A bill

 

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ENACTING THE "HOME REPAIR CONSUMER PROTECTION ACT" BY ADDING CHAPTER 31 TO TITLE 37 SO AS TO REQUIRE WRITTEN AND SIGNED CONTRACTS FOR CERTAIN HOME REPAIR SERVICES, TO PROVIDE CERTAIN RIGHTS AND PROTECTIONS OF HOMEOWNERS WHO ENTER INTO HOME REPAIR AGREEMENTS WITH HEIGHTENED PROTECTIONS FOR ELDERLY HOMEOWNERS, TO CREATE THE OFFENSE OF HOME REPAIR FRAUD AND TO ESTABLISH PENALTIES, AND TO ESTABLISH CERTAIN PROHIBITED ACTS OF CONTRACTORS OR THEIR AGENTS WHICH CONSTITUTE AN UNFAIR TRADE PRACTICE.

 

Be it enacted by the General Assembly of the State of South Carolina:

 

SECTION 1.  Title 37 of the S.C. Code is amended by adding:

 

CHAPTER 31

 

Home Repair Consumer Protection Act

 

    Section 37-31-10.  For purposes of this chapter:

    (1) "Contractor" means a general or mechanical contractor licensed under Chapter 11, Title 40, or a residential specialty contractor licensed under Article 1, Chapter 59, Title 40, who owns and operates a home improvement business or who undertakes, offers to undertake, or agrees to perform any home repair or improvement.

    (2) "Defect" means a deficiency in or a deficiency arising out of the design, specifications, surveying, planning, supervision, or observation of home repair work that results from any of the following:

       (a) use of defective or substandard materials, products, or components;

       (b) violation of the applicable building codes in effect at the time of the home repair work;

       (c) failure to conduct home repair work in accordance with accepted trade standards for good and workmanlike construction at the time of construction;

       (d) material deviations from the terms of the contract; or

       (e) creation of unsafe or uninhabitable conditions.

    (3) "Home repair" means the fixing, replacing, altering, converting, modernizing, improving of, or making of an addition to any real property primarily designed or used as a residence, in which the total price for all work agreed upon between the contractor and owner is more than five hundred dollars.

       (a) "Home repair" includes the construction, installation, replacement, or improvement of driveways, swimming pools, porches, kitchens, chimneys, chimney liners, garages, fences, fallout shelters, central air conditioning, central heating, boilers, furnaces, hot water heaters, electrical wiring, sewers, plumbing fixtures, storm doors, storm windows, awnings, and other improvements to structures within the residence or upon the land adjacent to the residence.

       (b) "Home repair" does not include:

           (i) the sale, installation, cleaning, or repair of carpets;

           (ii) the repair, installation, replacement, or connection of any home appliance including, but not limited to, disposals, refrigerators, ranges, garage door openers, televisions or television antennas, washing machines, telephones, hot water heaters, satellite dishes, or other appliances when the persons replacing, installing, repairing, or connecting the home appliance are employees or agents of the merchant that sold the home appliance or sold new products of the same type;

           (iii) landscaping; or

           (iv) the construction of a new home.

    (4) "Owner" means:

       (a) the owner of a private residence, including any person authorized by an owner to act on the owner's behalf to order, contract for, or purchase home repair work; or

       (b) a person entitled to the performance of the work of a contactor pursuant to a home repair contract.

    (5) "Substantial completion" has the meaning provided in Section 15-3-630.

 

    Section 37-31-20.  (A) Any contract or agreement for home repair services described in this chapter in the amount of one thousand dollars or more shall be in writing and signed by both parties. The contract shall include:

       (1) the name, address, and phone number of the contractor;

       (2) a description of the work to be performed, the materials to be used, and a set of specifications that cannot be changed without a written change order signed by the owner and the contractor;

       (3) the date of the transaction;

       (4) the total cost, including parts and materials listed with reasonable particularity and any charge for an estimate;

       (5) the approximate start date and completion date;

       (6) notice informing the owner of the right to cancel the contract within three business days after the date the contract was signed or, if the owner is sixty-two years of age or older, within five business days; and

       (7) inform the owner that notice of cancellation may be mailed or delivered to the contractor's address stated in the contract, or by any alternative method agreed upon by the parties.

    (B) Failure by a contractor, their agent, or another person subject to licensure under Chapters 11 or 59, Title 40 to provide the specified information, notices, and disclosures in the contract is cause for discipline under Chapters 11 or 59, Title 40, as appropriate.

