2019 New Mexico Statutes
Chapter 57 - Trade Practices and Regulations
Article 12 - Unfair Trade Practices
Section 57-12-10 - Private remedies.

Universal Citation: NM Stat § 57-12-10 (2019)

A. A person likely to be damaged by an unfair or deceptive trade practice or by an unconscionable trade practice of another may be granted an injunction against it under the principles of equity and on terms that the court considers reasonable. Proof of monetary damage, loss of profits or intent to deceive or take unfair advantage of any person is not required. Relief granted for the copying of an article shall be limited as to the prevention of confusion or misunderstanding as to source.

B. Any person who suffers any loss of money or property, real or personal, as a result of any employment by another person of a method, act or practice declared unlawful by the Unfair Practices Act may bring an action to recover actual damages or the sum of one hundred dollars ($100), whichever is greater. Where the trier of fact finds that the party charged with an unfair or deceptive trade practice or an unconscionable trade practice has willfully engaged in the trade practice, the court may award up to three times actual damages or three hundred dollars ($300), whichever is greater, to the party complaining of the practice.

C. The court shall award attorney fees and costs to the party complaining of an unfair or deceptive trade practice or unconscionable trade practice if the party prevails. The court shall award attorney fees and costs to the party charged with an unfair or deceptive trade practice or an unconscionable trade practice if it finds that the party complaining of such trade practice brought an action that was groundless.

D. The relief provided in this section is in addition to remedies otherwise available against the same conduct under the common law or other statutes of this state.

E. In any class action filed under this section, the court may award damages to the named plaintiffs as provided in Subsection B of this section and may award members of the class such actual damages as were suffered by each member of the class as a result of the unlawful method, act or practice.

F. A party to a court action for a private remedy pursuant to this section may request in writing during the thirty-day period following service of the summons and complaint on all parties named in the action that the parties attempt to settle the claim in early mediation. If a request for mediation is made, the parties shall choose a mutually acceptable mediator and enter into mediation within sixty days of the appointment of an acceptable mediator unless otherwise agreed by the parties. A request for mediation may be rescinded at any time if agreed to by all parties.

G. If the parties do not agree on a mutually acceptable mediator, the court shall appoint the mediator. If the early mediation pursuant to this section is entered into within sixty days following the appointment of the mediator, the parties suing on the basis of unfair, deceptive or unconscionable trade practices or acts under the Unfair Practices Act shall be required to pay no more than fifty dollars ($50.00) toward the cost of the mediation and the other party shall pay the remainder of such cost, unless otherwise agreed by the parties. If a person is seeking injunctive relief in accordance with Subsection A of this section, the person may pursue the claim for injunctive relief without following the mediation requirements of this subsection and Subsection F of this section.

History: 1953 Comp., § 49-15-8, enacted by Laws 1967, ch. 268, § 8; 1971, ch. 240, § 4; 1977, ch. 181, § 3; 1987, ch. 187, § 2; 2005, ch. 187, § 1.

ANNOTATIONS

Compiler's notes. — This section is similar to § 3 of the Uniform Deceptive Trade Practices Act.

The 2005 amendment, effective June 17, 2005, added Subsection F to provide that a party to a court action for a private remedy may request mediation of the claim and that if a request for mediation is made, the parties shall select an acceptable mediator and that a request for mediation may be rescinded if the parties agree; added Subsection G to provide that if the parties do not agree upon a mediator, the court shall appoint a mediator, that if mediation is entered into within 60 days after appointment of a mediator, the party suing shall be required to pay not more than $50 of the cost of mediation and that a person seeking injunctive relief may pursue the claim for injunctive relief without following the mediation requirements.

The 1987 amendment, effective June 19, 1987, added the second sentence of Subsection B and rewrote Subsection C.

Attorney fees. — Where plaintiff was successful on certain claims brought against defendant, but was not successful on an Unfair Trade Practices Act claim; the court ruled that defendant was only entitled to attorney fees incurred in defending the Unfair Trade Practices Act claim; and defendant did not identify what portion of defendants' attorney fees were attributable to defending the Unfair Trade Practices Act or demonstrate that it was difficult or impossible to segregate the work in defending the Unfair Trade Practices Act claim from plaintiff's other claims, the court did not abuse its discretion in ruling that defendant was not entitled to any attorney fees. Dean v. Brizuela, 2010-NMCA-076, 148 N.M. 548, 238 P.3d 917.

