Amendment ASA1-AB169

LRBs0173/10

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1997 - 1998 LEGISLATURE

ASSEMBLY SUBSTITUTE AMENDMENT 1, TO 1997 ASSEMBLY BILL 169

October 23, 1997 - Offered by Committee on Consumer Affairs.

AB169-ASA1,1,4 An Act to amend 165.25 (4) (ar) and 814.04 (intro.); and to create 100.195, 100.196, 100.197 and 100.198 of the statutes; relating to: unfair billing for consumer goods or services, trial delivery sales plans, lawn care service contracts and providing penalties.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB169-ASA1, s. 1 Section 1. 100.195 of the statutes is created to read:

AB169-ASA1,1,7 100.195 Unfair billing for consumer goods or services. (1) Definitions. In this section:

AB169-ASA1,1,12 (a) "Bill" means to represent to any consumer, directly or by implication, that the consumer is obligated to pay a stated amount for consumer goods or services. "Bill" includes to refer a payment to a collection agency or to make a statement representing that a payment obligation has been or may be referred to a collection agency or credit reporting agency.

AB169-ASA1,2,3 (b) "Cable television service" has the meaning given in s. 196.01 (1p) and includes services billed to consumers by a multichannel video programming distributor as defined under 47 USC 522 (12).

AB169-ASA1,2,5 (c) "Consumer" means an individual to whom a seller sells or leases, or offers to sell or lease, consumer goods or services at retail.

AB169-ASA1,2,8 (d) "Consumer goods or services" means goods or services that are used or intended for use for personal, family or household purposes. "Consumer goods or services" does not include any of the following:

AB169-ASA1,2,10 1. The treatment of disease, as defined in s. 448.01 (2), by a health care provider, as defined in s. 155.01 (7), or any provision of emergency medical care.

AB169-ASA1,2,11 2. Telecommunications or cable television services.

AB169-ASA1,2,13 3. Goods or services whose delivery is required by law even though the consumer has not agreed to purchase or lease those goods or services.

AB169-ASA1,2,15 4. The sale or lease of a motor vehicle by a licensed motor vehicle dealer, as defined in s. 218.01 (1) (n).

AB169-ASA1,2,17 (e) "Delivery" means a transfer to a consumer's custody or making available for use by a consumer.

AB169-ASA1,2,19 (f) "Seller" means a seller or lessor of consumer goods or services, and includes any employe, agent or representative acting on behalf of the seller.

AB169-ASA1,2,20 (g) "Telecommunications service" has the meaning given in s. 196.01 (9m).

AB169-ASA1,2,21 (2) Prohibitions. No seller may:

AB169-ASA1,2,23 (a) Bill a consumer for consumer goods or services that the consumer has not agreed to purchase or lease.

AB169-ASA1,3,3 (b) Bill a consumer for consumer goods or services at a price that is higher than a price previously agreed upon between the seller and consumer unless the consumer agrees to the higher price before the consumer is billed.

AB169-ASA1,3,6 (c) Bill a consumer for a delivery of consumer goods or services that the seller initiates under an agreement that is no longer in effect when the seller initiates the delivery.

AB169-ASA1,3,12 (d) Offer a consumer any prize or prize opportunity or free or reduced-price goods or services, the acceptance of which commits the consumer to receive or pay for other consumer goods or services, unless the seller clearly and conspicuously discloses that commitment in connection with every announcement or advertisement of the prize, prize opportunity or free or reduced-price goods or services.

AB169-ASA1,3,16 (e) Misrepresent to a consumer, directly or by implication, that the consumer's failure to reject or return a delivery of consumer goods or services that was not authorized by the consumer constitutes an acceptance that obligates the consumer to pay for those goods or services.

AB169-ASA1, s. 2 Section 2. 100.196 of the statutes is created to read:

AB169-ASA1,3,18 100.196 Trial delivery sales plans. (1) Definitions. In this section:

AB169-ASA1,3,19 (a) "Bill" has the meaning given in s. 100.195 (1) (a).

