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(a) Litigation financing contracts shall contain the disclosures specified in this section, which shall constitute material terms of the litigation financing contract.
(b) Unless otherwise specified, the disclosures shall be typed in at least fourteen-point, bold font and be placed clearly and conspicuously within the litigation financing contract, as follows:
(1) On the front page under appropriate headings in not less than fourteen-point font, language specifying:
(A) The total amount of money to be provided to the consumer by the litigation financier as part of the litigation financing transaction;
(B) The maximum amount the consumer can be required to provide the litigation financier, including but not limited to, all fees, charges, interest or other consideration, under the terms of the litigation financing contract;
(C) The maximum annual percentage fee, which shall include, but not be limited to, all fees, charges, interest or other consideration received by a litigation financier in consideration for litigation financing; provided, that the consumer may be charged for the litigation financing transaction under the terms of the litigation financing contract;
(D) The following:
Consumer's Right to Cancellation: You may cancel this contract without penalty or further obligation within five (5) business days from the date you signed this contract or received financing from [insert name of the litigation financier] by: returning the funds to [insert name, office address and office hours of the litigation financier] or by U.S. mail, [insert name and mailing address of litigation financier]. For purposes of the return deadline by U.S. mail, the postmark date on the returned funds or, if mailed by registered or certified mail, the date of the return receipt requested shall be considered the date of return.
(2) Within the body of the litigation financing contract, the following:
The litigation financier agrees that it has no right to and will not make any decisions about the conduct of your lawsuit or dispute and that the right to make those decisions remains solely with you and your attorney;
(3) Within the body of the litigation financing contract, in all capital letters contained within a box the following:
IF THERE IS NO RECOVERY OF ANY MONEY FROM YOUR LEGAL CLAIM OR IF THERE IS NOT ENOUGH MONEY TO SATISFY THE PORTION ASSIGNED TO [INSERT NAME OF THE LITIGATION FINANCIER] IN FULL, YOU WILL NOT OWE [INSERT NAME OF THE LITIGATION FINANCIER] ANYTHING IN EXCESS OF YOUR RECOVERY.
(4) Located immediately above the place on the litigation financing contract where the consumer's signature is required, the litigation financing contract shall include the following:
Do not sign this contract before you read it completely. If this contract contains any incomplete sections, you are entitled to a completely filled-in copy of the contract prior to signing it. Before you sign this contract, you should obtain the advice of an attorney. Depending on the circumstances you may want to consult a tax advisor, a financial professional or an accountant.
Cite this article: FindLaw.com - Tennessee Code Title 47. Commercial Instruments and Transactions § 47-16-106 - last updated January 01, 2020 | https://codes.findlaw.com/tn/title-47-commercial-instruments-and-transactions/tn-code-sect-47-16-106/
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