Can our Kansas consumer contract waive the customer's statutory claims?
No, and the Supreme Court has said so of a contractual waiver clause. In Stechschulte v. Jennings the Court held that even if a buyer's acknowledgment in a residential real-estate contract could "be read as a blanket waiver of the Stechschultes' KCPA claims", "K.S.A. 50-625(a) would have prevented its operation". Except as otherwise provided in the Kansas consumer protection act, a consumer may not waive or agree to forego rights or benefits under the act (K.S.A. 50-625(a)). A claim by or against a consumer, disputed or not, may be settled for less value than the amount claimed, but a settlement in which the consumer waives or agrees to forego rights or benefits under the act is invalid if the court finds the settlement to have been unconscionable at the time it was made, with the consumer's competence, any deception or coercion, the legal advice received and the value of the consideration all relevant (K.S.A. 50-625(b)-(c)). Warranty terms are separately controlled: with respect to property that is or is intended to become the subject of a consumer transaction in Kansas, no supplier shall exclude, modify or otherwise attempt to limit the implied warranties of merchantability and fitness for a particular purpose, or exclude, modify or attempt to limit any remedy provided by law for their breach (K.S.A. 50-639(a)), and a disclaimer or limitation in violation of that section is void (subsection (e)). That bar is not absolute: a supplier may limit the implied warranties as to a particular defect only if it establishes that the consumer had knowledge of the defect and that the knowledge became the basis of the bargain, and in no case may such a limitation reach liability for personal injury or property damage (subsection (c)).
The trap
A boilerplate waiver clause in a Kansas consumer contract does not merely fail; it can become evidence against the supplier. Unconscionability "is a question for the court", which "shall consider circumstances of which the supplier knew or had reason to know, such as, but not limited to" seven listed ones (an open list, not a closed one), and the seventh is that "except as provided by K.S.A. 50-639, and amendments thereto, the supplier excluded, modified or otherwise attempted to limit either the implied warranties of merchantability and fitness for a particular purpose or any remedy provided by law for a breach of those warranties." The warranty section carries its own scope limits, which a supplier in those trades should read first: it does not apply to seed for planting, to sales of livestock for agricultural purposes other than for immediate slaughter except where the supplier knowingly sells diseased livestock, or to a governmental entity disposing of surplus property where conspicuous written notice of the limitation, exclusion or disclaimer has been given. And unconscionability under the act is not confined to the signing: no supplier shall engage in any unconscionable act or practice in connection with a consumer transaction, and such an act violates the act "whether it occurs before, during or after the transaction" (K.S.A. 50-627(a)).
12 authorities
- statuteK.S.A. 50-625enactment date not established
The words that state the rule
(a) Except as otherwise provided in this act, a consumer may not waive or agree to forego rights or benefits under this act.
- statuteK.S.A. 50-625enactment date not established
The words that state the rule
(c) A settlement in which the consumer waives or agrees to forego rights or benefits under this act is invalid if the court finds the settlement to have been unconscionable at the time it was made.
- statuteK.S.A. 50-639enactment date not established
The words that state the rule
(a) Notwithstanding any other provisions of law, with respect to property which is the subject of or is intended to become the subject of a consumer transaction in this state, no supplier shall: (1) Exclude, modify or otherwise attempt to limit the implied warranties of merchantability as defined in K.S.A. 84-2-314, and amendments thereto, and fitness for a particular purpose, as defined in K.S.A. 84-2-315, and amendments thereto; or
- statuteK.S.A. 50-627enactment date not established
The words that state the rule
No supplier shall engage in any unconscionable act or practice in connection with a consumer transaction. An unconscionable act or practice violates this act whether it occurs before, during or after the transaction.
- statuteK.S.A. 50-627enactment date not established
The words that state the rule
(b) The unconscionability of an act or practice is a question for the court. In determining whether an act or practice is unconscionable, the court shall consider circumstances of which the supplier knew or had reason to know, such as, but not limited to the following that: (1) The supplier took advantage of the inability of the consumer reasonably to protect the consumer's interests because of the consumer's physical infirmity, ignorance, illiteracy, inability to understand the language of an agreement or similar factor; (2) when the consumer transaction was entered into, the price grossly exceeded the price at which similar property or services were readily obtainable in similar transactions by similar consumers; (3) the consumer was unable to receive a material benefit from the subject of the transaction; (4) when the consumer transaction was entered into, there was no reasonable probability of payment of the obligation in full by the consumer; (5) the transaction the supplier induced the consumer to enter into was excessively onesided in favor of the supplier; (6) the supplier made a misleading statement of opinion on which the consumer was likely to rely to the consumer's detriment; and (7) except as provided by K.S.A. 50-639, and amendments thereto, the supplier excluded, modified or otherwise attempted to limit either the implied warranties of merchantability and fitness for a particular purpose or any remedy provided by law for a breach of those warranties.
- statuteK.S.A. 50-625enactment date not established
The words that state the rule
(b) A claim, whether or not disputed, by or against a consumer may be settled for less value than the amount claimed.
- statuteK.S.A. 50-625enactment date not established
The words that state the rule
The competence of the consumer, any deception or coercion practiced upon the consumer, the nature and extent of the legal advice received by the consumer, and the value of the consideration are relevant to the issue of unconscionability.
- statuteK.S.A. 50-639enactment date not established
The words that state the rule
exclude, modify or attempt to limit any remedy provided by law, including the measure of damages available, for a breach of implied warranty of merchantability and fitness for a particular purpose.
- statuteK.S.A. 50-639enactment date not established
The words that state the rule
(e) A disclaimer or limitation in violation of this section is void. If a consumer prevails in an action based upon breach of warranty, and the supplier has violated this section, the court may, in addition to any damages recovered, award reasonable attorney fees and a civil penalty under K.S.A. 50-636, and amendments thereto, to be paid by the supplier who gave the improper disclaimer.
The words that state the rule
Before discussing the parties’ arguments, we must acknowledge K.S.A. 50-625(a). It was not cited by the parties, but we cannot ignore its explicit statement that a consumer cannot waive or forego rights under the KCPA. So, even if Osterhaus had reinforced McLellan and permitted Paragraph 5 of the Buyer Acknowledgment to be read as a blanket waiver of the Stechschultes’ KCPA claims against Golson and PHB, K.S.A. 50-625(a) would have prevented its operation. See Hunter v. American Rentals, 189 Kan. 615, 618 , 371 P.2d 131 (1962) (“To allow defendant to escape liability by reason of its alleged contract would be defeating the purpose and intention of the legislature as provided in the mentioned statute.”)
- statuteK.S.A. 50-639enactment date not established
The words that state the rule
(c) A supplier may limit the supplier's implied warranty of merchantability and fitness for a particular purpose with respect to a defect or defects in the property only if the supplier establishes that the consumer had knowledge of the defect or defects, which became the basis of the bargain between the parties. In neither case shall such limitation apply to liability for personal injury or property damage.
- statuteK.S.A. 50-639enactment date not established
The words that state the rule
(g) This section shall not apply to seed for planting. (h) This section shall not apply to sales of livestock for agricultural purposes, other than sales of livestock for immediate slaughter, except in cases where the supplier knowingly sells livestock which is diseased.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.