State of Illinois
90th General Assembly
Legislation

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[ Introduced ][ Enrolled ][ Senate Amendment 001 ]

90_HB3321eng

      815 ILCS 505/1            from Ch. 121 1/2, par. 261
      815 ILCS 505/2B           from Ch. 121 1/2, par. 262B
          Amends  the  Consumer  Fraud   and   Deceptive   Business
      Practices  Act.  Provides that where a sale of merchandise is
      made  to  a  consumer  by  a  seller  pursuant  to   a   home
      solicitation  sale (now a seller who is physically present at
      the  consumer's  residence),  the  consumer  may  avoid   the
      contract or transaction by notifying the seller within 3 full
      business days.  Defines "home solicitation sale".
                                                     LRB9011390MWpc
HB3321 Engrossed                               LRB9011390MWpc
 1        AN ACT to amend the Consumer Fraud and Deceptive Business
 2    Practices Act by changing Sections 1 and 2B.
 3        Be  it  enacted  by  the People of the State of Illinois,
 4    represented in the General Assembly:
 5        Section 5.  The Consumer  Fraud  and  Deceptive  Business
 6    Practices  Act  is  amended  by changing Sections 1 and 2B as
 7    follows:
 8        (815 ILCS 505/1) (from Ch. 121 1/2, par. 261)
 9        Sec. 1.  Definitions.
10        (a)  The term "advertisement"  includes  the  attempt  by
11    publication,  dissemination,  solicitation  or circulation to
12    induce directly or indirectly any person to  enter  into  any
13    obligation   or   acquire   any  title  or  interest  in  any
14    merchandise and includes every work device  to  disguise  any
15    form   of  business  solicitation  by  using  such  terms  as
16    "renewal", "invoice", "bill", "statement", or "reminder",  to
17    create  an  impression  of  existing obligation when there is
18    none, or other language to mislead any person in relation  to
19    any sought after commercial transaction. ;
20        (b)  The  term "merchandise" includes any objects, wares,
21    goods, commodities, intangibles, real estate situated outside
22    the State of Illinois, or services. ;
23        (c)  The term "person" includes any natural person or his
24    legal representative, partnership, corporation (domestic  and
25    foreign), company, trust, business entity or association, and
26    any  agent,  employee,  salesman, partner, officer, director,
27    member, stockholder, associate, trustee or cestui  que  trust
28    thereof. ;
29        (d)  The  term  "sale" includes any sale, offer for sale,
30    or attempt to sell any merchandise for cash or on credit.
31        (e)  The term "consumer" means any person  who  purchases
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 1    or  contracts  for the purchase of merchandise not for resale
 2    in the ordinary course of his trade or business but  for  his
 3    use or that of a member of his household.
 4        (f)  The   terms   "trade"   and   "commerce"   mean  the
 5    advertising, offering for sale, sale, or distribution of  any
 6    services  and  any  property,  tangible  or intangible, real,
 7    personal or mixed, and any other article, commodity, or thing
 8    of value wherever situated, and shall include  any  trade  or
 9    commerce  directly or indirectly affecting the people of this
10    State.
11        (g)  The term "pyramid sales scheme" includes any plan or
12    operation whereby a person in exchange  for  money  or  other
13    thing  of value acquires the opportunity to receive a benefit
14    or  thing  of  value,  which  is  primarily  based  upon  the
15    inducement of  additional  persons,  by  himself  or  others,
16    regardless  of  number,  to  participate  in the same plan or
17    operation and is not primarily contingent on  the  volume  or
18    quantity  of  goods,  services,  or  other  property  sold or
19    distributed or to be  sold  or  distributed  to  persons  for
20    purposes  of  resale  to  consumers.   For  purposes  of this
21    subsection, "money or other thing of value" shall not include
22    payments made for sales demonstration equipment and materials
23    furnished on a nonprofit basis for use in  making  sales  and
24    not for resale.
25        (h)  "Home  solicitation  sale"  means  a consumer credit
26    sale of goods or services, except the sale of  real  property
27    or  an  interest  in  real  property  or the sale of personal
28    property that is incidental to a sale of real property or  an
29    interest  in  real property, in which the seller, or a person
30    acting for the seller, engages the  consumer  in  a  personal
31    solicitation of the sale at the residence of the consumer and
32    the  consumer's agreement to the sale or offer to purchase is
33    given to the seller, or a person acting for  the  seller,  at
34    the  residence.   "Home solicitation sale" does not include a
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 1    sale made pursuant to a preexisting revolving charge  account
 2    or  a  sale  made pursuant to  prior negotiations between the
 3    seller and the consumer at  a  business  establishment  at  a
 4    fixed  location  where  goods  or  services  are  offered  or
 5    exhibited for sale.
 6    (Source: P.A. 83-808.)