A viable Unfair Practices Act claim need not allege actual monetary or property loss. Lohman v. Daimler-Chrysler Corp., 2007-NMCA-100, 142 N.M. 437, 166 P.3d 1091, cert. denied, 2007-NMCERT-005, 141 N.M. 762, 161 P.3d 259.

Business's standing to bring a private right of action against competitor. — A business may have a private right of action against a business competitor under the New Mexico Unfair Practices Act provided that the conduct alleged involves trade practices that either implicate consumer protection concerns or are addressed to the market generally. Gandydancer, LLC v. Rock House CGM, LLC, 2018-NMCA-064, cert. granted.

Where plaintiff, a construction company that provides railroad contracting services to BNSF railway company (BNSF), submitted a complaint to the New Mexico construction industries division, alleging defendant, a competing construction company, had performed unlicensed construction work in violation of the Construction Industries Licensing Act, and where plaintiff sued defendant in district court raising several claims, including an Unfair Practices Act (UPA) claim, alleging that defendant operated its business without satisfying the mandatory licensing requirements, induced plaintiff's former employees to divulge confidential trade secrets, and used those trade secrets to convince BNSF to hire defendant instead of plaintiff without disclosing to BNSF that it was unlicensed, the district court did not err in denying defendant's motion to dismiss for lack of standing, because the conduct alleged in plaintiff's complaint involved trade practices addressed to the market generally or otherwise implicated consumer protection concerns. Gandydancer, LLC v. Rock House CGM, LLC, 2018-NMCA-064, cert. granted.

Appellate attorney fees. — A plaintiff who prevails on appeal of an action brought under the Unfair Practices Act is entitled to an award of appellate attorney fees under 57-12-19C NMSA 1978. An award of fees on appeal furthers the public policies of encouraging individuals to pursue their Unfair Practices Act claims and reimbursing plaintiffs and their counsel for enforcing the Unfair Practices Act. Aguilera v. Palm Harbor Homes, Inc., 2004-NMCA-120, 136 N.M. 422, 99 P.3d 672, cert. denied, 2004-NMCERT-010, 136 N.M. 541, 101 P.3d 807.

Class actions. — Because 57-10-12 NMSA 1978 provides that a successful private plaintiff is entitled to attorney fees and costs; may recover the greater of actual damages or statutory damages even if proof of damages or loss or intent to deceive or take unfair advantage of a person cannot established; may recover the greater of treble actual or statutory damages upon a showing that the deceptive or unconscionable trade practice is willful; and are entitled to collect more than their actual damages as opposed to members who sue as a class, a private plaintiff has a individual remedy under 57-10-12 NMSA 1978 that is superior to the remedy the plaintiff would have as a member of a class action and is grounds for the denial of a class certification under Rule 1-023(B)(3) NMRA. Brooks v. Norwest Corp., 2004-NMCA-134, 136 N.M. 599, 103 P.3d 39, cert. denied, 2004-NMCERT-012, 136 N.M. 665, 103 P.3d 1097.

Reliance on deceptive conduct. — Consistent with a national trend to interpret consumer protection statutes, like the Unfair Practices Act, such that plaintiffs need not prove reliance, and consistent with the absence of language in the act requiring reliance, a plaintiff need not allege or prove that she relied on defendant's purported deceptive conduct in order to recover under the Act. Smoot v. Physicians Life Ins. Co.,, 2004-NMCA-027, 135 N.M. 265, 87 P.3d 545.

Proof of link required. — While it is true that the Unfair Practices Act requires proof of a casual link between conduct and loss, there is nothing in the language of the act requiring proof of a link between conduct and purchase or sale. Smoot v. Physicians Life Ins. Co., 2004-NMCA-027, 135 N.M. 265, 87 P.3d 545.

