2016 -- S 2769

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LC005120

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2016

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A N   A C T

RELATING TO BUSINESS REGULATIONS

     Introduced By: Senators Lynch Prata, Gallo, and Miller

     Date Introduced: March 10, 2016

     Referred To: Senate Judiciary

     (Business Regulation)

It is enacted by the General Assembly as follows:

     SECTION 1. Section 5-20.5-28 of the General Laws in Chapter 5-20.5 entitled "Real

Estate Brokers and Salespersons" is hereby amended to read as follows:

     5-20.5-28. Order to cease unsafe practices -- Appeal. Order to cease unsafe

practices; penalty -- Appeal. -- If the department of business regulation has reason to believe

that any person, firm, or corporation or association is conducting any activities requiring licensure

under this chapter without obtaining a license, or who after the denial, suspension or revocation

of a license conducts any activities requiring licensure under this chapter, the department may

issue its order to that person, firm, corporation or association commanding them to appear before

the department at a hearing to be held not sooner than ten (10) days nor later than twenty (20)

days after issuance of that order to show cause why the department should not issue an order to

that person to cease and desist from the violation of the provisions of this chapter. The order to

show cause may be served on any person, firm, corporation or association named in the order in

the same manner that a summons in a civil action may be served, or by mailing a copy of the

order, certified mail, return receipt requested, to that person at any address at which he or she has

done business or at which he or she lives. If upon that hearing the department is satisfied that the

person is in fact violating any provision of this chapter, then the department may order that

person, in writing, to cease and desist from that violation. The department may also order that

person to pay an administrative penalty not to exceed one thousand dollars ($1,000) for

unlicensed activity. All hearings shall be governed in accordance with the Administrative

Procedures Act, chapter 35 of title 42. If that person fails to comply with an order of the

department after being afforded a hearing, the superior court in the county where the land or real

estate is located has jurisdiction upon complaint of the department to restrain and enjoin that

person from violating this chapter.

     SECTION 2. Section 5-20.7-9, 5-20.7-17, 5-20.7-20 and 5-20.7-26 of the General Laws

in Chapter 5-20.7 entitled "Real Estate Appraiser Certification Act" are hereby amended to read

as follows:

     5-20.7-9. Requirements prior to certification or licensing examination. -- (a)

Residential classification. - As a prerequisite to taking the examination for certification as a state

certified residential real estate appraiser, an applicant shall present evidence satisfactory to the

board that he or she has successfully completed the required classroom hours of courses, and also

present evidence of having completed the required number of experience hours as promulgated

by the appraisal qualifications board of the Appraisal Foundation in subjects related to real estate

appraisal and the uniform standards of professional appraisal practice from a duly licensed real

estate school pursuant to the provisions of § 5-20.5-19 or a nationally recognized appraisal

organization, college, university, or other school approved by the appraisal qualifications board of

the Appraisal Foundation, or any other school that is approved by the board.

      (b) General classification. - As a prerequisite to taking the examination for certification

as a state certified general real estate appraiser, an applicant shall present evidence satisfactory to

the director that he or she has successfully completed the required classroom hours of courses,

and also present evidence of having completed the required number of experience hours as

promulgated by the appraisal qualifications board of the Appraisal Foundation in subjects related

to real estate appraisal and the uniform standards of professional appraisal practice from a duly

licensed real estate school pursuant to the provisions of § 5-20.5-19, or a nationally recognized

appraisal organization, college, university, or other school approved by the appraisal

qualifications board of the Appraisal Foundation, or such other school as approved by the board.

      (c) Licensed real estate appraiser. - As a prerequisite to taking the examination for

licensing as a state licensed residential real estate appraiser, an applicant shall present evidence

satisfactory to the board that he or she has successfully completed the required classroom hours

of courses, and also present evidence of having completed the required number of experience

hours as promulgated by the appraisal qualifications board of the Appraisal Foundation in

subjects related to real estate appraisal and the uniform standards of professional appraisal

practice from a duly licensed real estate school pursuant to the provisions of § 5-20.5-19 or a

nationally recognized appraisal organization, college, university, or other school approved by the

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appraisal qualifications board of the Appraisal Foundation, or any other school that is approved

by the board.

     5-20.7-17. Continuing education prerequisite to renewal. -- (a) As a prerequisite to

certificate or license renewal, a state certified or licensed real estate appraiser shall present

evidence satisfactory to the director of having met the continuing education requirements of this

section.

