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North Carolina House Bill H515

North Carolina 2025-2026 Regular Session

North Carolina House Bill H515 Compare Versions

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11 GENERAL ASSEMBLY OF NORTH CAROLINA
22 SESSION 2025
3-H 1
4-HOUSE BILL 515
3+H D
4+HOUSE BILL DRH30194-LR-35B
5+
56
67
78 Short Title: North Carolina Economic Abuse Prevention Act. (Public)
8-Sponsors: Representatives T. Brown, Howard, Setzer, and Carney (Primary Sponsors).
9-For a complete list of sponsors, refer to the North Carolina General Assembly web site.
10-Referred to: Judiciary 2, if favorable, Finance, if favorable, Rules, Calendar, and Operations of
11-the House
12-March 26, 2025
13-*H515 -v-1*
9+Sponsors: Representative T. Brown.
10+Referred to:
11+
12+*DRH30194 -LR-35B*
1413 A BILL TO BE ENTITLED 1
1514 AN ACT TO ENACT THE NORTH CAROLINA ECONOMIC ABUSE PREVENTION ACT . 2
1615 The General Assembly of North Carolina enacts: 3
1716 SECTION 1.(a) The General Assembly finds that survivors of domestic violence 4
1817 and the children of domestic violence survivors undergo multiple forms of abuses, including 5
1918 monetary abuse, and that survivors of domestic violence need multiple pathways to remedy 6
2019 coerced debt and to repair credit reports. Therefore, it is the public policy of this State to provide 7
2120 remedies for economic abuse against domestic violence survivors. 8
2221 SECTION 1.(b) The General Statutes are amended by adding a new Chapter to read: 9
2322 "Chapter 1H. 10
2423 "Economic Abuse Prevention Act. 11
2524 "§ 1H-1. Short title. 12
2625 This Chapter shall be known and may be cited as the North Carolina Economic Abuse 13
2726 Prevention Act. 14
2827 "§ 1H-2. Definitions. 15
2928 The following definitions apply to this Chapter: 16
3029 (1) Abuse. – As defined in G.S. 50C-1(1). 17
3130 (2) Adequate documentation. – Documentation that identifies a particular debt, or 18
3231 portion thereof, as coerced debt, describes the circumstances under which the 19
3332 coerced debt was incurred, and takes the form of any of the following: 20
3433 a. A police report. 21
3534 b. A Federal Trade Commission identity theft report identifying a 22
3635 particular debt, or portion thereof, as coerced, but not as identity theft. 23
3736 c. A court order issued under Chapter 50 or Chapter 50B of the General 24
3837 Statutes relating to domestic violence, Chapter 7B of the General 25
3938 Statutes relating to an abused, neglected, or dependent juvenile, or 26
4039 G.S. 108A-106 relating to disabled adults. 27
4140 d. A sworn written certification from a qualified third-party professional 28
4241 based on information they received while acting in a professional 29
4342 capacity. This documentation shall be signed by a qualified third-party 30
4443 professional and display the letterhead, address, and telephone number 31
4544 of the office, institution, center, or organization, as appropriate, that 32
4645 engages or employs, whether financially compensated or not, the 33
47-qualified third-party professional, or, if the qualified third-party 34 General Assembly Of North Carolina Session 2025
48-Page 2 House Bill 515-First Edition
49-professional is self-employed, the documentation shall display the 1
50-letterhead, address, and telephone number of the qualified third-party 2
51-professional. 3
52-(3) Claim. – A right to payment, whether or not that right is reduced to judgment, 4
53-liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, 5
54-undisputed, legal, or equitable. 6
55-(4) Claimant. – A person or an entity who has or purports to have a claim against 7
56-a debtor arising from coerced debt, or that person's or entity's successor or 8
57-assignee. This definition includes, but is not limited to, a debt collector or a 9
58-debt buyer. The term does not include a person who caused the claim 10
59-described in subdivision (3) of this section to arise through duress, 11
60-intimidation, threat of force, force, fraud, or undue influence perpetrated 12
61-against the debtor. 13
62-(5) Coerced debt. – A particular debt, or portion thereof, for personal, family, or 14
63-household use in the name of a debtor who is a victim of domestic violence as 15
64-defined in G.S. 50B-1, or a victim of domestic abuse as defined in 16
65-G.S. 14-32.3(a), or a current or former child in foster care as defined in 17
66-G.S. 131D-10.2, incurred as a result of duress, intimidation, threat of force, 18
67-force, or undue influence. 19
68-(6) Debtor. – A person who owes or is otherwise liable for coerced debt. 20
69-(7) Fraud. – An initial fraudulent act that is perpetrated against the debtor. 21
