Michigan House Bill HB5358

Michigan 2023-2024 Regular Session

• Introduced: 11/14/23
• Refer: 11/14/23
• Refer: 1/10/24
• Report Pass: 5/23/24

Caption

Commercial code: other; citations to the motor vehicle sales finance act; revise. Amends sec. 9201 of 1962 PA 174 (MCL 440.9201). TIE BAR WITH: HB 5354'23

Impact

If enacted, the bill would have several implications for state laws, particularly in the ambit of consumer protection and uniform commercial practices. It asserts that any transactions falling under this article must adhere to existing consumer protection laws, suggesting an attempt to harmonize state regulations with broader principles of fair lending and consumer rights. This could potentially afford consumers greater protection and lead to increased scrutiny for lenders operating within this framework, thereby fostering a more transparent and equitable lending environment.

Summary

House Bill 5358 seeks to amend the Uniform Commercial Code in Michigan, specifically revising section 9201 related to security agreements. The bill emphasizes that such security agreements are effective according to their terms between the involved parties and remain enforceable against purchasers of the collateral and other creditors. The intention behind this amendment appears to clarify the existing framework governing security interests and make it more consistent with other state regulations, enhancing the legal framework for transactions subject to the Commercial Code.

Contention

One of the notable points of contention around HB 5358 is its tie-bar with House Bill 5354. Critics might argue that this linkage could lead to unintended consequences if either bill faces opposition, as the implementation of HB 5358 is contingent upon the passage of the tied bill. Furthermore, discussions are likely to emerge regarding how these amendments affect existing consumer and commercial financing practices, with different stakeholders debating whether the proposed changes sufficiently protect consumers without imposing burdensome regulations on businesses.