§ 14A-5-202. Effect of violations on rights of parties.

(1)  If a creditor has violated the provisions of this act applying to certain negotiable instruments (Section 2-403 of this title), or limitations on the schedule of payments or loan term for supervised loans (Section 3-512 of this title), the debtor is not obligated to pay the credit service charge or loan finance charge and has a right to recover from the person violating this act or from an assignee of that person's rights who undertakes direct collection of payments or enforcement of rights arising from the debt a penalty in an amount determined by the court not in excess of three times the amount of the credit service charge or loan finance charge.  No action pursuant to this subsection may be brought more than one (1) year after the due date of the last scheduled payment of the agreement with respect to which the violation occurred.

(2)  If a creditor has violated the provisions of this act applying to authority to make supervised loans (Section 3-502 of this title), the loan is void and the debtor is not obligated to pay either the principal or loan finance charge.  If he has paid any part of the principal or of the loan finance charge, he has a right to recover the payment from the person violating this act or from an assignee of that person's rights who undertakes direct collection of payments or enforcement of rights arising from the debt.  With respect to violations arising from loans made pursuant to revolving loan accounts, no action pursuant to this subsection may be brought more than two (2) years after the violation occurred.  With respect to violations arising from other loans, no action pursuant to this subsection may be brought more than one (1) year after the due date of the last scheduled payment of the agreement pursuant to which the charge was paid.

(3)  Any creditor or servicer who fails to comply with any requirement for subsection 10 mortgages under Section 10 of this act, with respect to any person is liable to that person in an amount equal to the sum of all finance charges and fees paid by the consumer, unless the creditor demonstrates that the failure to comply is not material.  No action pursuant to this subsection may be brought more than one (1) year after the due date of the last scheduled payment of the agreement with respect to which the violation occurred.

(4)  A debtor is not obligated to pay a charge in excess of that allowed by this act, and if the debtor has paid an excess charge  the debtor has a right to a refund.  A refund may be made by reducing the debtor's obligation by the amount of the excess charge.  If the debtor has paid an amount in excess of the lawful obligation under the agreement, the debtor may recover the excess amount from the person who made the excess charge or from an assignee of that person's rights who undertakes direct collection of payments from or enforcement of rights against debtors arising from the debt.

(5)  If a debtor is entitled to a refund and a person liable to the debtor refuses to make a refund within a reasonable time after demand, the debtor may recover from that person a penalty in an amount determined by a court not exceeding the greater of either the amount of the credit service or loan finance charge or ten times the amount of the excess charge.  If the creditor has made an excess charge in deliberate violation of or in reckless disregard for this act, the penalty may be recovered even though the creditor has refunded the excess charge.  No penalty pursuant to this subsection may be recovered if a court has ordered a similar penalty assessed against the same person in a civil action by the Administrator (Section 6-113 of this title).  With respect to excess charges arising from sales made pursuant to revolving charge accounts or from loans made pursuant to revolving loan accounts, no action pursuant to this subsection may be brought more than two (2) years after the time the excess charge was made.  With respect to excess charges arising from other consumer credit sales or consumer loans, no action pursuant to this subsection may be brought more than one (1) year after the due date of the last scheduled payment of the agreement pursuant to which the charge was made.

(6)  Except as otherwise provided, no violation of this act impairs rights on a debt.

(7)  If an employer discharges an employee in violation of the provisions prohibiting discharge (Section 5-106 of this title), the employee may within thirty (30) days bring a civil action for recovery of wages lost as a result of the violation and for an order requiring the reinstatement of the employee.  Damages recoverable shall not exceed lost wages for six (6) weeks.

(8)  If the creditor establishes by a preponderance of evidence that a violation is unintentional or the result of a bona fide error no liability is imposed under subsections (1), (2) and (5) of this section and the validity of the transaction is not affected.

(9)  In any case in which it is found that a creditor has violated this act, the court may award reasonable attorney fees incurred by the debtor.

Added by Laws 1969, c. 352, § 5-202, eff. July 1, 1969.  Amended by Laws 2003, c. 330, § 13, eff. Jan. 1, 2004.