Amended in Assembly March 14, 2013

California Legislature—2013–14 Regular Session

Assembly Bill No. 1095

Introduced by Assembly Member Nestande

February 22, 2013

begin delete An act to amend Section 3294 of the Civil Code, relating to civil actions. end delete begin insert An act to amend Section 21608.5 of the Business and Professions Code, relating to business. end insert

LEGISLATIVE COUNSEL’S DIGEST

AB 1095, as amended, Nestande. begin delete Civil actions: damages. end delete begin insert Junk dealers and recyclers: nonferrous materials. end insert

begin insert

Existing law requires junk dealers and recyclers, as defined, to maintain written records of all sales and purchases made in the course of their business, and makes a violation of the recordkeeping requirements a misdemeanor. Existing law prohibits a junk dealer or recycler from providing payment for nonferrous material, as defined, unless the payment is made by cash or check, the check is mailed or the cash or check is provided no earlier than 3 days after the date of sale, and the dealer or recycler obtains a photograph or video of the seller and certain other identifying information, as specified, which information is to be retained by the dealer or recycler, as part of the written record of purchases, for a specified period of time. Existing law exempts from the payment by cash or check requirement those sellers of junk or recycling materials who conduct 5 or more separate transactions per month with the junk dealer or recycler, as specified.

end insert begin insert

This bill would require a junk dealer or recycler to provide payment by check only, mailed or provided to the seller of the materials no earlier than 30 days after the date of sale, and would prohibit the junk dealer or recycler from recycling, selling, or disposing of the materials during that time period. The bill would delete the exemption from the check-only payment requirement of those sellers of junk or recycling materials who conduct 5 or more separate transactions per month with the junk dealer or recycler. The bill would exempt from the check-only payment requirement, and permit payment by check or cash on or after the 3rd business day from the date of sale, the sale of nonferrous materials under specified circumstances, including if the nonferrous materials were marked with an indicia of ownership, as defined. Under these circumstances, the bill would require the junk dealer or recycler to obtain specified documentation from the seller.

end insert begin insert

The bill would also exempt from the check-only payment requirement, and permit payment by check or cash on or after the 3rd business day from the date of sale, the sale of nonferrous materials that were removed from the home of the seller during construction, if the junk dealer or recycler obtained specified documentation from the seller, including a letter from a licensed contractor stating that the materials were removed from the home of the seller during construction. The bill would provide that a licensed contractor who willfully or knowingly makes a false or fictitious statement in that letter is guilty of a crime. The bill would also require the junk dealer or regular to retain the documentation obtained pursuant to these provisions as part of the written record of purchases.

end insert begin insert

Because a violation of the recordkeeping requirement would be a crime and because this bill creates a new crime, the bill would impose a state-mandated local program.

end insert begin insert

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

end insert begin insert

This bill would provide that no reimbursement is required by this act for a specified reason.

end insert begin delete

Existing law authorizes the plaintiff, in an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, to recover damages for the sake of example and by way of punishing the defendant in addition to the actual damages.

end delete begin delete

This bill would make technical, nonsubstantive changes to this provision.

end delete

Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program:  begin delete no end delete begin insert yes end insert .

The people of the State of California do enact as follows:

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Section 21608.5 of the end insert begin insert Business and Professions
Code end insert begin insert is amended to read: end insert

21608.5.  

(a) A junk dealer or recycler in this state shall not
provide payment for nonferrous material unless, in addition to
meeting the written record requirements of Sections 21605 and
21606, all of the following requirements are met:

(1) The payment for the material is made by begin delete cash or check. The end delete
check begin insert , which end insert may be mailed to the seller at the address provided
pursuant to paragraph (3) or begin delete the cash or check may be end delete collected
by the seller from the junk dealer or recycler on or after the begin delete third
business end delete begin insert 30th end insert day after the date of sale begin insert , during which period the
junk dealer or recycler may not discard, disassemble, recycle, sell,
dispose of, or otherwise remove the items purchased from the junk
dealer’s or recycler’s property end insert .

(2) At the time of sale, the junk dealer or recycler obtains a clear
photograph or video of the seller.

