Someone pays a contractor, but the work is not done, or the work violates the building code. A vendor has “hidden fees,” or falsely states in its advertising that it has adequate insurance to cover damage to property. These are examples of “unfair or deceptive acts or practices” from which a consumer can seek relief under Massachusetts General Laws, Chapter 93A. But it is important to take certain steps to properly assert your rights. M.G.L. c. 93A, sec. 2.
The first step in a 93A claim is the demand letter. A wronged consumer must notify the offending business of his or her claim in writing, and allow the business 30 days to respond with a “reasonable offer of settlement.” The letter must clearly identify the consumer making the claim, reasonably describe the complained of unfair or deceptive act or practice, and state the injuries suffered by the claimant because of the unfair or deceptive act or practice. Moreover, rulings of the Massachusetts Supreme Judicial Court suggest that a demand letter is not adequate under Chapter 93A unless it defines the relief—financial compensation and/or specific actions—which the consumer seeks in order to settle the claim.
The timing of the demand letter is also crucial. If a consumer wishes to file a lawsuit against an offending business, the demand letter must be mailed or delivered at least 30 days before the lawsuit is filed; failure to do so is grounds for a court to dismiss the lawsuit. Chery v. Metro. Prop. & Cas. Ins. Co. (If a 93A claim is being raised as part of a counterclaim to an existing lawsuit, if a 93A claim is a “business to business” claim, or if the offending business has no location or assets in Massachusetts, a demand letter is not required.) Additionally, a claim for violating M.G.L. Chapter 93A must generally be filed within four years of the time the unfair or deceptive business practice occurred. M.G.L. c. 260, sec. 5A.
After receipt of the demand letter, the business has 30 days to respond to the consumer’s settlement demand in writing with a “reasonable offer of settlement.” If the consumer does not accept the offer, or if an agreement cannot be negotiated and the consumer files a lawsuit, there are risks that both sides must face. The consumer, if successful in court, may recover up to three times the actual damages suffered, and the court may also compel the business to pay the consumer’s attorney’s fees. M.G.L. c. 93A, sec. 9. However, a court may find that the business’s original settlement offer was reasonable and award the consumer only that amount—or the court may find that the consumer’s complaint is simply not supported by the facts. The court must first determine whether the business’s conduct was, in fact, unfair or deceptive; and if the answer is yes, then the crucial questions to be decided are whether the conduct was willful, whether the business’s refusal to grant the consumer his or her original demand was in bad faith, and whether the business was aware of its violation of the law.
Please note that a violation of Chapter 93A does not cover conduct which is merely negligent in nature or which is simply in breach of a contract. Also, in addition to consumer-related claims, Chapter 93A covers unfair competition and certain types of “business to business” claims, where a party is alleged to have committed unfair or deceptive acts or practices.
Bennett & Belfort P.C. frequently represents both individuals and businesses in both bringing and defending alleged violations of M.G.L. c.93A, Sections 2 and 11.