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Title 15. Contracts and Obligations in General
Chapter 1
Interest
15-1-1 Interest rates -- Contracted rate -- Legal rate.
(1) The parties to a lawful written, verbal, or implied contract may agree upon any rate of interest
for the contract, including a contract for services, a loan or forbearance of any money, goods, or
services, or a claim for breach of contract.
(2) Unless the parties to a lawful written, verbal, or implied contract expressly specify a different
rate of interest, the legal rate of interest for the contract, including a contract for services, a loan
or forbearance of any money, goods, or services, or a claim for breach of contract is 10% per
annum.
(3) Nothing in this section may be construed in any way to affect any penalty or interest charge that
by law applies to delinquent or other taxes or to any contract or obligations made before May
14, 1981.
Amended by Chapter 437, 2019 General Session
15-1-3 Calculated by the year.
Whenever in any statute or deed, or written or verbal contract, or in any public or private
instrument whatever, any certain rate of interest is mentioned and no period of time is stated,
interest shall be calculated at the rate mentioned by the year.
No Change Since 1953
15-1-4 Interest on judgments.
(1) As used in this section, "federal postjudgment interest rate" means the interest rate established
for the federal court system under 28 U.S.C. Sec. 1961, as amended.
(2)
(a) Except as provided in Subsection (2)(b), a judgment rendered on a lawful contract shall
conform to the contract and shall bear the interest agreed upon by the parties, which shall be
specified in the judgment.
(b) A judgment rendered on a deferred deposit loan subject to Title 7, Chapter 23, Check
Cashing and Deferred Deposit Lending Registration Act, shall bear interest at the rate
imposed under Subsection (3)(a) on an amount not exceeding the sum of:
(i) the total of the principal balance of the deferred deposit loan;
(ii) interest at the rate imposed by the deferred deposit loan agreement for a period not
exceeding 10 weeks as provided in Subsection 7-23-401(4);
(iii) costs;
(iv) attorney fees; and
(v) other amounts allowed by law and ordered by the court.
(3)
(a) Except as otherwise provided by law, or as governed by Subsection (4), all other final civil
and criminal judgments of the district court, the justice court, and the Business and Chancery
Court shall bear interest at the federal postjudgment interest rate as of January 1 of each
year, plus 2%.
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(b) The postjudgment interest rate in effect at the time of the judgment shall remain the interest
rate for the duration of the judgment.
(c) The interest on criminal judgments shall be calculated on the total amount of the judgment.
(d) Interest paid on state revenue shall be deposited in accordance with Section 63A-3-505.
(e) Interest paid on revenue to a county or municipality shall be paid to the general fund of the
county or municipality.
(4) A judgment under $10,000 in an action regarding the purchase of goods and services shall
bear interest from the date on which the district court, the justice court, or the Business and
Chancery Court enters the judgment at 10% plus the federal postjudgment interest rate in effect
on January 1 of the year in which the judgment is entered.
Amended by Chapter 394, 2023 General Session
Chapter 2
Legal Capacity of Children
15-2-1 Period of minority.
The period of minority extends in males and females to the age of 18 years; but all minors
obtain their majority by marriage. It is further provided that courts in divorce actions may order
support to age 21.
Amended by Chapter 39, 1975 General Session
15-2-2 Liability for necessaries and on contracts -- Disaffirmance.
A minor is bound not only for reasonable value of necessaries but also by the minor's contracts,
unless the minor disaffirms them before or within a reasonable time after the minor attains majority
and restores to the other party all money or property received by the minor by virtue of said
contracts and remaining within the minor's control at any time after attaining majority.
Amended by Chapter 365, 2024 General Session
15-2-3 Limitation on right to disaffirm.
No contract can be thus disaffirmed in cases where, on account of the minor's own
misrepresentations as to the minor's majority or from the minor having engaged in business as
adult, the other party had good reason to believe the minor capable of contracting.
Amended by Chapter 365, 2024 General Session
15-2-4 Payment for personal services.
When a contract for the personal services of a minor has been made with the minor alone, and
those services are afterward performed, payment made therefor to such minor in accordance with
the terms of the contract is a full satisfaction for those services, and the parent or guardian cannot
recover therefor a second time.
Amended by Chapter 365, 2024 General Session
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Chapter 3
Interparty Agreements
15-3-1 Conveyances, releases, sales by persons acting jointly.
A conveyance, release or sale may be made to or by two or more persons acting jointly and
one or more, but less than all, of these persons acting either alone or with other persons; and a
contract may be made between such parties.
Amended by Chapter 365, 2024 General Session
15-3-2 Contracts not discharged by merger in obligor and obligee.
No contract shall be discharged because after its formation the obligation and the right
thereunder become vested in the same person, acting in different capacities as to the right and the
obligation.
No Change Since 1953
15-3-3 Fraudulent transactions not validated.
Nothing herein shall validate a transaction within its provisions which is actually or constructively
fraudulent.
No Change Since 1953
15-3-4 Effective date of chapter.
This chapter does not apply to conveyances, releases, sales or contracts made prior to July 1,
1929.
Amended by Chapter 378, 2010 General Session
Chapter 4
Joint Obligations
Superseded 9/1/2024
15-4-1 Definitions.
As used in this chapter:
(1) "Obligation" includes a liability in tort and contractual obligations.
(2) "Obligee" includes a creditor and a person having a right based on a tort.
(3) "Obligor" includes a debtor and a person liable for a tort.
(4)
(a) "School fee" means a charge, deposit, rent, or other mandatory payment imposed by:
(i) a public school as defined in Section 26B-2-401; or
(ii) a private school that provides education to students in any grade from kindergarten through
grade 12.
(b) "School fee" includes:
(i) an admission fee;
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(ii) a transportation charge; or
(iii) a charge, deposit, rent, or other mandatory payment imposed by a third party in connection
with an activity or function sponsored by a school described in Subsection (4)(a).
(5) "Several obligors" means obligors severally bound for the same performance.
