Chapter 917 Oregon Laws 2001

AN ACT

HB 3917

Relating to trade practices; creating new provisions; and amending ORS 646.605, 646.638 and 697.005.

Be It Enacted by the People of the State of Oregon:

SECTION 1. (1) As used in this section:

(a) “Buyer” means a person who buys or agrees to buy a manufactured dwelling from a manufactured dwelling dealer.

(b) “Cash sale price” means the price for which a manufactured dwelling dealer would sell to a buyer, and the buyer would buy from a dealer, a manufactured dwelling that is covered by a purchase agreement, if the sale were a sale for cash instead of a retail installment sale.

(c) “Manufactured dwelling” has the meaning given that term in ORS 446.003.

(d) “Manufactured dwelling dealer” means a vehicle dealer issued a certificate under ORS 822.020 who sells a manufactured dwelling.

(e) “Retail installment sale” has the meaning given that term in ORS 83.510.

(2) A manufactured dwelling dealer engages in an unlawful practice when, in a sale of a manufactured dwelling, the dealer does any of the following:

(a) Misrepresents to a buyer that, as a condition of financing, the buyer must purchase:

(A) Credit life insurance;

(B) Credit disability insurance;

(C) Credit unemployment insurance;

(D) Credit property insurance;

(E) Health insurance;

(F) Life insurance; or

(G) An extended warranty.

(b) In close connection with the sale, misrepresents to a lender:

(A) The cash sale price;

(B) The amount of the buyer's down payment; or

(C) The buyer's credit or employment history.

SECTION 2. Section 1 of this 2001 Act is added to and made a part of ORS 646.605 to 646.652.

SECTION 3. ORS 646.638 is amended to read:

646.638. (1) Except as provided in subsection (8) of this section, any person who suffers any ascertainable loss of money or property, real or personal, as a result of willful use or employment by another person of a method, act or practice declared unlawful by ORS 646.608 or section 1 of this 2001 Act, may bring an individual action in an appropriate court to recover actual damages or $200, whichever is greater. The court or the jury, as the case may be, may award punitive damages and the court may provide [such] the equitable relief [as it deems] the court considers necessary or proper.

(2) Upon commencement of any action brought under subsection (1) of this section the party bringing the action shall mail a copy of the complaint or other initial pleading to the Attorney General and, upon entry of any judgment [or decree] in the action, shall mail a copy of [such] the judgment [or decree] to the Attorney General. Failure to mail a copy of the complaint shall not be a jurisdictional defect, but [no] a court may not enter judgment [shall be entered] for the plaintiff until proof of mailing is filed with the court. Proof of mailing may be by affidavit or by return receipt of mailing.

(3) Except as provided in subsection (4) of this section, the court may award reasonable attorney fees to the prevailing party in an action under this section.

(4) The court may not award attorney fees to a prevailing defendant under the provisions of subsection (3) of this section if the action under this section is maintained as a class action pursuant to ORCP 32.

(5) Any permanent injunction or final judgment or order of the court made under ORS 646.632 or 646.636 [shall be] is prima facie evidence in an action brought under this section that the respondent used or employed a method, act or practice declared unlawful by ORS 646.608 or section 1 of this 2001 Act, but an assurance of voluntary compliance, whether or not approved by the court, shall not be evidence of [such] the violation.

(6) Actions brought under this section shall be commenced within one year from the discovery of the unlawful method, act or practice. However, whenever any complaint is filed by a prosecuting attorney to prevent, restrain or punish violations of ORS 646.608 or section 1 of this 2001 Act, running of the statute of limitations with respect to every private right of action under this section and based in whole or in part on any matter complained of in said proceeding shall be suspended during the pendency thereof.

(7) Notwithstanding subsection (6) of this section, in any action brought by a seller or lessor against a purchaser or lessee of real estate, goods or services, [such] the purchaser or lessee may assert any counterclaim the purchaser or lessee has arising out of a violation of ORS 646.605 to 646.652.

(8) This section does not apply to any method, act or practice described in ORS 646.608 (1)(w). Actions for violation of laws relating to odometers are provided under ORS 815.410 and 815.415.