70-(8) Immediate family member. – As defined in G.S. 53-244.030(13). 22
71-(9) Person. – A natural person. 23
72-(10) Qualified third-party professional. – Any of the following who also has a 24
73-degree, certificate, or license from an accredited program for counseling 25
74-domestic violence victims: 26
75-a. Any agent of a domestic violence or sexual assault program, as defined 27
76-in G.S. 8-53.12. 28
77-b. A guardian ad litem or attorney appointed in accordance with 29
78-G.S. 1A-1, Rule 17 of the Rules of Civil Procedure, or G.S. 7B-601. 30
79-c. A board-certified psychiatrist or psychologist. 31
80-d. A licensed marriage and family therapist. 32
81-e. A licensed professional clinical counselor. 33
82-f. A licensed clinical social worker. 34
83-g. A social worker or caseworker employed by a county department of 35
84-social services for the purposes described in G.S. 108A-100 or 36
85-G.S. 7B-100. 37
86-h. A non-licensed or credentialed domestic violence professional who 38
87-otherwise meets the criteria of G.S. 8-53.12(a)(1). 39
88-(11) Sworn written certification. – A document in which the author declares under 40
89-penalty of perjury as true any material fact, and which is accompanied by the 41
90-following, to the extent that an item listed below is relevant to the debtor's 42
91-allegation that the debt is coerced debt: 43
92-a. A copy of the debtor's drivers license or identification card, as issued 44
93-by the State. 45
94-b. Any other identification document that supports the statement that the 46
95-particular debt, or portion thereof, is coerced debt. 47
96-c. An express statement that the debtor did not willingly authorize the 48
97-use of the debtor's name or personal information for incurring the 49
98-coerced debt, and specific facts supporting the claim of coerced debt, 50 General Assembly Of North Carolina Session 2025
99-House Bill 515-First Edition Page 3
100-if available, and, if not all of the debt was coerced, a statement 1
101-identifying the portion thereof that was coerced. 2
102-d. Any available correspondence disputing the coerced debt after 3
103-transaction information has been provided to the debtor. 4
104-e. Information, if known by the debtor, including, but not limited to, a 5
105-credit card number or loan number, that can be used by the claimant 6
106-to identify the account associated with the coerced debt and the person 7
107-or persons in whose name the debt was incurred. 8
108-f. The identity of the person or persons who coerced the debtor into 9
109-incurring the debt and contact information for that person or persons, 10
110-if known by the debtor; except when, in the alternative, the debtor 11
111-executes sworn statements asserting that disclosing this information is 12
112-likely to result in abuse to the debtor or an immediate family member 13
113-of the debtor and identifying the name, address, and telephone number 14
114-of the person or persons who coerced the debtor into incurring the debt. 15
115-g. A telephone number for contacting the person signing the certification 16
116-concerning any additional information or questions, or direction that 17
117-further communications to the debtor be in writing only, with the 18
118-mailing address specified in the statement. 19
119-h. The certification required by this subdivision shall be sufficient if it is 20
120-in substantially the following form: 21
121-"I declare under penalty of perjury that the representations made herein are true, correct, and 22
122-contain no material omissions of fact. 23
123-_______(Date and Place)________ _______(Signature)________" 24
124-"§ 1H-3. Scope. 25
125-(a) This Chapter does not apply to secured debts. 26
126-(b) This Chapter does not allow a court to order a claimant to refund any moneys already 27
127-paid on a debt that is determined to be coerced. 28
128-(c) This Chapter does not diminish the rights of a claimant to recover payment for a 29
129-coerced debt from the person or persons who coerced a debtor into incurring that debt. 30
130-(d) This Chapter does not reduce or eliminate any other rights or defenses available to a 31
131-debtor or claimant pursuant to any other law. 32
132-"§ 1H-4. Civil liability. 33
133-A person shall not cause another person to incur a coerced debt. A person who causes another 34
134-person to incur a coerced debt in violation of this section shall be civilly liable to the claimant 35
135-for the amount of the debt, or portion of said debt to be determined by a court, plus the claimant's 36
136-attorneys' fees and costs. 37
137-"§ 1H-5. Notice of coerced debts. 38