(3) (A) Except as provided in subparagraph (B), the junk dealer
or recycler obtains a copy of the valid driver’s license of the seller
containing a photograph and an address of the seller, a copy of a
state or federal government-issued identification card containing
a photograph and an address of the seller, a passport from any
other country in addition to another item of identification bearing
an address of the seller, or a Matricula Consular in addition to
another item of identification bearing an address of the seller.

(B) If the seller prefers to have the check for the material mailed
to an alternative address, other than a post office box, the junk
dealer or recycler shall obtain a copy of a driver’s license or
identification card described in subparagraph (A), and a gas or
electric utility bill addressed to the seller at that alternative address
with a payment due date no more than two months prior to the
date of sale. For purposes of this paragraph, “alternative address”
means an address that is different from the address appearing on
the seller’s driver’s license or identification card.

(4) The junk dealer or recycler obtains a clear photograph or
video of the nonferrous material being purchased.

(5) The junk dealer or recycler shall preserve the information
obtained pursuant to this subdivision for a period of two years after
the date of sale.

(6) (A) The junk dealer or recycler obtains a thumbprint of the
seller, as prescribed by the Department of Justice. The junk dealer
or recycler shall keep this thumbprint with the information obtained
under this subdivision and shall preserve the thumbprint in either
hardcopy or electronic format for a period of two years after the
date of sale.

(B) Inspection or seizure of the thumbprint shall only be
performed by a peace officer acting within the scope of his or her
authority in response to a criminal search warrant signed by a
magistrate and served on the junk dealer or recycler by the peace
officer. Probable cause for the issuance of that warrant must be
based upon a theft specifically involving the transaction for which
the thumbprint was given.

begin delete

(b) Paragraph (1) of subdivision (a) shall not apply if, during
any three-month period commencing on or after the effective date
of this section, the junk dealer or recycler completes five or more
separate transactions per month, on five or more separate days per
month, with the seller and, in order for paragraph (1) of subdivision
(a) to continue to be inapplicable, the seller must continue to
complete five or more separate transactions per month with the
junk dealer or recycler.

end delete begin delete

(c)

end delete

begin insert (b) end insert  This section shall not apply if, on the date of sale, the junk
dealer or recycler has on file or receives all of the following
information:

(1) The name, physical business address, and business telephone
number of the seller’s business.

(2) The business license number or tax identification number
of the seller’s business.

(3) A copy of the valid driver’s license of the person delivering
the nonferrous material on behalf of the seller to the junk dealer
or the recycler.

begin delete

(d)

end delete

begin insert (c) end insert  (1) This section shall not apply to the purchase of nonferrous
material having a value of not more than twenty dollars ($20) in
a single transaction, when the majority of the transaction is for the
redemption of beverage containers under the California Beverage
Container Recycling and Litter Reduction Act, as set forth in
Division 12.1 (commencing with Section 14500) of the Public
Resources Code.

(2) Materials made of copper or copper alloys shall not be
purchased under this subdivision.

begin delete

(e)

end delete

begin insert (d) end insert  This section shall not apply to coin dealers or to automobile
dismantlers, as defined in Section 220 of the Vehicle Code.

begin insert

(e) Paragraph (1) of subdivision (a) shall not apply, and
payment for the nonferrous materials may be made by cash, or
check mailed to the seller at the address provided pursuant to
paragraph (3) of subdivision (a), or by cash or check collected by
the seller from the junk dealer or recycler on or after the third
business day after the date of sale, if one of the following conditions
are met:

end insert begin insert

(1) If the materials are marked with an indicia of ownership,
the junk dealer or recycler obtains a proof of ownership record,
including, but not limited to, a receipt from the indicated owner,
or a bill of lading, from the person selling or delivering the
materials that shows that person has lawful possession or
ownership of the materials. Copies of these documents shall be
maintained by the junk dealer or recycler as part of the written
record of the transaction.

end insert begin insert

(2) If the materials are not marked with an indicia of ownership,
the junk dealer or recycler obtains a proof of purchase record
identifying the materials brought in for sale or recycling, including,
but not limited to, a retail store receipt identifying the materials
by part number if that part number is indicated on the materials.
Copies of these documents shall be maintained by the junk dealer
or recycler as part of the written record of the transaction.

