SENATE BILL No. 531
An Act concerning credit agreements; relating to actions for legal
or equitable relief or
defenses; amending K.S.A. 16-117 and 16-118 and repealing
the existing sections.
Be it enacted by the Legislature of the State of Kansas:
Section 1. K.S.A. 16-117 is hereby amended to read as
117. As used in this act:
(a) ``Credit agreement'' means an agreement by a financial
to lend or delay repayment of money, goods or things in action, to
erwise extend credit or to make any other financial accommodation.
purposes of this act the term ``credit agreement'' does not include
following agreements: Open-end or closed-end promissory
estate mortgages, security agreements, guaranty agreements, letters
credit, deposit account agreements, agreements in connection
accounts for the payment of overdrafts, agreements in
student loans insured or guaranteed pursuant to the federal higher
cation act of 1965 and acts amendatory thereof and
thereto, and agreements in connection with ``lender credit cards''
fined in the uniform consumer credit code;
(b) ``creditor'' means a financial institution which extends
extends a financial accommodation under a credit agreement with
(c) ``debtor'' means a person who obtains credit or receives a
accommodation under a credit agreement with a financial
(d) ``financial institution'' means a bank, savings and loan
savings bank or credit union.
Sec. 2. K.S.A. 16-118 is hereby amended to read as
(a) A debtor or a creditor may not maintain an action for legal
relief or a defense, based in either case upon a failure to
alleged credit agreement, unless the material
terms and conditions of the
is are in writing and
is signed by the creditor and the debtor.
(b) All credit agreements shall contain a clear, conspicuous
printed notice to the debtor that states that the written credit
is a final expression of the credit agreement between the creditor
debtor and such written credit agreement may not be contradicted
evidence of any prior oral credit agreement or of a contemporaneous
credit agreement between the creditor and debtor. A written credit
ment shall contain a sufficient space for the placement of
terms, including the reduction to writing of a previous oral credit
ment and an affirmation, signed or initialed by the debtor and the
itor, that no unwritten oral credit agreement between the parties
(c) Failure to comply with provisions of subsections (a)
and (b) shall
preclude an action or defense based on any of the following
legal or eq-
uitable theories: (1) An implied agreement based on course of
performance or on a fiduciary relationship; (2) promissory or
estoppel; (3) part performance; or (4) negligent
Sec. 3. K.S.A. 16-117 and 16-118 are hereby repealed.
Sec. 4. This act shall take effect and be in force from
and after its
publication in the statute book.
Approved April 2, 1998