and as to the extent of Marry she will recover or can recover all the damages while bob may not be entitle to the mental anguish damages as to get the mental anguish damages it is the established rule that the certain event or act disrupts ones daily routine. 21 . that the product has defects. and they will recover  Up to 3x mental anguish and economic.

Master your semester with Scribd & The New York Times

Special offer for students: Only $4.99/month.

Master your semester with Scribd & The New York Times

Cancel anytime.