Amended in Assembly June 11, 2014

Amended in Senate January 22, 2014

Amended in Senate January 6, 2014

Amended in Senate April 1, 2013

Senate BillNo. 245


Introduced by Senator Correa

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:

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SECTION 1.  

Section 1632 of the Civil Code is amended to
2read:

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1632.  

(a) The Legislature hereby finds and declares all of the
2following:

3(1) This section was enacted in 1976 to increase consumer
4information and protections for the state’s sizeable and growing
5Spanish-speaking population.

6(2) Since 1976, the state’s population has become increasingly
7diverse and the number of Californians who speak languages other
8than English as their primary language at home has increased
9dramatically.

10(3) According to data from the American Community Survey,
11which has replaced the decennial census for detailed socioeconomic
12information about United States residents, approximately 15.2
13million Californians speak a language other than English at home,
14based on data from combined years 2009 through 2011. This
15compares to approximately 19.6 million people who speak only
16English at home. Among the Californians who speak a language
17other than English at home, approximately 8.4 million speak
18English very well, and another 3 million speak English well. The
19remaining 3.8 million Californians surveyed do not speak English
20well or do not speak English at all. Among this group, the five
21languages other than English that are most widely spoken at home
22are Spanish, Chinese,begin delete Filipino/Tagalog,end deletebegin insert Tagalog,end insert Vietnamese, and
23Korean. These five languages are spoken at home by approximately
243.5 million of the 3.8 million Californians with limited or no
25English proficiency, who speak a language other than English at
26home.

27(b) Any person engaged in a trade or business who negotiates
28primarily in Spanish, Chinese, Tagalog, Vietnamese, or Korean,
29orally or in writing, in the course of entering into any of the
30following, shall deliver to the other party to the contract or
31agreement and prior to the execution thereof, a translation of the
32contract or agreement in the language in which the contract or
33agreement was negotiated, that includes a translation of every term
34and condition in that contract or agreement:

35(1) A contract or agreement subject to the provisions of Title 2
36(commencing with Section 1801) of, and Chapter 2b (commencing
37with Section 2981) and Chapter 2d (commencing with Section
382985.7) of Title 14 of, Part 4 of Division 3.

P3    1(2) A loan or extension of credit secured other than by real
2property, or unsecured, for use primarily for personal, family, or
3household purposes.

4(3) A lease, sublease, rental contract or agreement, or other term
5of tenancy contract or agreement, for a period of longer than one
6month, covering a dwelling, an apartment, or mobilehome, or other
7dwelling unit normally occupied as a residence.

8(4) Notwithstanding paragraph (2), a loan or extension of credit
9for use primarily for personal, family, or household purposes in
10which the loan or extension of credit is subject to the provisions
11of Article 7 (commencing with Section 10240) of Chapter 3 of
12Part 1 of Division 4 of the Business and Professions Code, or
13Division 7 (commencing with Section 18000), or Division 9
14(commencing with Section 22000) of the Financial Code.

15(5) Notwithstanding paragraph (2), a reverse mortgage as
16described in Chapter 8 (commencing with Section 1923) of Title
174 of Part 4 of Division 3.

18(6) A contract or agreement, containing a statement of fees or
19charges, entered into for the purpose of obtaining legal services,
20when the person who is engaged in business is currently licensed
21to practice law pursuant to Chapter 4 (commencing with Section
226000) of Division 3 of the Business and Professions Code.

23(7) A foreclosure consulting contract subject to Article 1.5
24(commencing with Section 2945) of Chapter 2 of Title 14 of Part
254 of Division 3.

26(c) Notwithstanding subdivision (b), for a loan subject to this
27part and to Article 7 (commencing with Section 10240) of Chapter
283 of Part 1 of Division 4 of the Business and Professions Code,
29the delivery of a translation of the statement to the borrower
30required by Section 10240 of the Business and Professions Code
31in any of the languages specified in subdivision (b) in which the
32contract or agreement was negotiated, is in compliance with
33subdivision (b).

34(d) At the time and place where a lease, sublease, or rental
35contract or agreement described in subdivision (b) is executed,
36notice in any of the languages specified in subdivision (b) in which
37the contract or agreement was negotiated shall be provided to the
38lessee or tenant.

39(e) Provision by a supervised financial organization of a
40translation of the disclosures required by Regulation M or
P4    1Regulation Z, and, if applicable, Division 7 (commencing with
2Section 18000) or Division 9 (commencing with Section 22000)
3of the Financial Code in any of the languages specified in
4subdivision (b) in which the contract or agreement was negotiated,
5prior to the execution of the contract or agreement, shall also be
6deemed in compliance with the requirements of subdivision (b)
7with regard to the original contract or agreement.

8(1) “Regulation M” and “Regulation Z” mean any rule,
9regulation, or interpretation promulgated by the Board of
10Governors of the Federal Reserve System and any interpretation
11or approval issued by an official or employee duly authorized by
12the board to issue interpretations or approvals dealing with,
13respectively, consumer leasing or consumer lending, pursuant to
14the Federal Truth in Lending Act, as amended (15 U.S.C. Sec.
151601 et seq.).

