HB 515

House committee substitute to the 1st edition makes the following changes. Modifies the following defined terms of the Economic Abuse Prevention Act (new GS Chapter 1H): adequate documentation, claim, claimant, and qualified-third party professional . Defines secured debt. Broadens the scope of matters excluded from the Act in GS 1H-3 to include (1) any debts that have been reduced to a civil judgment or other court order and (2) any consumer finance companies licensed and doing business under Article 15 of GS Chapter 53. Removes provisions specifying that the Act does not diminish the rights of a claimant to recover payment for a coerced debt from the person or persons who coerced a debtor into incurring that debt. Removes provisions from GS 1A-5 requiring a debtor to give 30 days' written notice, as described, of their intent to file an action against the claimant and review documents. Removes provisions barring the filing of an action where the claimant has ceased efforts to collect on the particular debt, or a portion thereof, identified in the notice and the debtor receives written notice of cessation before the 30-day period expires. Removes provisions requiring that the debtor have received written notice from the claimant of its determination that the information debtor submitted for review does not establish that the particular debt is coerced debt before the debtor can commence an action against a claimant in connection with an allegedly coerced debt. Recodifies the Act’s provisions pertaining to the order establishing relief from a coerced debt from GS 1H-6 to GS 1H-7. Recodifies the Act’s miscellaneous provisions to GS 1H-8 (was, GS 1H-9). Enacts, at GS 1H-6, the affirmative defense of a coerced debt in actions against a debtor to satisfy a debt. Requires allegations underlying the affirmative defense to be pled with particularity with the documents required under GS 1H-5 attached to the responsive pleading. Recodifies provisions providing for sanctions against a debtor who files knowingly false motions, pleadings, or other papers or engages in other tactics that are frivolous or intended to cause unnecessary delay against a claimant shall be liable for the claimant's attorneys' fees and costs in defending the lawsuit from new GS 1H-7 to GS 1H-6. Clarifies, in GS 1H-8, that claimants can collect against a person who used or possessed money, goods, services, or property obtained through coerced debt so long as that person is not the debtor. Removes severability clause from GS 1H-8 and reorganizes it into Section 2 of the act, with technical changes. Removes provisions from GS 1H-8 that authorize a debtor to file a cross-complaint in an action filed by a claimant to collect a debt incurred prior to the act’s effective date of July 1, 2025. Specifies that the act applies to debts incurred or actions filed on or after the act’s effective date. Makes technical, organizational, and clarifying changes.