SECTION 4. ORS 646.605 is amended to read:

646.605. As used in ORS 646.605 to 646.652:

(1) “Appropriate court” means the circuit court of a county:

(a) Where one or more of the defendants reside;

(b) Where one or more of the defendants maintain a principal place of business;

(c) Where one or more of the defendants are alleged to have committed an act prohibited by ORS 646.605 to 646.652; or

(d) With the defendant's consent, where the prosecuting attorney maintains an office.

(2) “Documentary material” means the original or a copy of any book, record, report, memorandum, paper, communication, tabulation, map, chart, photograph, mechanical transcription, or other tangible document or recording, wherever situate.

(3) “Examination” of documentary material shall include inspection, study, or copying of any such material, and taking testimony under oath or acknowledgment in respect of any such documentary material or copy thereof.

(4) “Person” means natural persons, corporations, trusts, partnerships, incorporated or unincorporated associations, and any other legal entity except bodies or officers acting under statutory authority of this state or the United States.

(5) “Prosecuting attorney” means the Attorney General or the district attorney of any county in which a violation of ORS 646.605 to 646.652 is alleged to have occurred.

(6) “Real estate, goods or services” means those which are or may be obtained primarily for personal, family or household purposes, or which are or may be obtained for any purposes as a result of a telephone solicitation, and includes franchises, distributorships and other similar business opportunities, but does not include insurance. Real estate does not cover conduct covered by ORS chapter 90.

(7) “Telephone solicitation” means a solicitation where a person, in the course of the person's business, vocation or occupation, uses a telephone or an automatic dialing-announcing device to initiate telephonic contact with a potential customer and the person is not one of the following:

(a) A person who is a broker-dealer or salesperson licensed under ORS 59.175, or a mortgage banker or mortgage broker licensed under ORS 59.850 when the solicitation is for a security qualified for sale pursuant to ORS 59.055;

(b) A person who is licensed or is otherwise authorized to engage in professional real estate activity pursuant to ORS chapter 696, when the solicitation involves professional real estate activity;

(c) A person licensed or exempt from licensure as a builder pursuant to ORS chapter 701, when the solicitation involves the construction, alteration, repair, improvement or demolition of a structure;

(d) A person licensed or otherwise authorized to sell insurance as an agent pursuant to ORS chapter 744, when the solicitation involves insurance;

(e) A person soliciting the sale of a newspaper of general circulation, a magazine or membership in a book or record club who complies with ORS 646.611, when the solicitation involves newspapers, magazines or membership in a book or record club;

(f) A person soliciting without the intent to complete and who does not complete the sales presentation during the telephone solicitation and who only completes the sales presentation at a later face-to-face meeting between the solicitor and the prospective purchaser;

(g) A supervised financial institution or parent, subsidiary or affiliate thereof. As used in this paragraph, “supervised financial institution” means any financial institution or trust company, as those terms are defined in ORS 706.008, or any personal property broker, consumer finance lender, commercial finance lender or insurer that is subject to regulation by an official or agency of this state or of the United States;

(h) A person who is authorized to conduct prearrangement or preconstruction funeral or cemetery sales, pursuant to ORS chapter 692, when the solicitation involves prearrangement or preconstruction funeral or cemetery plans;

(i) A person who solicits the services provided by a cable television system licensed or franchised pursuant to state, local or federal law, when the solicitation involves cable television services;

(j) A person or affiliate of a person whose business is regulated by the Public Utility Commission of Oregon;

(k) A person who sells farm products as defined by ORS chapter 576 if the solicitation neither intends to nor actually results in a sale that costs the purchaser in excess of $100;

(L) An issuer or subsidiary of an issuer that has a class of securities that is subject to section 12 of the Securities Exchange Act of 1934 and that is either registered or exempt from registration under paragraph (A), (B), (C), (E), (F), (G) or (H) or subsection (g) of that section;

(m) A person soliciting exclusively the sale of telephone answering services to be provided by that person or that person's employer when the solicitation involves answering services; or

(n) A telecommunications utility with access lines of 15,000 or less or a cooperative telephone association when the solicitation involves regulated goods or services.

(8) “Trade” and “commerce” mean advertising, offering or distributing, whether by sale, rental or otherwise, any real estate, goods or services, and includes any trade or commerce directly or indirectly affecting the people of this state.

