AN ACT Relating to
regulating the assignment of retail charge agreements; amending RCW 63.14.010;
adding new sections to chapter 63.14 RCW; and declaring an emergency.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
WASHINGTON:
Sec. 1. RCW 63.14.010 and 1992 c
134 s 16 are each amended to read as follows:
In this chapter, unless
the context otherwise requires:
(1) "Goods"
means all chattels personal when purchased primarily for personal, family, or
household use and not for commercial or business use, but not including money
or, except as provided in the next sentence, things in action. The term
includes but is not limited to merchandise certificates or coupons, issued by a
retail seller, to be used in their face amount in lieu of cash in exchange for
goods or services sold by such a seller and goods which, at the time of sale or
subsequently, are to be so affixed to real property as to become a part
thereof, whether or not severable therefrom;
(2) "Lender credit
card" means a card or device under a lender credit card agreement pursuant
to which the issuer gives to a cardholder residing in this state the privilege
of obtaining credit from the issuer or other persons in purchasing or leasing
property or services, obtaining loans, or otherwise, and the issuer of which is
not: (a) Principally engaged in the business of selling goods; or (b) a
financial institution;
(3) "Lender credit
card agreement" means an agreement entered into or performed in this state
prescribing the terms of retail installment transactions pursuant to which the
issuer may, with the buyer's consent, purchase or acquire one or more retail
sellers' indebtedness of the buyer under a sales slip or memorandum evidencing
the purchase, lease, loan, or otherwise to be paid in accordance with the
agreement. The issuer of a lender credit card agreement shall not be
principally engaged in the business of selling goods or be a financial
institution;
(4) "Financial
institution" means any bank or trust company, mutual savings bank, credit
union, or savings and loan association organized pursuant to the laws of any
one of the United States of America or the United States of America, or the
laws of a foreign country if also qualified to conduct business in any one of
the United States of America or pursuant to the laws of the United States of
America;
(5)
"Services" means work, labor, or services of any kind when purchased
primarily for personal, family, or household use and not for commercial or
business use whether or not furnished in connection with the delivery,
installation, servicing, repair, or improvement of goods and includes repairs,
alterations, or improvements upon or in connection with real property, but does
not include services for which the price charged is required by law to be
determined or approved by or to be filed, subject to approval or disapproval,
with the United States or any state, or any department, division, agency,
officer, or official of either as in the case of transportation services;
(6) "Retail
buyer" or "buyer" means a person who buys or agrees to buy goods
or obtain services or agrees to have services rendered or furnished, from a
retail seller;
(7) "Retail
seller" or "seller" means a person engaged in the business of
selling goods or services to retail buyers;
(8) "Retail
installment transaction" means any transaction in which a retail buyer
purchases goods or services from a retail seller pursuant to a retail
installment contract, a retail charge agreement, or a lender credit card
agreement, as defined in this section, which provides for a service charge, as
defined in this section, and under which the buyer agrees to pay the unpaid
balance in one or more installments or which provides for no service charge and
under which the buyer agrees to pay the unpaid balance in more than four
installments;
(9) "Retail
installment contract" or "contract" means a contract, other than
a retail charge agreement, a lender credit card agreement, or an instrument
reflecting a sale made pursuant thereto, entered into or performed in this
state for a retail installment transaction. The term "retail installment
contract" may include a chattel mortgage, a conditional sale contract, and
a contract in the form of a bailment or a lease if the bailee or lessee
contracts to pay as compensation for their use a sum substantially equivalent
to or in excess of the value of the goods sold and if it is agreed that the
bailee or lessee is bound to become, or for no other or a merely nominal
consideration, has the option of becoming the owner of the goods upon full
compliance with the provisions of the bailment or lease. The term "retail
installment contract" does not include: (a) A "consumer lease,"
heretofore or hereafter entered into, as defined in RCW 63.10.020; (b) a lease
which would constitute such "consumer lease" but for the fact that:
(i) It was entered into before April 29, 1983; (ii) the lessee was not a
natural person; (iii) the lease was not primarily for personal, family, or
household purposes; or (iv) the total contractual obligations exceeded
twenty-five thousand dollars; or (c) a lease-purchase agreement under chapter
63.19 RCW;
(10) "Retail
charge agreement," "revolving charge agreement," or "charge
agreement" means an agreement between a retail buyer and a retail
seller that is entered into or performed in this state ((prescribing))
and that prescribes the terms of retail installment transactions with
one or more sellers which may be made thereunder from time to time and
under the terms of which a service charge, as defined in this section, is to be
computed in relation to the buyer's unpaid balance from time to time;
(11) "Service
charge" however denominated or expressed, means the amount which is paid
or payable for the privilege of purchasing goods or services to be paid for by
the buyer in installments over a period of time. It does not include the
amount, if any, charged for insurance premiums, delinquency charges, attorneys'
fees, court costs, or official fees;
(12) "Sale
price" means the price for which the seller would have sold or furnished
to the buyer, and the buyer would have bought or obtained from the seller, the
goods or services which are the subject matter of a retail installment
transaction. The sale price may include any taxes, registration and license
fees, and charges for transferring vehicle titles, delivery, installation,
servicing, repairs, alterations, or improvements;
(13) "Official
fees" means the amount of the fees prescribed by law for filing,
recording, or otherwise perfecting, and releasing or satisfying, a retained
title, lien, or other security interest created by a retail installment
transaction;
(14) "Time
balance" means the principal balance plus the service charge;
(15) "Principal
balance" means the sale price of the goods or services which are the
subject matter of a retail installment contract less the amount of the buyer's
down payment in money or goods or both, plus the amounts, if any, included
therein, if a separate identified charge is made therefor and stated in the
contract, for insurance and official fees;
(16) "Person"
means an individual, partnership, joint venture, corporation, association, or
any other group, however organized;
(17) "Rate"
means the percentage which, when multiplied times the outstanding balance for
each month or other installment period, yields the amount of the service charge
for such month or period.
NEW SECTION. Sec.
2. A new section is added
to chapter 63.14 RCW to read as follows:
(1) A retail seller may
sell, transfer, or assign a retail installment contract or charge agreement.
After such sale, transfer, or assignment, the retail installment contract or
charge agreement remains a retail installment contract or charge agreement.
(2) Nothing contained
in this chapter shall be deemed to limit any charge made by an assignee of a
retail installment contract or charge agreement to the seller-assignor upon the
sale, transfer, assignment, or discount of the contract or agreement,
notwithstanding retention by the assignee of recourse rights against the
seller-assignor and notwithstanding duties retained by the seller-assignor to
service delinquencies, perform service or warranty agreements regarding the
property which is the subject matter of the assigned or discounted contracts or
charge agreements, or to do or perform any other duty with respect to the
contract or agreement assigned or the subject matter of such contract or
agreement.
NEW SECTION. Sec.
3. A new section is added
to chapter 63.14 RCW to read as follows:
No person may pursue
any remedy alleging a violation of this chapter on the basis of any act or
omission that does not constitute a violation of this chapter as amended by
this act. For purposes of this section, the phrase "pursue any
remedy" includes pleading a defense, asserting a counterclaim or right of
offset or recoupment, commencing, maintaining, or continuing any legal action,
or pursuing or defending any appeal.
NEW SECTION. Sec.
4. This act is necessary for
the immediate preservation of the public peace, health, or safety, or support
of the state government and its existing public institutions, and shall take
effect immediately.
NEW
SECTION. Sec. 5. If any provision of this
act or its application to any person or circumstance is held invalid, the
remainder of the act or the application of the provision to other persons or
circumstances is not affected.