16(2) As used in this section, “supervised financial organization”
17means a bank, savings association as defined in Section 5102 of
18the Financial Code, credit union, or holding company, affiliate, or
19subsidiary thereof, or any person subject to Article 7 (commencing
20with Section 10240) of Chapter 3 of Part 1 of Division 4 of the
21Business and Professions Code, or Division 7 (commencing with
22Section 18000) or Division 9 (commencing with Section 22000)
23of the Financial Code.

24(f) At the time and place where a contract or agreement
25described in paragraph (1) or (2) of subdivision (b) is executed, a
26notice in any of the languages specified in subdivision (b) in which
27the contract or agreement was negotiated shall be conspicuously
28displayed to the effect that the person described in subdivision (b)
29is required to provide a contract or agreement in the language in
30which the contract or agreement was negotiated, or a translation
31of the disclosures required by law in the language in which the
32contract or agreement was negotiated, as the case may be. If a
33person described in subdivision (b) does business at more than one
34location or branch, the requirements of this section shall apply
35only with respect to the location or branch at which the language
36in which the contract or agreement was negotiated is used.

37(g) The term “contract” or “agreement,” as used in this section,
38means the document creating the rights and obligations of the
39parties and includes any subsequent document making substantial
40changes in the rights and obligations of the parties. The term
P5    1“contract” or “agreement” does not include any subsequent
2documents authorized or contemplated by the original document
3such as periodic statements, sales slips or invoices representing
4purchases made pursuant to a credit card agreement, a retail
5installment contract or account or other revolving sales or loan
6account, memoranda of purchases in an add-on sale, or refinancing
7of a purchase as provided by, or pursuant to, the original document.

8The term “contract” or “agreement” does not include a home
9improvement contract as defined in Sections 7151.2 and 7159 of
10the Business and Professions Code, nor does it include plans,
11specifications, description of work to be done and materials to be
12used, or collateral security taken or to be taken for the retail buyer’s
13obligation contained in a contract for the installation of goods by
14a contractor licensed pursuant to Chapter 9 (commencing with
15Section 7000) of Division 3 of the Business and Professions Code,
16if the home improvement contract or installation contract is
17otherwise a part of a contract described in subdivision (b).

18Matters ordinarily incorporated by reference in contracts or
19agreements as described in paragraph (3) of subdivision (b),
20including, but not limited to, rules and regulations governing a
21tenancy and inventories of furnishings to be provided by the person
22described in subdivision (b), are not included in the term “contract”
23or “agreement.”

24(h) This section does not apply to any person engaged in a trade
25or business who negotiates primarily in a language other than
26English, as described by subdivision (b), if the party with whom
27he or she is negotiating is a buyer of goods or services, or receives
28a loan or extension of credit, or enters an agreement obligating
29himself or herself as a tenant, lessee, or sublessee, or similarly
30obligates himself or herself by contract or lease, and the party
31negotiates the terms of the contract, lease, or other obligation
32through his or her own interpreter.

33As used in this subdivision, “his or her own interpreter” means
34a person, not a minor, able to speak fluently and read with full
35understanding both the English language and any of the languages
36specified in subdivision (b) in which the contract or agreement
37was negotiated, and who is not employed by, or whose service is
38made available through, the person engaged in the trade or
39business.

P6    1(i) Notwithstanding subdivision (b), a translation may retain the
2following elements of the executed English-language contract or
3agreement without translation: names and titles of individuals and
4other persons, addresses, brand names, trade names, trademarks,
5registered service marks, full or abbreviated designations of the
6make and model of goods or services, alphanumeric codes,
7numerals, dollar amounts expressed in numerals, dates, and
8individual words or expressions having no generally accepted
9non-English translation. It is permissible, but not required, that
10this translation be signed.

11(j) The terms of the contract or agreement that is executed in
12the English language shall determine the rights and obligations of
13the parties. However, the translation of the contract or the
14disclosures required by subdivision (e) in any of the languages
15specified in subdivision (b) in which the contract or agreement
16was negotiated shall be admissible in evidence only to show that
17no contract was entered into because of a substantial difference in
18the material terms and conditions of the contract and the translation.

19(k) Upon a failure to comply with the provisions of this section,
20the person aggrieved may rescind the contract or agreement in the
21manner provided by this chapter. If the contract for a consumer
22credit sale or consumer lease that has been sold and assigned to a
23financial institution is rescinded pursuant to this subdivision, the
24consumer shall make restitution to and have restitution made by
25the person with whom he or she made the contract, and shall give
26notice of rescission to the assignee. Notwithstanding that the
27contract was assigned without recourse, the assignment shall be
28deemed rescinded and the assignor shall promptly repurchase the
29contract from the assignee.



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