Michigan Has Become a Buyer-Beware State

Michigan has a dirty little secret and it's driving people out of our state.

Lindsay Duneske said she discovered how weak Michigan's Consumer Protection Act has become after the company that built her new home in Milan kept putting off needed repairs.

She said she and her husband bought the house in 2007 for $306,000, after receiving assurances that the builder would fix buckling roof shingles and vinyl siding, leaky windows and other problems.

After the builder reneged, Duneske said, she couldn't find a lawyer to help her because home builders are no longer covered by the Consumer Protection Act.

She said the builder eventually went out of business and its lawyer got a court order to stop her from pestering him.

"We have been totally and completely cheated," Duneske said, adding that she feels betrayed by state officials. "We are looking to move, and it will be anywhere but Michigan." [emphasis mine]

Builders aren't the only ones exempted from the law. Banks, mortgage brokers, debt collectors, finance companies, home improvement contractors, new and used car dealers, auto repair shops, funeral homes, and plumbers and electricians are included. And according to a State Bar of Michigan Consumer Law Section study, consumers are at risk:

The study, titled "Consumers at Risk: Are Most of Michigan's Worst Business Practices Exempt from Our Consumer Protection Act?", examined businesses on the state Attorney General's list of top 10 consumer complaints for 2008. It found that 72 percent of businesses generating the most complaints are exempt from the state's Consumer Protection Act due to Michigan Supreme Court decisions. [emphasis added] That includes nearly all the businesses in the top three complaint categories – credit and finance; gasoline, fuel and energy; and telecommunications, satellite and cable TV.

Michigan Supreme Court decisions (a Republican Supreme Court majority installed by former Gov. John Engler) in 1999 and 2007 turned the law into mush according to former State Attorney General Frank Kelley, leaving people in the lurch. Frank says he's "sick about what happened," and he added that, in his judgment, the court's interpretations have "been against the public."

A decade ago we had some of the nation's best consumer protection laws on the books, now we're ranked with Rhode Island as "the Terrible Two" by the National Consumer Law Center.

"While these two states have UDAP statutes that appear strong on paper, they provide almost no actual protection to consumers," the Boston-based advocacy group said. Such statutes are known in the consumer protection community as Unfair and Deceptive Acts and Practices (UDAP) laws.

"In fact, the UDAP statutes in these states are worse than ineffective, as they give the appearance of providing protection for consumers while actually providing nothing."

Where has AG Mike Cox been this whole time? He's been busy keeping his name in the papers and doing seminars on worthy projects which might just propel him to be the governor someday. And attempts to fix the law have gone nowhere because business groups and the MICOC oppose any changes.

"The Chamber of Commerce has a long-standing policy in opposition to expanding the Consumer Protection Act," said its Lansing lobbyist, Wendy Block, who spoke out against a 2007 measure to restore the act. She said the legislation would open the flood gates to needless lawsuits.

Because of their opposition, consumers are left holding the bag when unscrupulous companies take advantage of them.

State Rep. Robert Jones (D-Kalamazoo) introduced corrective measures to protect consumers, but these groups opposed the plan and it died. The Democratic House plans to reintroduce the measure soon, not just to protect consumers, but also honest businesses that Jones says, "often can't compete with fly-by-night operations whose promises – although deceptive – sound better than the offers of honest merchants."

The Free Press says it's time to pass the legislation. They also have some questions for Mike Cox, Mike Bishop and their Republican colleagues:

Is it really their intent to exempt three-quarters of Michigan businesses from the ethical rules laid down in the MCPA? Or did the justices who defanged the state's consumer protection overreach?

My money is on exempting three-quarters of Michigan businesses. When did Republicans ever do anything for consumers?