Opinion ID: 1760157
Heading Depth: 1
Heading Rank: 8

Heading: Unconscionable Acts

Text: Section 17.50 of the DTPA provides that a consumer may recover actual damages for any unconscionable action or course of action that is the producing cause of the damages. TEX. BUS. & COM.CODE § 17.50(a)(3). The DTPA defines an unconscionable action or course of action as an act or practice, which ... takes advantage of the lack of knowledge, ability, experience, or capacity of a person to a grossly unfair degree. Id. § 17.45(5)(A). Unconscionability under the DTPA is an objective standard for which scienter is irrelevant. Chastain v. Koonce, 700 S.W.2d 579, 583 (Tex.1985) (This should be determined by examining the entire transaction and not by inquiring whether the defendant intended to take advantage of the consumer or acted with knowledge or conscious indifference.). To prove an unconscionable action or course of action, a plaintiff must show that the defendant's acts took advantage of her lack of knowledge and that the resulting unfairness was glaringly noticeable, flagrant, complete and unmitigated. Id. at 584. The court of appeals cited several allegedly unconscionable courses of action by INA, including: (1) INA's failure to disclose that 75% of its own risk was covered through reinsurance by the Colony Insurance Company; (2) INA's failure to disclose the Meatte injunction; (3) INA's failure to ensure that licensed agents presented and explained the surety bond agreements; (4) Ace's and Gunnels's promotion of INA's underwriting of the Overlord programs as proof that they were sound investment opportunities; (5) INA's failure to require the lenders to timely make demand for payment before it honored the surety bonds; and (6) INA's pursuit of collection efforts against Red despite her prepayment of the notes. 928 S.W.2d at 150-51.