 7        (815 ILCS 505/2B) (from Ch. 121 1/2, par. 262B)
 8        Sec.  2B.   Where  a sale of merchandise involving $25 or
 9    more is made or contracted to be made whether under a  single
10    contract  or  under  multiple  contracts,  to a consumer by a
11    seller pursuant to a home solicitation sale who is physically
12    present at the consumer's residence, that consumer may  avoid
13    the  contract or transaction by notifying the seller within 3
14    full business days following that day on which  the  contract
15    was  signed  or  the  sale  was  made and by returning to the
16    person, in its original condition, any merchandise  delivered
17    to  the  consumer under the contract or sale. At the time the
18    transaction is made or the contract signed, the person  shall
19    furnish  the  consumer  with  a  fully  completed  receipt or
20    contract pertaining to the transaction, in substantially  the
21    same   language   as   that  principally  used  in  the  oral
22    presentation  to  the  consumer,  containing  a  "Notice   of
23    Cancellation"  informing  the consumer that he may cancel the
24    transaction at any time within 3 days and showing the date of
25    the transaction with the name and address of the person,  and
26    in  immediate proximity to the space reserved in the contract
27    for the consumer's signature or on  the  front  page  of  the
28    receipt if a contract is not used, a statement which shall be
29    in  bold  face  type,  in  at  least  10-point  type  and  in
30    substantially the following form:
31        "YOU,  THE  CONSUMER,  MAY CANCEL THIS TRANSACTION AT ANY
32    TIME PRIOR TO MIDNIGHT OF THE THIRD BUSINESS  DAY  AFTER  THE
33    DATE  OF  THIS  TRANSACTION.    SEE  THE  ATTACHED  NOTICE OF
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 1    CANCELLATION FORM FOR AN EXPLANATION OF THIS RIGHT."
 2        Attached to the receipt or contract shall be a  completed
 3    form  in  duplicate, captioned "NOTICE OF CANCELLATION" which
 4    shall be easily detachable and  which  shall  contain  in  10
 5    point bold face type the following information and statements
 6    in the same language as that used in the contract:
 7                       NOTICE OF CANCELLATION
 8                                      (enter date of transaction)
 9                                      ...........................
10                                                           (Date)
11        YOU  MAY  CANCEL THIS TRANSACTION, WITHOUT ANY PENALTY OR
12    OBLIGATION, WITHIN 3 BUSINESS DAYS FROM THE ABOVE DATE.
13        IF YOU CANCEL, ANY PROPERTY TRADED IN, ANY PAYMENTS  MADE
14    BY  YOU,  AND ANY NEGOTIABLE INSTRUMENT EXECUTED BY YOU UNDER
15    THE CONTRACT  OR  TRANSACTION  WILL  BE  RETURNED  WITHIN  10
16    BUSINESS  DAYS  FOLLOWING  RECEIPT  BY  THE  SELLER  OF  YOUR
17    CANCELLATION NOTICE, AND ANY SECURITY INTEREST ARISING OUT OF
18    THE TRANSACTION WILL BE CANCELLED.
19        IF  YOU  CANCEL, YOU MUST MAKE AVAILABLE TO THE SELLER AT
20    YOUR RESIDENCE IN SUBSTANTIALLY AS GOOD A CONDITION  AS  WHEN
21    RECEIVED,  ANY  GOODS DELIVERED TO YOU UNDER THIS CONTRACT OR
22    TRANSACTION,  OR  YOU  MAY  IF  YOU  WISH,  COMPLY  WITH  THE
23    INSTRUCTIONS OF THE SELLER REGARDING THE RETURN  SHIPMENT  OF
24    THE GOODS AT THE SELLER'S EXPENSE AND RISK.
25        IF  YOU  MAKE  THE  GOODS AVAILABLE TO THE SELLER AND THE
26    SELLER DOES NOT PICK THEM UP WITHIN 20 DAYS OF  THE  DATE  OF
27    YOUR NOTICE OF CANCELLATION, YOU MAY RETAIN OR DISPOSE OF THE
28    GOODS  WITHOUT  ANY  FURTHER OBLIGATION.  IF YOU FAIL TO MAKE
29    THE GOODS AVAILABLE TO THE SELLER, OR IF YOU AGREE TO  RETURN
30    THE  GOODS  TO  THE SELLER AND FAIL TO DO SO, THEN YOU REMAIN
31    LIABLE FOR PERFORMANCE OF ALL OBLIGATIONS UNDER THE CONTRACT.
32        TO CANCEL THIS TRANSACTION, MAIL OR DELIVER A SIGNED  AND
33    DATED  COPY  OF THIS CANCELLATION NOTICE OR ANY OTHER WRITTEN
34    NOTICE, OR SEND A TELEGRAM, TO (Name of seller), AT  (address
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 1    of  seller's  place  of  business) NOT LATER THAN MIDNIGHT OF
 2    (date).
 3        I HEREBY CANCEL THIS TRANSACTION.
 4    (Date) ............
 5                                              ...................