138-(a) Upon receipt of both of the following, a claimant shall cease collection activities until 39
139-completion of the review provided in subsection (c) of this section: 40
140-(1) Adequate documentation. 41
141-(2) The debtor's sworn written certification that a particular debt, or portion 42
142-thereof, being collected is coerced debt. 43
143-(b) If a debtor notifies a claimant orally that a particular debt, or portion thereof, being 44
144-collected is coerced debt, the claimant shall notify the debtor, orally or in writing, that the debtor's 45
145-notification must be in writing. If a debtor notifies a claimant in writing that a particular debt, or 46
146-portion thereof, being collected is coerced debt, but omits information required by subsection (a) 47
147-of this section, and, if the claimant does not cease collection activities, the claimant shall provide 48
148-written notice to the debtor of the additional information that is required. 49
149-(c) Within 10 business days of receiving the complete statement and information 50
150-described in subsection (a) of this section, the claimant shall, if the claimant furnished adverse 51 General Assembly Of North Carolina Session 2025
151-Page 4 House Bill 515-First Edition
152-information about the debtor to a consumer credit reporting agency, notify the consumer credit 1
153-reporting agency that the account is disputed. The claimant shall initiate a review considering all 2
154-of the information provided by the debtor and other information available to the claimant in its 3
155-file. Within 30 days of completing the review, the claimant shall notify the debtor in writing of 4
156-the claimant's determination and the good-faith basis for that determination. The claimant shall 5
157-not recommence collection activities until the debtor has been notified in writing of the good-faith 6
158-determination that the information does not establish that the particular debt, or portion thereof, 7
159-is coerced debt. 8
160-(d) No inference or presumption that the debt is valid or invalid, or that the debtor is liable 9
161-or not liable for the particular debt, or portion thereof, shall arise if the claimant decides after the 10
162-review described in subsection (c) of this section to cease or recommence collection activities. 11
163-The exercise or nonexercise of rights under this section is not a waiver of any other right or 12
164-defense of the debtor or claimant. 13
165-(e) At least 30 days before filing an action pursuant to G.S. 1H-6 or other action against 14
166-a claimant in connection with an allegedly coerced debt, a debtor shall submit notice of the 15
167-debtor's intent to file an action against the claimant and documents that comply with subsection 16
168-(a) of this section in writing to the claimant. This 30-day period shall begin to run when the 17
169-claimant receives this written notice. This written notice shall meet all of the following 18
170-requirements: 19
171-(1) The notice shall be sent by certified mail, overnight delivery, or other method 20
172-that allows for confirmation of the delivery date. 21
173-(2) The notice shall be sent to an address made available to the debtor by the 22
174-claimant for receipt of the notice, or, if an address has not been identified by 23
175-the claimant, to the claimant's principal place of business as identified by the 24
176-Secretary of State. If an address is unavailable through the Secretary of State's 25
177-website, the debtor may use the correspondence address of the claimant, or in 26
178-the case of a debt collector, the address on file with the Department of 27
179-Insurance for licensing purposes. 28
180-(f) The debtor shall not commence an action described in G.S. 1H-6 or other action 29
181-against a claimant in connection with an allegedly coerced debt if the claimant informs the debtor 30
182-that it has ceased all efforts to collect on the particular debt, or portion thereof, identified in the 31
183-written notice pursuant to subsection (e) of this section and the debtor receives written notice of 32
184-this cessation before the expiration of the 30-day period. 33
185-(g) The debtor may commence an action described in G.S. 1H-6 or other action against a 34
186-claimant in connection with an allegedly coerced debt if either of the following conditions is 35
187-satisfied: 36
188-(1) The 30-day period described in subsection (e) of this section expires and the 37
189-collection activities have not ceased or the debtor has not received written 38
190-notice that collection activities have ceased. 39
