CHAPTER 56
SENATE BILL No. 531
An Act concerning credit agreements; relating to actions for legal
or equitable relief or
defenses; amending K.S.A. 16-117 and 16-118 and repealing
the existing sections.
Be it enacted by the Legislature of the State of Kansas:
Section 1. K.S.A. 16-117 is hereby amended to read as
follows: 16-
117. As used in this act:
(a) ``Credit agreement'' means an agreement by a financial
institution
to lend or delay repayment of money, goods or things in action, to
oth-
erwise extend credit or to make any other financial accommodation.
For
purposes of this act the term ``credit agreement'' does not include
the
following agreements: Open-end or closed-end promissory
notes, real
estate mortgages, security agreements, guaranty agreements, letters
of
credit, deposit account agreements, agreements in connection
with deposit
accounts for the payment of overdrafts, agreements in
connection with
student loans insured or guaranteed pursuant to the federal higher
edu-
cation act of 1965 and acts amendatory thereof and
supplementary
thereto, and agreements in connection with ``lender credit cards''
as de-
fined in the uniform consumer credit code;
(b) ``creditor'' means a financial institution which extends
credit or
extends a financial accommodation under a credit agreement with
a
debtor;
(c) ``debtor'' means a person who obtains credit or receives a
financial
accommodation under a credit agreement with a financial
institution; and
(d) ``financial institution'' means a bank, savings and loan
association,
savings bank or credit union.
Sec. 2. K.S.A. 16-118 is hereby amended to read as
follows: 16-118.
(a) A debtor or a creditor may not maintain an action for legal
or equitable
relief or a defense, based in either case upon a failure to
perform on a an
alleged credit agreement, unless the material
terms and conditions of the
agreement is are in writing and
is signed by the creditor and the debtor.
(b) All credit agreements shall contain a clear, conspicuous
and
printed notice to the debtor that states that the written credit
agreement
is a final expression of the credit agreement between the creditor
and
debtor and such written credit agreement may not be contradicted
by
evidence of any prior oral credit agreement or of a contemporaneous
oral
credit agreement between the creditor and debtor. A written credit
agree-
ment shall contain a sufficient space for the placement of
nonstandard
terms, including the reduction to writing of a previous oral credit
agree-
ment and an affirmation, signed or initialed by the debtor and the
cred-
itor, that no unwritten oral credit agreement between the parties
exists.
(c) Failure to comply with provisions of subsections (a)
and (b) shall
preclude an action or defense based on any of the following
legal or eq-
uitable theories: (1) An implied agreement based on course of
dealing or
performance or on a fiduciary relationship; (2) promissory or
equitable
estoppel; (3) part performance; or (4) negligent
representation.
Sec. 3. K.S.A. 16-117 and 16-118 are hereby repealed.
Sec. 4. This act shall take effect and be in force from
and after its
publication in the statute book.
Approved April 2, 1998
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