California Civil Code

§ 1812.116

CIV § 1812.116 Effective Sep 21, 1980Div. 3 · Title 2.6 · Part 4

Statute text

(a)Every contract for discount buying services shall provide that if any goods ordered by the buyer from the seller are not delivered to the buyer or available for pickup by the buyer at a location within his county of residence within six weeks from the date the buyer placed an order for such goods, then any moneys paid by the buyer for such goods in advance of delivery shall, upon the buyer’s request, be fully refunded unless a predetermined delivery date has been furnished to the buyer in writing at the time he ordered such goods and the goods are delivered to the buyer or are available for pickup by that date.

(b)Prior to receiving from a buyer any payments pursuant to the terms of a contract for discount buying services, the discount buying organization shall establish a trust account at a federally insured bank or savings and loan association for the deposit, except for the first fifty dollars ($50) of a downpayment, of the contract payments as they are received. If the discount buying organization sells or assigns the contract for discount buying services to a third party and such third party pays the discount buying organization as consideration an amount which is commercially reasonable for the sale or assignment of the contract, the discount buying organization shall deposit all funds received from the third party into the trust account. If the discount buying organization in any manner transfers the contract for discount buying services to a third party which is to act as the recipient of contract payments from the buyer and such third party does not pay the discount buying organization as consideration for such transfer an amount which is commercially reasonable, then all sums received by the third party from the buyer shall be deposited in the discount buying organization’s trust account for contract payments. As to each buyer, during the first one-fourth or first six months of the buyer’s membership period, whichever is shorter, funds representing no more than one-fourth of the contract price may be withdrawn from the trust account. During each subsequent one-fourth or six-month period, whichever is shorter, funds representing an additional one-fourth of the contract price may be withdrawn from the trust account.

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Legislative history

Amended by Stats. 1980, Ch. 1001, Sec. 2. Effective September 21, 1980.