(6) "Waiver" means the act of not requiring an individual to pay an amount that the individual
otherwise owes.
Amended by Chapter 327, 2023 General Session
Effective 9/1/2024
15-4-1 Definitions.
As used in this chapter:
(1) "Administrative agency" means the same as that term is defined in Section 81-6-101.
(2) "Child" means the same as that term is defined in Section 81-6-101.
(3) "Obligation" includes a liability in tort and contractual obligations.
(4) "Obligee" includes a creditor and a person having a right based on a tort.
(5) "Obligor" includes a debtor and a person liable for a tort.
(6)
(a) "School fee" means a charge, deposit, rent, or other mandatory payment imposed by:
(i) a public school as defined in Section 26B-2-401; or
(ii) a private school that provides education to students in any grade from kindergarten through
grade 12.
(b) "School fee" includes:
(i) an admission fee;
(ii) a transportation charge; or
(iii) a charge, deposit, rent, or other mandatory payment imposed by a third party in connection
with an activity or function sponsored by a school described in Subsection (6)(a).
(7) "Several obligors" means obligors severally bound for the same performance.
(8) "Waiver" means the act of not requiring an individual to pay an amount that the individual
otherwise owes.
Amended by Chapter 366, 2024 General Session
15-4-2 Discharge of co-obligors by judgment.
A judgment against one or more of several obligors, or against one or more of joint or of joint
and several obligors, may not discharge a co-obligor who was not a party to the proceeding
wherein the judgment was rendered.
Amended by Chapter 378, 2010 General Session
15-4-3 Payments by co-obligor.
The amount or value of any consideration received by the obligee from one or more of
several obligors, or from one or more of joint or of joint and several obligors, in whole or in partial
satisfaction of their obligations shall be credited to the extent of the amount received on the
obligation of all co-obligors to whom the obligor or obligors giving the consideration did not stand in
the relation of a surety.
No Change Since 1953
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15-4-4 Release of co-obligor -- Reservation of rights.
Subject to the provisions of Section 15-4-3, the obligee's release or discharge of one or more
of several obligors, or of one or more of joint or of joint and several obligors, does not discharge
co-obligors against whom the obligee in writing and as part of the same transaction as the release
or discharge expressly reserves his rights; and in the absence of such a reservation of rights shall
discharge co-obligors only to the extent provided in Section 15-4-5.
Amended by Chapter 378, 2010 General Session
15-4-5 Release of co-obligor -- Effect of knowledge of obligee.
(1) If an obligee releasing or discharging an obligor without express reservation of rights against
a co-obligor then knows or has reason to know that the obligor released or discharged did not
pay as much of the claim as that obligor was bound by that obligor's contract or relation with
that co-obligor to pay, the obligee's claim against that co-obligor shall be satisfied to the amount
which the obligee knew or had reason to know that the released or discharged obligor was
bound to such co-obligor to pay.
(2) If an obligee so releasing or discharging an obligor has not then such knowledge or reason to
know, the obligee's claim against the co-obligor shall be satisfied to the extent of the lesser of
two amounts, namely:
(a) the amount of the fractional share of the obligor released or discharged; or
(b) the amount that such obligor was bound by that obligor's contract or relation with the co-
obligor to pay.
Amended by Chapter 365, 2024 General Session
15-4-6 Death of joint obligor -- Survivorship.
On the death of a joint obligor in contract the joint obligor's executor or administrator shall be
bound as such jointly and severally with the surviving obligor or obligors.
Amended by Chapter 365, 2024 General Session
Superseded 9/1/2024
15-4-6.5 Divorce or separate maintenance of co-obligors.
(1) On the entering of a decree of divorce or separate maintenance of joint debtors in contract, the
claim of a creditor remains unchanged unless otherwise provided by the contract or until a new
contract is entered into between the creditor and the debtors individually.
(2) In addition to the creditor's duties as a secured party under Title 70A, Chapter 9a, Uniform
Commercial Code - Secured Transactions, and the creditor's duties as a trustee or beneficiary
of a trust deed under Title 57, Chapter 1, Conveyances, a creditor, who has been notified by
service of a copy of a court order under Section 30-3-5 or 30-4-3 that the debtors are divorced
or living separately under an order for separate maintenance, and who has been expressly
advised of the separate, current addresses of the debtors either by the court order or by other
written notice, shall provide to the debtors individually all statements, notices, and other similar
correspondence required by law or by the contract.
(3)
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(a) Except as provided in Subsection (3)(b), a creditor may continue to make negative credit
reports of joint debtors under Section 70C-7-107 and may report the repayment practices or
credit history of joint debtors under Title 7, Chapter 14, Credit Information Exchange.
(b) With respect to a debtor who is not ordered by the court under Sections 30-3-5 or 30-4-3 to
make payments on a joint obligation, no negative credit report under Section 70C-7-107, and
no report of the debtor's repayment practices or credit history under Title 7, Chapter 14, Credit
Information Exchange, may be made regarding the joint obligation after the creditor is served
notice of the court's order as required under Subsection (2), unless the creditor has made
a demand on the debtor for payment because of the failure to make payments by the other
debtor, who is ordered by the court to make the payments.
Amended by Chapter 252, 2000 General Session
Effective 9/1/2024
15-4-6.5 Divorce or separate maintenance of co-obligors.
(1) On the entering of a decree of divorce or separate maintenance of joint debtors in contract, the
claim of a creditor remains unchanged unless otherwise provided by the contract or until a new
contract is entered into between the creditor and the debtors individually.
(2) In addition to the creditor's duties as a secured party under Title 70A, Chapter 9a, Uniform
Commercial Code - Secured Transactions, and the creditor's duties as a trustee or beneficiary
of a trust deed under Title 57, Chapter 1, Conveyances, a creditor shall provide to the debtors
individually all statements, notices, and other similar correspondence required by law or by the
contract if:
(a) the creditor has been notified by service of a copy of a court order under Section 81-4-204
or 81-4-406 that the debtors are divorced or living separately under an order for separate
maintenance; and
(b) the creditor has been expressly advised of the separate and current addresses of the debtors
by the court order or by other written notice.