Prevailing party on some, but not all claims. — Where plaintiff sued defendant for several claims, including tortious interference with prospective contractual relations and violation of the New Mexico Unfair Trade Practices Act; the trial court dismissed most of plaintiff's claims and directed a verdict against plaintiff on the tortious interference claim; and a jury awarded plaintiff damages on the UTPA claim, plaintiff was a prevailing party and was entitled to attorney's fees and costs. Knight v. Snap-On Tools Corp., 3 F.3d 1398 (10th Cir. 1993).

Where plaintiff prevailed on one, but not all of plaintiff's claims under the New Mexico Unfair Trade Practices Act, defendant was not entitled to attorney's fees and costs. Knight v. Snap-On Tools Corp., 3 F.3d 1398 (10th Cir. 1993).

Failure to file answer bringing partial directed verdict. — In a civil suit by the state under the Pyramid or Multilevel Sales Act and the Unfair Practices Act, defendant's right to trial by jury was not infringed upon by the trial court's granting of a partial directed verdict against him on the issue of liability and the court's rejection of requested jury instructions, including requested special interrogatories to the jury, where defendant failed to file an answer to the complaint filed by the state, but only filed a document entitled "Declaration of Status", and challenged the jurisdiction of the court and the constitutionality of the Pyramid or Multilevel Sales Act (now Pyramid Promotional Schemes Act, 57-13-1 et seq.). State ex rel. Stratton v. Sinks, 1987-NMCA-092, 106 N.M. 213, 741 P.2d 435.

Actual damages required. — To obtain financial recovery under the Unfair Practices Act, the deceptive trade practice must have caused plaintiffs to suffer actual damages. Chavarria v. Fleetwood Retail Corp., 2005-NMCA-082, 137 N.M. 783, 115 P.3d 799, rev'd on other grounds, Chavarria v. Fleetwood Retail Corp., 2006-NMSC-046, 140 N.M. 478, 143 P.3d 717.

Failure to deliver mobile home with custom features. — Award of Unfair Practices Act damages for defendant's failure to deliver a mobile home with certain custom features ordered by plaintiffs are damages that appear to relate to promises made by defendant during the sale itself and thus are properly awarded under the UPA. Chavarria v. Fleetwood Retail Corp., 2005-NMCA-082, 137 N.M. 783, 115 P.3d 799, rev'd on other grounds, Chavarria v. Fleetwood Retail Corp., 2006-NMSC-046, 140 N.M. 478, 143 P.3d 717.

Failure to prove "loss of money or property". — Where the aggrieved party did not produce evidence of loss of money or property as a result of a contractor's forgery of a construction contract and overbilling, recovery was limited to $300. Page & Wirtz Constr. Co. v. Solomon, 1990-NMSC-063, 110 N.M. 206, 794 P.2d 349.

Recovery of cost of repair or diminished value. — Car buyers who claimed recovery for the cost of repairs were limited to only recovering the cost of such repairs ($840) even though the difference between the fair market value of the vehicle before and after the damage took place was $1,000, because a party may recover only the smaller of these items. Hale v. Basin Motor Co., 1990-NMSC-068, 110 N.M. 314, 795 P.2d 1006.

Measure of damages for erroneous financial advice. — The proper measure of damages in cases where negligent financial or tax advise has led a plaintiff to incur additional tax liability is the difference between what the plaintiff would have owed absent the negligence and what the plaintiff paid because of the negligence, plus incidental damages. Maese v. Garrett, 2014-NMCA-072, cert. denied, 2014-NMCERT-006.

Recovery of damages due to erroneous financial advice. — Where defendant provided financial services to plaintiff, which included management of plaintiff's securities account; at defendant's recommendation, plaintiff purchased a deferred variable annuity; defendant subsequently erroneously advised plaintiff that plaintiff could withdraw money from the annuity to purchase of an office building without incurring any tax liability; plaintiff withdrew the money from the annuity; the IRS determined that the withdrawal was subject to income tax, increased plaintiff's tax liability by the amount withdrawn, and assessed $77,623 in additional taxes, interest and penalties; and plaintiff would not have withdrawn money from the annuity but for defendant's misrepresentation that the withdrawal would be tax free, plaintiff suffered a compensable loss and the district court's damages award to plaintiff in the amount of $77,623 was correct. Maese v. Garrett, 2014-NMCA-072, cert. denied, 2014-NMCERT-006.

