AN ACT Relating to transient merchants; adding a new chapter to Title 18 RCW; prescribing penalties; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. This chapter shall be known and may be cited as the transient merchant licensing act of 1985.

NEW SECTION. Sec. 2. It is the purpose and intent of this chapter to protect the public from improper sales techniques by providing for the licensing and regulation of transient merchants. It is further the intent of this chapter that the license fees, bonding requirements, and penalties prescribed herein for transient merchants shall be minimum license fees. Bond requirements and penalties shall not be construed to limit or restrict the authority of counties, cities, and towns in the state to levy additional license fees and to require additional bonding for transient merchants engaging in business in such counties, cities, and towns.

NEW SECTION. Sec. 3. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter:

(1) "Transient merchant" means any person, firm, corporation, partnership, or other entity that engages in, does, or transacts any temporary or transient business in the state, either in one locality or traveling from place to place in the state, offering for sale or selling goods, wares, merchandise, or services, and includes those merchants who, for the purpose of carrying on such business, hire, lease, use, or occupy any building, structure, motor vehicle, railroad car, or real estate.

(2) "Temporary or transient business" means any business conducted for the sale or offer for sale of goods, wares, or merchandise that is carried on in any building, structure, motor vehicle, railroad car, or real estate for a period of less than six months in each year.

(3) "Person" means any individual, corporation, partnership, association or other entity.

NEW SECTION. Sec. 4. This chapter shall not apply to:

(1) Sales at wholesale to retail merchants by commercial travelers or selling agents in the usual course of business;

(2) Wholesale trade shows and conventions;

(3) Sales of goods, wares, or merchandise by sample catalog or brochure for future delivery;

(4) Fairs and convention center activities conducted primarily for amusement and entertainment;

(5) Any general sale, fair, auction, or bazaar sponsored by a church or religious organization;

(6) Garage sales held on premises devoted to residential use;

(7) Sales of crafts or items made by hand and sold or offered for sale by the person making such crafts or handmade items;

(8) Sales of agricultural products, except nursery products and foliage plants; and

(9) Sales made by a seller at residential premises pursuant to an invitation issued by the owner or legal occupant of such premises.

A transient merchant not otherwise exempted from this chapter shall not be relieved or exempted from this chapter by reason of associating temporarily with any local dealer, auctioneer, trader, contractor, or merchant or by conducting such temporary or transient business in connection with or in the name of any local dealer, auctioneer, trader, contractor, or merchant.

NEW SECTION. Sec. 5. It is unlawful for any transient merchant to transact business in any county in this state unless that merchant and the owners of any goods, wares, or merchandise to be offered for sale or sold, if the goods, wares, or merchandise are not owned by the merchant, have first secured a license and have otherwise complied with the requirements of this chapter.

NEW SECTION. Sec. 6. Any transient merchant desiring to transact business in any county in this state shall make an application for and obtain a license in each county in which that merchant desires to transact business. The application for license shall be filed with the county clerk, and shall include the following:

(1) The name and permanent address of the transient merchant making the application, and if the applicant is a firm or corporation, the name and address of the members of the firm or the officers of the corporation, as the case may be;

(2) If the applicant is a corporation, there shall be stated on the application form the date of incorporation, the state of incorporation, and if the applicant is a corporation formed in a state other than the state of Washington, the date on which such corporation qualified to transact business as a foreign corporation in the state of Washington;

(3) A statement showing the kind of business proposed to be conducted, the length of time for which the applicant desires to transact such business, and the location of such proposed place of business;

(4) The name and permanent address of the transient merchant's registered agent or office;

(5) Evidence that the applicant has acquired all other required city, county, and state permits and licenses; and

(6) Evidence that any personal property taxes due on goods, wares, or merchandise to be offered for sale have been paid.

NEW SECTION. Sec. 7. The county clerk in each county shall design and cause to be printed appropriate forms for applications for licenses and for the license certificates to be issued to applicants under this chapter.

NEW SECTION. Sec. 8. Each registered agent designated by a transient merchant in the application for a license shall be a resident of the county and shall be the agent of the transient merchant upon whom any process, notice, or demand required or permitted by law to be served upon the transient merchant may be served. The registered agent shall agree in writing to act as such agent and a copy of the agreement to so act shall be filed by the applicant with the application for a license.

The county clerk of each county shall maintain an alphabetical list of all transient merchants in the county and the names and addresses of their registered agents.

If any transient merchant doing business or having done business in any county within the state fails to have or maintain a registered agent in the county, or if such registered agent cannot be found at the agent's permanent address, the county clerk shall be an agent of the transient merchant for service of all process, notices, or demands. Service on the county clerk shall be made by delivering to and leaving with the clerk or any person designated by the clerk to receive such service, duplicate copies of the process, notice, or demand. When any such process, notice, or demand is served on the clerk, the clerk shall immediately cause one copy thereof to be forwarded by registered or certified mail to the permanent address of the transient merchant. The provisions of this section shall not limit or otherwise affect the right of any person to serve any process, notice, or demand in any other manner now or hereafter authorized by law.

NEW SECTION. Sec. 9. Each application for a transient merchant license shall be accompanied by a license fee of two hundred fifty dollars and by a cash bond or a surety bond issued by a corporate surety authorized to do business in the state in the amount of two thousand dollars or five percent of the wholesale value of any goods, wares, merchandise, or services to be offered for sale whichever sum is less. The surety bond shall be in favor of the state of Washington and shall assure the payment by the applicant of all taxes that may be due from the applicant to the state or any political subdivision of the state, the payment of any fines that may be assessed against the applicant or its agents or employees for violation of this chapter and for the satisfaction of all judgments that may be rendered against the transient merchant or its agents or employees in any cause of action commenced by any purchaser of goods, wares, merchandise or services within one year from the date of the sale by such transient merchant. The bonds shall be maintained as long as the transient merchant conducts business in the county and for a period of one year after the termination of such business and shall be released only when the transient merchant furnishes satisfactory proof to the county clerk that it has satisfied all claims of purchasers of goods, wares, merchandise, or services from that merchant, and that all state and local sales taxes and other taxes have been paid.

NEW SECTION. Sec. 10. A transient business license shall be issued under this chapter only when all requirements of this chapter have been met, the license shall not be transferable, shall be valid only within the territorial limits of the issuing county, shall be valid only for a period of ninety days, and shall be valid only for the business stated in the application. A license so issued shall be valid for only one person, unless that person is a member of a partnership or employee of a firm or corporation obtaining such license.

NEW SECTION. Sec. 11. Any person or entity that transacts a transient business as defined in this chapter without having first obtained a license in accordance with this chapter or who knowingly advertises, offers for sale, or sells any goods, wares, merchandise, or services in violation of any provision of this chapter shall be guilty of a gross misdemeanor. The penalties in this chapter are in addition to any other penalties prescribed by law for any criminal offense committed by the licensee.

NEW SECTION. Sec. 12. It is the duty of the county sheriff and other law enforcement officers in each county and the prosecuting attorney for each county to enforce this chapter.

NEW SECTION. Sec. 13. Sections 1 through 12 of this act shall constitute a new chapter in Title 18 RCW.

NEW SECTION. Sec. 14. This act is necessary for the immediate preservation of the public peace, health, and safety, the support of the state government and its existing public institutions, and shall take effect immediately.