(3)
(a) Except as provided in Subsection (3)(b), a creditor may:
(i) continue to make negative credit reports of joint debtors under Section 70C-7-107; and
(ii) report the repayment practices or credit history of joint debtors under Title 7, Chapter 14,
Credit Information Exchange.
(b) If a debtor who is not ordered by the court under Section 81-4-204 or 81-4-406 to make
payments on a joint obligation, the creditor may not make a negative credit report under
Section 70C-7-107, or a report of the debtor's repayment practices or credit history under Title
7, Chapter 14, Credit Information Exchange, regarding the joint obligation after the creditor is
served notice of the court's order as required under Subsection (2), unless the creditor has
made a demand on the debtor for payment because of the failure to make payments by the
other debtor who is ordered by the court to make the payments.
Amended by Chapter 366, 2024 General Session
Superseded 9/1/2024
15-4-6.7 Medical and miscellaneous expenses of minor children -- Collection and billing
pursuant to court or administrative order of child support.
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(1) When a court enters an order that provides for the payment of medical and dental expenses
of a minor child under Section 30-3-5, 30-4-3, or 78B-12-111, or an administrative order under
Section 26B-9-224, a provider who receives a copy of the order:
(a) at or before the time the provider renders medical or dental services to the minor child shall,
upon request from either parent, separately bill each parent for the share of the medical and
dental expenses that the parent is required to pay under the order; or
(b) within 30 days after the day on which the provider renders the medical or dental service, may
not:
(i) make a claim for unpaid medical and dental expenses against a parent who has paid in full
the share of the medical and dental expenses that the parent is required to pay under the
order; or
(ii) make a negative credit report under Section 70C-7-107, or report of the debtor's repayment
practices or credit history under Title 7, Chapter 14, Credit Information Exchange, regarding
a parent who has paid in full the share of the medical and dental expenses that the parent is
required to pay under the order.
(2)
(a) When a court enters an order that provides for the payment of school fees of a minor child
under Section 30-3-5 or 30-4-3:
(i) a provider who receives a copy of the order before the day on which the provider first issues
a bill for a school fee shall, upon request from either parent, separately bill each parent for
the share of the school fee that the parent is required to pay under the order;
(ii) a provider who receives a copy of the order, regardless of whether the provider receives
the copy before, on, or after the day on which the provider first issues a bill for the school
fee may not make a negative credit report under Section 70C-7-107, or report of the
debtor's repayment practices or credit history under Title 7, Chapter 14, Credit Information
Exchange, regarding a parent who has paid in full the share of the school fee that the parent
is required to pay under the order; and
(iii) each parent is liable only for the share of the school fee that the parent is required to pay
under the order.
(b) A provider may bill a parent for the parent's share of a minor child's school fee under an order
described in Subsection (2)(a) regardless of whether the provider grants the other parent a
waiver for all or a portion of the other parent's share of the minor child's school fee.
Amended by Chapter 327, 2023 General Session
Effective 9/1/2024
15-4-6.7 Medical and miscellaneous expenses of a child -- Collection and billing pursuant to
court or administrative order of child support.
(1) When a court or an administrative agency enters an order that provides for the payment of
medical and dental expenses of a child as described in Section 26B-9-224 or 81-6-202, a
provider who receives a copy of the order:
(a) at or before the time the provider renders medical or dental services to the child, and upon
request from a parent, shall separately bill each parent for the share of the medical and dental
expenses that the parent is required to pay under the order; or
(b) within 30 days after the day on which the provider renders the medical or dental service to the
child, may not:
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(i) make a claim for unpaid medical and dental expenses against a parent who has paid in full
the share of the medical and dental expenses that the parent is required to pay under the
order; or
(ii) make a negative credit report under Section 70C-7-107, or a report of the debtor's
repayment practices or credit history under Title 7, Chapter 14, Credit Information
Exchange, regarding a parent who has paid in full the share of the medical and dental
expenses that the parent is required to pay under the order.
(2)
(a) When a court enters an order that provides for the payment of school fees of a child in a
separate maintenance action under Section 81-4-204 or in a divorce action under Section
81-4-406:
(i) a provider, who receives a copy of the order before the day on which the provider first issues
a bill for a school fee and upon request from a parent, shall separately bill each parent for
the share of the school fee that the parent is required to pay under the order;
(ii) a provider, who receives a copy of the order, regardless of whether the provider receives
the copy before, on, or after the day on which the provider first issues a bill for the school
fee, may not make a negative credit report under Section 70C-7-107, or report of the
debtor's repayment practices or credit history under Title 7, Chapter 14, Credit Information
Exchange, regarding a parent who has paid in full the share of the school fee that the parent
is required to pay under the order; and
(iii) each parent is liable only for the share of the school fee that the parent is required to pay
under the order.
(b) A provider may bill a parent for the parent's share of a child's school fee under an order
described in Subsection (2)(a) regardless of whether the provider grants the other parent a
waiver for all or a portion of the other parent's share of the child's school fee.
Amended by Chapter 366, 2024 General Session
15-4-7 Effective date of chapter.
This chapter does not apply to obligations arising prior to July 1, 1929.
Amended by Chapter 378, 2010 General Session
Chapter 6
Prompt Payment Act
15-6-1 Short title.
This act shall be known and may be cited as the "Utah Prompt Payment Act."
Enacted by Chapter 300, 1983 General Session
15-6-2 Time for payment by state agencies.
(1) An agency of the state of Utah which acquires property or services pursuant to a contract
with a business shall pay for each complete delivered item of property or service on the date
required by contract between such business and agency or, if no date for payment is specified
by contract, within 60 days after receipt of the invoice covering the delivered items or services.
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(2) The acquisition of property includes the rental of real or personal property.
