requires two-thirds majority vote (§§ 3, 6, 10)                                                                                                      

                                                                                                  

 

Assembly Bill No. 478–Committee on Ways and Means

 

(On Behalf of the Department of Administration)

 

March 24, 2003

____________

 

Referred to Committee on Commerce and Labor

 

SUMMARY—Revises provisions relating to registration of certain businesses regulated by Division of Consumer Affairs of the Department of Business and Industry. (BDR 52‑1249)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: No.

 

~

 

EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to trade practices; increasing the fee for the issuance or renewal of a certificate of registration by the Division of Consumer Affairs of the Department of Business and Industry for a credit service organization, organization for buying goods or services at a discount, dance studio, health club or seller of travel; requiring the Division to regulate martial arts studios; requiring tour brokers, tour operators and martial arts studios to register with the Division; prescribing a fee for such registration; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1  Section 1. Chapter 598 of NRS is hereby amended by adding

1-2  thereto the provisions set forth as sections 2 and 3 of this act.

1-3  Sec. 2.  “Martial arts studio” means a facility where

1-4  instruction is provided, for compensation, in unarmed combat that

1-5  involves the use of the techniques from one or more disciplines of

1-6  the martial arts, including, without limitation, grappling, kicking

1-7  and striking.

2-1  Sec. 3.  1.  Before advertising its services or conducting

2-2  business in this state, a tour broker or tour operator must register

2-3  with the Division by:

2-4  (a) Submitting to the Division an application for registration

2-5  on a form prescribed by the Division;

2-6  (b) Paying to the Division a fee of $100; and

2-7  (c) Depositing the security required pursuant to NRS 598.495

2-8  with the Division.

2-9  2.  The Division shall issue a certificate of registration to the

2-10  tour broker or tour operator upon receipt of:

2-11      (a) The security in the proper form as required pursuant to

2-12  NRS 598.495; and

2-13      (b) The payment of the fee required by subsection 1.

2-14      3.  A certificate of registration:

2-15      (a) Is not transferable or assignable; and

2-16      (b) Expires 1 year after it is issued.

2-17      4.  A tour broker or tour operator must renew a certificate of

2-18  registration issued pursuant to this section before the certificate

2-19  expires by:

2-20      (a) Submitting to the Division an application for the renewal

2-21  of the certificate on a form prescribed by the Division; and

2-22      (b) Paying to the Division a renewal fee of $100.

2-23      Sec. 4.  NRS 598.0999 is hereby amended to read as follows:

2-24      598.0999  1.  A person who violates a court order or

2-25  injunction issued pursuant to the provisions of NRS 598.0903 to

2-26  598.0999, inclusive, upon a complaint brought by the

2-27  Commissioner, the Director, the district attorney of any county of

2-28  this state or the Attorney General shall forfeit and pay to the State

2-29  General Fund a civil penalty of not more than $10,000 for each

2-30  violation. For the purpose of this section, the court issuing the order

2-31  or injunction retains jurisdiction over the action or proceeding. Such

2-32  civil penalties are in addition to any other penalty or remedy

2-33  available for the enforcement of the provisions of NRS 598.0903 to

2-34  598.0999, inclusive.

2-35      2.  In any action brought pursuant to the provisions of NRS

2-36  598.0903 to 598.0999, inclusive, if the court finds that a person has

2-37  willfully engaged in a deceptive trade practice, the Commissioner,

2-38  the Director, the district attorney of any county in this state or the

2-39  Attorney General bringing the action may recover a civil penalty not

2-40  to exceed $2,500 for each violation. The court in any such action

2-41  may, in addition to any other relief or reimbursement, award

2-42  reasonable attorney’s fees and costs.

2-43      3.  A natural person, firm, or any officer or managing agent of

2-44  any corporation or association who knowingly and willfully engages

2-45  in a deceptive trade practice:

3-1  (a) For the first offense, is guilty of a misdemeanor.

3-2  (b) For the second offense, is guilty of a gross misdemeanor.

3-3  (c) For the third and all subsequent offenses, is guilty of a

3-4  category D felony and shall be punished as provided in

3-5  NRS 193.130.

