BILL NUMBER: AB 171 AMENDED 06/02/94 BILL TEXT AMENDED IN SENATE JUNE 2, 1994 AMENDED IN SENATE MARCH 21, 1994 AMENDED IN ASSEMBLY APRIL 20, 1993 AMENDED IN ASSEMBLY MARCH 17, 1993 INTRODUCED BY Assembly Member Conroy JANUARY 19, 1993 An act to amend Section 17538.5 of the Business and Professions Code, relating to consumer protection. LEGISLATIVE COUNSEL'S DIGEST AB 171, as amended, Conroy. Consumer protection: goods and services. Existing law makes it a misdemeanor for any person conducting a business in this state that utilizes a post office box address or a street address representing a site used primarily for the receipt or delivery of mail or as a telephone answering service, to sell or offer to sell consumer goods or services without disclosing the legal name under which business is done and the complete street address from which business is actually conducted in all advertising and promotional materials. This bill would include within this provision any person conducting a business in this state that utilizes a private mailbox receiving service. By so doing, this bill would impose a state-mandated local program by expanding the scope of an existing crime. This bill would also provide that the above provision shall not apply to persons whose current business street address or home address is filed with the United States Postal Service and who have signed an acknowledgment form, as specified. The bill would prohibit a commercial mail receiving agency from providing private mailbox receiving service to any customer until the agency {- complies with specified registration requirements, and -} obtains from every customer certain identification and a signed acknowledgment containing specified provisions of law that prohibit engaging in unfair competition or false advertising and that regulate the use of private mailbox receiving service. The bill would also require the commercial mail receiving agency to maintain certain information for each customer and make that information available to any {- governmental -} {+ law enforcement +} agency. By making a violation of these provisions a crime, the bill would impose a state-mandated local program. The bill would specify notice procedures to inform a consumer who complains regarding a mailbox user of actions that may be taken. A commercial mail receiving agency that contacts a {- governmental -} {+ law enforcement +} agency regarding possible illegal or fraudulent activities by a private mailbox receiving service customer is immune from civil liability related to that contact. 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. This bill would provide that no reimbursement is required by this act for a specified reason. {+ The bill would state legislative intent. +} Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. {+ The Legislature finds and declares all of the following: (a) The California workplace is rapidly changing. (b) It is estimated that over 7.5 million Californians operate home-based businesses. (c) A large number of home-based businesses and other individuals use commercial mail receiving agencies for convenience and numerous support services provided by these businesses. (d) The commercial mail receiving agency industry is the most appropriate party to establish self-regulation and identification policies to provide consumer confidence. (e) There is a need for the commercial mail receiving agency industry to have a statewide registry system available to governmental agencies for inspection. (f) A registry system for commercial mail receiving agencies will provide a mechanism to identify commercial mail receiving agency locations to assist governmental agencies in resolving consumer disputes and complaints. SEC. 2. +} Section 17538.5 of the Business and Professions Code is amended to read: 17538.5. (a) It is unlawful in the sale or offering for sale of consumer goods or services for any person conducting, any business in this state which utilizes a post office box address, a private mailbox receiving service, or a street address representing a site used for the receipt or delivery of mail or as a telephone answering service, to fail to disclose the legal name under which business is done and the complete street address from which business is actually conducted in all advertising and promotional materials, including order blanks and forms. Any violation of the provisions of this section is a misdemeanor punishable by imprisonment in the county jail not exceeding six months, or by a fine not exceeding two thousand five hundred dollars ($2,500), or by both. (b) This section shall not apply to a person who sells the preponderance of goods and services at retail from trade premises which are open to the public regularly during normal business hours where the post office box or telephone answering service is supportive of and ancillary to the sales made or to any person who provides services pursuant to a license issued pursuant to this code or any other provision of law by a state board or agency or, except for a person conducting a mail order or catalog business, by a city or county or city and county in this state, which has the person's current business street address or home address on record and which is authorized to reveal that address to inquiring persons. In addition, this section shall not apply to any person (1) whose current business street address or home address is contained in a United States Postal Service (USPS) Form 1583 that is filed with the USPS, and (2) who has signed an acknowledgement form substantially in accordance with the provisions set forth in subdivision (f) which, among other things, authorizes the commercial mail receiving agency to act as that person's agent for service of process. {- (c) A commercial mail receiving agency (CMRA) shall not provide mail receiving service for any customer until it has filed a registration form with the Department of Consumer Affairs. The registration form shall be prepared by the Department of Consumer Affairs and shall include the following information for each CMRA: (1) Trade or business name of the CMRA. (2) Complete business location of the CMRA, including street address, city, county, ZIP Code, business telephone and fax numbers. (3) Type of business entity. (4) Legal name of business owner. (5) Name of primary individual owners if business operates as a corporation, partnership, or other legal entity. The Department of Consumer Affairs shall maintain for inspection by any other federal, state, or local agency a complete list of all CMRAs registered in the state, including the locations and street addresses of all mail receiving services provided by the United States Postal Service. A -} {+ (c) A +} commercial mail receiving agency (CMRA) shall not provide private mailbox receiving service to any customer until it obtains from that customer at least two pieces of identification regarding that customer and provides to that customer an acknowledgment, as set forth in subdivision (f), which (1) acknowledges the obligation to advise the CMRA of any change in address, (2) authorizes the CMRA to act as an agent for service of process, and (3) acknowledges the requirements of Sections 17200 and 17500, which prohibit unfair competition and false advertising. The commercial mail receiving agency shall thereafter maintain a copy of any United States Postal Service Form 1583 for each mailbox service customer, along with a copy of each of the two pieces of identification used by the customer, for a period of two years after the termination of service to that customer. Upon the request of any {- governmental -} {+ law