 

    Section 37-31-30.  An owner who signs a home repair contract may cancel the contract within three business days following the date on which the contract was signed or, if the owner is sixty-two years of age or older, within five business days. Notice of cancellation may be mailed or delivered to the contractor's address stated in the contract, or by any other method agreed upon by the parties.

 

    Section 37-31-40.  (A) A person commits the offense of home repair fraud if he knowingly:

       (1) misrepresents a material fact relating to the terms of the home repair contract or agreement or the preexisting or existing condition of any portion of the property involved, or creates or confirms another's impression which is false and which he does not believe to be true, or promises performance which he does not intend to perform or knows will not be performed;

       (2) uses or employs any deception, false pretense, or false promises in order to induce, encourage, or solicit each person to enter into any home repair contract or agreement;

       (3) enters into an unconscionable agreement or contract requiring payment to the contractor of at least four thousand dollars. A contract is unconscionable within the meaning of this section when an unreasonable difference exists between the value of the services, materials, and work to be performed and the amount charged for those services, materials, and work. For purposes of this section, prima facie evidence shall exist that the contract or agreement is unconscionable if the total payment called for by the contract or agreement is in excess of four times the fair market value for those services, materials, and work; or

       (4) damages the property of a person with the intent to enter into an agreement or contract for home repair;

       (5) misrepresents himself or another to be an employee or agent of any unit of the federal, state, or municipal government or any other governmental unit, or an employee or agent of any public utility, with the intent to cause a person to enter into, with himself or another, any contract or agreement for home repair services;

       (6) damages a person's property with the intent to induce, encourage, or solicit that person to enter into a written or oral agreement for performing home repair services;

       (7) misrepresents an item as a special-order material or misrepresents the cost of the special-order material;

       (8) alters a home repair contract, agreement, or other document incident to performing or selling a home repair service without the consent of the consumer; or

       (9) receives any advance payment for performing home improvement services or providing home improvement materials and fails to perform or provide such services or materials when specified in the contract, taking into account any force majeure or unforeseen labor strike that would extend the time frame, or unless extended by agreement with the owner, and fails to return the payment received for such services or materials which were not provided by that date.

    (B) A person who violates the provisions of subsection (A) of this section is guilty:

       (1) of a misdemeanor if the amount involved is two thousand dollars or less or if the amount involved cannot be satisfactorily ascertained and, upon conviction, must be fined not more than ten thousand dollars or imprisoned not more than three years, or both; or

       (2) of a felony if the amount involved exceeds two thousand dollars and, upon conviction, must be fined not more than fifty thousand dollars or imprisoned not more than ten years, or both.

 

    Section 37-31-50.  (A) A person commits the offense of aggravated home repair fraud when he commits home repair fraud pursuant to Section 37-31-150:

       (1) against an elderly person who is sixty-two years of age or older or against a person with a disability; or

       (2) in connection with a home repair project intended to benefit a person with a disability.

    (B) A person who violates the provisions of subsection (A) is guilty of a felony and:

       (1) if the amount involved is two thousand dollars or less, must be fined not more than twenty thousand dollars or imprisoned not more than five years, or both; or

       (2) if the amount involved exceeds two thousand dollars, must be fined not more than fifty thousand dollars or imprisoned not more than fifteen years, or both.

 

    Section 37-31-60.  (A) No person shall:

       (1) fail to refund the amount paid for home repair services within ten business days of receipt of a written request for a refund if no substantial portion of the contracted work has been performed at the time of the request and more than forty-five days have elapsed since the starting date specified in the home repair contract;

       (2) abandon or fail to perform, without justification, any home repair contract or project undertaken by a contractor;

       (3) deviate from or disregard plans or specifications, in any material respect, without a written change order dated and signed by both the contractor and the owner, which contains accompanying price changes for each deviation;

       (4) advertise or offer, by any means, to perform home repair services if the person does not intend to:

           (a) accept a home repair contract;

           (b) perform the home repair services; or

           (c) charge for the home repair services at the price advertised or offered;

       (5) demand or receive any payment for home repair services before the home repair contract is signed; or

       (6) subsequent to entering into a contract for home repair services or materials, change the name or contractor's business, liability insurance information, the contractor's business address, or any other identifying information in a fraudulent or deceptive manner likely to cause confusion or misunderstanding without advising the owner in writing within ten days following any such change.

    (B) A violation of any provision of this section is an unfair trade practice under the South Carolina Consumer Protection Code in Chapter 6 of this title.

 

SECTION 2.  This act takes effect upon approval by the Governor.

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