AB169-ASA1,3,20 (b) "Consumer" has the meaning given in s. 100.195 (1) (c).

AB169-ASA1,3,21 (c) "Consumer goods or services" has the meaning given in s. 100.195 (1) (d).

AB169-ASA1,3,22 (d) "Delivery" has the meaning given in s. 100.195 (1) (e).

AB169-ASA1,3,25 (e) "Disclosure" means a clear and conspicuous statement that is designed to be readily noticed and understood by the consumer and, if made in writing, to be retained by the consumer.

AB169-ASA1,4,5 (f) "In writing" means legibly printed on paper or another tangible nonelectronic medium that is delivered to the consumer, or legibly printed in an electronic form that the consumer can electronically retrieve, store or print for future reference. "In writing" does not include presentation on a medium, such as a billboard, that cannot be conveniently retained by a consumer.

AB169-ASA1,4,9 (g) "Prepaid return mailer" means an envelope, box or other container in which a consumer is able to safely return a trial delivery to the seller, at the seller's expense, without having to leave home and without having to incur postage, shipping, handling, repackaging or other costs.

AB169-ASA1,4,10 (h) "Seller" has the meaning given in s. 100.195 (1) (f).

AB169-ASA1,4,12 (i) "Trial delivery" means a delivery to a consumer of consumer goods or services that the consumer has not yet agreed to purchase or lease.

AB169-ASA1,4,17 (j) "Trial delivery sales plan" means an agreement between a seller and a consumer in which the consumer authorizes the seller to make one or more trial deliveries to the consumer, and to bill the consumer for a trial delivery if the consumer does not reject or return it in conformance with the terms of the agreement. "Trial delivery sales plan" does not include any of the following:

AB169-ASA1,4,18 1. A negative option plan that is subject to and that complies with 16 CFR 425.

AB169-ASA1,4,20 2. An agreement to purchase or lease goods or services without any trial delivery, but subject to a right of cancellation or return.

AB169-ASA1,4,22 3. Consumer goods or services delivered to a consumer in person at the seller's regular place of business.

AB169-ASA1,5,3 (2) Disclosure of trial delivery sales plan terms. (a) Before a consumer enters into any trial delivery sales plan, the seller shall make a disclosure to the consumer of all of the material terms of the trial delivery sales plan, including all terms required under sub. (3). The terms of the trial delivery sales plan made in the disclosure shall be in meaningful sequence and shall not be separated by promotional information.

AB169-ASA1,5,6 (b) If a seller solicits a consumer by mail to enter into a trial delivery sales plan, the seller shall make the disclosure under par. (a) in writing as part of that mail solicitation.

AB169-ASA1,5,9 (c) If a seller makes the disclosure under par. (a) other than in writing, the seller shall repeat the disclosure in writing at or before the time that the seller first makes a trial delivery to the consumer.

AB169-ASA1,5,11 (3) Trial delivery sales plans; terms required. The terms of the trial delivery sales plan shall include all of the following:

AB169-ASA1,5,12 (a) The nature of the consumer goods or services offered.

AB169-ASA1,5,13 (b) The consumer's obligations, including all of the following:

AB169-ASA1,5,14 1. Any minimum purchase or minimum lease requirements.

AB169-ASA1,5,17 2. The maximum price of the consumer goods or services included in any trial delivery. The maximum price shall include all postage, shipping, handling or other costs charged to the consumer, except as provided in sub. (4) (c).

AB169-ASA1,5,19 3. Any obligation incurred by the consumer if the consumer fails to reject or return any trial delivery under the trial delivery sales plan.

AB169-ASA1,5,21 4. Any obligation by the consumer to pay return shipping or other costs associated with the rejection or return of a trial delivery.

AB169-ASA1,5,23 (c) All of the following information if the trial delivery sales plan may result in more than one trial delivery:

AB169-ASA1,5,24 1. The duration of the trial delivery sales plan.