enforcement +} agency, the commercial mail receiving agency shall make available to that {- governmental -} {+ law enforcement +} agency, for purposes of inspection and copying, its copy of the United States Postal Service Form 1583 and the two pieces of identification used by the customer. (d) Every person receiving private mailbox receiving service from a CMRA in this state shall be required to sign an agreement, along with a USPS Form 1583, which authorizes the CMRA owner or operator to act as agent for service of process for the mail receiving service customer. Every CMRA owner or operator shall be required to accept service of process for and on behalf of any of their mail receiving service customers, and for a period of time of 18 months after termination of any mail receiving service customer agreement. Upon receipt of any process for any mailbox service customer, the CMRA owner or operator shall (1) within 48 hours after receipt of any process, place a copy of the documents or a notice that the documents were received into the customer's mailbox or other place where the customer usually receives his or her mail, and (2) within five days after receipt, send all documents received by first class mail, to the last known home or personal address of the mail receiving service customer, as disclosed in the USPS Form 1583 submitted by the customer in connection with the establishment of the mail receiving service. Service of process upon the mail receiving service customer shall then be deemed perfected 10 days after the date of mailing. If the CMRA owner or operator has complied with the foregoing requirements and provides to any party participating in a lawsuit involving a mail receiving service customer a declaration of service by mail, given under penalty of perjury along with a certificate of mailing, the CMRA owner or operator shall have no further liability in connection with acting as agent for service of process for its mail receiving service customer. (e) In the event any consumer makes a complaint to the owner or operator of a CMRA regarding one of the CMRA's private mailbox receiving service customers, the CMRA owner or operator shall provide the consumer with a notice as set forth in subdivision {- (f) -} {+ (g) +} advising the consumer of his or her rights of redress. An owner or operator of a CMRA who, acting in good faith, contacts a {- governmental -} {+ law enforcement +} agency concerning suspected illegal or fraudulent activities carried out by a mail receiving service customer shall have no liability for claims filed by the customer arising out of that contact. Any owner or operator of a commercial mail receiving agency that maintains on file a copy of the United States Postal Service Form 1583 for its private mailbox receiving service customers and complies with{- the registration requirements set forth in -} subdivision (c) shall not be liable for any illegal acts of any mail receiving service customer, provided that the CMRA owner or operator has not participated in any of the illegal acts. (f) The following acknowledgement and notice shall be delivered to each person obtaining private mailbox receiving service at a CMRA: "ACKNOWLEDGEMENT BY PRIVATE MAILBOX SERVICE CUSTOMERS This acknowledgement is required by Section 17538.5 of the Business and Professions Code. Any person obtaining private mailbox receiving service in the State of California must read and acknowledge receipt of the following statement, which is to be kept on file at this CMRA and will be made available, upon demand, to any {- governmental -} {+ law enforcement +} agency. By requesting and obtaining use of a private mailbox receiving service in the State of California, I acknowledge that: 1. I am obligated to disclose my actual home address or place of residence on a USPS Form 1583 or other form as may later be developed and I further agree that I will provide prompt written notice to this CMRA of any subsequent change in my home address or place of residence. 2. By signing below, I authorize this CMRA to act as my agent for service of process to receive any legal documents that may be served upon me. I understand that this CMRA will (A) place a copy of the documents or a notice that the documents were received into my mailbox or other place where I usually receive my mail, and (B) deposit all documents with the United States Postal Service, by first-class mail, addressed to my last known home or personal address as disclosed in my USPS Form 1583 or as otherwise specified by me. 3. I further acknowledge that I understand that use of a private mailbox receiving service for commercial purposes in the State of California requires the user to comply with Section 17538.5 of the Business and Professions Code and may subject the user to laws prohibiting unfair competition and false advertising as set forth in Sections 17200 and 17500 of the Business and Professions Code. Any violation of those laws is a misdemeanor punishable by imprisonment in the county jail or fines and civil penalties as provided by law. I understand that the United States Postal Service Form 1583 that must be prepared for each private mailbox receiving service customer shall be delivered to the local United States Post Office and a copy of the form must be retained by this CMRA and made available upon demand to any {- governmental -} {+ law enforcement +} agency. I hereby agree to accept and abide by the foregoing requirements. __________ _____________________________ Date Signature _____________________________ Name Printed _____________________________ Street Address _____________________________ City State Zip" (g) Any CMRA operating in this state shall provide a copy of the following notice to any consumer who inquires or has a complaint regarding activities carried out by any user of a private mailbox receiving service: "NOTICE TO CONSUMERS This notice is required by Section 17538.5 of the Business and Professions Code. If you have a complaint or believe that you have been defrauded by a user of a private mailbox receiving service at this commercial mail receiving agency, you are advised that you may take the following actions to resolve your complaint or dispute: 1. You should write a clear and concise letter to the business setting forth a description of the problem and requesting the desired resolution. 2. If you cannot obtain satisfaction by contacting the business, you may contact your local United States Post Office (Postal Inspector), consumer protection agency, or district attorney or city attorney's office and advise them that you want to file a consumer fraud complaint. The agency will provide you with the necessary forms. 3. You may file a small claims lawsuit against the business, if the amount in dispute is five thousand dollars ($5,000) or less. Service of process may be made by leaving the complaint with this commercial mail receiving agency as provided in subdivision (b) of Section 415.20 of the Code of Civil Procedure. 4. You may consult with an attorney and file a civil lawsuit against the business seeking monetary damages and any other appropriate relief." {- SEC. 2. -} {+ SEC. 3. +} No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs which may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, changes the definition of a crime or infraction, changes the penalty for a crime or infraction, or eliminates a crime or infraction. Notwithstanding Section 17580 of the Government Code, unless otherwise specified in this act, the provisions of this act shall become operative on the same date that the act takes effect pursuant to the California Constitution.