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HF 4347

as introduced - 93rd Legislature (2023 - 2024) Posted on 03/21/2024 03:40pm

KEY: stricken = removed, old language.
underscored = added, new language.
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Bill Text Versions

Engrossments
Introduction Posted on 02/27/2024

Current Version - as introduced

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A bill for an act
 relating to commerce; modifying provisions governing coerced debt; amending
Minnesota Statutes 2023 Supplement, sections 332.71, subdivisions 2, 4, 5, 7;
332.72; 332.73, subdivision 1; 332.74, subdivisions 3, 5; repealing Minnesota
Statutes 2023 Supplement, section 332.71, subdivision 8.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2023 Supplement, section 332.71, subdivision 2, is amended
to read:


Subd. 2.

Coerced debt.

(a) "Coerced debt" means all or a portion of debt in a debtor's
name that has been incurred as a result of:

(1) the use of the debtor's personal information without the debtor's knowledge,
authorization, or consent;

(2) the use or threat of force, intimidation, undue influence, deleted text begin harassment,deleted text end fraud, deception,
coercion, or other similar means against the debtor; or

(3) economic abuse perpetrated against the debtor.

(b) Coerced debt does not include secured debt.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
 new text end

Sec. 2.

Minnesota Statutes 2023 Supplement, section 332.71, subdivision 4, is amended
to read:


Subd. 4.

Debtor.

"Debtor" means a person who (1) is a victim of domestic abuse,
deleted text begin harassmentdeleted text end new text begin economic abusenew text end , or sex or labor trafficking, and (2) owes coerced debt.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
 new text end

Sec. 3.

Minnesota Statutes 2023 Supplement, section 332.71, subdivision 5, is amended
to read:


Subd. 5.

Documentation.

"Documentation" means deleted text begin a writing that identifies a debt or a
portion of a debt as coerced debt, describes the circumstances under which the coerced debt
was incurred, and takes the form ofdeleted text end :

(1) a police report;

(2) a Federal Trade Commission identity theft report;

(3) an order in a dissolution proceeding under chapter 518 that declares that one or more
debts are coerced; or

(4) a sworn written certification.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
 new text end

Sec. 4.

Minnesota Statutes 2023 Supplement, section 332.71, subdivision 7, is amended
to read:


Subd. 7.

Economic abuse.

"Economic abuse" means behavior in the context of a domestic
relationship that controls, restrains, restricts, impairs, or interferes with the ability of a deleted text begin victim
of domestic abuse, harassment, or sex or labor traffickingdeleted text end new text begin debtornew text end to acquire, use, or maintain
economic resources, including but not limited to:

(1) withholding or restricting access to, or the acquisition of, money, assets, credit, or
financial information;

(2) interfering with the victim's ability to work and earn wages; or

(3) exerting undue influence over a person's financial and economic behavior or decisions.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
 new text end

Sec. 5.

Minnesota Statutes 2023 Supplement, section 332.72, is amended to read:


332.72 COERCED DEBT PROHIBITED.

new text begin (a) new text end A person is prohibited from causing another person to incur coerced debt.

new text begin (b) A person who causes another person to incur a coerced debt in violation of this
section is civilly liable to the creditor for the amount of the debt, or portion thereof,
determined by a court to be coerced debt, plus the creditor's reasonable attorney fees and
costs, provided the creditor follows the procedures under section 332.74, subdivision 3,
paragraph (b).
 new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
 new text end

Sec. 6.

Minnesota Statutes 2023 Supplement, section 332.73, subdivision 1, is amended
to read:


Subdivision 1.

Notification.

(a) Before taking an affirmative action under section 332.74,
a debtor must, by certified mail, notify a creditor that the debt or a portion of a debt on
which the creditor demands payment is coerced debt and request that the creditor cease all
collection activity on the coerced debt. The notification and request must be in writing and
include documentation. new text begin If not already included in documentation, the notification must
include a signed statement that includes:
new text end

new text begin (1) an assertion that the debtor is a victim of domestic abuse, economic abuse, or sex or
labor trafficking;
 new text end

new text begin (2) a recitation of the facts supporting the claim that the debt is coerced; and
 new text end

new text begin (3) if only a portion of the debt is claimed to be coerced debt, an itemization of the
portion of the debt that is claimed to be coerced debt.
 new text end

new text begin (b) new text end The creditor, within 30 days of the date the notification and request is received, must
notify the debtor in writing of the creditor's decision to either immediately cease all collection
activity or continue to pursue collection.new text begin If a creditor ceases collection but subsequently
decides to resume collection activity, the creditor must notify the debtor ten days prior to
the date the collection activity resumes.
new text end

deleted text begin (b) If a creditor ceases collection but subsequently decides to resume collection activity,
the creditor must notify the debtor ten days prior to the date the collection activity resumes.
 deleted text end

(c) A debtor must not proceed with an action under section 332.74 until the 30-day
period provided under paragraph (a) has expired.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
 new text end

Sec. 7.

Minnesota Statutes 2023 Supplement, section 332.74, subdivision 3, is amended
to read:


Subd. 3.

Relief.

(a) If a debtor shows by a preponderance of the evidence that the debtor
has been aggrieved by a violation of section 332.72 and the debtor has incurred coerced
debt, the debtor is entitled to one or more of the following:

(1) a declaratory judgment that the debt or portion of a debt is coerced debt;

(2) an injunction prohibiting the creditor from (i) holding or attempting to hold the debtor
liable for the debt or portion of a debt, or (ii) enforcing a judgment related to the coerced
debt; and

(3) an order dismissing any cause of action brought by the creditor to enforce or collect
the coerced debt from the debtor or, if only a portion of the debt is established as coerced
debt, an order directing that the judgment, if any, in the action be amended to reflect only
the portion of the debt that is not coerced debt.

(b) If the court orders relief for the debtor under paragraph (a), the court, after the
creditor's motion has been new text begin personally new text end served new text begin on the person who violated section 332.72, or
if personal service cannot be made, after service new text end by United States mail to the last known
address of the person deleted text begin who violated section 332.72deleted text end new text begin and one-week published notice under
section 645.11new text end , deleted text begin shalldeleted text end new text begin mustnew text end issue a judgment in favor of the creditor against the person in
the amount of the debt or a portion thereof.

(c) This subdivision applies regardless of the judicial district in which the creditor's
action or the debtor's petition was filed.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
 new text end

Sec. 8.

Minnesota Statutes 2023 Supplement, section 332.74, subdivision 5, is amended
to read:


Subd. 5.

Burden.

In any affirmative action taken under subdivision 1 or any affirmative
defense asserted in subdivision 4, the debtor bears the burden to show by a preponderance
of the evidence that the debtor incurred coerced debt. There is a presumption that the debtor
has incurred coerced debt if the person alleged to have caused the debtor to incur the coerced
debt has been deleted text begin criminallydeleted text end convicteddeleted text begin , entered a guilty plea, or entered an Alford plea underdeleted text end
new text begin of or received a stay of adjudication for a violation of new text end section 609.27, 609.282, 609.322, or
609.527.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
 new text end

Sec. 9. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2023 Supplement, section 332.71, subdivision 8, new text end new text begin is repealed.
 new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2025.
 new text end

APPENDIX

Repealed Minnesota Statutes: 24-06602

332.71 DEFINITIONS.

Subd. 8.

Harassment.

"Harassment" has the meaning given in section 609.748.