AB169-ASA1,6,2 2. Whether the trial delivery sales plan remains in effect until canceled by the seller or consumer.

AB169-ASA1,6,3 3. The frequency of trial deliveries under the trial delivery sales plan.

AB169-ASA1,6,9 (d) Clear and conspicuous instructions stating a reasonable method by which the consumer may reject or return a trial delivery to avoid being billed for that trial delivery and to avoid any other consequences that may result from a failure to reject or return the trial delivery. The instructions shall include the 10-day requirement under sub. (6) (a) and any applicable restrictions on the manner in which the trial delivery may be rejected or returned.

AB169-ASA1,6,11 (e) The right of the consumer to cancel the trial delivery sales plan at any time, subject to any minimum purchase or lease requirements under par. (b) 1.

AB169-ASA1,6,14 (f) Clear and conspicuous instructions stating a reasonable method by which the consumer may exercise his or her right to cancel the trial delivery sales plan without charge to the consumer.

AB169-ASA1,6,17 (4) Trial delivery sales plans; restrictions. (a) If a trial delivery sales plan is for a definite period of time, neither the seller nor the consumer may extend the period by means of an automatic renewal or automatic extension provision.

AB169-ASA1,6,20 (b) The information under sub. (3) (c) shall be stated in a manner so that the consumer can easily determine the maximum number of trial deliveries that may occur in any 12-month period.

AB169-ASA1,6,22 (c) The maximum price stated under sub. (3) (b) 2. need not include postage or shipping costs if all of the following apply:

AB169-ASA1,6,24 1. The seller makes a disclosure that the consumer must pay postage or shipping costs.

AB169-ASA1,7,2 2. The postage or shipping costs do not exceed those that are charged or would be charged by the U.S. postal service or common carrier for the same trial delivery.

AB169-ASA1,7,5 (5) Disclosure to accompany each trial delivery. With each trial delivery under a trial delivery sales plan, the seller shall include a written disclosure that states all of the following:

AB169-ASA1,7,7 (a) The total price that the consumer must pay for the trial delivery if the consumer accepts the trial delivery.

AB169-ASA1,7,9 (b) Every other obligation that the consumer incurs by accepting the trial delivery.

AB169-ASA1,7,15 (c) Clear and conspicuous instructions stating a reasonable method by which the consumer may reject or return a trial delivery to avoid being billed for that trial delivery and to avoid any other consequences that may result from a failure to reject or return the trial delivery. The instructions shall include the 10-day requirement under sub. (6) (a) and any applicable restrictions on the manner in which the trial delivery may be rejected or returned.

AB169-ASA1,7,18 (d) Clear and conspicuous instructions stating a reasonable method by which the consumer may avoid receiving the next trial delivery. The instructions shall include the 10-day requirement under sub. (6) (a).

AB169-ASA1,7,22 (6) Trial delivery sales plans; rejections and returns. (a) A seller shall allow the consumer at least 10 days after the consumer receives a trial delivery to initiate the rejection or return of that trial delivery or to avoid receiving the next trial delivery.

AB169-ASA1,7,25 (b) A seller may not represent that the consumer may return a trial delivery at the seller's expense unless the seller includes with the trial delivery a prepaid return mailer that includes all of the following:

AB169-ASA1,8,2 1. The address to which the consumer shall return the goods or services under the trial delivery.

AB169-ASA1,8,4 2. Adequate prepayment of any postage, shipping, handling, repackaging or other costs that are necessary to accomplish the return of the trial delivery.

AB169-ASA1,8,7 3. Clear and conspicuous instructions on how the consumer may use the prepaid return mailer to accomplish the return of the goods or services included in a trial delivery.

AB169-ASA1,8,8 (7) Prohibitions. No seller may do any of the following:

AB169-ASA1,8,9 (a) Misrepresent the terms of a trial delivery sales plan.