(9) “Unconscionable tactics” include, but are not limited to, actions by which a person:

(a) Knowingly takes advantage of a customer's physical infirmity, ignorance, illiteracy or inability to understand the language of the agreement;

(b) Knowingly permits a customer to enter into a transaction from which the customer will derive no material benefit; or

(c) Permits a customer to enter into a transaction with knowledge that there is no reasonable probability of payment of the attendant financial obligation in full by the customer when due.

(10) A willful violation occurs when the person committing the violation knew or should have known that the conduct of the person was a violation.

(11) A loan is made “in close connection with the sale of a manufactured dwelling” if:

(a) The lender directly or indirectly controls, is controlled by or is under common control with the seller, unless the relationship is remote and is not a factor in the transaction;

(b) The lender gives a commission, rebate or credit in any form to a seller who refers the borrower to the lender, other than payment of the proceeds of the loan jointly to the seller and the borrower;

(c) The lender is related to the seller by blood or marriage;

(d) The seller directly and materially assists the borrower in obtaining the loan;

(e) The seller prepares documents that are given to the lender and used in connection with the loan; or

(f) The lender supplies documents to the seller used by the borrower in obtaining the loan.

SECTION 5. ORS 697.005 is amended to read:

697.005. As used in ORS 697.005 to 697.095:

(1)(a) “Collection agency” means:

(A) Any person directly or indirectly engaged in soliciting claims for collection, or collecting or attempting to collect claims owed, due or asserted to be owed or due to another person or to a public body;

(B) Any person who directly or indirectly furnishes, attempts to furnish, sells or offers to sell forms represented to be a collection system even though the forms direct the debtor to make payment to the creditor and even though the forms may be or are actually used by the creditor in the creditor's own name;

(C) Any person who in attempting to collect or in collecting the person's own claim uses a fictitious name or any name other than the person's own that indicates to the debtor that a third person is collecting or attempting to collect the claim;

(D) Any person in the business of engaging in the solicitation of the right to repossess or in the repossession of collateral security due or asserted to be due to another person; or

(E) Any person who in the collection of claims from another person:

(i) Uses any name other than the name regularly used in the conduct of the business out of which the claim arose; and

(ii) Engages in any action or conduct that tends to convey the impression that a third party has been employed or engaged to collect the claim.

(b) “Collection agency” does not include:

(A) Any individual engaged in soliciting claims for collection, or collecting or attempting to collect claims on behalf of a registrant under ORS 697.005 to 697.095, if the individual is an employee of the registrant;

(B) Any individual collecting or attempting to collect claims for not more than three employers, if all collection efforts are carried on in the name of the employer and the individual is an employee of the employer;

(C) Any person who prepares or mails monthly or periodic statements of accounts due on behalf of another person if all payments are made to that other person and no other collection efforts are made by the person preparing the statements of accounts;

(D) Any attorney-at-law rendering services in the performance of the duties of an attorney-at-law;

(E) Any licensed certified public accountant or public accountant rendering services in the performance of the duties of a licensed certified public accountant or public accountant;

(F) Any bank, mutual savings bank, consumer finance company, trust company, savings and loan association, credit union or debt consolidation agency;

(G) Any real estate licensee or escrow agent licensed under the provisions of ORS chapter 696, as to any collection or billing activity involving a real estate transaction or collection escrow transaction of the licensee or escrow agent;

(H) Any individual regularly employed as a credit person or in a similar capacity by one person, firm or corporation that is not a collection agency as defined in this section;

(I) Any public officer or any person acting under order of any court;

(J) Any person acting as a property manager in collecting or billing for rent, fees, deposits or other sums due landlords of managed units;

(K) Any person while the person is providing billing services. A person is providing billing services for the purposes of this subparagraph if the person engages, directly or indirectly, in the business or pursuit of collection of claims for other persons, whether in the other person's name or any other name, by any means that:

(i) Is an accounting procedure, preparation of mail billing or any other means intended to accelerate cash flow to the other person's bank account or to any separate trust account; and

(ii) Does not include any personal contact or contact by telephone with the person from whom the claim is sought to be collected;

(L) Any person while the person is providing factoring services. A person is providing factoring services for the purposes of this subparagraph if the person engages, directly or indirectly, in the business or pursuit of:

(i) Lending or advancing money to commercial clients on the security of merchandise or accounts receivable and then enforcing collection actions or procedures on such accounts; or