Recovery limited absent actual losses. — In the absence of actual losses, plaintiff was still entitled to recover the statutory damages of $100; he was only required to put on evidence of his actual damages as it pertained to recovery of actual damages. Jones v. GMC, 1998-NMCA-020, 124 N.M. 606, 953 P.2d 1104.

Federal diversity jurisdiction. — In unfair trade practices action, federal court did not err in assuming diversity jurisdiction based on amount in controversy of $50,000, where treble damages sought were $41,028.51 and the plaintiff sought reasonable attorney's fees and costs. Miera v. Dairyland Ins. Co., 143 F.3d 1337 (10th Cir. 1998).

In an action involving Unfair Practices Act claims proceeding in a federal court pursuant to its diversity jurisdiction, the potential award under this section of attorney fees and treble damages, in addition to compensatory damages, should be considered in determining whether the plaintiff satisfies the jurisdictional amount-in-controversy requirement. Woodmen of the World Life Ins. Soc'y v. Manganaro, 342 F.3d 1213 (10th Cir. 2003).

Triple damages. — The permissive language of Subsection B leads to the conclusion that it was within the legislature's contemplation that in some cases, but not all, the false or misleading statement would be made at the outset with the intent to deceive, and in such cases triple damages would not be unwarranted. Conversely, it suggests also that the legislature anticipated other situations wherein the statement would not be intentionally unfair or deceptive, but could become a false or misleading representation at some time during the life of the transaction. Ashlock v. Sunwest Bank, 1988-NMSC-026, 107 N.M. 100, 753 P.2d 346, overruled on other grounds by Gonzales v. Surgidev Corp., 1995-NMSC-036, 120 N.M. 133, 899 P.2d 576.

The district court did not abuse its discretion in denying treble damages based on its findings regarding the record in the case and other remedies awarded. Woodworker's Supply, Inc. v. Principal Mut. Life Ins. Co., 170 F.3d 985 (10th Cir. 1999).

Willfully defined. — The legislature contemplated proof of some culpable mental state to demonstrate "willfully", as set forth in Subsection B of 57-12-8 NMSA 1978; willful conduct is the intentional doing of an act with knowledge that harm may result. Atherton v. Gopin, 2015-NMCA-003, cert. granted, 2014-NMCERT-012.

Meaning of "groundless" claim. — In enacting Subsection C, the legislature intended the term "groundless" to have the same meaning as "frivolous" as used in Rule 16-301 NMRA. The rule provides in applicable part that "[a] lawyer shall not bring or defend a proceeding, or assert or controvert an issue therein, unless there is a basis for doing so that is not frivolous, which includes a good faith argument for an extension, modification or reversal of existing law." G.E.W. Mech. Contractors v. Johnston Co., 1993-NMCA-081, 115 N.M. 727, 858 P.2d 103.

The simple fact that the defendant prevailed on an unfair practices claim does not establish that the claim is groundless; rather, the defendant must show that there is no arguable basis in law or fact to support the cause of action and the claim is not supported by a good-faith argument for the extension, modification, or reversal of existing law. Marchman v. NCNB Tex. Nat'l. Bank, 1995-NMSC-041, 120 N.M. 74, 898 P.2d 709.

Dismissal of the plaintiffs' claims on the grounds of forum non conveniens did not reflect on the merits of the claims and could not be construed as a ruling that the claims were groundless. Marchman v. NCNB Tex. Nat'l. Bank, 1995-NMSC-041, 120 N.M. 74, 898 P.2d 709.

Defendant not entitled to attorney fees merely for prevailing against plaintiff's claims. — In an action for breach of contract and unfair trade practices, where plaintiff hired defendant to design and construct a replacement irrigation well on plaintiff's property, and although a written contract was not executed, plaintiff's understanding of the agreement, as told to him by defendant, was that defendant would construct a well that would be fully adequate for plaintiff's irrigation purposes, that it would be capable of producing 2,500 to 3,000 gallons of water per minute, and that it would last at least fifty years, and where, after three-and-a-half years, the well stopped working, the district court did not err in denying defendant's request for attorney fees even though defendant prevailed on plaintiff's unfair practices claim, because plaintiff's claim was not groundless and there was nothing in the record to support defendant's conclusory assertion that plaintiff failed to make a proper argument. Robey v. Parnell, 2017-NMCA-038.

