S*45 Session 106 (1985-1986)
S*0045(Rat #0253, Act #0165 of 1985) General Bill, By T.E. Garrison
Similar(H 3005)
A Bill to amend the Code of Laws of South Carolina, 1976, by adding Chapter 79
to Title 44, so as to enact the Physical Fitness Services Act
12/10/84 Senate Prefiled
12/10/84 Senate Referred to Committee on General
01/09/85 Senate Introduced and read first time SJ-84
01/09/85 Senate Referred to Committee on General SJ-84
01/10/85 Senate Recalled from Committee on General SJ-96
01/10/85 Senate Committed to Committee on Medical Affairs SJ-96
02/26/85 Senate Committee report: Favorable with amendment
Medical Affairs SJ-653
02/27/85 Senate Amended SJ-692
02/27/85 Senate Read second time SJ-693
02/28/85 Senate Read third time and sent to House SJ-714
03/05/85 House Introduced and read first time HJ-1093
03/05/85 House Referred to Committee on Labor, Commerce and
Industry HJ-1093
05/08/85 House Committee report: Favorable with amendment Labor,
Commerce and Industry HJ-3065
05/14/85 House Retaining place on calendar recommitted to
Committee on Labor, Commerce and Industry HJ-3155
06/03/85 House Recalled from Committee on Labor, Commerce and
Industry HJ-3769
06/04/85 House Amended HJ-3818
06/04/85 House Read second time HJ-3821
06/05/85 House Read third time HJ-3937
06/05/85 House Returned HJ-3937
06/06/85 Senate Concurred in House amendment and enrolled SJ-2867
06/18/85 Ratified R 253
06/24/85 Signed By Governor
06/24/85 Effective date 06/24/85
06/24/85 Act No. 165
07/10/85 Copies available
(A165, R253, S45)
AN ACT TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING CHAPTER 79
TO TITLE 44, SO AS TO ENACT THE PHYSICAL FITNESS SERVICES ACT.
Be it enacted by the General Assembly of the State of South Carolina:
Physical fitness services act
SECTION 1. Title 44 of the 1976 Code is amended by adding:
"CHAPTER 79
Physical Fitness Services Act
Section 44-79-10. This chapter may be cited as the Physical Fitness Services
Act.
Section 44-79-20. As used in this chapter:
1. 'Physical fitness services' means facilities or services for the
development of physical fitness through exercise or weight control. The term
includes the facilities and services of health or exercise centers, clubs,
studios, or classes; health spas; weight control centers, clinics, or studios;
figure salons; tanning centers; and athletic or sport clubs. It does not include
rehabilitative therapy administered by a licensed physical therapist.
2. 'Customer' or 'member' means a person who contracts for the use of physical
fitness services.
3. 'Major facility' means swimming pool, whirlpool, tennis courts, racquet or
handball courts, golf course, indoor or outdoor track, gymnasium with exercise
equipment, calisthenic
room or similar collection of physical fitness equipment.
4. 'Major service' means locations which have offices, treatment rooms, or
counseling rooms but no major facilities and other treatments, visits, or
sessions to reduce and control weight.
5. 'Center' means any person or organization which, for profit, offers
physical fitness services, whether at multiple outlets bearing the same name or
a single outlet. Any subsidiary of a center, operating under the same name and
offering such services, is a part of the center.
6. 'Outlet' means a separate location of a center which is not physically
connected with another center but which uses the same name.
7. 'Administrator' means the administrator of the South Carolina Department
of Consumer Affairs.
Section 44-79-30. Every prepaid or credit contract for physical fitness services
of over one month's duration or over fifty dollars in amount must conform to the
following requirements:
1. the contract must be in writing, and a copy must be given to the customer
at the time he signs it;
2. the contract shall state clearly the street address or location of the
center and outlets which the member may use at the time the contract is executed
and the major facilities or major services which each offers;
3. the contract shall reveal the finance charge, if any, which the member
agrees to pay;
4. if the customer executes a promissory note in connection with the contract,
the contract shall clearly indicate whether the promissory note is assignable
paper and whether it may be discounted and sold to third parties. Assignment of
the promissory note does not affect the right of the member to cancel the
contract or the method by which the cancellation may be made;
5. the contract must contain a right to cancel provision in the following
language:
'CUSTOMER'S RIGHT TO CANCEL
(a) You may cancel this contract by sending notice of your wish to cancel to
the center before midnight of the third business day after you sign the contract.
This notice must be sent certified mail to the following:
_______________________________________ .
Within thirty days of receipt of this notice, the center shall return any
payments made and any note or other evidence of indebtedness. If you use the
seller's facilities or services, the center may charge you a reasonable fee based
on days of actual use.
(b) In addition, you or your estate may also cancel the contract at any time
by written notice to the center at the above address if the following
circumstances occur:
(1) the customer's death;
(2) substantial physical disability, certified by a physician, which makes
it permanently impossible for the customer to use the center's services;
(3) the customer's permanent relocation to a residence over fifty miles
distant from an outlet operated by the center, if the center is unable to arrange
for the customer's use of another center with equivalent major facilities and
services.
The center may require presentation of information to substantiate that one of
these circumstances has occurred.
If the contract is cancelled because of disability, death, or permanent change
of residence, the center shall return any note or other evidence of indebtedness
and unearned prepayments as follows: For each month that the contract was in
effect, the center is entitled to the rate a month or a treatment which it would
have charged if the contract had initially been one for the number of months or
the number of treatments for which the contract was actually in effect. The rate
is to be determined from a fee schedule in effect on the date of the contract.
