Bill Text: CA AB2708 | 2017-2018 | Regular Session | Amended
Bill Title: Contracts: translation.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2018-06-13 - From committee: Without further action pursuant to Joint Rule 62(a). [AB2708 Detail]
Download: California-2017-AB2708-Amended.html
|
Amended
IN
Assembly
April 18, 2018 |
| Assembly Bill | No. 2708 |
| Introduced by Assembly Member Reyes |
February 15, 2018 |
LEGISLATIVE COUNSEL'S DIGEST
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NOBill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 1632 of the Civil Code is amended to read:1632.
(a) The Legislature hereby finds and declares all of the following:SEC. 2.
Section 1632.5 of the Civil Code is amended to read:1632.5.
(a) A supervised financial organization that negotiates primarily in Spanish, Chinese, Tagalog, Vietnamese, or Korean, whether orally or in writing, in the course of entering into a contract or agreement for a loan or extension of credit secured by residential real property, shall deliver to the other party to that contract or agreement prior to the execution of the contract or agreement the form described in subdivision (i) for that language.(a)The Legislature hereby finds and declares all of the following:
(1)This section was enacted in 1976 to increase consumer information and protections for the state’s sizeable and growing Spanish-speaking population.
(2)Since 1976, the state’s population has become increasingly diverse and the number of Californians who speak languages other than English as their primary language at home has increased dramatically.
(3)According to data from the American Community Survey, which has replaced the decennial census for detailed socioeconomic information about United States residents, approximately 15.2 million Californians speak a language
other than English at home, based on data from combined years 2009 through 2011. This compares to approximately 19.6 million people who speak only English at home. Among the Californians who speak a language other than English at home, approximately 8.4 million speak English very well, and another 3 million speak English well. The remaining 3.8 million Californians \
surveyed do not speak English well or do not speak English at all. Among this group, the five languages other than English that are most widely spoken at home are Spanish, Chinese, Tagalog, Vietnamese, and Korean. These five
languages are spoken at home by approximately 3.5 million of the 3.8 million Californians with limited or no English proficiency, who speak a language other than English at home.
(b)Any person engaged in a trade or business who negotiates primarily in Spanish, Chinese, Tagalog, Vietnamese, or Korean,
or who negotiates with a party who negotiates primarily in Spanish, Chinese, Tagalog, Vietnamese, or Korean, orally or in writing, in the course of entering into any of the following, shall deliver to the other party to the contract or agreement and prior to the execution thereof, a translation of the contract or agreement in the language in which the contract or agreement was negotiated, or the language in which the other party to the contract or agreement primarily negotiates, that includes a translation of every term and condition in that contract or agreement:
(1)A contract or agreement subject to the provisions of Title 2 (commencing with Section 1801) of, and Chapter 2b (commencing with Section 2981) and Chapter 2d (commencing with Section 2985.7) of Title 14 of, Part 4 of Division 3.
(2)A loan or extension of credit secured other than by real property, or unsecured, for use primarily for personal, family, or household purposes.
(3)A lease, sublease, rental contract or agreement, or other term of tenancy contract or agreement, for a period of longer than one month, covering a dwelling, an apartment, or mobilehome, or other dwelling unit normally occupied as a residence.
(4)Notwithstanding paragraph (2), a loan or extension of credit for use primarily for personal, family, or household purposes in which the loan or extension of credit is subject to the provisions of Article 7 (commencing with Section 10240) of Chapter 3 of Part 1 of Division 4 of the Business and Professions Code, or Division 7 (commencing with Section 18000), or Division 9 (commencing with Section 22000) of the Financial Code.
(5)Notwithstanding paragraph (2), a reverse mortgage as described in Chapter 8 (commencing with Section 1923) of Title 4 of Part 4 of Division 3.
(6)A contract or agreement, containing a statement of fees or charges, entered into for the purpose of obtaining legal services, when the person who is engaged in business is currently licensed to practice law pursuant to Chapter 4 (commencing with Section 6000) of Division 3 of the Business and Professions Code.
(7)A foreclosure consulting contract subject to Article 1.5 (commencing with Section 2945) of Chapter 2 of Title 14 of Part 4 of Division 3.
(c)Notwithstanding subdivision (b), for a loan subject to this part and to Article 7 (commencing with Section 10240) of Chapter 3 of Part 1 of Division 4 of the
Business and Professions Code, the delivery of a translation of the statement to the borrower required by Section 10240 of the Business and Professions Code in the language specified in subdivision (b) is in compliance with subdivision (b).
(d)At the time and place where a lease, sublease, or rental contract or agreement described in subdivision (b) is executed, notice in the language
specified in subdivision (b)
shall be provided to the lessee or tenant.
(e)Provision by a supervised financial organization of a translation of the disclosures required by Regulation M or Regulation Z, and, if applicable, Division 7 (commencing with Section 18000) or Division 9 (commencing with Section 22000) of the Financial Code in the language specified in subdivision (b) prior to the execution of the contract or agreement, shall also be deemed in compliance with the requirements of subdivision (b) with
regard to the original contract or agreement.