191-(2) The debtor receives written notice pursuant to subsection (c) of this section of 40
192-the claimant's good-faith determination that the information does not establish 41
193-that the particular debt, or portion thereof, is coerced debt. 42
194-(h) A claimant that ceases collection activities under this section and does not 43
195-recommence those collection activities shall do both of the following: 44
196-(1) If the claimant has furnished adverse information to a consumer credit 45
197-reporting agency regarding the debtor and a particular debt, or portion thereof, 46
198-notify the agency to delete that information no later than 10 business days after 47
199-making its determination. 48
200-(2) If the claimant is a debt collector, notify the creditor no later than 10 business 49
201-days after making its determination that collection activities have been 50 General Assembly Of North Carolina Session 2025
202-House Bill 515-First Edition Page 5
203-terminated based upon the debtor's assertion that a particular debt, or portion 1
204-thereof, being collected is coerced debt. 2
205-"§ 1H-6. Order establishing relief from coerced debt. 3
206-(a) A debtor may bring an action against a claimant to establish that a particular debt, or 4
207-portion thereof, is coerced debt. 5
208-(b) In an action brought by a claimant to recover a particular debt against the debtor, the 6
209-debtor may file a cross-complaint to establish that the particular debt, or portion thereof, is 7
210-coerced debt. The notice described in G.S. 1H-5(c) shall not be required as a prerequisite to filing 8
211-a cross-complaint. A debtor shall plead the allegations of coerced debt with particularity and shall 9
212-do either of the following: 10
213-(1) Attach the documents provided to the claimant pursuant to G.S. 1H-5(a) to 11
214-any complaint. 12
215-(2) Attach the documents identified in G.S. 1H-5(a) to any cross-complaint. 13
216-(c) If the debtor establishes by a preponderance of the evidence that the particular debt, 14
217-or portion thereof, is coerced debt, the debtor shall be entitled to the following relief: 15
218-(1) A declaratory judgment that the debtor is not obligated to the claimant on the 16
219-particular debt, or portion thereof, that is coerced debt. 17
220-(2) An injunction prohibiting the claimant from holding or attempting to hold the 18
221-debtor personally liable on the particular debt, or portion thereof, that is 19
222-coerced debt, and prohibiting the claimant from enforcing a judgment related 20
223-to the particular debt, or portion thereof, that is coerced debt against the debtor. 21
224-(3) An order dismissing any cause of action brought by the claimant to enforce or 22
225-collect on the particular debt from the debtor or, if only a portion of the debt 23
226-is established as coerced debt, an order directing that the complaint and 24
227-judgment, if any, in the action be amended to reflect only the portion of the 25
228-particular debt that is not coerced debt. 26
229-(c1) If the debtor establishes by a preponderance of the evidence that the particular debt, 27
230-or portion thereof, is coerced debt, the court shall issue a judgment in favor of the claimant against 28
231-the person or persons who coerced the debtor into incurring the debt in the amount of the debt, 29
232-or portion thereof, that is coerced debt, provided that the person or persons who coerced the 30
233-debtor into incurring the debt or debts has been brought within the jurisdiction of the court and 31
234-joined as a party to the action and the evidence supports such a judgment. The court presiding 32
235-over the action shall take the appropriate steps necessary to prevent abuse of the debtor or an 33
236-immediate family member of the debtor, including, but not limited to, sealing court records, 34
237-redacting personally identifiable information about the debtor and any immediate family member 35
238-of the debtor, and directing that any deposition or evidentiary hearing be conducted remotely. 36
239-(d) A debtor who files knowingly false motions, pleadings, or other papers or engages in 37
240-other tactics that are frivolous or intended to cause unnecessary delay against a claimant shall be 38
241-liable for the claimant's attorneys' fees and costs in defending the lawsuit. 39
242-(e) The claimant may move the court to make written findings regarding evidence related 40
243-to the person who caused the coerced debt to be incurred. 41
244-"§ 1H-7. Miscellaneous provisions. 42
245-(a) Where some or all of a claim is established as having arisen from coerced debt, a 43
246-claimant shall have standing, and may use all rights and remedies, to collect by any lawful means 44