      (b) The basic continuing education requirement for renewal of a certificate or license is

the completion by the applicant, during the immediately preceding term of certification, of not

less than twenty-eight (28) hours of instruction in courses or seminars from a duly licensed real

estate school pursuant to the provisions of § 5-20.5-19 or a nationally recognized appraisal

organization, college, university, or other school approved by the appraiser qualifications board

of the Appraisal Foundation or such other school as approved by the board.

      (c) In lieu of meeting the requirements of subsection (b) of this section, an applicant for

certificate or license renewal may satisfy all or part of the recertification requirements by

presenting evidence of the following:

      (1) Completion of an educational program of study determined by the board to be

equivalent, for continuing education purposes, to courses meeting the requirements of subsection

(b) of this section; or

      (2) Participation other than as a student in educational processes and programs approved

by the board which relate to appraisal theory, practices or techniques, including, but not

necessarily limited to, teaching, program development and preparation of textbooks, monographs,

articles, and other instructional materials, which may be credited for no greater than fifty percent

(50%) of the total number of the continuing education requirements of this section.

      (3) [Deleted by P.L. 2013, ch. 54, § 1 and P.L. 2013, ch. 58, § 1].

     5-20.7-20. Revocation or suspension of certification or license. Revocation or

suspension of certification or license; Fine.-- The director of the department of business

regulation may, upon his or her own motion or by recommendation of the board, and shall, upon

the verified complaint, in writing, of any person setting forth a cause under this section, ascertain

the facts and, if warranted, hold a hearing for the imposition of the fine up to one thousand dollars

($1,000) or for the suspension or revocation of a certification or license. The director has the

power to refuse a certification or license for cause or to suspend or revoke a certification or

license where it has been obtained by false representation, or by fraudulent act or conduct, or

where the holder of a certificate in performing or attempting to perform any of the acts mentioned

in this chapter, is found guilty of:

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      (1) Procuring or attempting to procure certification or licensing pursuant to this chapter

by knowingly making a false statement, knowingly submitting false information, refusing to

provide complete information in response to a question in an application for certification or

license or through any form of fraud or misrepresentation;

      (2) Failing to meet the minimum qualifications established by this chapter;

      (3) Paying money other than provided for by this chapter to any member or employee of

the board or department to procure a certification under this chapter;

      (4) A conviction, including a conviction based upon a plea of guilty or nolo contendere,

of a crime, which is substantially related to the qualifications, functions, and duties of a person

developing appraisals and communicating appraisals to others or convicted of any felony;

      (5) An act or omission involving dishonesty, fraud, or misrepresentation with the intent

to benefit the certificate holder or another person or with the intent to substantially injure another,

mislead or defraud another person;

      (6) Failure or refusal without good cause to exercise reasonable diligence in developing

an appraisal, preparing an appraisal report or communicating an appraisal;

      (7) Accepting an appraisal assignment when the employment itself is contingent upon

the appraiser reporting a predetermined estimate, analysis or opinion, or where the fee to be paid

is contingent upon the opinion, conclusion, or valuation reached, or upon the consequence

resulting from the appraisal assignment; or

      (8) Entry of a final civil judgment against the person on grounds of fraud,

misrepresentation, or deceit in the making of an appraisal.

     5-20.7-26. Order to cease unsafe practices – Appeal. Order to cease unsafe practices;

Penalty -- Appeal. -- If the department of business regulation has reason to believe that any

person, firm, or corporation or association is conducting any activities requiring licensure or

certification pursuant to this chapter without obtaining a license, or who after the denial,

suspension or revocation of a license conducts any activities requiring licensure or certification

pursuant to this chapter, the department may issue its order to that person, firm, corporation or

association commanding them to appear before the department at a hearing to be held not sooner

than ten (10) days and not later than twenty (20) days after issuance of that order, to show cause

why the department should not issue an order to that entity to cease and desist from the violation

of the provisions of this chapter. The order to show cause may be served on any person, firm,

corporation or association named in the order in the same manner that a summons in a civil action

may be served, or by mailing a copy of the order, certified mail, return receipt requested, to that

entity at any address which is the place of business or place of residence. If upon that hearing the

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department is satisfied that the entity is in fact violating any provision of this chapter, then the

department may order that entity, in writing, to cease and desist from that violation. The

department may also order that person to pay an administrative penalty not to exceed one

thousand dollars ($1,000) for unlicensed activity. All hearings shall be governed in accordance

with chapter 35 of title 42. If that entity fails to comply with an order of the department after

being afforded a hearing, the superior court in the county where the land or real estate is located

has jurisdiction upon complaint of the department to restrain and enjoin that entity from violating

this chapter.

