Code Section Group

Civil Code - CIV

DIVISION 3. OBLIGATIONS [1427 - 3272.9]

  ( Heading of Division 3 amended by Stats. 1988, Ch. 160, Sec. 14. )

PART 4. OBLIGATIONS ARISING FROM PARTICULAR TRANSACTIONS [1738 - 3273]

  ( Part 4 enacted 1872. )

TITLE 2. CREDIT SALES [1801 - 1812.35]

  ( Title 2 added by Stats. 1959, Ch. 201. )

CHAPTER 1. Retail Installment Sales [1801 - 1812.20]

  ( Chapter 1 added by Stats. 1959, Ch. 201. )

ARTICLE 4. Restrictions on Retail Installment Contracts [1804.1 - 1804.4]
  ( Article 4 added by Stats. 1959, Ch. 201. )

1804.1.
  

No contract or obligation shall contain any provision by which:

(a) The buyer agrees not to assert against a seller a claim or defense arising out of the sale or agrees not to assert against an assignee such a claim or defense other than as provided in Section 1804.2.

(b) In the absence of the buyer’s default in the performance of any of his or her obligations, the holder may accelerate the maturity of any part or all of the amount owing thereunder.

(c) A power of attorney is given to confess judgment in this state, or an assignment of wages is given; provided, that nothing herein contained shall prohibit the giving of an assignment of wages contained in a separate instrument, executed pursuant to Section 300 of the Labor Code.

(d) The seller or holder of the contract or other person acting on his or her behalf is given authority to enter upon the buyer’s premises unlawfully or to commit any breach of the peace in the repossession of goods.

(e) The buyer waives any right of action against the seller or holder of the contract or other person acting on his or her behalf, for any illegal act committed in the collection of payments under the contract or in the repossession of goods.

(f) The buyer executes a power of attorney appointing the seller or holder of the contract, or other person acting on his or her behalf, as the buyer’s agent in collection of payments under the contract or in the repossession of goods.

(g) The buyer relieves the seller from liability for any legal remedies which the buyer may have against the seller under the contract or any separate instrument executed in connection therewith.

(h) The buyer agrees to the payment of any charge by reason of the exercise of his or her right to rescind or void the contract.

(i) The seller or holder of the contract is given the right to commence an action on a contract under the provisions of this chapter in a county other than the county in which the contract was in fact signed by the buyer, the county in which the buyer resides at the commencement of the action, the county in which the buyer resided at the time that the contract was entered into, or in the county in which the goods purchased pursuant to the contract have been so affixed to real property as to become a part of such real property.

(j) The seller takes a security interest, other than a mechanics’ lien, in the buyer’s real property which is the buyer’s primary residence where the buyer is a person who is 65 years of age or older and the contract is for a home improvement, as defined in Section 7151.2 of the Business and Professions Code.

(Amended by Stats. 1999, Ch. 512, Sec. 2. Effective January 1, 2000.)

1804.2.
  

(a) An assignee of the seller’s rights is subject to all equities and defenses of the buyer against the seller arising out of the sale, notwithstanding an agreement to the contrary, but the assignee’s liability may not exceed the amount of the debt owing to the assignee at the time of the assignment.

(b) The assignee shall have recourse against the seller to the extent of any liability incurred by the assignee pursuant to this section regardless of whether the assignment was with or without recourse.

(Amended by Stats. 1975, Ch. 66.)

1804.3.
  

(a) No contract other than one for services shall provide for a security interest in any goods theretofore fully paid for or which have not been sold by the seller.

(b) Any contract for goods which provides for a security interest in real property where the primary goods sold are not to be attached to the real property shall be a violation of this chapter and subject to the penalties set forth in Article 12.2 (commencing with Section 1812.6).

(c) This section shall become operative October 1, 1982.

(Amended (as amended by Stats. 1981, Ch. 107, Sec. 4) by Stats. 1982, Ch. 129, Sec. 4. Effective March 25, 1982. Section operative October 1, 1982, by its own provisions, or sooner as prescribed by Sec. 13 of Ch. 129.)

1804.4.
  

Any provision in a contract which is prohibited by this chapter shall be void but shall not otherwise affect the validity of the contract.

(Added by Stats. 1959, Ch. 201.)

CIVCivil Code - CIV4.