Enacted by Chapter 300, 1983 General Session
15-6-3 Interest on payments by state agencies.
(1)
(a) Interest shall accrue and be charged on payments overdue under Section 15-6-2 at 2% above
the rate paid by the Internal Revenue Service on refund claims.
(b) This rate is established and adjusted on a quarterly basis and shall be applied on a per
annum basis beginning on the day after payment is due, if the payment due date is specified
by contract, or on the 61st day after receipt of the invoice, if no payment date is specified by
contract.
(c) Interest ceases to accrue on the date payment is made.
(2) Any interest that remains unpaid at the end of any 60-day period or that remains unpaid at the
end of any specified period provided by contract shall be added to the principal amount of the
debt and shall accumulate interest.
(3) A state agency may not seek additional appropriations to pay interest that accrues because the
agency failed to make payments as required by Section 15-6-2.
Amended by Chapter 79, 1989 General Session
15-6-4 Disputed payments excepted.
If the agency fails to pay the amount due on time because of a dispute between the agency
and the business over the amount due or over compliance with the contract, the provisions of this
chapter do not apply.
Amended by Chapter 79, 1989 General Session
15-6-5 Contractors' payments to subcontractors -- Time -- Interest.
Upon payment by an agency of the state of Utah or by an agency of the United States, a
business which has acquired under contract, property or services in connection with its contract
with such an agency from a subcontractor or supplier, shall pay such subcontractor or supplier
within 30 days after payment from such agency. Interest at the rate of 15.5% per annum shall
accrue and is due any subcontractor or supplier who is not paid within 45 days after the business
receives payment from the agency, unless otherwise provided by contract between the business
and the subcontractor or supplier. Interest begins to accrue on the 31st day at the rate specified in
this subsection.
Enacted by Chapter 300, 1983 General Session
15-6-6 Exceptions.
This chapter does not apply to contracts that involve disbursement of federal funds, or state and
federal funds, by the state or its agencies.
Enacted by Chapter 79, 1989 General Session
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Chapter 7
Registered Public Obligations Act
15-7-1 Short title.
This act shall be known and may be cited as the "Registered Public Obligations Act."
Enacted by Chapter 62, 1983 General Session
15-7-2 Definitions.
As used in this chapter:
(1) "Authorized officer" means any individual required or permitted by any law or by the issuing
public entity to execute on behalf of the public entity, a certificated registered public obligation
or a writing relating to an uncertificated registered public obligation.
(2) "Certificated registered public obligation" means a registered public obligation which is
represented by an instrument.
(3) "Code" means the Internal Revenue Code of 1954.
(4) "Facsimile seal" means the reproduction by engraving, imprinting, stamping, or other means of
the seal of the issuer, official, or official body.
(5) "Facsimile signature" means the reproduction by engraving, imprinting, stamping, or other
means of a manual signature.
(6) "Financial intermediary" means a bank, broker, clearing corporation or other person, or the
nominee of any of them, which in the ordinary course of its business maintains registered public
obligation accounts for its customers.
(7) "Issuer" means a public entity which issues an obligation.
(8) "Obligation" means an agreement by a public entity to pay principal and any interest on the
obligation, whether in the form of a contract to repay borrowed money, a lease, an installment
purchase agreement, or otherwise, and includes a share, participation, or other interest in any
such agreement.
(9) "Official" or "official body" means the person or group of persons that is empowered to provide
for the original issuance of an obligation of the issuer, by defining the obligation and its
terms, conditions, and other incidents, or to perform duties with respect to a registered public
obligation and any successor of such person or group of persons.
(10) "Official actions" means the actions by statute, order, ordinance, resolution, contract, or other
authorized means by which the issuer provides for issuance of a registered public obligation.
(11) "Public entity" means any entity, department, or agency which is empowered under the laws
of one or more states, territories, possessions of the United States or the District of Columbia,
including this state, to issue obligations any interest with respect to which may, under any
provision of law, be provided an exemption from the income tax referred to in the Code. The
term "public entity" includes, without limitation, this state, an entity deriving powers from and
acting pursuant to a state constitution or legislative act, a county, city, town, a municipal
corporation, a quasi-municipal corporation, a state university or college, a school district,
a special service district, a special district, a separate legal or administrative entity created
under the Interlocal Cooperation Act or other joint agreement entity, a community reinvestment
agency, any other political subdivision, a public authority or public agency, a public trust, a
nonprofit corporation, or other organizations.
(12) "Registered public obligation" means an obligation issued by a public entity which is issued
pursuant to a system of registration.
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(13) "System of registration" and its variants means a plan that provides:
(a) with respect to a certificated registered public obligation, that:
(i) the certificated registered public obligation specifies a person entitled to the registered public
obligation and the rights it represents; and
(ii) transfer of the certificated registered public obligation and the rights it represents may be
registered upon books maintained for that purpose by or on behalf of the issuer; and
(b) with respect to an uncertificated registered public obligation, that:
(i) books maintained by or on behalf of the issuer for the purpose of registration of the transfer
of a registered public obligation specify a person entitled to the registered public obligation
and the rights evidenced by it; and
(ii) transfer of the uncertificated registered public obligation and the rights evidenced by it be
registered upon such books.
(14) "Uncertificated registered public obligation" means a registered public obligation which is not
represented by an instrument.
Amended by Chapter 16, 2023 General Session
15-7-3 Purpose.
(1) The Code provides that interest with respect to certain obligations may not be exempt from
federal income taxation unless they are in registered form. It is therefore a matter of state
concern that public entities be authorized to provide for the issuance of obligations in registered
form. It is a purpose of this act to empower all public entities to establish and maintain a system
which permits obligations to be issued in registered form within the meaning of the applicable
Code provisions.
(2) It is further a purpose of this act to empower the establishment and maintenance of differing
systems of registration of obligations, including system incidents, so as to accommodate the
differing impacts upon issuers and varieties of obligations. It is further a purpose of this act
to authorize systems that will facilitate the prompt and accurate transfer of registered public
obligations and developing practices with regard to the registration and transfer of registered
public obligations.