(ii) Soliciting or collecting on accounts that have been purchased from commercial clients under an agreement whether or not the agreement:

(I) Allows recourse against the commercial client;

(II) Requires the commercial client to provide any form of guarantee of payment of the purchased account; or

(III) Requires the commercial client to establish or maintain a reserve account in any form;

(M) Any individual employed by another person who operates as a collection agency if the person does not operate as a collection agency independent of that employment;

(N) Any mortgage banker as defined in ORS 59.840;

(O) Any public utility, as defined in ORS 757.005, any telecommunications utility, as defined in ORS 759.005, any people's utility district, as defined in ORS 261.010, and any cooperative corporation engaged in furnishing electric or communication service to consumers; [or]

(P) Any public body or any individual collecting or attempting to collect claims owed, due or asserted to be owed or due to any public body, if the individual is an employee of the public body[.]; or

(Q) Any person for whom the Director of the Department of Consumer and Business Services determines by order or by rule that the protection of the public health, safety and welfare does not require registration with the department as a collection agency.

(2) “Collection system” means a scheme intended or calculated to be used to collect claims sent, prepared or delivered by:

(a) A person who in collecting or attempting to collect the person's own claim uses a fictitious name or any name other than the person's own that indicates to the debtor that a third person is collecting or attempting to collect the claim; or

(b) A person directly or indirectly engaged in soliciting claims for collection, or collecting or attempting to collect claims owed or due or asserted to be owed or due another person.

(3) “Claim” means any obligation for the payment of money or thing of value arising out of any agreement or contract, express or implied.

(4) “Client” or “customer” means any person authorizing or employing a collection agency to collect a claim.

(5) “Debtor” means any person owing or alleged to owe a claim.

(6) “Debts incurred outside this state” means any action or proceeding that:

(a) Arises out of a promise, made anywhere to the plaintiff or a third party for the plaintiff's benefit, by the defendant to perform services outside of this state or to pay for services to be performed outside of this state by the plaintiff;

(b) Arises out of services actually performed for the plaintiff by the defendant outside of this state or services actually performed for the defendant by the plaintiff outside of this state, if the performance outside of this state was authorized or ratified by the defendant;

(c) Arises out of a promise, made anywhere to the plaintiff or a third party for the plaintiff's benefit, by the defendant to deliver or receive outside of this state or to send from outside of this state goods, documents of title or other things of value;

(d) Relates to goods, documents of title or other things of value sent from outside of this state by the defendant to the plaintiff or a third person on the plaintiff's order or direction;

(e) Relates to goods, documents of title or other things of value actually received outside of this state by the plaintiff from the defendant or by the defendant from the plaintiff, without regard to where delivery to carrier occurred; or

(f) Where jurisdiction at the time the debt was incurred was outside of this state.

(7) “Department” means the Department of Consumer and Business Services.

(8) “Director” means the Director of the Department of Consumer and Business Services.

(9) “Out-of-state collection agency” means a collection agency located outside of this state whose activities within this state are limited to collecting debts incurred outside of this state from debtors located in this state. As used in this subsection, “collecting debts” means collecting by means of interstate communications, including telephone, mail or facsimile transmission from the collection agency location in another state on behalf of clients located outside of this state.

(10) “Person” includes an individual, firm, partnership, trust, joint venture, association, limited liability company or corporation.

(11) “Public body” means:

(a) The state and any branch, department, agency, board or commission of the state;

(b) Any city, county, district or other political subdivision or municipal or public corporation and any instrumentality thereof; and

(c) Any intergovernmental agency, department, council, joint board of control created under ORS 190.125 or other like entity, which is created under ORS 190.003 to 190.130 and which does not act under the direction and control of any single member government.

(12) “Registered” or “registrant” means any person registered under ORS 697.005 to 697.095 or registered or licensed as a collection agency under the laws of another state.

(13) “Statement of account” means a report setting forth amounts billed, invoices, credits allowed or aged balance due.

SECTION 6. Section 1 of this 2001 Act and the amendments to ORS 646.605 and 646.638 by sections 3 and 4 of this 2001 Act apply to conduct occurring on or after the effective date of this 2001 Act.

Approved by the Governor August 3, 2001

Filed in the office of Secretary of State August 6, 2001

Effective date January 1, 2002

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