• DYE CULIK PC | Consumer Protection Division

Massachusetts SJC Clarifies Requirements for Consumer Pre-Suit 93A Demand Letters

93A Demand

Under the Consumer Protection Act, commonly called “Chapter 93A,” consumers may sue businesses for engaging in unfair or deceptive acts or practices. When a business receives a demand letter, it has 30 days to respond with a reasonable settlement offer.

If it does not make a reasonable settlement offer, and the consumer wins their case, the consumer may be entitled to double or triple damages – essentially, a punitive-damages award for the company’s refusal to settle the case early. A demand letter must be sent prior to filing suit, at least in many circumstances.

The case involved interpretation of the language of the statute, and when a demand letter is required. The consumer argued that the demand letter does not have to be sent in either of two situations: either if the business does not have an office in Massachusetts; or, if the business has no assets in Massachusetts.

The business – mortgage servicer Nationstar Mortgage – argued that no demand was required only where both conditions were satisfied. This would have meant that there were more situations where consumers have to send demand letters.

Rejecting Nationstar’s argument, the Supreme Judicial Court wrote that to require demand letters in more situations would contravene Chapter 93A’s purpose as a consumer-protection law. Furthermore, if a business is not entitled to receive a demand letter, it may pay its settlement offer into the court when a case is filed as a substitute for making a settlement offer, thereby preventing double or triple damages.

This case settles an issue that many companies have been raising when consumers failed to send pre-suit demand letters. It allows consumers to file suit against out-of-state companies, or companies that do not keep assets in Massachusetts. It also makes it so that consumers do not have to spend limited time and resources to find out whether a company keeps assets in Massachusetts.

The decision is here: Moronta v. Nationstar Mortgage

Culik Law has handled numerous lawsuits involving violations of Chapter 93A, as well as mortgage claims against businesses throughout Massachusetts, including ones against Nationstar Mortgage. If you have been treated unfairly or deceptively, contact Culik Law to see if we may be able to help.

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