247-that claim, or portion thereof, from the person or persons determined to have coerced the debt, 45
248-or against a person who used or possessed money, goods, services, or property obtained through 46
249-coerced debt. 47
250-(b) The statute of limitations for a claimant to bring an action to collect coerced debt from 48
251-any person determined to have coerced the debt shall run from the date of the court's 49
252-determination that the person caused the duress, intimidation, threat of force, force, fraud, or 50 General Assembly Of North Carolina Session 2025
253-Page 6 House Bill 515-First Edition
254-undue influence giving rise to the coerced debt at issue and shall be brought within five years of 1
255-that determination. 2
256-(c) If any provision of this Chapter or the application thereof to any person or 3
257-circumstances is held invalid, such invalidity shall not affect other provisions or applications of 4
258-this Chapter that can be given effect without the invalid provision or application and, to this end, 5
259-the provisions of this Chapter are severable. 6
260-(d) This Chapter applies only to debts incurred on or after July 1, 2025, except that a 7
261-debtor may file a cross-complaint described by subsection (b) of this section in an action filed by 8
262-a claimant to collect a debt incurred prior to July 1, 2025, unless a final judgment has been entered 9
263-in that action." 10
264-SECTION 2. This act becomes effective July 1, 2025. 11
46+qualified third-party professional, or, if the qualified third-party 34
47+professional is self-employed, the documentation shall display the 35
48+H.B. 515
49+Mar 25, 2025
50+HOUSE PRINCIPAL CLERK General Assembly Of North Carolina Session 2025
51+Page 2 DRH30194-LR-35B
52+letterhead, address, and telephone number of the qualified third-party 1
53+professional. 2
54+(3) Claim. – A right to payment, whether or not that right is reduced to judgment, 3
55+liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, 4
56+undisputed, legal, or equitable. 5
57+(4) Claimant. – A person or an entity who has or purports to have a claim against 6
58+a debtor arising from coerced debt, or that person's or entity's successor or 7
59+assignee. This definition includes, but is not limited to, a debt collector or a 8
60+debt buyer. The term does not include a person who caused the claim 9
61+described in subdivision (3) of this section to arise through duress, 10
62+intimidation, threat of force, force, fraud, or undue influence perpetrated 11
63+against the debtor. 12
64+(5) Coerced debt. – A particular debt, or portion thereof, for personal, family, or 13
65+household use in the name of a debtor who is a victim of domestic violence as 14
66+defined in G.S. 50B-1, or a victim of domestic abuse as defined in 15
67+G.S. 14-32.3(a), or a current or former child in foster care as defined in 16
68+G.S. 131D-10.2, incurred as a result of duress, intimidation, threat of force, 17
69+force, or undue influence. 18
70+(6) Debtor. – A person who owes or is otherwise liable for coerced debt. 19
71+(7) Fraud. – An initial fraudulent act that is perpetrated against the debtor. 20
72+(8) Immediate family member. – As defined in G.S. 53-244.030(13). 21
73+(9) Person. – A natural person. 22
74+(10) Qualified third-party professional. – Any of the following who also has a 23
75+degree, certificate, or license from an accredited program for counseling 24
76+domestic violence victims: 25
77+a. Any agent of a domestic violence or sexual assault program, as defined 26
78+in G.S. 8-53.12. 27
79+b. A guardian ad litem or attorney appointed in accordance with 28
80+G.S. 1A-1, Rule 17 of the Rules of Civil Procedure, or G.S. 7B-601. 29
81+c. A board-certified psychiatrist or psychologist. 30
82+d. A licensed marriage and family therapist. 31
83+e. A licensed professional clinical counselor. 32
84+f. A licensed clinical social worker. 33
85+g. A social worker or caseworker employed by a county department of 34
86+social services for the purposes described in G.S. 108A-100 or 35
87+G.S. 7B-100. 36
88+h. A non-licensed or credentialed domestic violence professional who 37
89+otherwise meets the criteria of G.S. 8-53.12(a)(1). 38
90+(11) Sworn written certification. – A document in which the author declares under 39
91+penalty of perjury as true any material fact, and which is accompanied by the 40
92+following, to the extent that an item listed below is relevant to the debtor's 41
93+allegation that the debt is coerced debt: 42
94+a. A copy of the debtor's drivers license or identification card, as issued 43