Enacted by Chapter 62, 1983 General Session
15-7-4 Registration system established by issuer.
(1)
(a) Each issuer is authorized to establish and maintain a system of registration with respect to
each obligation it issues.
(b) The system described in this Subsection (1) may either be:
(i) a system pursuant to which only certificated registered public obligations are issued;
(ii) a system pursuant to which only uncertificated registered public obligations are issued; or
(iii) a system pursuant to which both certificated and uncertificated registered public obligations
are issued.
(c) The issuer may amend, discontinue, and reinstitute a system established under this section,
from time to time, subject to covenants.
(2) The system shall be established, amended, discontinued, or reinstituted, for the issuer by, and
shall be maintained for the issuer as provided by, the official or official body.
(3) The system shall be described in the registered public obligation or in the official actions which
provide for original issuance of the registered public obligation, and in subsequent official
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actions providing for amendments and other matters from time to time. The description may be
by reference to a program of the issuer which is established by the official or official body.
(4) The system shall define the method or methods by which transfer of the registered public
obligation is effective with respect to the issuer, and by which payment of principal and any
interest shall be made. The system may permit the issuance of registered public obligations in
any denomination to represent several registered public obligations of smaller denominations.
The system may also provide for the form of any certificated registered public obligation or of
any writing relating to an uncertificated registered public obligation, for identifying numbers or
other designations, for a sufficient supply of certificates for subsequent transfers, for record
and payment dates, for varying denominations, for communications to holders or owners of
obligations, and for accounting, cancelled certificate destruction, registration and release of
security interests and other incidental matters. Unless the issuer otherwise provides, the record
date for interest payable on the first or fifteenth days of a month shall be the fifteenth day or
the last business day of the preceding month, respectively, and for interest payable on other
than the first or fifteenth days of a month, shall be the fifteenth calendar day before the interest
payment date.
(5) Under a system pursuant to which both certificated and uncertificated registered public
obligations are issued, both types of registered public obligations may be regularly issued,
or one type may be regularly issued and the other type issued only under described
circumstances or to particular described categories of owners and provision may be made for
registration and release of security interests in registered public obligations.
(6) The system may include covenants of the issuer as to amendments, discontinuances, and
reinstitutions of the system and the effect of such on the exemption of interest from the income
tax provided for by the Code.
(7) Whenever an issuer issues an uncertificated registered public obligation, the system of
registration may provide that, as long as the uncertified registered obligation remains
outstanding and unpaid, a true copy of the official actions of the issuer relating to the
uncertificated registered public obligation will be maintained by the issuer or by the person, if
any, maintaining the system on behalf of the issuer. A copy of such official actions verified by
an authorized officer is admissible before any court of record, administrative body, or arbitration
panel without further authentication.
(8) Nothing in this act precludes conversion from one form of registered public obligation provided
by this act to a form of obligation not provided by this act if interest on the converted obligation
continues to be exempt from income taxation under the Code.
(9) Rights provided by other laws with respect to obligations in forms not provided by this act shall,
to the extent not inconsistent with this act, apply with respect to registered public obligations
issued in forms authorized by this act.
Amended by Chapter 258, 2015 General Session
15-7-5 Execution of obligations.
(1) A certificated registered public obligation shall be executed by the issuer by the manual or
facsimile signature or signatures of authorized officers. Any signature of an authorized officer
may be attested by the manual or facsimile signature of another authorized officer.
(2) In addition to the signatures referred to in Subsection (1), any certificated registered public
obligation or any writing relating to an uncertificated registered public obligation may include a
certificate or certificates signed by the manual or facsimile signature of an authenticating agent,
registrar, transfer agent, or the like.
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(3) At least one signature of an authorized officer or other persons required or permitted to be
placed on a certificated registered public obligation shall be the manual signature.
Enacted by Chapter 62, 1983 General Session
15-7-6 Signatures of officers.
(1) Any certificated registered public obligation is valid and binding, notwithstanding the fact that
any authorized officer who signed it ceased to be an authorized officer before it is issued.
(2) An authorized officer may adopt as and for the signature of such officer the signature of a
predecessor in office if that predecessor's signature appears on the certificated registered
public obligation. An authorized officer incurs no liability by adoption of a predecessor's
signature that would not be incurred by such authorized officer if the signature were that of such
authorized officer.
Enacted by Chapter 62, 1983 General Session
15-7-7 Seals.
If a seal is required or permitted in the execution of a certificated registered public obligation,
an authorized officer may cause a facsimile of the seal to be placed on such obligation. Use of a
facsimile of the seal has the same legal effect as the impression of the seal.
Enacted by Chapter 62, 1983 General Session
15-7-8 Agents of issuer.
(1) An issuer may appoint for such term as may be agreed, including for so long as a registered
public obligation may be outstanding, corporate or other authenticating agents, transfer agents,
registrars, paying or other agents and specify the terms of their appointment, including their
rights, their compensation and duties, limits upon their liabilities and the provision for their
payment of liquidated damages in the event of breach of certain of the duties imposed, which
liquidated damages may be made payable to the issuer, the owner, or a financial intermediary.
Such agents need not maintain a place of business in Utah or do business within this state.
(2) An issuer may agree with custodian banks and financial intermediaries, or their nominees, in
connection with the establishment and maintenance by others of a central depository system
for the transfer or pledge of registered public obligations. Any such custodian banks and
financial intermediaries, or nominees, may, if qualified and acting as fiduciaries, also serve
as authenticating agents, transfer agents, registrars, paying or other agents of the issuer with
respect to the same issue of registered public obligations.
(3) Nothing precludes an issuer from performing, alone or jointly with other issuers, any function
described in this section.
Enacted by Chapter 62, 1983 General Session
15-7-9 Transfer costs -- Agreements as to payment of costs.