(1)“Regulation M” and “Regulation Z” mean any rule, regulation, or interpretation promulgated by the Board of Governors of the Federal Reserve System and any interpretation or approval issued by an official or employee duly authorized by the board to issue interpretations or approvals dealing with, respectively, consumer leasing or consumer lending, pursuant to the federal Truth in Lending Act, as amended (15 U.S.C. Sec. 1601 et seq.).
(2)As used in this section, “supervised financial organization” means a bank, savings association as defined in Section 5102 of the Financial Code, credit union, or holding company, affiliate, or
subsidiary thereof, or any person subject to Article 7 (commencing with Section 10240) of Chapter 3 of Part 1 of Division 4 of the Business and Professions Code, or Division 7 (commencing with Section 18000) or Division 9 (commencing with Section 22000) of the Financial Code.
(f)At the time and place where a contract or agreement described in paragraph (1) or (2) of subdivision (b) is executed, a notice in the language specified in subdivision (b)
shall be conspicuously displayed to the effect that the person described in subdivision (b) is required to provide a contract or agreement in the language in which the contract or agreement was negotiated or the language in which the party primarily negotiates, or a translation of the disclosures required by law in the language in which the contract or agreement was negotiated or the language in which the party primarily negotiates, as the case may be. If a person described in subdivision (b) does business at more than one location or branch, the requirements of this section shall apply only
with respect to the location or branch at which the contract or agreement was executed.
(g)The term “contract” or “agreement,” as used in this section, means the document creating the rights and obligations of the parties and includes any subsequent document making substantial changes in the rights and obligations of the parties. The term “contract” or “agreement” does not include any subsequent documents authorized or contemplated by the original document such as periodic statements, sales slips or invoices representing purchases made pursuant to a credit card agreement, a retail installment contract or account or other revolving
sales or loan account, memoranda of purchases in an add-on sale, or refinancing of a purchase as provided by, or pursuant to, the original document.
The term “contract” or “agreement” does not include a home improvement contract as defined in Sections 7151.2 and 7159 of the Business and Professions Code, nor does it include plans, specifications, description of work to be done and materials to be used, or collateral security taken or to be taken for the retail buyer’s obligation contained in a contract for the installation of goods by a contractor licensed pursuant to Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code, if the home improvement contract or installation contract is otherwise a part of a contract described in subdivision (b).
Matters ordinarily incorporated by reference in contracts or agreements as described in paragraph (3) of subdivision (b), including, but not
limited to, rules and regulations governing a tenancy and inventories of furnishings to be provided by the person described in subdivision (b), are not included in the term “contract” or “agreement.”
(h)(1)This section does not apply to any person engaged in a trade or business who negotiates primarily in a language other than English, or a person who negotiates with a party who negotiates primarily in a language other than English, as described
in subdivision (b), if the party with whom he or she is negotiating is a buyer of goods or services, or receives a loan or extension of credit, or enters an agreement obligating himself or herself as a tenant, lessee, or sublessee, or similarly obligates himself or herself by contract or lease, and the party negotiates the terms of the contract, lease, or other obligation through his or her own interpreter.
(2)As used in this subdivision, “his or her own interpreter” means a person, not a minor, able to speak fluently and read with full understanding both
the English language and
the language
specified in subdivision
(b), and who is not employed by, or whose service is made available through, the person engaged in the trade or business.
(i)Notwithstanding subdivision (b), a translation may retain the following elements of the executed English-language contract or agreement without translation: names and titles of individuals and other persons, addresses, brand names, trade names, trademarks, registered service marks, full or abbreviated designations of the make and model of goods or services, alphanumeric codes, numerals, dollar amounts expressed in numerals, dates, and individual words or expressions having no generally accepted non-English translation. It is permissible, but not required, that this translation be signed.
(j)The terms of the contract or agreement that is executed in the English language shall determine the rights and obligations of the
parties. However, the translation of the contract or the disclosures required by subdivision (e) in the languages specified in subdivision (b) shall be admissible in evidence only to show that no contract was entered into because of a substantial difference in the material terms and conditions of the contract and the translation.
(k)Upon a failure to comply with the provisions of this section, the person aggrieved may rescind the contract or agreement in the manner provided by this chapter. If the contract for a consumer credit sale or consumer lease that has been sold and assigned to a financial
institution is rescinded pursuant to this subdivision, the consumer shall make restitution to and have restitution made by the person with whom he or she made the contract, and shall give notice of rescission to the assignee. Notwithstanding that the contract was assigned without recourse, the assignment shall be deemed rescinded and the assignor shall promptly repurchase the contract from the assignee.
(l)As used in this section, “language specified in subdivision (b)” means the language listed in subdivision (b) in which the contract or agreement was negotiated or the language listed in subdivision (b) in which the other party to the contract primarily negotiates.