     SECTION 3. Section 19-14-24 of the General Laws in Chapter 19-14 entitled "Licensed

Activities" is hereby amended to read as follows:

     19-14-24. Other business in same place. Tying with other business. -- No licensee

shall condition any sale on the requirement that the consumer purchase any other product or

service from a specified provider including those providers with whom the licensee is sharing

office space. conduct any business under this title within any office or place of business in which

any other business is solicited or engaged, except as the director or the director's designee may

authorize, in writing. Approval shall not be unreasonably withheld if the director or the director's

designee finds that the character of the other business is such that the granting of the authority

would not evade the provisions of this chapter.

     SECTION 4. Section 31-44-17 of the General Laws in Chapter 31-44 entitled "Mobile

and Manufactured Homes" is hereby amended to read as follows:

     31-44-17. Filing of complaint with department -- Notice -- Rules of evidence not

binding. -- (a) Any resident of a mobile and manufactured housing park or any owner of a mobile

and manufactured housing park may petition the director by filing a complaint with the

department of business regulation. and paying a twenty-five dollar ($25.00) filing fee which shall

be used to defray the costs of the director. The filing fee may be waived by the director if he or

she or his or her agent determines that the fee will cause an unfair financial burden on the

petitioner. After review of the claim and a decision by the director that the matter has merit and is

not frivolous, the director shall schedule a hearing within sixty (60) days from receipt of the

claim. If the director finds the claim to be without merit or to be frivolous, the director shall

dismiss the complaint and explain in writing to the complainant his or her reasons for dismissing

the complaint.

      (b) The director or his or her agent shall serve notice, in writing, of the time and place of

the hearing upon all appropriate parties at least twenty (20) days prior to the date of the hearing.

Both parties to the complaint may be represented by counsel.

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      (c) The director or his or her agent shall not be bound by common law or statutory rules

of evidence but may admit all testimony having a reasonable probative value. Complaints filed

shall be handled in accordance with the departments' rules of practice and the Administrative

Procedures Act, chapter 35 of title 42. It may exclude evidence which, in the opinion of the

director or his or her agent, is immaterial, irrelevant, or unduly repetitious.

     SECTION 5. Section 42-14-12 of the General Laws in Chapter 42-14 entitled

"Department of Business Regulation" is hereby amended to read as follows:

     42-14-12. Sales of businesses. -- Any person, firm, or corporation acting may act as a

broker for the sale of an existing business or the transfer of all or a substantial part of the

materials, supplies, merchandise, or other inventory of an existing business or for the making of a

bulk transfer under chapter 6 of title 6A for a fee, charge, or commission shall be required to post

a bond in the sum of twenty thousand dollars ($20,000) with the department of business

regulation with surety or sureties approved by the director of the department. Provided, however,

that the provisions of this section shall not apply to attorneys, any person licensed as a real estate

broker, or real estate salesman pursuant to the provisions of chapter 20.5 of title 5, except that no

person, firm, or corporation shall act or hold himself or herself out as a business broker unless he

or she holds a real estate broker's license issued by the department of business regulation that has

not been revoked provided the sale does not include the transfer of real estate with the business. If

the sale of the business includes with it the sale or lease of any parcel or interest in real estate, as

defined under chapter 20.5 of title 5, the broker must hold a valid real estate broker's license duly

issued by the department of business regulation.

     SECTION 6. Section 42-14.2-20 of the General Laws in Chapter 42-14.2 entitled

"Department of Business Regulation - Automobile Wrecking and Salvage Yards" is hereby

amended to read as follows:

     42-14.2-20. Cease and desist orders. Cease and desist orders; Penalties.-- (a) If the

department shall have reason to believe that any person, firm, corporation, or association is

violating the provisions of this chapter, the department may issue its order to that person, firm,

corporation, or association commanding them to appear before the department at a hearing to be

held not sooner than ten (10) days nor later than twenty (20) days after issuance of the order to

show cause why the commission should not issue an order to the person to cease and desist from

the violation of the provisions of this chapter.