3-6  4.  Any offense which occurred within 10 years immediately

3-7  preceding the date of the principal offense or after the principal

3-8  offense constitutes a prior offense for the purposes of subsection 3

3-9  when evidenced by a conviction, without regard to the sequence of

3-10  the offenses and convictions.

3-11      5.  If a person violates any provision of NRS 598.0903 to

3-12  598.0999, inclusive, 598.100 to 598.2801, inclusive, 598.305 to

3-13  598.395, inclusive, 598.405 to 598.525, inclusive, and section 3 of

3-14  this act, 598.741 to 598.787, inclusive, or 598.840 to 598.966,

3-15  inclusive, and section 2 of this act fails to comply with a judgment

3-16  or order of any court in this state concerning a violation of such a

3-17  provision, or fails to comply with an assurance of discontinuance or

3-18  other agreement concerning an alleged violation of such a provision,

3-19  the Commissioner or the district attorney of any county may bring

3-20  an action in the name of the State of Nevada seeking:

3-21      (a) The suspension of the person’s privilege to conduct business

3-22  within this state; or

3-23      (b) If the defendant is a corporation, dissolution of the

3-24  corporation.

3-25  The court may grant or deny the relief sought or may order other

3-26  appropriate relief.

3-27      Sec. 5.  NRS 598.335 is hereby amended to read as follows:

3-28      598.335  “Seller of travel” means a person who offers for sale,

3-29  directly or indirectly, transportation by air, land, rail or water, travel

3-30  services, vacation certificates or any combination thereof, to a

3-31  person or group of persons for a fee, commission or other valuable

3-32  consideration. The term:

3-33      1.  Includes any person who offers membership in a travel club

3-34  or any services related to travel for an advance fee or payment.

3-35      2.  Does not include:

3-36      (a) A hotel that provides or arranges travel services for its

3-37  patrons or guests;

3-38      (b) A person who, for compensation, transports persons or

3-39  property by air, land, rail or water; or

3-40      (c) A tour broker or tour operator who is subject to the

3-41  provisions of NRS 598.405 to 598.525, inclusive[.] , and section 3

3-42  of this act.

 

 

 

4-1  Sec. 6.  NRS 598.365 is hereby amended to read as follows:

4-2  598.365  1.  Before advertising its services or conducting

4-3  business in this state, a seller of travel must register with the

4-4  Division by:

4-5  (a) Submitting to the Division an application for registration on

4-6  a form prescribed by the Division;

4-7  (b) Paying to the Division a fee of [$25;] $100; and

4-8  (c) Depositing the security required pursuant to NRS 598.375, if

4-9  any, with the Division.

4-10      2.  The Division shall issue a certificate of registration to the

4-11  seller of travel upon receipt of:

4-12      (a) The security in the proper form if the seller of travel is

4-13  required to deposit security pursuant to NRS 598.375; and

4-14      (b) The payment of the fee required by this section.

4-15      3.  A certificate of registration:

4-16      (a) Is not transferable or assignable; and

4-17      (b) Expires 1 year after it is issued.

4-18      4.  A seller of travel must renew a certificate of registration

4-19  issued pursuant to this section before the certificate expires by:

4-20      (a) Submitting to the Division an application for the renewal of

4-21  the certificate on a form prescribed by the Division; and

4-22      (b) Paying to the Division a fee of [$25.] $100.

4-23      Sec. 7.  NRS 598.405 is hereby amended to read as follows:

4-24      598.405  As used in NRS 598.405 to 598.525, inclusive, and

4-25  section 3 of this act, unless the context otherwise requires, the

4-26  words and terms defined in NRS 598.416 to 598.465, inclusive,

4-27  have the meanings ascribed to them in those sections.

4-28      Sec. 8.  NRS 598.485 is hereby amended to read as follows:

4-29      598.485  The provisions of NRS 598.495, 598.506 and 598.515

4-30  and section 3 of this act do not apply to a tour broker whose

4-31  business is confined to advertising, or a tour operator whose

4-32  business is confined to advertising and conducting, sightseeing tours

4-33  that originate in a county other than a county whose population is

4-34  400,000 or more.