(1) An issuer, before or at original issuance of registered public obligations, may as part of
a system of registration provide that the transferor or transferee of the registered public
obligations pay all or a designated part of the costs of the system as a condition precedent to
transfer or that costs be paid out of proceeds of the registered public obligations, or that both
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methods may be used. Any costs of the system not required to be paid by the transferor or
transferee or out of such proceeds is the liability of the issuer.
(2) The issuer may as a part of a system of registration provide for reimbursement or for
satisfaction of its liability by payment by others. The issuer may enter into agreements with
others respecting such reimbursement or payment, may establish fees and charges pursuant to
such agreements or otherwise, and may provide that the amount or estimated amount of such
fees and charges shall be reimbursed or paid from the same sources and with the same priority
and effect and subject to the same procedures as the obligations.
Enacted by Chapter 62, 1983 General Session
15-7-10 Investment of public funds in registered obligations of public entities of other
states.
Obligations issued by public entities under the laws of another state, the District of Columbia,
or by territories or possessions of the United States, which are in registered form, whether or
not represented by an instrument, and which, except for their form, satisfy the requirements with
regard to security for deposits of money of public agencies prescribed pursuant to the law of Utah,
are deemed to satisfy all such requirements even though they are in registered form if a security
interest in such obligations is perfected on behalf of the public agency whose money is deposited.
Enacted by Chapter 62, 1983 General Session
15-7-11 Registration records -- Public inspection -- Location.
(1) Records, with regard to the ownership of or security interests in registered public obligations,
are not subject to inspection or copying under any law of this state relating to the right of the
public to inspect or copy public records.
(2) Registration records of the issuer may be maintained at such locations within or without this
state as the issuer determines.
Enacted by Chapter 62, 1983 General Session
15-7-12 Obligations subject to chapter.
(1) Unless the official or official body of the issuer determines otherwise before or at the time of the
original issuance of a registered public obligation, this act is applicable to such registered public
obligation. When this act is applicable, the provisions of this act prevail over any inconsistent
provision under any other law. Pursuant to Section 11-14-401, this act is specifically made
applicable to registered public obligations issued under Title 11, Chapter 14, Local Government
Bonding Act, in accordance with Section 11-14-305.
(2) Nothing in this act limits or prevents the issuance of obligations in any other form or manner
authorized by law.
(3) Unless determined otherwise pursuant to Subsection (1), this act is applicable with respect to
obligations which have been approved before enactment of this act by vote, referendum, or
hearing, which authorized or permitted the authorization of obligations in bearer and registered
form, or in bearer form only, and such obligations need not be resubmitted for a further
vote, referendum or hearing, for the purpose of authorizing or permitting the authorization of
registered public obligations under this act.
Amended by Chapter 105, 2005 General Session
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15-7-13 Construction with other law.
This act shall be construed in conjunction with the Uniform Commercial Code and the principles
of contract law relative to the registration and transfer of obligations.
Enacted by Chapter 62, 1983 General Session
15-7-14 Covenant against repeal of chapter.
The state hereby covenants with the owners of any registered public obligations that it will
not amend or repeal this act if the effect may be to impair the exemption from income taxation of
interest on registered public obligations.
Enacted by Chapter 62, 1983 General Session
Chapter 8
Utah Rental Purchase Agreement Act
15-8-1 Short title.
This chapter is known as the "Utah Rental Purchase Agreement Act."
Enacted by Chapter 251, 1993 General Session
15-8-2 Purpose -- Rules of construction.
(1) This chapter shall be liberally construed and applied to promote its underlying purposes and
policies.
(2) The underlying purposes and policies of this chapter are to:
(a) define, simplify, and clarify the law governing consumer rental purchase agreements;
(b) provide certain disclosures to consumers who enter into consumer rental purchase
agreements, and further consumer understanding of the terms of consumer rental purchase
agreements;
(c) protect consumers against unfair practices;
(d) permit and encourage the development of fair and economically sound rental purchase
practices; and
(e) make the law on consumer rental purchase agreements, including administrative rules, more
uniform among the various consumer credit code jurisdictions.
Enacted by Chapter 251, 1993 General Session
15-8-3 Definitions.
As used in this title:
(1) "Cash price" means the price at which the lessor would have sold the property to the consumer
for cash on the date of the rental purchase agreement.
(2) "Consumer" means a natural person who rents personal property under a rental purchase
agreement to be used primarily for personal, family, or household purposes.
(3) "Consummation" means the time at which a consumer becomes contractually obligated on a
rental purchase agreement.
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(4) "Lessor" means a person who regularly provides the use of property through rental purchase
agreements and to whom rental payments are initially payable on the face of a rental purchase
agreement.
(5) "Rental purchase agreement" means an agreement for the use of personal property by a
natural person primarily for personal, family, or household purposes for an initial period of
four months or less that is automatically renewable with each payment after the initial period,
but which does not obligate or require the consumer to continue renting or using the property
beyond the initial period, and that permits the consumer to become the owner of the property.
Enacted by Chapter 251, 1993 General Session
15-8-4 Inapplicability of other laws -- Exempted transactions.
(1) Rental purchase agreements that comply with this chapter are not governed by the laws
relating to:
(a) a security interest as defined in Subsection 70A-1a-201(2)(ii); or
(b) Title 70C, Utah Consumer Credit Code, except that Sections 70C-7-102 through 70C-7-104
and 70C-2-205 shall apply to lessors as defined in this chapter to the same extent as they
apply to creditors under Title 70C, Utah Consumer Credit Code.
(2) The chapter does not apply to the following:
(a) rental purchase agreements primarily for business, commercial, or agricultural purposes, or
those made with governmental agencies or instrumentalities or with organizations;
(b) a lease of a safe deposit box;
(c) a lease or bailment of personal property which is incidental to the lease of real property and
which provides that the consumer has no option to purchase the leased property; or
(d) a lease of a motor vehicle, as defined in Section 41-1a-102.