95+by the State. 44
96+b. Any other identification document that supports the statement that the 45
97+particular debt, or portion thereof, is coerced debt. 46
98+c. An express statement that the debtor did not willingly authorize the 47
99+use of the debtor's name or personal information for incurring the 48
100+coerced debt, and specific facts supporting the claim of coerced debt, 49
101+if available, and, if not all of the debt was coerced, a statement 50
102+identifying the portion thereof that was coerced. 51 General Assembly Of North Carolina Session 2025
103+DRH30194-LR-35B Page 3
104+d. Any available correspondence disputing the coerced debt after 1
105+transaction information has been provided to the debtor. 2
106+e. Information, if known by the debtor, including, but not limited to, a 3
107+credit card number or loan number, that can be used by the claimant 4
108+to identify the account associated with the coerced debt and the person 5
109+or persons in whose name the debt was incurred. 6
110+f. The identity of the person or persons who coerced the debtor into 7
111+incurring the debt and contact information for that person or persons, 8
112+if known by the debtor; except when, in the alternative, the debtor 9
113+executes sworn statements asserting that disclosing this information is 10
114+likely to result in abuse to the debtor or an immediate family member 11
115+of the debtor and identifying the name, address, and telephone number 12
116+of the person or persons who coerced the debtor into incurring the debt. 13
117+g. A telephone number for contacting the person signing the certification 14
118+concerning any additional information or questions, or direction that 15
119+further communications to the debtor be in writing only, with the 16
120+mailing address specified in the statement. 17
121+h. The certification required by this subdivision shall be sufficient if it is 18
122+in substantially the following form: 19
123+"I declare under penalty of perjury that the representations made herein are true, correct, and 20
124+contain no material omissions of fact. 21
125+_______(Date and Place)________ _______(Signature)________" 22
126+"§ 1H-3. Scope. 23
127+(a) This Chapter does not apply to secured debts. 24
128+(b) This Chapter does not allow a court to order a claimant to refund any moneys already 25
129+paid on a debt that is determined to be coerced. 26
130+(c) This Chapter does not diminish the rights of a claimant to recover payment for a 27
131+coerced debt from the person or persons who coerced a debtor into incurring that debt. 28
132+(d) This Chapter does not reduce or eliminate any other rights or defenses available to a 29
133+debtor or claimant pursuant to any other law. 30
134+"§ 1H-4. Civil liability. 31
135+A person shall not cause another person to incur a coerced debt. A person who causes another 32
136+person to incur a coerced debt in violation of this section shall be civilly liable to the claimant 33
137+for the amount of the debt, or portion of said debt to be determined by a court, plus the claimant's 34
138+attorneys' fees and costs. 35
139+"§ 1H-5. Notice of coerced debts. 36
140+(a) Upon receipt of both of the following, a claimant shall cease collection activities until 37
141+completion of the review provided in subsection (c) of this section: 38
142+(1) Adequate documentation. 39
143+(2) The debtor's sworn written certification that a particular debt, or portion 40
144+thereof, being collected is coerced debt. 41
145+(b) If a debtor notifies a claimant orally that a particular debt, or portion thereof, being 42
146+collected is coerced debt, the claimant shall notify the debtor, orally or in writing, that the debtor's 43
147+notification must be in writing. If a debtor notifies a claimant in writing that a particular debt, or 44
148+portion thereof, being collected is coerced debt, but omits information required by subsection (a) 45
149+of this section, and, if the claimant does not cease collection activities, the claimant shall provide 46
150+written notice to the debtor of the additional information that is required. 47
151+(c) Within 10 business days of receiving the complete statement and information 48
152+described in subsection (a) of this section, the claimant shall, if the claimant furnished adverse 49
153+information about the debtor to a consumer credit reporting agency, notify the consumer credit 50
154+reporting agency that the account is disputed. The claimant shall initiate a review considering all 51 General Assembly Of North Carolina Session 2025
155+Page 4 DRH30194-LR-35B