 6                                              (Buyer's signature)
 7        Such written "Notice of Cancellation" may be sent by  the
 8    consumer  to  the  person  to  cancel the contract. The 3 day
 9    period provided for in this Section does not  commence  until
10    the consumer is furnished a "Notice of Cancellation", and the
11    address  at  which such notice to the seller can be given. If
12    those conditions are met,  the  seller  must  return  to  the
13    consumer the full amount of any payment made or consideration
14    given  under  the  contract  or for the merchandise. It is an
15    unlawful practice within the meaning  of  this  Act  for  any
16    person to
17        (a)  Fail,  before  furnishing  copies  of the "Notice of
18    Cancellation" to the consumer,  to  complete  the  copies  by
19    entering  the name of the person, the address of the person's
20    place of business, the date of the transaction, and the date,
21    not earlier than the third business day following the date of
22    the transaction, by which the consumer  may  give  notice  of
23    cancellation;
24        (b)  Include  in  any  contract  or  receipt  under  this
25    Section  any  confession  of judgment or any waiver of any of
26    the rights to which  the  consumer  is  entitled  under  this
27    Section  including  specifically  his  right  to  cancel  the
28    transaction   in  accordance  with  the  provisions  of  this
29    Section;
30        (c)  Fail to inform each consumer orally, at the time  he
31    signs  the  contract  or  purchases  or  leases  the goods or
32    services, of his right to cancel;
33        (d)  Misrepresent in any manner the consumer's  right  to
34    cancel;
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 1        (e)  Use  any  undue  influence,  coercion  or  any other
 2    wilful act or representation to interfere with the consumer's
 3    exercise of his rights under this Section;
 4        (f)  Fail  or  refuse  to  honor  any  valid  notice   of
 5    cancellation  by a consumer and within 10 business days after
 6    the receipt of such notice, to
 7        (i)  refund all payments made under the contract or sale,
 8        (ii)  return  any  goods  or  property  traded   in,   in
 9    substantially  as  good  a  condition as when received by the
10    person, or
11        (iii)  cancel  and  return  any   negotiable   instrument
12    executed  by  the consumer in connection with the contract or
13    transaction and take any action necessary or  appropriate  to
14    terminate  promptly  any  security  interest  created  in the
15    transaction;
16        (g)  Negotiate, transfer, sell, or  assign  any  note  or
17    other  evidence of indebtedness to a finance company or other
18    third party prior to  midnight  of  the  fifth  business  day
19    following  the  day  the  contract was signed or the goods or
20    services were purchased or leased; or
21        (h)  Fail, within 10 business  days  of  receipt  of  the
22    consumer's  notice of cancellation, to notify him whether the
23    seller intends to repossess or  to  abandon  any  shipped  or
24    delivered goods.
25        For  the  purposes  of  this  Section,  the  word  "sale"
26    includes a sale, lease or rental.
27        This Section does not apply to any transaction
28        (a)  made pursuant to prior negotiations in the course of
29    a  visit  by  the consumer to a retail business establishment
30    having  a  fixed  permanent  location  where  the  goods  are
31    exhibited, or the services are offered, for sale or lease  on
32    a continuing basis;
33        (b)  in  which  the  consumer  is  accorded  the right of
34    rescission  by  the  provisions  of   the   Consumer   Credit
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 1    Protection   Act  (15  U.S.C.  1635)  or  regulations  issued
 2    pursuant thereto;
 3        (c)  in which the consumer has initiated the contact  and
 4    the  goods  or  services  are  needed  to  meet  a  bona fide
 5    immediate  personal  emergency  of  the  consumer,  and   the
 6    consumer  furnishes  the  person  with  a  separate dated and
 7    signed  personal  statement  in  the  consumer's  handwriting
 8    describing  the  situation  requiring  immediate  remedy  and
 9    expressly acknowledging and waiving the right to  cancel  the
10    sale within 3 business days;
11        (d)  conducted   and  consummated  entirely  by  mail  or
12    telephone without any other contact between the consumer  and
13    the  person  or  its  representative prior to delivery of the
14    goods or performance of the services;
15        (e)  in which the consumer has initiated the contact  and
16    specifically  requested  the person to visit his home for the
17    purpose of  repairing  or  performing  maintenance  upon  the
18    consumer's  personal  property,  on the condition that if, in
19    the course of such a visit, the person sells the consumer the
20    right to receive additional  services  or  goods  other  than
21    replacement   parts   necessarily   used  in  performing  the
22    maintenance or in making  the  repairs,  the  sale  of  those
23    additional  goods  or  services  does  not  fall  within this
24    exclusion; or
25        (f)  pertaining  to  the   sale   or   rental   of   real
26    property,   to   the   sale  of  insurance  or  to  the  sale
27    of   securities   or   commodities   by    a    broker-dealer
28    registered  with  the  Securities  and  Exchange  Commission.
29    (Source: P.A. 86-898.)

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