Amended by Chapter 189, 2014 General Session
15-8-5 General requirements of disclosure.
(1) A lessor shall disclose to a consumer the information required by this chapter. In a transaction
involving more than one lessor, only one lessor needs to make the disclosures, but all lessors
shall be bound by the disclosures.
(2) The disclosures shall be made at or before consummation of the rental purchase agreement.
(3) The disclosures shall be made clearly and conspicuously in writing and a copy of the rental
purchase agreement shall be provided to the consumer at consummation or at some specified
time after consummation, with consent of the consumer. The disclosures required under
Subsection 15-8-6(1) shall be made on the face of the contract, above the line provided for the
consumer's signature.
(4) If a disclosure becomes inaccurate as the result of any act, occurrence, or agreement by the
consumer after delivery of the required disclosures, the resulting inaccuracy is not a violation of
this chapter.
Amended by Chapter 12, 1994 General Session
15-8-6 Disclosures.
(1) For each rental purchase agreement, the lessor shall disclose in the agreement the following
items, as applicable:
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(a) the total number, total dollar amount, and timing of all payments necessary to acquire
ownership of the property;
(b) a statement that the consumer will not own the property until the consumer has made the total
payments necessary to acquire ownership;
(c) a statement that the consumer is responsible to the lessor for the fair market value of the
property if, and as of the time, it is stolen, damaged, or destroyed;
(d) a brief description of the rented property, sufficient to identify the property to the consumer
and the lessor, including an identification number, if applicable, and a statement indicating
whether the property is new or used, but a statement that indicates new property is used, is
not a violation of this chapter;
(e) a statement of the cash price of the property, which, in the case of a single agreement
involving a lease of two or more items as a set, is sufficient if it states the aggregate cash
price of all items;
(f) the total amount initially payable or required at or before consummation of the agreement or
delivery of the property, whichever is later;
(g) a statement that the total of payments does not include other charges, such as late payment,
default, pickup, and reinstatement fees, which fees shall be separately disclosed in the
agreement;
(h) a statement clearly summarizing the terms of the consumer's option to purchase, including a
statement that the consumer has the right to exercise an early purchase option and the price,
formula, or method for determining the price at which the property may be so purchased;
(i) a statement identifying the party responsible for maintaining or servicing the property while it is
being rented, together with a description of that responsibility, and a statement that if any part
of a manufacturer's express warranty covers the property at the time the consumer acquires
ownership of the property, it shall be transferred to the consumer, if allowed by the terms of
the warranty;
(j) the consummation date of the agreement and the identities of the lessor and consumer;
(k) a statement that the consumer may terminate the agreement without penalty upon expiration
of any rental period by voluntarily surrendering or returning the property in good repair, along
with any past due rental payments; and
(l) a notice of the right to reinstate an agreement as provided in this chapter.
(2) With respect to matters specifically governed by the federal Consumer Credit Protection Act,
compliance with that act satisfies the requirements of this section.
Enacted by Chapter 251, 1993 General Session
15-8-7 Prohibited practices.
A rental purchase agreement may not contain:
(1) a confession of judgment;
(2) a negotiable instrument;
(3) a claim of a property interest in any goods except those goods delivered by the lessor pursuant
to the rental purchase agreement;
(4) a wage assignment;
(5) a waiver by the consumer of claims or defenses;
(6) a provision authorizing the lessor or a person acting on the lessor's behalf to enter upon the
consumer's premises or to commit any breach of the peace while repossessing rented property;
or
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(7) a provision mandating that the consumer purchase from the lessor insurance or a liability
damage waiver for the merchandise.
Enacted by Chapter 251, 1993 General Session
15-8-8 Reinstatement.
(1)
(a) A consumer who fails to make a timely rental payment may reinstate the agreement, without
losing any rights or options that exist under the agreement, by paying:
(i) all past due rental charges;
(ii) reasonable costs of pickup and redelivery if the consumer reinstates after lessor has been
required to pick up the property from the consumer; and
(iii) any applicable late fee.
(b) Any reinstatement payment shall be made within five days after the renewal date if the
consumer pays monthly, or within two days after the renewal date if the consumer pays more
frequently than monthly.
(2) A consumer who has paid less than 2/3 of the total of payments necessary to acquire
ownership and who has returned or voluntarily surrendered the property, other than through
judicial process, during the applicable reinstatement period set forth in Subsection (1), may
reinstate the agreement. Reinstatement may occur under the circumstance described in this
subsection, during a period, as agreed by the parties, which may not be less than 45 days from
the date of the return or surrender of the property.
(3) A consumer who has paid 2/3 or more of the total payments necessary to acquire ownership
and who has returned or voluntarily surrendered the property, other than through judicial
process, during the applicable period set forth in Subsection (1), may reinstate the agreement.
Reinstatement may occur under the circumstances described in this subsection during a period,
as agreed by the parties, which may not be less than 90 days from the date of the return or
surrender of the property.
(4) This section does not prevent a lessor from attempting to repossess property during the
reinstatement period, but such a repossession does not affect the consumer's right to reinstate.
Upon reinstatement, the lessor shall provide the consumer with the same property, if available,
or substitute property of comparable quality and condition.
Enacted by Chapter 251, 1993 General Session
15-8-9 Receipts and accounts.
A lessor shall, upon request by the consumer, provide a written receipt for each payment made
by cash or money order.
Enacted by Chapter 251, 1993 General Session
15-8-10 Renegotiations and extensions.
(1) A renegotiation shall occur when an existing rental purchase agreement is satisfied and
replaced by a new agreement entered into by the same lessor and consumer. A renegotiation
shall be considered a new agreement requiring new disclosures. However, events such as the
following may not be treated as renegotiations:
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(a) the addition or return of property in a multiple item agreement or the substitution of the rental
property, if in either case the previous periodic payment allocable to a rental period does not
change by more than 25%;
(b) a deferral or extension of one or more periodic payments, or any portion of a periodic
payment;
(c) a reduction in charges in the agreement; or
(d) any court proceedings involving an agreement.