end insert begin insert

(3) If the materials are recycled after being removed from the
home of the seller, the junk dealer or recycler obtains the following
documentation, and maintains that documentation as part of the
written record of the transaction:

end insert begin insert

(A) A letter from a licensed contractor indicating the address
of the seller and stating that the materials were removed from the
home of the seller during the course of construction. A licensed
contractor who willfully or knowingly makes a false or fictitious
statement under this subparagraph is guilty of a misdemeanor
punishable pursuant to subdivision (b) of Section 21608.

end insert begin insert

(B) A copy of the contractor’s license.

end insert begin insert

(C) A utility bill addressed to the seller with a payment due date
no more than two months prior to the date of sale, indicating the
seller’s name and address as it appears on the letter pursuant to
subparagraph (A) and the seller’s name as it appears on the
identification documentation provided pursuant to paragraph (3)
of subdivision (a).

end insert begin insert

(f) For the purposes of this section, the following terms have
the following meanings:

end insert begin insert

(1) “Indicia of ownership” means words, symbols, or registered
trademarks printed, stamped, etched, attached, or otherwise
displayed on the exterior surface of the materials that reasonably
identify the owner.

end insert begin delete

(f) For the purposes of this section, “nonferrous

end delete

begin insert (2) end insert begin insert   end insert begin insert “Nonferrous end insert material” means copper, copper alloys,
stainless steel, or aluminum, but does not include beverage
containers, as defined in Section 14505 of the Public Resources
Code, that are subject to a redemption payment pursuant to Section
14560 of the Public Resources Code.

(g) This section is intended to occupy the entire field of law
related to junk dealer or recycler transactions involving nonferrous
material. However, a city or county ordinance, or a city and county
ordinance, relating to the subject matter of this section is not in
conflict with this section if the ordinance is passed by a two-thirds
vote and it can be demonstrated by clear and convincing evidence
that the ordinance is both necessary and addresses a unique problem
within and specific to the jurisdiction of the ordinance that cannot
effectively be addressed under this section.

begin insert

begin insert SEC. 2. end insert   

end insert begin insert

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.

end insert

begin delete

SECTION 1.  

Section 3294 of the Civil Code is amended to
read:

3294.  

(a) In an action for the breach of an obligation not arising
from contract, where it is proven by clear and convincing evidence
that the defendant has been guilty of oppression, fraud, or malice,
the plaintiff, in addition to the actual damages, may recover
damages for the sake of example and by way of punishing the
defendant.

(b) An employer shall not be liable for damages pursuant to
subdivision (a), based upon acts of an employee of the employer,
unless the employer had advance knowledge of the unfitness of
the employee and employed him or her with a conscious disregard
of the rights or safety of others or authorized or ratified the
wrongful conduct for which the damages are awarded or was
personally guilty of oppression, fraud, or malice. With respect to
a corporate employer, the advance knowledge and conscious
disregard, authorization, ratification or act of oppression, fraud,
or malice must be on the part of an officer, director, or managing
agent of the corporation.

(c) As used in this section, the following definitions shall apply:

(1) “Malice” means conduct which is intended by the defendant
to cause injury to the plaintiff or despicable conduct which is
carried on by the defendant with a willful and conscious disregard
of the safety or rights of others.

(2) “Oppression” means despicable conduct that subjects a
person to cruel and unjust hardship in conscious disregard of that
person’s rights.

(3) “Fraud” means an intentional misrepresentation, deceit, or
concealment of a material fact known to the defendant with the
intention on the part of the defendant of thereby depriving a person
of property or a legal right or otherwise causing injury.

(d) Damages may be recovered pursuant to this section in an
action pursuant to Chapter 4 (commencing with Section 377.10)
of Title 3 of Part 2 of the Code of Civil Procedure based upon a
death which resulted from a homicide for which the defendant has
been convicted of a felony, whether or not the decedent died
instantly or survived the fatal injury for some period of time. The
procedures for joinder and consolidation contained in Section
377.62 of the Code of Civil Procedure shall apply to prevent
multiple recoveries of punitive or exemplary damages based upon
the same wrongful act.

(e) The amendments to this section made by Chapter 1498 of
the Statutes of 1987 apply to all actions in which the initial trial
has not commenced prior to January 1, 1988.

end delete