156+of the information provided by the debtor and other information available to the claimant in its 1
157+file. Within 30 days of completing the review, the claimant shall notify the debtor in writing of 2
158+the claimant's determination and the good-faith basis for that determination. The claimant shall 3
159+not recommence collection activities until the debtor has been notified in writing of the good-faith 4
160+determination that the information does not establish that the particular debt, or portion thereof, 5
161+is coerced debt. 6
162+(d) No inference or presumption that the debt is valid or invalid, or that the debtor is liable 7
163+or not liable for the particular debt, or portion thereof, shall arise if the claimant decides after the 8
164+review described in subsection (c) of this section to cease or recommence collection activities. 9
165+The exercise or nonexercise of rights under this section is not a waiver of any other right or 10
166+defense of the debtor or claimant. 11
167+(e) At least 30 days before filing an action pursuant to G.S. 1H-6 or other action against 12
168+a claimant in connection with an allegedly coerced debt, a debtor shall submit notice of the 13
169+debtor's intent to file an action against the claimant and documents that comply with subsection 14
170+(a) of this section in writing to the claimant. This 30-day period shall begin to run when the 15
171+claimant receives this written notice. This written notice shall meet all of the following 16
172+requirements: 17
173+(1) The notice shall be sent by certified mail, overnight delivery, or other method 18
174+that allows for confirmation of the delivery date. 19
175+(2) The notice shall be sent to an address made available to the debtor by the 20
176+claimant for receipt of the notice, or, if an address has not been identified by 21
177+the claimant, to the claimant's principal place of business as identified by the 22
178+Secretary of State. If an address is unavailable through the Secretary of State's 23
179+website, the debtor may use the correspondence address of the claimant, or in 24
180+the case of a debt collector, the address on file with the Department of 25
181+Insurance for licensing purposes. 26
182+(f) The debtor shall not commence an action described in G.S. 1H-6 or other action 27
183+against a claimant in connection with an allegedly coerced debt if the claimant informs the debtor 28
184+that it has ceased all efforts to collect on the particular debt, or portion thereof, identified in the 29
185+written notice pursuant to subsection (e) of this section and the debtor receives written notice of 30
186+this cessation before the expiration of the 30-day period. 31
187+(g) The debtor may commence an action described in G.S. 1H-6 or other action against a 32
188+claimant in connection with an allegedly coerced debt if either of the following conditions is 33
189+satisfied: 34
190+(1) The 30-day period described in subsection (e) of this section expires and the 35
191+collection activities have not ceased or the debtor has not received written 36
192+notice that collection activities have ceased. 37
193+(2) The debtor receives written notice pursuant to subsection (c) of this section of 38
194+the claimant's good-faith determination that the information does not establish 39
195+that the particular debt, or portion thereof, is coerced debt. 40
196+(h) A claimant that ceases collection activities under this section and does not 41
197+recommence those collection activities shall do both of the following: 42
198+(1) If the claimant has furnished adverse information to a consumer credit 43
199+reporting agency regarding the debtor and a particular debt, or portion thereof, 44
200+notify the agency to delete that information no later than 10 business days after 45
201+making its determination. 46
202+(2) If the claimant is a debt collector, notify the creditor no later than 10 business 47
203+days after making its determination that collection activities have been 48
204+terminated based upon the debtor's assertion that a particular debt, or portion 49
205+thereof, being collected is coerced debt. 50
206+"§ 1H-6. Order establishing relief from coerced debt. 51 General Assembly Of North Carolina Session 2025
207+DRH30194-LR-35B Page 5
208+(a) A debtor may bring an action against a claimant to establish that a particular debt, or 1
209+portion thereof, is coerced debt. 2
210+(b) In an action brought by a claimant to recover a particular debt against the debtor, the 3
211+debtor may file a cross-complaint to establish that the particular debt, or portion thereof, is 4
212+coerced debt. The notice described in G.S. 1H-5(c) shall not be required as a prerequisite to filing 5