(2) Disclosures are not required for any extension of a rental purchase agreement.
Enacted by Chapter 251, 1993 General Session
15-8-11 Enforcement -- Penalties.
(1)
(a) A lessor who fails to comply with the requirements of this chapter is liable to a consumer in an
amount equal to the greater of:
(i) the actual damages sustained by the consumer as a result of the lessor's failure to comply
with this chapter; or
(ii) 25% of the total payments necessary to acquire ownership, but not less than $100 nor more
than $1,000.
(b) A lessor may also be liable to the consumer for the costs of the action and reasonable
attorneys' fees, as determined by the court.
(2) A consumer may not take any action to offset the amount for which a lessor is potentially liable
under Subsection (1) against any amount owed by the consumer, unless the amount of the
lessor's liability has been determined by judgment of a court of competent jurisdiction in an
action in which the lessor was a party. This subsection does not bar a consumer then in default
on an obligation from asserting a violation of this chapter as an original action, or as a defense
or counterclaim, to an action brought by a lessor against the consumer.
(3) No action under this section may be brought in any court of competent jurisdiction more than
two years after the date the consumer made his last rental payment or more than two years
after the date of the occurrence of the violation that is the subject of the suit, whichever is later.
Enacted by Chapter 251, 1993 General Session
15-8-12 Lessor's defenses.
(1) If a lessor established by a preponderance of evidence that a violation of this chapter is
unintentional or the result of a bona fide error, no penalty specified in Section 15-8-11 may be
imposed and the validity of the transaction is not affected.
(2) A lessor has no liability under this part for any failure to comply with any requirement imposed
under this chapter if, within 60 days after discovering an error, and prior to the institution of
an action under this chapter or the receipt of written notice of the error from the consumer,
the lessor notifies the affected consumer of the error and makes whatever adjustments in the
consumer's account as are necessary to correct the error.
(3) A penalty does not apply if any action is performed or omitted in good faith and in conformity
with any provision of this chapter, notwithstanding that after an action or omission has occurred,
the provision of the chapter is, for any reason, amended, rescinded, or determined by judicial or
other competent authority to be invalid.
Enacted by Chapter 251, 1993 General Session
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Chapter 10
Service Contracts Act
Part 1
General Provisions
15-10-101 Title.
This chapter is known as the "Service Contracts Act."
Enacted by Chapter 46, 2003 General Session
15-10-102 Definitions.
As used in this chapter:
(1) "Automatic renewal provision" means a provision under which a service contract is renewed for
one or more specified periods if:
(a) the renewal causes the service contract to be in effect more than six months after the day of
the initiation of the service contract; and
(b) the renewal is effective unless the consumer gives notice to the seller of the consumer's
intention to terminate the service contract.
(2) "Business consumer" means a person engaged in business if the person enters into a service
contract as part of the person's business activities.
(3)
(a) "Consumer" means a person receiving service, maintenance, or repair under a service
contract.
(b) "Consumer" includes a representative of an association subject to:
(i) Title 57, Chapter 8, Condominium Ownership Act; or
(ii) Title 57, Chapter 8a, Community Association Act.
(4) "Seller" means a person providing service, maintenance, or repair under a service contract.
(5)
(a) "Service contract" means a contract for service, maintenance, or repair:
(i) in connection with real property; or
(ii) that provides a benefit to the real property.
(b) "Service contract" does not include a contract affecting any right, title, estate, or interest in
real property, including:
(i) a fee title interest;
(ii) a leasehold interest;
(iii) an option contract relating to real property;
(iv) a real estate purchase contract;
(v) an easement; or
(vi) any other real property interest governed by Title 57, Real Estate.
Amended by Chapter 262, 2011 General Session
Part 2
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Restrictions on Automatic Renewal Provisions
15-10-201 Notice requirement.
(1) Except as provided in Subsection (2)(b), a service contract may not contain an automatic
renewal provision unless the seller provides the consumer written notice complying with
Subsection (2) that informs the consumer of the automatic renewal provision.
(2)
(a) For a service contract executed on or after July 1, 2011, that exceeds 12 months for a
renewal period, a seller shall provide written notice of an automatic renewal provision
prominently displayed on the first page of the service contract.
(b) In addition to complying with Subsection (2)(a), a seller shall provide written notice required
under Subsection (1) to the consumer:
(i) personally;
(ii) by certified mail; or
(iii) prominently displayed on the first page of a monthly statement.
(c)
(i) A seller shall provide written notice under Subsection (2)(b):
(A) no later than 30 calendar days before the last day on which the consumer may give notice
of the consumer's intention to terminate the service contract; and
(B) no sooner than 90 calendar days before the last day on which the consumer may give
notice of the consumer's intention to terminate the service contract.
(ii) A seller may not provide written notice required under Subsection (1) except:
(A) as provided in Subsection (2)(a); or
(B) during the time period described in Subsection (2)(c)(i).
(d) Written notice required under Subsection (1) shall be:
(i) written in clear and understandable language; and
(ii) printed in an easy-to-read type size and style.
Amended by Chapter 189, 2014 General Session
15-10-202 Remedy for violation.
(1) Subject to Subsection (2), if a seller does not comply with Section 15-10-201 with respect to a
service contract containing an automatic renewal provision:
(a) the automatic renewal provision is void and unconscionable as a matter of public policy; and
(b) the service contract shall automatically renew on a month-to-month basis.
(2) Subsection (1) applies to an automatic renewal provision in a service contract with a business
consumer for which a seller does not comply with Section 15-10-201 only if the service contract
is executed on or after July 1, 2011.
Amended by Chapter 262, 2011 General Session
Part 3
Exemptions
15-10-301 Exemptions.
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This chapter does not apply to a contract made pursuant to Title 11, Chapter 13, Interlocal
Cooperation Act.
Enacted by Chapter 46, 2003 General Session
