AB894: Bill Text

LRB-3055/1

MGG:wlj:jf

2001 - 2002 LEGISLATURE

2001 Assembly BILL 894

March 7, 2002 - Introduced by Representatives Jeskewitz, Ainsworth, Musser, Ryba, Berceau, Rhoades, Hahn, J. Lehman, Turner, Miller, Townsend, Huebsch, Plouff, Olsen, Albers, Hundertmark, Plale, Stone and Lassa, cosponsored by Senators Hansen, Schultz and Baumgart. Referred to Committee on Small Business and Consumer Affairs.

AB894,1,4 An Act to amend 165.25 (4) (ar) and 814.04 (intro.); and to create 100.195, 100.197 and 100.198 of the statutes; relating to: the prohibition of certain billing practices for consumer goods or services, lawn care service contracts, granting rule-making authority, and providing penalties.

Analysis by the Legislative Reference Bureau

This bill prohibits certain consumer billing practices by sellers and lessors. The prohibited practices are:

1. Billing a person for consumer goods or services that the consumer has not agreed to purchase or lease.

2. Billing a consumer for consumer goods or services at a price that is higher than the price previously agreed upon, unless the consumer agrees to the higher price or is given the opportunity to cancel without penalty.

3. Billing a consumer for consumer goods under an agreement that is no longer in effect.

4. Offering a consumer free or reduced-price goods or services that commit the consumer to pay for other consumer goods or services, unless the seller discloses the commitment with every advertisement of the free or reduced-price goods or services.

5. Misrepresenting to a consumer that the consumer's failure to reject a delivery of consumer goods or services obligates the consumer to pay for the goods or services.

The bill defines consumer goods and services to exclude various goods and services that include cable and satellite television and other telecommunications services and health care.

The bill requires that the department of agriculture, trade and consumer protection (DATCP) promulgate rules for the regulation of sale plans under which consumer goods or services are delivered before the consumer agrees to purchase or lease the goods or services. The bill requires that the secretary of DATCP appoint an advisory committee to make recommendations for these rules.

The bill specifically regulates lawn care service contracts. Lawn care services under the bill consist of mowing services, trimming services, and the application of fertilizer, pesticides, or other additives. Under the bill, a contract for lawn care services may not be in effect for more than one year unless, in the subsequent years, the person selling the lawn care services makes a written disclosure to the consumer as to the type of services provided, the price and frequency of those services, and the right of the consumer to cancel the contract. The consumer has the right to cancel the contract at no cost to the consumer if the consumer does so within 30 days after receiving the written disclosure.

The bill authorizes DATCP to bring an action to enjoin persons from violating these laws governing billing practices and lawn care services contracts. Persons who violate these laws are also subject to civil forfeitures and criminal penalties. In addition, the bill does not preclude these violations from being prosecuted as unfair methods of competition, unfair trade practices, or fraudulent representations under existing laws. The bill allows an individual to bring a civil action for violation of these laws.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

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

AB894, s. 1 Section 1. 100.195 of the statutes is created to read:

AB894,2,3 100.195 Unfair billing for consumer goods or services. (1) Definitions. In this section:

AB894,2,8 (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.

AB894,3,2 (b) "Consumer" means an individual to whom a seller sells or leases, or offers to sell or lease, consumer goods or services at retail.

AB894,3,5 (c) "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:

AB894,3,7 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.

AB894,3,8 2. Telecommunications services or cable television services.

AB894,3,10 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.

AB894,3,12 4. The sale or lease of a motor vehicle by a licensed motor vehicle dealer, as defined in s. 218.0101 (23) (a).

AB894,3,14 (d) "Delivery" means a transfer to a consumer's custody or making available for use by a consumer.

AB894,3,17 (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 customer.

AB894,3,19 (f) "Seller" means a seller or lessor of consumer goods or services, and includes any employee, agent, or representative acting on behalf of the seller.

AB894,3,20 (g) "Telecommunications service" has the meaning given in s. 196.01 (9m).

AB894,3,21 (h) "Television service" means all of the following:

AB894,3,22 1. Cable television service, as defined in s. 196.01 (1p).

AB894,3,24 2. Services billed to consumers by a multichannel video programming distributor as defined under 47 USC 522 (13).

AB894,3,25 (2) Prohibitions. No seller may:

AB894,4,2 (a) Bill a consumer for consumer goods or services that the consumer has not agreed to purchase or lease.

AB894,4,9 (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. This paragraph does not prohibit a seller from increasing the price of goods or services delivered under a sale or lease agreement of indefinite duration, if the seller gives the consumer advance reasonable disclosure of the proposed increase and the opportunity to cancel the agreement without penalty prior to any delivery at the increased price.

AB894,4,12 (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.

AB894,4,17 (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 makes a disclosure of that commitment in connection with every announcement or advertisement of the prize, prize opportunity or free or reduced-price goods or services.

AB894,4,21 (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.

AB894,4,24 (3) Acceptance of free goods or services. For purposes of sub. (2), the acceptance of free goods or services does not, of itself, constitute an agreement to purchase or lease the goods or services.

AB894,5,3 (4) Rules. (a) The department shall promulgate rules for the regulation of sales plans in which consumer goods or services are delivered to a consumer before the consumer agrees to purchase or lease the consumer goods or services.

AB894,5,10 (b) The secretary shall appoint an advisory committee to make recommendations regarding the content and scope of any rule promulgated under par. (a). The recommendations of the advisory committee, if any, shall be submitted to the board of agriculture, trade and consumer protection and to the presiding officer of each house of the legislature as part of the report required under s. 227.19 (2). The advisory committee shall consist of the attorney general or his or her designee and the following persons appointed by the secretary:

AB894,5,11 1. One or more persons who is a consumer in this state.

AB894,5,13 2. One or more persons who is employed in this state by a direct marketing employer.

AB894,5,14 3. One or more persons who represents senior citizens.

AB894, s. 2 Section 2. 100.197 of the statutes is created to read:

AB894,5,16 100.197 Lawn care service contracts. (1) Definitions. In this section:

AB894,5,18 (a) "Consumer" means an individual to whom a provider sells or leases, or offers to sell or lease, lawn care services.

AB894,5,23 (b) "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.

AB894,5,25 (c) "Lawn care services" means any of the following services provided in or around a consumer's personal residence for nonagricultural purposes:

AB894,6,2 1. Application of a fertilizer, a pesticide, or a soil or plant additive intended to promote plant growth or health.

AB894,6,3 2. A plant mowing or trimming service.

AB894,6,5 (d) "Provider" means a person who sells or leases, or offers to sell or lease, lawn care services to consumers.

AB894,6,7 (e) "Written disclosure" means a clear and conspicuous statement in writing that is designed to be readily noticed and understood by the consumer.