Amended in Senate January 22, 2014

Amended in Senate January 6, 2014

Amended in Senate April 1, 2013

Senate Bill No. 245

Introduced by Senator Correa

begin delete

(Principal coauthor: Senator Calderon)

end delete

February 12, 2013

An act to amend Section 1632 of the Civil Code, relating to consumer affairs.

LEGISLATIVE COUNSEL’S DIGEST

SB 245, as amended, Correa. Contracts.

Existing law states findings and declarations of the Legislature relating to consumer information and protections afforded to the state’s diverse population in which the number of Californians who speak languages other than English as their primary language at home has increased.

This bill would revise information contained in those findings and declarations relating to the languages most widely spoken in households with limited English proficiency and the percentage of Californians who speak a language other than English in their homes, based upon more recent census data.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

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:

(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, begin delete the top five languages
other than English, that are most widely spoken in households with
limited English proficiency, are Spanish, Chinese, Filipino/Tagalog,
Vietnamese, and Korean, end delete begin insert approximately 15.2 million Californians
speak a language other than English at home, end insert based on data from
combined years 2009 through 2011. begin delete Limited English proficiency
includes survey participants who end delete begin insert 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 end insert do not speak English well or do not speak English at all.
Among begin delete the 3.8 million households in California with limited
English proficiency, approximately 3.5 million people speak either end delete
begin insert this group, the five languages other than English that are most
widely spoken at home are end insert Spanish, Chinese, Filipino/Tagalog,
begin delete Vietnamese, or Korean at home. This compares to approximately
19.6 million people, end delete begin insert 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, end insert who speak
begin delete only end delete begin insert a language other than end insert English at home.

(b) Any person engaged in a trade or business 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, 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, begin delete family end delete
begin insert family, end insert 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, begin delete family end delete begin insert family, end insert 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 any of the languages specified in subdivision (b) in which the
contract or agreement was negotiated, 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 any of the languages specified in subdivision (b) in which
the contract or agreement was negotiated 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 any of the languages specified in
subdivision (b) in which the contract or agreement was negotiated,
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 any of the languages specified in subdivision (b) in which
the contract or agreement was negotiated 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 a translation
of the disclosures required by law in the language in which the
contract or agreement was negotiated, 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 language
in which the contract or agreement was negotiated is used.

(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) This section does not apply to any person engaged in a trade
or business who negotiates primarily in a language other than
English, as described by 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.

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 any of the languages
specified in subdivision (b) in which the contract or agreement
was negotiated, 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 any of the languages
specified in subdivision (b) in which the contract or agreement
was negotiated 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.