Many laws govern how firms transact business in Texas. The Deceptive Trade Practice Act is a business and commercial law that can have consequences for businesses in this state.
What the DTPA does
The DTPA is a wide-ranging consumer law that allows consumers to sue anyone who makes false, misleading, or deceptive statements when they conduct business. It covers individuals, partnerships, and corporations.
A business also violates the DTPA if it does not disclose known defects if this nondisclosure was intended to entice a consumer into the transaction. In these situations, silence may be a DTPA violation.
A consumer who can file a DTPA lawsuit is any individual, partnership or corporation that seeks to purchase or lease any goods or services. Government entities may also sue under this law.
Violators can be liable for three times the consumer’s economic damages, court costs and attorney fees.
Unconscionable acts
The DTPA also prohibits unconscionable acts. These are acts or practices that harm consumers by taking advantage of the buyer’s lack of knowledge, ability, experience, or capacity to a greatly unfair degree.
This arises, for example, when a shrewd seller manipulates an unsophisticated consumer into buying an item that is unwanted or unneeded.
Breach of warranties
Consumers may file a suit under the DTPA for beach of express or implied warranties. These include:
- Express warranty which is a written or verbal statement affirming that goods or services conform to a particular description and which do not constitute opinions.
- Implied warranty of merchantability which guarantees that goods are merchantable, fit for the ordinary purpose for their use and conform to factual promises on the label or container.
- Implied warranty of fitness for purpose created when a consumer tells the seller that they want to buy a product for a specific purpose and the buyer relies on the seller’s skills in selecting that good.
- Implied warranty of good and workmanlike manner which is when the person performing the work generally considered skillful by those able to judge that work.
- Implied warranty of suitability which is used mostly for commercial leases and requires that the property be free from hidden physical or structural defects or inadequate or defective HVAC or other building services.
Process
At least 60 days before filing a DTPA lawsuit, consumers must give written notice of their problem to the merchant or seller. This is intended to provide an opportunity for the seller to resolve the complaint without further action.
This DTPA notice should contain:
- Details and facts about the claim.
- The merchant or seller’s alleged act constituting a DTPA violation.
- The section of the Texas Business and Commerce Act applies to the claim.
- The amount of economic damages.
- Special damages such as mental anguish.
- Attorney’s fees.
- A statement that the letter is the required notice before filing suit, that there will be a lawsuit if the claim is not resolved within 60 days and that a successful lawsuit entitles the plaintiff to three times their damages.
