HOUSE SUBSTITUTE NO. 1
HOUSE BILL NO. 427
AS AMENDED BY HOUSE AMENDMENT NO. 3
AN ACT TO AMEND TITLE 6 OF THE DELAWARE CODE RELATING TO REGISTRATION AND REGULATION OF TRANSIENT RETAILERS.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE (Two-thirds of all members elected to each House thereof concurring therein):
Section 1. Amend Title 6 of the Delaware Code by adding thereto a new Chapter 47 to read as follows:
"CHAPTER 47. TRANSIENT RETAILERS
The purpose of this Chapter is to protect the public from improper sales techniques by transient retailers, and to provide a method of processing warranty claims on merchandise sold by transient retailers.
As used in this Chapter, the following terms shall have the respective meanings ascribed by this section:
(1) 'Registered agent' as used in this Chapter may be, but is not required to be, the agent appointed pursuant to Section 132, Title 8 of the Delaware Code.
(2) 'Transient retailer' means any person, firm or corporation, as principal or agent, or both, which engages In, does or transacts any temporary or transient business in this State, either in one locality or in traveling from place to place in this State, offering for sale or selling goods, wares, merchandise, food or beverages, and including those who, for the purpose of carrying on such business, hire, lease, use or occupy any permanent or mobile building, structure, motor vehicle including trucks, or real estate for the exhibition by means of samples, catalogues, photographs and price lists or sale of such goods, wares, or merchandise.
(3) 'Temporary or transient business' means any exhibition and sale of goods, wares or merchandise which is carried on in any building, structure, motor vehicle or real estate for a period of less than six months in each year.
(4) 'Operator' means the owner or operator of any building, structure, motor vehicle or real estate, whether fixed or mobile, which is leased or rented to a transient merchant.
(a) The provisions of this Chapter shall not apply to:
(1) Sales made to dealers by commercial travelers or selling agents in the usual course of business;
(2) bona fide sales of goods, wares or merchandise by sample, brochure, or catalogue for future delivery:
(3) any annual fair;
(4) any special event, taking place upon real property which Is designed for and in the business of conducting such events where the transient merchant's goods, wares or merchandise are only displayed and sold on said property;
(5) any general sale, fair, auction or bazaar sponsored by an ecclesiastical society, religious corporation, public service or charitable organization;
(7) garage sales on premises devoted to residential use;sales of crafts or items made by hand when sold or offered for sale by the person making such crafts or handmade items;
(8) sales of local agricultural products;
(9) sales resulting from prior invitation to the vendor by the owner or occupant of the residence.
(b) No transient retailer not otherwise exempted from the provisions of this Chapter by paragraph (a) of this section shall be relieved or exempted from the provisions of this Chapter by reason of associating himself temporarily with any local dealer, auctioneer, trader, or merchant or by conducting such temporary or transient business in connection with or in the name of any local dealer, auctioneer, trader or merchant.
§4704. License required.
It shall be unlawful for any transient retailer to transact business in this State unless such transient retailer and the owners of any goods, wares or merchandise to be offered for sale or sold, if such are not owned by the vendor, shall have first secured a license as provided in §2905 of Title 30 and shall have complied with the other requirements of this Chapter. The fee for such license shall be identical to the annual license fee assessed against a retailer transacting business in this state on a year round basis.
§4705. Registration of transient retailers.
In addition to obtaining the license referred to in Section 4704 of this Title, any transient retailer desiring to transact business in this State shall first register by filing an application with the Director of Revenue. The application shall state the following facts:
(1) The name and permanent address of the transient retailer 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, then 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 Delaware, the date on which such corporation qualified to transact business as a foreign corporation in the State of Delaware.
(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) A description of the types of goods, wares and merchandise to be offered for sale in this State.
(5) The name and permanent address of the transient retailer's registered agent and office.
§4706. Registered agent.
(a) Every transient retailer shall file with the application required by §4705 the name and permanent address of such retailer's registered agent.
(b) Such registered agent shall be a resident of Delaware and shall be an agent of such transient retailer upon whom any legal process permitted by law to be served upon the transient retailer may be served.
(c) The registered agent shall agree in writing to act as such agent and a copy of the agreement shall be filed with the application.
(d) The Director of Revenue shall maintain an alphabetical record of all transient retailers and the names and addresses of their registered agents.