Award of punitive damages not excessive. — Because the ratio of punitive damages to compensatory damages awarded was smaller than the statutory ratio in Subsection B of this section for similar conduct, the award of punitive damages was not excessive. Bogle v. Summit Inv. Co., 2005-NMCA-024, 137 N.M. 80, 107 P.3d 520.

Restitution is an appropriate remedy for unconscionable loans. — Where defendants marketed and originated signature loans that carried the substantively unconscionable and invalid APRs of between 1,147.14 and 1,500 percent, the proper remedy was to strike the unconscionable interest term, enforce the remainder of the loan contracts without the unconscionable term, apply the statutory default interest rate of 15 percent simple interest pursuant to 56-8-3 NMSA 1978, and require defendants to refund all money collected on the loans in excess of 15 percent of the principal as restitution for their unconscionable trade practices. State ex rel. King v. B&B Inv. Grp. Inc., 2014-NMSC-024.

Award of attorney fees. — To be entitled to attorneys fees, it is not enough to show that the plaintiff did not prevail on such claims. The defending party must also establish that, at the time such claim was filed, the claim was initiated in bad faith or there was no credible evidence to support it. Jones v. Beavers, 1993-NMCA-100, 116 N.M. 634, 866 P.2d 362, cert. denied, 116 N.M. 290, 861 P.2d 971.

Even though plaintiff elected not to recover on his claim under the Unfair Practices Act, but chose to recover damages for fraudulent misrepresentation, he was entitled to an award of attorney's fees under Subsection C. Garcia v. Coffman, 1997-NMCA-092, 124 N.M. 12, 946 P.2d 216, cert. denied, 123 N.M. 626, 944 P.2d 274.

An award of attorneys' fees and costs is not limited to a specific percentage of recovery and includes attorneys' fees and costs on appeal. Jones v. GMC, 1998-NMCA-020, 124 N.M. 606, 953 P.2d 1104.

Attorney's fees properly awarded to a defendant even though the plaintiff withdrew an unfair practices claim prior to trial, where the plaintiff failed to use the appropriate language in its motion to have the claim dismissed and there was confusion as to whether that was the plaintiff's intent. Buckingham v. Ryan, 1998-NMCA-012, 124 N.M. 498, 953 P.2d 33.

Requirement in Subsection C of this section regarding attorneys' fees applies to fees on appeal as well as fees at the district court level. Aguilera v. Palm Harbor Homes, Inc., 2004-NMCA-120, 136 N.M. 422, 99 P.3d 672, cert. denied, 2004-NMCERT-010, 136 N.M. 541, 101 P.3d 807.

Subsection C of this section allows the award of attorney fees in Unfair Practices Act cases, and Rule 12-403 NMRA simply provides a procedure for requesting the appellate portion of those allowable fees. Aguilera v. Palm Harbor Homes, Inc., 2004-NMCA-120, 136 N.M. 422, 99 P.3d 672, cert. denied, 2004-NMCERT-010, 136 N.M. 541, 101 P.3d 807.

Multiplier applied to a lodestar attorney fee. — To the extent a lodestar value does not take into account the factors that justify a multiplier, the district court has discretion to apply a multiplier factor to a lodestar fee awarded in an action under the Unfair Practices Act, 57-12-1 et seq. NMSA 1978. Atherton v. Gopin, 2012-NMCA-023, 272 P.3d 700.

Where plaintiff recovered $5,200.00 plus attorney fees in an action under the Unfair Practices Act, 57-12-1 et seq. NMSA 1978; plaintiff calculated attorney fees of $35,759.10; and the court awarded plaintiff attorney fees of $39,608.40 based on the lodestar method, the court had discretion to apply a multiplier factor to the lodestar fee to the extent a lodestar value did not take into account the factors that justify a multiplier. Atherton v. Gopin, 2012-NMCA-023, 272 P.3d 700.