213+a cross-complaint. A debtor shall plead the allegations of coerced debt with particularity and shall 6
214+do either of the following: 7
215+(1) Attach the documents provided to the claimant pursuant to G.S. 1H-5(a) to 8
216+any complaint. 9
217+(2) Attach the documents identified in G.S. 1H-5(a) to any cross-complaint. 10
218+(c) If the debtor establishes by a preponderance of the evidence that the particular debt, 11
219+or portion thereof, is coerced debt, the debtor shall be entitled to the following relief: 12
220+(1) A declaratory judgment that the debtor is not obligated to the claimant on the 13
221+particular debt, or portion thereof, that is coerced debt. 14
222+(2) An injunction prohibiting the claimant from holding or attempting to hold the 15
223+debtor personally liable on the particular debt, or portion thereof, that is 16
224+coerced debt, and prohibiting the claimant from enforcing a judgment related 17
225+to the particular debt, or portion thereof, that is coerced debt against the debtor. 18
226+(3) An order dismissing any cause of action brought by the claimant to enforce or 19
227+collect on the particular debt from the debtor or, if only a portion of the debt 20
228+is established as coerced debt, an order directing that the complaint and 21
229+judgment, if any, in the action be amended to reflect only the portion of the 22
230+particular debt that is not coerced debt. 23
231+(c1) If the debtor establishes by a preponderance of the evidence that the particular debt, 24
232+or portion thereof, is coerced debt, the court shall issue a judgment in favor of the claimant against 25
233+the person or persons who coerced the debtor into incurring the debt in the amount of the debt, 26
234+or portion thereof, that is coerced debt, provided that the person or persons who coerced the 27
235+debtor into incurring the debt or debts has been brought within the jurisdiction of the court and 28
236+joined as a party to the action and the evidence supports such a judgment. The court presiding 29
237+over the action shall take the appropriate steps necessary to prevent abuse of the debtor or an 30
238+immediate family member of the debtor, including, but not limited to, sealing court records, 31
239+redacting personally identifiable information about the debtor and any immediate family member 32
240+of the debtor, and directing that any deposition or evidentiary hearing be conducted remotely. 33
241+(d) A debtor who files knowingly false motions, pleadings, or other papers or engages in 34
242+other tactics that are frivolous or intended to cause unnecessary delay against a claimant shall be 35
243+liable for the claimant's attorneys' fees and costs in defending the lawsuit. 36
244+(e) The claimant may move the court to make written findings regarding evidence related 37
245+to the person who caused the coerced debt to be incurred. 38
246+"§ 1H-7. Miscellaneous provisions. 39
247+(a) Where some or all of a claim is established as having arisen from coerced debt, a 40
248+claimant shall have standing, and may use all rights and remedies, to collect by any lawful means 41
249+that claim, or portion thereof, from the person or persons determined to have coerced the debt, 42
250+or against a person who used or possessed money, goods, services, or property obtained through 43
251+coerced debt. 44
252+(b) The statute of limitations for a claimant to bring an action to collect coerced debt from 45
253+any person determined to have coerced the debt shall run from the date of the court's 46
254+determination that the person caused the duress, intimidation, threat of force, force, fraud, or 47
255+undue influence giving rise to the coerced debt at issue and shall be brought within five years of 48
256+that determination. 49
257+(c) If any provision of this Chapter or the application thereof to any person or 50
258+circumstances is held invalid, such invalidity shall not affect other provisions or applications of 51 General Assembly Of North Carolina Session 2025
259+Page 6 DRH30194-LR-35B
260+this Chapter that can be given effect without the invalid provision or application and, to this end, 1
261+the provisions of this Chapter are severable. 2
262+(d) This Chapter applies only to debts incurred on or after July 1, 2025, except that a 3
263+debtor may file a cross-complaint described by subsection (b) of this section in an action filed by 4
264+a claimant to collect a debt incurred prior to July 1, 2025, unless a final judgment has been entered 5
265+in that action." 6
266+SECTION 2. This act becomes effective July 1, 2025. 7