Common Consumer Complaints
October 20, 2012Consumer Protection
One of the clients in your corporate practice mentions that his daughter just signed a contract for a car that she really can’t afford. “I told her not to worry, because she has three days to cancel the contract, right?” he asks you. Your pro bono client tells you that a debt collector is calling his employer. He is worried about getting fired and wants to know if the calls are legal. A longtime client calls you about her apartment lease. “I moved out months ago and have not received my security deposit back from the landlord. Isn’t there a law preventing him from doing this?” She asks.
No matter what kind of practice you have you may, from time to time, have clients ask you for help with a consumer problem. There are common consumer complaints that we hear all the time. Below are some of the most frequently asked questions.
Don’t I have the right to cancel any contract, including a car sales contract, within three days?
Generally, no. Many believe that there is a three-day “cooling off’ period for consumer contracts. There are types of contracts, including door-to-door sales contracts, to which the law provides consumers with a right to cancel. However, most other contracts are binding when signed unless the contract specifically provides the consumer with a right to cancel. Car sales contracts are generally binding and cannot be canceled. However, if the financing terms or any other terms of the contract have not yet been finalized, the consumer may not bound even if she has signed a purchase order or other document. It is best if consumers do not take delivery of the car until all of the terms of the contract have been finalized.
At the end of my residential lease, can I skip paying the last month’s rent and let the security deposit take care of it?
No. A tenant is bound to pay all rent due through the end of the lease. The security deposit protects the landlord not only from non-payment of rent, but also from any damage the tenant might cause to the rental unit. Tenants who are worried they will not get their security deposits back should know that the law protects them. South Carolina law defines a “security deposit” as money held in trust by the landlord to secure the full and faithful performance of the terms and conditions of the lease agreement. S.C. Code §27-40-210(18). If a tenant has paid all rent due and has not caused any damage to the rental unit, the landlord is required to return the security deposit “upon the termination of the tenancy.” If there has been some damage to the premises above and beyond ordinary wear and tear, the landlord is permitted to retain that portion of the security deposit needed to repair the damage. If a deduction from the security deposit is made, the landlord must itemize the deductions (and amount due, if any) and notify the tenant in writing within thirty days after the end of the tenancy. If he fails to do so, the tenant may recover the property and money in an amount equal to three times the amount wrongfully withheld and reasonable attorney’s fees. §27-40-410(b).
Other common law actions may also be available. See, e.g., BURBACH v. INVESTORS MANAGEMENT CORP., 326 S.C. 492, 484 S.E.2d 119 (Ct. App. 1997) ($32,000.00 punitive damages awarded on conversion theory for landlord’s failure to return $350.00 security deposit.). The tenant bears the responsibility of providing the landlord in writing with a forwarding address or new address to which these written notices and refunds may be sent. If the tenant fails to do so, his right to recover damages under §27-40-410(b) is lost. S.C. Code § 27-40-410(a).
Do I have to pay for a copy of my medical records?
Yes. Consumers have a right under South Carolina’s Physicians’ Patient Records Act to obtain a copy of their medical records. S.C. Code § 44-115-130. However, a physician may charge for the search and duplication of a medical record. The fee may not exceed sixty-five cents per page for the first thirty pages and fifty cents per page for all other pages, and a clerical fee for searching and handling not to exceed fifteen dollars per request plus actual postage and applicable sales tax. Records may not be withheld from the patient due to unpaid medical bills. §44-115-70. If medical records relate to a psychiatric or psychological problem, the doctor has the discretion to decide whether or not to release the entire record. However, the patient is entitled to receive a written summary of the records. §44-115-60.
If the request is made by a licensed attorney representing the patient, when the request is accompanied by a written authorization signed by the patient, the patient’s legal guardian, or the patient’s personal representative, for any reason, the entire record must be produced. The right to get copies of medical records from a federal medical facility, such as a Veterans Health Administration hospital, is covered by the Federal Privacy Act, which also permits facilities to charge fees. The Privacy Act of 1974,5 U.S.C. 552A.
My new car has been in the shop nearly a dozen times for the same problem and I think it’s a lemon. The dealership says I have to go to arbitration. Does that mean I can’t sue?
No. Under state and federal law, consumers with warranty disputes can choose to have them resolved through arbitration or by going to court either in the first instance or after receiving an unsatisfactory arbitration decision. The Magnuson-Moss Warranty Act, 15 USC §§2301-2312. S.C. Code § 56-28-40, et. seq.
Can a debt collector call my employer?
No. Under South Carolina law, a debt collector cannot contact the debtor’s employer prior to obtaining a final judgment (except in limited circumstances to verify employment). S.C. Code §37-5-108(d). The collector may contact other people to find out such information as where the debtor lives, what the debtor’s phone number is and where the debtor works, but the collector cannot disclose information that will affect the debtor’s reputation. Collectors cannot use obscene or grossly abusive language or threats of force, or violence in the course of collecting a debt. Id.
Can I do anything about what is in my credit report?
That depends on whether the information in your credit report is accurate.
Consumers are entitled to free copies of their report if they have been denied credit and the prospective creditor said it was because of something in the credit report. Consumers are also entitled to free reports if they are victims of fraud. The three major credit reporting agencies are: Equifax (1-800-685-1111); Experian (1-888-397-3742); and Trans Union (1-800-888-4213).
Despite the claims of so-called “credit repair” organizations, credit information that is negative, but accurate, cannot he removed from credit files. Generally, negative information is removed from a credit file after seven years, although a bankruptcy, tax lien or judgment can stay on the report longer. However, consumers have the right under the Fair Credit Reporting Act to dispute information that is inaccurate with the credit reporting agency. Any information that cannot be verified by the agency must be removed and a correction sent to anyone who recently requested a copy of the consumer’s report. . 15 U.S.C. §1681 — 1681t.
Consumers who are intimidated and misinformed about their rights regarding their credit files sometimes pay money to companies offering “credit repair” services. Some of these companies offer dubious or illegal tactics, such as offering to get the person a new “Social Security Number” (actually an Employer Identification Number) to get a clean credit slate. Others do nothing that the consumer could not do himself by reviewing copies of the credit report and challenging incorrect information.
What are the “opt-out” privacy rights I’ve heard about?
The Federal Financial Services Modernization Act (also known as the Gramm-Leach-Bliley Act) signed into law on November 12, 1999, requires financial services companies such as banks in lending institutions, to send their customers an annual privacy statement with the right to “opt-out” of having the company share their personal information with third parties. The act does not give consumers the right to prevent companies for sharing their information with affiliated companies, which may include marketing companies with which the company has a relationship. 15 U.S.C. §§ 6801 – 6810.
If consumers do not send in the opt-out form they receive with the privacy notice, they can later ask the company to send another one. The right to opt-out is continuing. However, if they fail to return the initial opt-out but later choose to do so, the financial institution may have sold or shared their personal data in the meantime. Another opt-out right consumers have is the right to tell the credit reporting agencies to remove their name from the mailing lists sold to marketers of pre-approved credit offers. These offers not only add to a consumer’s unwanted to mail, but also can lead to credit card fraud if they fall into the hands a mailbox thief. Consumers can notify all three major credit-reporting agencies that they want to opt-out of receiving these offers by calling 1-888-5-OPT-OUT.