Appellate fees recoverable. — Subsection C does not by its own terms limit itself to fees and costs incurred at the trial court level. The award of attorney fees and costs on appeal is entirely consistent with the statutory purpose of creating a private remedy to redress wrongs resulting from unfair or deceptive trade practices. Hale v. Basin Motor Co., 1990-NMSC-068, 110 N.M. 314, 795 P.2d 1006.

The district court has the authority to award attorney fees on appeal even if an arbitration panel lacked the authority to do so. Aguilera v. Palm Harbor Homes, Inc., 2004-NMCA-120, 136 N.M. 422, 99 P.3d 672, cert. denied, 2004-NMCERT-010, 136 N.M. 541, 101 P.3d 807.

An award of fees on appeal furthers the public policies of encouraging individuals to pursue their Unfair Practices Act claims and reimbursing plaintiffs and their counsel for enforcing the Unfair Practices Act. Aguilera v. Palm Harbor Homes, Inc., 2004-NMCA-120, 136 N.M. 422, 99 P.3d 672, cert. denied, 2004-NMCERT-010, 136 N.M. 541, 101 P.3d 807.

Treble damages and punitive damages exclusive. — Recovery of both statutory treble damages and punitive damages based upon the same conduct would be improper. In Subsection D, the legislature created a new statutory remedy in addition to those otherwise available, but did not suggest that a party would be entitled to multiple awards of damages arising out of the same conduct. Hale v. Basin Motor Co., 1990-NMSC-068, 110 N.M. 314, 795 P.2d 1006.

The Unfair Practices Act does not permit a jury to award punitive damages; it only permits a judge to award up to treble damages for a willful violation of the Act. McLelland v. United Wis. Life Ins. Co., 1999-NMCA-055, 127 N.M. 303, 980 P.2d 86, cert. denied, 127 N.M. 389, 981 P.2d 1207.

Arbitration clause barred. — Regulation mandating arbitration clause in title insurance contract is in conflict with 59A-16-30 NMSA 1978 and this section; therefore, plaintiff in suit against title company may have statutory claims heard in a court of law. Lisanti v. Alamo Title Ins. of Tex., 2001-NMCA-100, 131 N.M. 334, 35 P.3d 989, aff'd, 2002-NMSC-032, 132 N.M. 750, 55 P.3d 962.

Because 59A-16-30 and 57-12-10 NMSA 1978 provide for judicial actions on claims of unfair insurance and trade practices, a regulation, NMAC 13.14.18.14, which requires mandatory arbitration in title insurance policy disputes, is unenforceable because it violates the landowner's right to a trial by jury, as guaranteed by N.M. Const. art. II, § 12, in his action against a title insurance company asserting the above-stated claims and because the rights created by the statutes prevail over the regulation. Lisanti v. Alamo Title Ins., 2002-NMSC-032, 132 N.M. 750, 55 P.3d 962, cert. denied, 537 U.S. 1193, 123 S. Ct. 1288, 154 L. Ed. 2d 1027 (2003).

Law reviews. — For article, "Consumer Class Actions Under the New Mexico Unfair Practices Act," see 4 N.M.L. Rev. 49 (1973).

For article, "The Impact of the Revised New Mexico Class Action Rules Upon Consumers," see 9 N.M.L. Rev. 263 (1979).

Am. Jur. 2d, A.L.R. and C.J.S. references. — Liability for interference with at will business relationship, 5 A.L.R.4th 9.

Recovery based on tortfeasor's profits in action for procuring breach of contract, 5 A.L.R.4th 1276.

When statute of limitations commences to run on action under state deceptive trade practice or consumer protection acts, 18 A.L.R.4th 1340.

Award of attorneys' fees in actions under state deceptive trade practice and consumer protection acts, 35 A.L.R.4th 12.

Recoverability of compensatory damages for mental anguish or emotional distress for breach of service contract, 54 A.L.R.4th 901.

Disclaimer: These codes may not be the most recent version. New Mexico may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.