(c) The right of cancellation shall affect only the financial obligations
under the contract and customer's right to use the center's physical fitness
services.'
6. Any contractual provision allowing more liberal rights of cancellation than
set forth in this chapter may be substituted for the notice required in this
chapter.
Section 44-79-40. No contract for physical fitness services may:
1. have a duration of longer than twenty-four months or be measured by the
life of the buyer, the life of the center, or any similar indefinite term;
2. waive the required provisions of this chapter;
3. provide that a right of action or defense of the member may be cut off by
assignment of the contract to a third person.
Section 44-79-50. Any provision of any contract for physical fitness services
which does not comply with this chapter is unenforceable against the member.
Section 44-79-60. A contract for physical fitness services may contain clauses
which:
1. provide for extension of the term of the agreement for a period equal to
a period of temporary disability or pregnancy of the customer, or for any other
just or reasonable cause;
2. specify that the written contract constitutes the entire agreement between
the parties;
3. provide for a renewal option, which to be enforceable must be exercised by
the buyer in writing, or by payment by the buyer of part or all of the renewal
price. Any renewal option may be exercised only near the expiration of any
previous contract and for only twelve months.
Section 44-79-70. Any right of action or defense which the member may raise
based on the contract for physical fitness services is preserved against any
assignee or successor to the contract.
Section 44-79-80. 1. Every center which enters into prepaid or credit contracts
for physical fitness services of over one month's duration or over fifty dollars
in amount shall maintain with the Administrator a surety bond in a sum to be
determined by the Administrator based on the estimated future costs to service
contracts sold, but not to exceed twenty-five thousand dollars.
2. In lieu of the bond required in this section, the center may furnish under
penalty of perjury information which reasonably demonstrates financial
responsibility as will enable the center to satisfy the possible claims against
the bond. In the event the center is controlled by, under common control with,
or controls other corporations and the other corporation agrees in writing to
satisfy the claims against a bond allowed under this section, the financial
responsibility of the other corporation must be considered in determining the
requirement for a bond. In determining whether the center has the requisite
financial responsibility, the Administrator may consider the operating and
business history, reputation, and management within and without the State, as
well as the operating and business history and reputation of any business
controlled by, under common control with, or controlling the center. The
provisions of subsections 1 and 2 of this section do not apply to physical
fitness service facilities that have been in operation for five years or more on
the effective date of this act.
3. Each center is required to notify the Administrator upon substantial change
of its financial status and to submit an annual report.
4. No person may offer physical fitness services in this State without first
obtaining a certificate of authority from the Administrator. A certificate of
authority must be issued by the Administrator upon submission of items (a)
through (f) of this section. The applicant must submit:
(a) A formal application for the certificate in such form and detail as the
Administrator requires.
(b) A certified copy of its charter or articles of incorporation and its
bylaws, if any.
(c) If a corporation, a certified copy of the certificate of authority or
good standing certificate from the Secretary of State of South Carolina.
(d) A copy of its membership agreement.
(e) A copy of any contract to be issued.
(f) A list of outlets at which physical fitness services will be offered.
(g) Any other relevant information required by the Administrator.
5. No certificate of authority may be issued by the Administrator until the
center pays an initial certificate of authority fee of twenty-five dollars an
outlet. Certificates of authority may be renewed upon payment of an annual
renewal fee of fifty dollars an outlet on or before December thirty-first.
6. A copy of the Certificate of Authority required by this chapter must be
posted conspicuously at every location where monies or contracts are received by
the center.
7. It is unlawful for any center or person acting on behalf of a center
required to obtain and maintain a Certificate of Authority under this chapter to
advertise, sell, or offer to sell the use of physical fitness services when a
valid certificate is not on file with the Administrator.
8. The Administrator may order the center to cease and desist, or may revoke,
suspend, or refuse to continue the certificate of authority of a center,
whenever, after a hearing and for causes shown, he determines that the center has
violated or failed to comply with any provisions of this chapter or regulations
promulgated under the authority of this chapter.
Section 44-79-90. The Administrator shall administer this chapter and may
promulgate regulations, subject to the Administrative Procedures Act, necessary
to carry out its provisions.
Section 44-79-100. 1. No center shall advertise physical fitness services which
are not operating or available without clearly and conspicuously disclosing in
the advertisement that such are not presently operating or available.
2. No center shall advertise physical fitness services which are not operating
or available in each and every outlet unless the advertisement clearly and
conspicuously discloses the facilities or services which are not operating or
available at each outlet.
3. Substantiation for physical fitness services advertising claims, and
information necessary to determine the amount of the bonds required by this
chapter, must be provided upon request of a circuit solicitor, the Attorney
General, or the Department of Consumer Affairs.
Section 44-79-110. The State of South Carolina and its political subdivisions
and any not-for-profit corporations are exempt from the terms of this chapter.
Section 44-79-120. Any person who violates any provision of this chapter is
guilty of a misdemeanor and upon conviction must be fined not less than five
hundred dollars nor more than five thousand dollars or be imprisoned for no more
than three years, or both.
A violation of any provision of this chapter is considered a violation of
Section 39-5-20 of the South Carolina Unfair Trade Practices Act."
Effective date
SECTION 2. The provisions of Chapter 79 of Title 44 of the 1976 Code do not
apply to any contracts for physical fitness services entered into before the
effective date of this act, except that recovery may be made on any bond or
certificate of deposit required under Chapter 79 for failure to comply with
pre-existing contractual obligations.
Time effective
SECTION 3. This act shall take effect upon approval by the Governor. |