2023 Laws of Puerto Rico › TITLE TEN - Commerce (§§ 1 — 4196) › Subtitle 1 - Regulation of Business Generally (§§ 1 — 998q) › Chapter 36 - Retail Installment Sales and Finance Companies (§§ 731 — 793) › Subchapter II - Retail Installment Sales of Goods and Services (§§ 741 — 760) › § 749 - Provisions expressly prohibited—Buyer’s and seller’s rights and duties

No contract shall contain any provisions by which:
(a) The buyer agrees not to assert against an assignee a claim or defense arising out of the sale. Any assignee who acquires a contract or a related note shall send by mail to the buyer a notice of the assignment within thirty (30) days after the date such assignment is made. Such notice shall indicate the name and address of the assignee, the names of the seller and the buyer, and a description of the goods or services which are the subject matter of the contract (including the make, model, year and serial number, if any, in case the goods are new or used), the time balance of the contract and, the number and amount of installments in which the time balance is payable and the due date or expiration thereof. The notice shall contain, further, the following legend printed or typewritten, in at least ten- (10) point type.
“Notice:
(1) If the within statement of your transaction with the seller is not correct in every respect; or
(2) if the goods described in or in an enclosure with this notice have not been delivered to you by the seller or are not now in your possession; or
(3) if the seller has not fully performed all his agreements with you; you must notify the assignee in writing by certified mail with acknowledgment or receipt, at the address indicated in this notice within twenty (20) days from the date on which he may have information of any fact that may give rise to a cause of action or defense arising out of the sale which you might have against the seller.”
(b) In the absence of the buyer’s default, the holder may, arbitrarily and without reasonable cause, accelerate the maturity of the balance due under under the contract.
The holder may accelerate the maturity of the balance due under the contract in any of the following circumstances:
(1) When the buyer fails to pay three consecutive installments.
(2) Whenever the buyer fails to pay one or more installments due, if on two (2) or more previous occasions the buyer had failed to pay two (2) or more consecutive installments and on said occasions the buyer had paid the installments overdue in full.
(3) When the buyer who has failed to pay one or more consecutive installments tenders partial payment of the sum due, and after making such partial payment, continues to pay future installments when due, but continues in default with respect to the remainder of the overdue sum for three (3) consecutive installments subsequent to the date on which the partial payment was made.
(4) With regard to the insurance policy premium financing business, the Financial Institutions Commissioner shall provide how and when the holder of the financing contract may accelerate the maturity of the balance owed under said contract. However, the period of default that results in such acceleration shall not be less than fifteen (15) days nor more than three (3) months.
The holder may not refuse to receive the amount of one or more installments due if the buyer tenders payment, unless the holder has filed a judicial claim in the cases it is in order. Its acceptance shall not imply that the remaining installments in arrears or the debt are being condoned.
(c) The buyer waives any right of action against the seller or the holder of the contract, or other person acting on his behalf, for any illegal act committed in the collection of the installments under the contract or in the repossession of the goods.
(d) The title to any goods, or any lien thereon, is to be submitted posteriorly, in addition to the goods which are the subject matter of the contract, accessories therefor or special equipment used in connection with such goods, as additional security for the payment of the time balance.
(e) The buyer appoints the seller or the holder of the contract, or other person acting on his behalf, as the buyer’s agent in collection of payments under the contract, or in the repossession of goods.
(f) The buyer relieves the seller from any liability which the buyer may have against the seller under the contract or any other instrument executed in connection therewith.
(g) The buyer agrees to pay costs and counsel fees or any other expense arising from any extrajudicial claim connected with a contract under this chapter.
(h) The holder may file proceedings for the repossession of the goods before the buyer has failed to pay two (2) consecutive installments. Any repossession action shall be subject to the limitations established in subsection (b) of this section for the debt acceleration cases. The reposession proceedings shall be governed by §§ 401 et seq. of Title 19, known as the “Commercial Transactions Act”, and shall only be filed once the debt has been accelerated under the parameters of this chapter.
(i) The buyer who has paid an insurance policy and who authorizes the seller or the holder of the contract to endorse checks payable to the buyer or payable to the buyer and/or to the seller or holder by reason of the unearned premiums of any insurance acquired by the buyer, in case of an advance settlement of the debt, except that if the buyer is in default of any payment at the time of the advance payment he may authorize the seller or holder to endorse checks payable to the buyer, which unearned premiums shall be credited to the payment of the debt.
Any such prohibited provision included in the contract shall be void per se but shall not otherwise affect the validity of the remaining provisions of the contract.
History —June 19, 1964, No. 68, p. 192, § 209; May 31, 1972, No. 78, p. 171, § 6; May 31, 1973, No. 69, p. 310, § 4; Mar. 4, 1976, No. 9, p. 20, § 2; Aug. 17, 1989, No. 69, p. 301, § 3; Dec. 23, 1998, No. 310, § 5, eff. 60 days after Dec. 23, 1998.