(a)A supervised financial organization that negotiates primarily in Spanish, Chinese, Tagalog, Vietnamese, or Korean, or that negotiates with a party who negotiates primarily in Spanish, Chinese, Tagalog, Vietnamese, or Korean, whether orally or in writing, in the course of entering into a contract or agreement for a loan or extension of credit secured by residential real property, shall deliver to the other party to that contract or agreement prior to the execution of the contract or agreement the form described in subdivision (i) for that language.
(b)For purposes of this section:
(1)“Contract” or “agreement” shall have the same meaning as defined in subdivision (g) of Section 1632.
(2)“Supervised financial organization” means a bank, savings association, as defined in Section 5102 of the Financial Code, credit union, or holding company, affiliate, or subsidiary thereof, or any person subject to Division 7 (commencing with Section 18000), Division 9 (commencing with Section 22000), or Division 20 (commencing with Section 50000) of the Financial Code.
(c)(1)With respect to a contract or agreement for a loan or extension of credit secured by residential real property as described in subdivision (a), a supervised financial organization that complies with this section shall be deemed in compliance with Section 1632.
(2)A supervised financial organization
that complies with Section 1632, with respect to a contract or agreement for a loan or extension of credit secured by residential real property as described in subdivision (a), shall be deemed in compliance with this section.
(d)The supervised financial organization shall provide the form described in subdivision (i) to the borrower no later than three business days after receipt of the written application, and if any of the loan terms summarized materially change after provision of the translated form but prior to consummation of the loan, the supervised financial organization shall provide an updated version of the translated form prior to consummation of the loan.
(e)(1)This section does not apply to a supervised financial organization that negotiates primarily in a language other than English, as described by subdivision (a),
or a person who negotiates with a party who negotiates primarily in a language other than English, if the party with whom the supervised financial organization is negotiating, negotiates the terms of the contract through his or her own interpreter.
(2)For purposes of this subdivision, “his or her own interpreter” means a person, not a minor, able to speak fluently and read with full understanding both the English language and the language specified in subdivision (a) that is the language in which the contract was negotiated,
or the language in which the party primarily negotiates,
who is not employed by, and whose services are not made available through, the person engaged in the trade or business.
(f)Notwithstanding subdivision (a), a translated form may retain any of the following elements of the executed English language contract or agreement without translation:
(1)Names and titles of individuals and other persons.
(2)Addresses, brand names, trade names, trademarks, or registered service marks.
(3)Full or abbreviated designations of the make and model of goods or services.
(4)Alphanumeric codes.
(5)Individual words or expressions having no generally accepted non-English
translation.
(g)The terms of the contract or agreement which is executed in the English language shall determine the rights and obligations of the parties. However, the translation of the form described in subdivision (i) and required by subdivision (a) shall be admissible in evidence only to show that no contract or agreement was entered into because of a substantial difference in the material terms and conditions of the contract or agreement and the prior translated form provided to the borrower.
(h)(1)A licensing agency may, by order, after appropriate notice and opportunity for hearing, levy administrative penalties against a supervised financial organization that violates any provision of this section, and the supervised financial organization may be liable for administrative penalties, up to the amounts of two thousand five hundred dollars ($2,500)
for the first violation, five thousand dollars ($5,000) for the second violation, and ten thousand dollars ($10,000) for each subsequent violation. Except for licensing agencies exempt from the provisions of the Administrative Procedure Act, any hearing shall be held in accordance with the Administrative Procedure Act (Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code), and the licensing agency shall have all the powers granted under that act.
(2)A licensing agency may exercise any and all authority and powers available to it under any other provisions of law to administer and enforce this section, including, but not limited to, investigating and examining the licensed person’s books and records, and charging and collecting the reasonable costs for these activities. The licensing agency shall not charge a licensed person twice for the same service. Any civil, criminal, and administrative
authority and remedies available to the licensing agency pursuant to its licensing law may be sought and employed in any combination deemed advisable by the licensing agency to enforce the provisions of this section.
(3)Any supervised financial organization that violates any provision of this section shall be deemed to have violated its licensing law.
(4)Nothing in this section shall be construed to impair or impede the Attorney General from bringing an action to enforce this division.
(i)The Department of Business Oversight shall create a form to be made available in each of the languages set forth in subdivision (a) for use by a supervised financial organization to summarize the terms of a mortgage loan pursuant to subdivision (a). In creating the form, the Department of Business Oversight may use as guidance
the United States Department of Housing and Urban Development’s Good Faith Estimate disclosure form.
(j)This section shall not apply to federally chartered banks, credit unions, savings banks, or thrifts.
(k)Except as otherwise provided in subdivision (h), this section shall not be construed to create or enhance any claim, right of action, or civil liability that did not previously exist under state law, or limit any claim, right of action, or civil liability that otherwise exists under state law.
(l)An action against a supervised financial organization for a violation of this section may only be brought by a licensing agency or by the Attorney General.
(m)This section shall become operative beginning on July 1, 2010, or 90 days following the
issuance of a form by the Department of Business Oversight pursuant to subdivision (i), whichever occurs later.