4-35      Sec. 9.  NRS 598.525 is hereby amended to read as follows:

4-36      598.525  The Commissioner may adopt such regulations as the

4-37  Commissioner determines are necessary to carry out the [intent]

4-38  provisions of NRS 598.405 to 598.525, inclusive[.] , and section 3

4-39  of this act.

4-40      Sec. 10.  NRS 598.721 is hereby amended to read as follows:

4-41      598.721  1.  Each credit service organization, organization for

4-42  buying goods or services at a discount, dance studio , martial arts

4-43  studio and health club regulated by the provisions of this chapter

4-44  shall apply for registration on the form prescribed by the Division.

5-1  2.  At the time of application for registration, the applicant must

5-2  pay to the Division an administrative fee of [$25] $100 and deposit

5-3  the required security with the Division.

5-4  3.  Upon receipt of the security in the proper form and the

5-5  payment of the administrative fee required by this section, the

5-6  Division shall issue a certificate of registration to the applicant. A

5-7  certificate of registration:

5-8  (a) Is not transferable or assignable; and

5-9  (b) Expires 1 year after it is issued.

5-10      4.  A registrant must renew a certificate of registration issued

5-11  pursuant to this section before the certificate expires by submitting

5-12  to the Division [an] :

5-13      (a) An application for the renewal of the certificate on a form

5-14  prescribed by the Division[.] ; and

5-15      (b) A renewal fee of $100.

5-16      Sec. 11.  NRS 598.940 is hereby amended to read as follows:

5-17      598.940  As used in NRS 598.940 to 598.966, inclusive, and

5-18  section 2 of this act, unless the context otherwise requires, the

5-19  words and terms defined in NRS 598.9403 to 598.9417, inclusive,

5-20  and section 2 of this act have the meanings ascribed to them in

5-21  those sections.

5-22      Sec. 12.  NRS 598.9417 is hereby amended to read as follows:

5-23      598.9417  “Pre-sale” means the sale of dance lessons, the use of

5-24  facilities or other services by a dance studio , martial arts studio or

5-25  health club before all amenities, facilities or benefits identified in

5-26  the contract or sales presentation are available to the buyer.

5-27      Sec. 13.  NRS 598.942 is hereby amended to read as follows:

5-28      598.942  The provisions of NRS 598.940 to 598.966, inclusive,

5-29  and section 2 of this act apply to contracts for dance lessons, the

5-30  use of facilities or other services from a dance studio , martial arts

5-31  studio or health club only if the membership is intended for use by

5-32  the buyer or for the buyer and the members of his family and:

5-33      1.  The buyer purchases or becomes obligated to purchase the

5-34  dance lessons, use of facilities or other services for more than 3

5-35  months and the dance studio , martial arts studio or health club

5-36  requires the payment of any fee or dues more than 3 months in

5-37  advance;

5-38      2.  The dance studio , martial arts studio or health club requires

5-39  the payment of a fee for initiation or membership in an amount

5-40  greater than $75; or

5-41      3.  The dance studio , martial arts studio or health club accepts

5-42  from a buyer more than $100 at any one time for dance lessons, the

5-43  use of facilities or other services.

 

 

6-1  Sec. 14.  NRS 598.944 is hereby amended to read as follows:

6-2  598.944  1.  Each owner of a dance studio , martial arts studio

6-3  or health club shall register with the Division pursuant to NRS

6-4  598.721, listing the full name and address of the studio or club and

6-5  any other description of its facilities or activities the Division

6-6  requires.

6-7  2.  At least one member of the governing body of the dance

6-8  studio , martial arts studio or health club must live in the county

6-9  where the studio or club is located. He is the agent of the studio or

6-10  club and its owner for receipt of process served.

6-11      Sec. 15.  NRS 598.946 is hereby amended to read as follows:

6-12      598.946  1.  Except as otherwise provided in subsection 5,

6-13  before advertising its services or conducting business in this state,

6-14  the owner of a dance studio [or a] , martial arts studio or health

6-15  club must register pursuant to NRS 598.721 and 598.944 and

6-16  deposit security with the Division pursuant to NRS 598.726. The

6-17  security must:

6-18      (a) Be conditioned on compliance by the owner with the

6-19  provisions of NRS 598.940 to 598.966, inclusive, and the terms of

6-20  the contract with a buyer; and

6-21      (b) Remain on deposit with the Division until the release of the

6-22  security is authorized or required pursuant to NRS 598.736, except

6-23  that the dance studio , martial arts studio or health club may change

6-24  the form of the security as provided in NRS 598.726.