(e) Whenever a transient retailer doing business or having done business in this State shall fall to have or maintain a registered agent in the State, or whenever any such registered agent cannot with due diligence be found at his permanent address, the Director of Revenue shall be an agent of such transient retailer upon whom any such legal process may be served. Service on the Director of Revenue of such legal process with the fee of $4 shall be made In the same manner as is provided by law for service of writs of summons and when so made shall be as effectual to all intents and purposes as If made personally upon the defendant within this State; provided, that not later than 7 days following the filing of the return of services of process In the court in which the civil action is commenced or following the filing with the court of the proof of the nonreceipt of notice provided for in subsection (h) of this section, the plaintiff or a person acting in his behalf shall send by registered man to the transient retailer a notice consisting of a copy of the process and complaint served upon the Director of Revenue and the statement that service of the original of such process has been made upon the Director of Revenue of this State, and that under this section such service is as effectual to all intents and purposes as if it had been made upon such transient retailer personally within this State.
(f) Proof of the mailing and receipt or refusal of the notice shall be made in such manner as the court, by rule or otherwise, shall direct.
(g) The return receipt or other official proof of delivery shall constitute presumptive evidence that the notice mailed was received by the transient retailer or his agent; and the notation of refusal shall constitute presumptive evidence that the refusal was by the transient retailer or his agent.
(h) The plaintiff or his counsel of record in the action may within 7 days following the return of any undelivered notice mailed in accordance with subsection (e) of this section other than a notice, delivery of which is shown by the notation of the postal authorities on the original envelope to have been refused by the transient retailer or his agent, file with the court in which the civil action Is commenced proof of the nonreceipt of the notice by the transient retailer or his agent, which proof shall consist of the usual receipt given by the post office at the time of mailing to the person mailing the registered article containing the notice, the original envelope of the undelivered registered article and an affidavit made by or on behalf of plaintiff specifying:
(1) The datc upon which the envelope containing the notice was mailed by registered mall;
(2) The date upon which the envelope containing the notice was returned to the sender;
(3) That the notice provided for in subsection (e) of this section was contained in the envelope at the time it was mailed; and
(4) That the receipt, obtained at the time of mailing by the person mailing the envelope containing the notice, is the receipt filed with the affidavit.
(i) The time in which defendant shall serve his answer shall be computed from the date of the mailing of the registered letter which is the subject of the return receipt or other official proof of delivery or the notation of refusal of delivery; provided, however, that the court in which the action is pending may, at any time before or after the expiration of the prescribed time for answering, order such continuances u may be necessary to afford the defendant therein reasonable opportunity to defend the action.
(j) Nothing herein contained limits or affects rights to serve process in any other manner now or hereafter provided by law. This section is an extension of and not a limitation upon the rights otherwise existing of service of legal process upon nonresidents.
§4707. Bond required.
(1) At the time of filing the application for license u provided in 94704 and u a part thereof, the applicant shall file and deposit with the Department of Pittance, a surety bond issued by an authorized surety insurer, or a cash bond, in the amount of $1,000, or, in the discretion of the Director of Revenue, a lesser amount determined in accordance with 5375 of Title 30, Delaware Code. The surety bond shall run in favor or the State of Delaware and shall be for the use of assuring the payment by the applicant of all taxes that may be payable by or due from the applicant to the State of Delaware or any department thereof or any subdivision of the State of Delaware, municipal or otherwise, and the payment of any fines that may be assessed by any court against the applicant or its agents or employees for violation of the provisions of this Chapter.
(2) Such surety bond shall be maintained tutimpalred as long as the transient retailer conducts business in this State. Whenever the transient retailer ceases to conduct temporary or transient business in this State and furnishes the Department proof satisfactory that it has satisfied all claims or causes of action against It, the Department shall release said bond to the applicant.
No transient retailer who seeks to transact business In this state may advertise in any presale advertising media without including in each such advertisement the triuuient retailer's complete name In a form easily comprehensible to the reader, listener or viewer of such advertisement.
§4709. Penalty for violation.
(a) A transient retailer who transacts business without having first obtained a license and filing a registration application, or who knowingly makes a material misstatement in such registration application, or who knowingly advertises, offers for sale, or sells any goods, wares or merchandise contrary to this Chapter is guilty of a misdemeanor and upon conviction shall be punished by a fine of not more than two hundred dollars or imprisoned for not more than thirty daYs, or both.
(b) Justices of the Peace shall have original and exclusive Jurisdiction to hear and determine violations of this Chapter.
§4710. Deceptive trade practices.
In addition to the criminal penalty provided in §4709, any violation of the provisions of this Chapter shall constitute a deceptive trade practice under Subchapter ill, Chapter 25, Title 6 of the Delaware Code. "
Section 2. The provisions of this Act are severable. If any portion of this Act is held unconstitutional or invalid, it shall not affect any portion of this Act not in itself unconstitutional or invalid.
Section 3. This Act shall become effective January 1, 1987.
Approved July 2, 1986.