6-25      2.  Except as otherwise provided in subsection 3, the amount of

6-26  the security to be deposited must be:

6-27      (a) Ten thousand dollars, if the dance studio , martial arts studio

6-28  or health club has less than 400 members;

6-29      (b) Fifteen thousand dollars, if the dance studio , martial arts

6-30  studio or health club has 400 members or more but less than 800

6-31  members;

6-32      (c) Twenty thousand dollars, if the dance studio , martial arts

6-33  studio or health club has 800 members or more but less than 1,200

6-34  members;

6-35      (d) Twenty-five thousand dollars, if the dance studio , martial

6-36  arts studio or health club has 1,200 members or more but less than

6-37  1,500 members;

6-38      (e) Thirty-five thousand dollars, if the dance studio , martial

6-39  arts studio or health club has 1,500 members or more but less than

6-40  4,000 members;

6-41      (f) Fifty thousand dollars, if the dance studio , martial arts

6-42  studio or health club has 4,000 members or more but less than

6-43  25,000 members; and

6-44      (g) Two hundred and fifty thousand dollars, if the dance studio ,

6-45  martial arts studio or health club has 25,000 or more members.

7-1  3.  If a dance studio , martial arts studio or health club

7-2  conducts any pre-sale of dance lessons, the use of facilities or other

7-3  services, the amount of the security required by this section is

7-4  $100,000 unless a greater amount is required pursuant to paragraph

7-5  (g) of subsection 2.

7-6  4.  A dance studio , martial arts studio or health club shall

7-7  report to the Division on a quarterly basis the size of its membership

7-8  and shall, on the basis of any change in the size of that membership,

7-9  adjust accordingly the amount of the security deposited with the

7-10  Division.

7-11      5.  If, on October 1, 2001, a dance studio , martial arts studio

7-12  or health club has not deposited security with the Division pursuant

7-13  to NRS 598.726 because it was not required to do so pursuant to this

7-14  section, the dance studio , martial arts studio or health club:

7-15      (a) Is not required to deposit security with the Division pursuant

7-16  to NRS 598.726; and

7-17      (b) Shall obtain a written acknowledgment from each member

7-18  and prominently post a notice on its premises stating that no security

7-19  for refunds or reimbursement has been deposited with the State of

7-20  Nevada.

7-21      Sec. 16.  NRS 598.948 is hereby amended to read as follows:

7-22      598.948  Each contract between the buyer and the dance studio

7-23  , martial arts studio or health club must:

7-24      1.  Be in writing, legible and have all spaces filled in before the

7-25  buyer signs it;

7-26      2.  Be in the language in which the sales presentation was

7-27  given;

7-28      3.  Contain the addresses of the buyer and the studio or club;

7-29      4.  Be given to the buyer when he signs it;

7-30      5.  Disclose whether security has been obtained and deposited

7-31  with the Division pursuant to NRS 598.726;

7-32      6.  Specify the term of membership of the buyer, which must

7-33  not be measured by the life of the buyer;

7-34      7.  Clearly specify the right of the buyer to cancel the contract

7-35  pursuant to NRS 598.950;

7-36      8.  Not contain a clause by which the contract is automatically

7-37  renewed; and

7-38      9.  Specify the number of lessons and the cost of each lesson, if

7-39  the contract is for dance lessons.

7-40      Sec. 17.  NRS 598.950 is hereby amended to read as follows:

7-41      598.950  A buyer may cancel a contract for dance lessons, the

7-42  use of facilities or other services from a dance studio , martial arts

7-43  studio or health club within 3 business days after he receives a copy

7-44  of the contract by notifying the studio or club in writing. The notice

7-45  must be delivered in person or by mail postmarked by midnight of

8-1  the third business day. The studio or club shall return all money paid

8-2  by the buyer within 15 days after it receives the notice of

8-3  cancellation.

8-4  Sec. 18.  NRS 598.952 is hereby amended to read as follows:

8-5  598.952  A dance studio , martial arts studio or health club

8-6  shall not make any false or misleading representation to the buyer or

8-7  in its advertising. A contract for services from a dance studio ,

8-8  martial arts studio or health club is void and unenforceable if any

8-9  false or misleading representation was made to the buyer.

8-10      Sec. 19.  NRS 598.954 is hereby amended to read as follows:

8-11      598.954  If a buyer becomes disabled during the term of a

8-12  contract, and a physician confirms in writing to the dance studio ,

8-13  martial arts studio or health club that:

8-14      1.  The buyer is not physically able to use the facilities of the

8-15  studio or club; and

8-16      2.  The disability will continue for more than

8-17  3 months,

8-18  the buyer is entitled to suspend the contract for the duration of the

8-19  disability. After he recovers, he is entitled to an extension of the

8-20  contract for a period equal to the time of the disability. If he is

8-21  permanently disabled, he may cancel the contract and receive a

8-22  refund pro rata of the amount paid pursuant to it.

8-23      Sec. 20.  NRS 598.956 is hereby amended to read as follows:

8-24      598.956  1.  If a dance studio , martial arts studio or health

8-25  club is closed for more than 1 month, through no fault of the buyer,

8-26  he is entitled to:

8-27      (a) Extend the contract for a period equal to the time the studio

8-28  or club is closed; or

8-29      (b) Receive a refund pro rata of the amount paid pursuant to the

8-30  contract.

8-31      2.  If the dance studio , martial arts studio or health club is

8-32  closed without fault of its owner or management, the election of

8-33  remedies under subsection 1 must be made by the studio or club. If

8-34  the studio or club is closed because of the fault of its owner or

8-35  management, the election must be made by the buyer.

8-36      Sec. 21.  NRS 598.958 is hereby amended to read as follows:

8-37      598.958  1.  If a dance studio , martial arts studio or health

8-38  club transfers its obligations to provide goods or services to a buyer

8-39  to another studio or club that provides substantially fewer goods or

8-40  services, the buyer may consent to the transfer in writing after a full

8-41  disclosure of the goods and services provided by the new studio or

8-42  club. If the buyer does not consent, his contract is rescinded and he

8-43  must be given a refund pro rata upon the amount of time he was a

8-44  member of the dance studio , martial arts studio or health club.

9-1  2.  If a dance studio , martial arts studio or health club moves

9-2  its place of business that is geographically closest to the residence of

9-3  the buyer as set forth in the contract, more than 20 miles farther

9-4  away from the residence of the buyer than it was when the contract

9-5  for services was signed, the buyer may rescind the contract and the

9-6  dance studio , martial arts studio or health club shall provide a

9-7  refund pro rata based upon the amount of time he was a member.

9-8  Sec. 22.  NRS 598.960 is hereby amended to read as follows:

9-9  598.960  If a dance studio , martial arts studio or health club

9-10  does not comply with the provisions of NRS 598.940 to 598.950,

9-11  inclusive, and section 2 of this act or 598.954 to 598.966, inclusive,

9-12  the buyer may agree in writing, after a full disclosure, to any

9-13  correction of the defect if the correction is made within 30 days after

9-14  he signs a contract for dance lessons, the use of facilities or other

9-15  services. If the buyer does not consent, or if the correction is not

9-16  made within the 30-day period, the contract is rescinded and the

9-17  buyer must be given a full refund.

9-18      Sec. 23.  NRS 598.962 is hereby amended to read as follows:

9-19      598.962  Any waiver by the buyer of the provisions of NRS

9-20  598.940 to 598.966, inclusive, and section 2 of this act is contrary

9-21  to public policy and void.

9-22      Sec. 24.  NRS 598.966 is hereby amended to read as follows:

9-23      598.966  1.  The remedies, duties and prohibitions of NRS

9-24  598.940 to 598.966, inclusive, and section 2 of this act are not

9-25  exclusive and are in addition to any other remedies provided by law.

9-26      2.  Any violation of NRS 598.944 to 598.958, inclusive,

9-27  constitutes a deceptive trade practice for the purposes of NRS

9-28  598.0903 to 598.0999, inclusive.

 

9-29  H