      (b) An order to show cause may be served on any person, firm, corporation, or

association named therein by any person in the same manner that a summons in a civil action may

be served, or by mailing a copy of the order to the person at any address at which he or she has

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done business or at which he or she lives. If upon the hearing the department shall be satisfied

that the person is in fact violating any provision of this chapter, then the department shall order

that person, in writing, to cease and desist from the violation. The department may also order that

person to pay an administrative penalty not to exceed one thousand dollars ($1,000) for

unlicensed activity. At any hearing, any person subject to an order of the department to cease and

desist may be represented by counsel.

      (c) The department shall not be bound by common law rules of evidence, but may

receive and consider any statements, documents, and things which shall be considered by them

necessary or useful in arriving at their decision. If that person shall thereafter fail to comply with

the order of the department, the superior court for Providence County shall have jurisdiction upon

the complaint of the department to restrain and enjoin that person from violating this chapter. The

complaint shall be in the form of a civil action. The findings and order of the department shall

constitute prima facie evidence that the person ordered by the department to cease and desist has

violated the provisions of this chapter.

      (d) The attorney general shall afford the department any necessary assistance in

obtaining relief in the superior court.

     SECTION 7. Chapter 23-26 of the General Laws entitled "Bedding and Upholstered

Furniture" is hereby amended by adding thereto the following section:

     23-26-32. Civil penalties for violations - Cease and desist authority. – (a) In addition

to every other power granted the department of business regulation, the department may impose

an administrative penalty of not more than five hundred dollars ($500) for any violation or failure

to comply with the provisions of this chapter or with any rule or regulation promulgated by the

department.

     (b) If the director has reason to believe that any person or entity is violating any provision

of this chapter or rule or regulation promulgated thereunder, the director may issue an order to

that person or entity commanding them to appear before the department at a hearing to show

cause why the director should not issue an order to that person or entity to cease and desist from

the violation. By decision after hearing, approved by the director, the department may issue an

order to cease and desist which shall be enforceable in superior court.

     SECTION 8. Chapter 31-44 of the General Laws entitled "Mobile and Manufactured

Homes" is hereby amended by adding thereto the following section:

     31-44-23. Cease and desist authority. – If the director has reason to believe that any

person or entity is violating any provision of this chapter or rule or regulation promulgated

thereunder, the director may issue an order to that person or entity commanding them to appear

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before the department at a hearing to show cause why the director should not issue an order to

that person or entity to cease and desist from the violation. By decision after hearing, approved by

the director, the department may issue an order to cease and desist which shall be enforceable in

the superior court for Providence county.

     SECTION 9. Chapter 31-46 of the General Laws entitled "Rhode Island Salvage Law" is

hereby amended by adding thereto the following section:

     31-46-8. Civil penalties for violations - Cease and desist authority. – (a) In addition to

every other power granted the department of business regulation, the department may impose an

administrative penalty of not more than five hundred dollars ($500) for any violation or failure to

comply with the provisions of this chapter or with any rule or regulation promulgated by the

department.

     (b) If the director has reason to believe that any person or entity is violating any provision

of this chapter or any rule or regulation promulgated thereunder, the director may issue an order

to that person or entity commanding them to appear before the department at a hearing to show

cause why the director should not issue an order that person or entity to cease and desist from the

violation. By decision after hearing, approved by the director, the department may issue an order

to cease and desist which shall be enforceable in the superior court for Providence county.

     SECTION 10. Chapter 41-5 of the General Laws entitled "Boxing and Wrestling" is

hereby amended by adding thereto the following section:

     41-5-25. Civil penalties for violations - Cease and desist authority. – (a) In addition to

every other power granted the department of business regulation, the department may impose an

administrative penalty of not more than five hundred dollars ($500) for any violation or failure to

comply with the provisions of this chapter or with any rule or regulation promulgated by the

department.

     (b) If the director has reason to believe that any person or entity is violating any provision

of this chapter or rule or regulation promulgated thereunder, the director may issue an order to

that person or entity commanding them to appear before the department at a hearing to show

cause why the director should not issue an order to that person or entity to cease and desist from

the violation. By decision after hearing, approved by the director, the department may issue an

order to cease and desist which shall be enforceable in superior court for Providence county.

     SECTION 11. Chapter 41-5.2 of the General Laws entitled "Mixed Martial Arts" is

hereby amended by adding thereto the following section:

     41-5.2-30. Civil penalties for violations - Cease and desist authority. – (a) In addition

to every other power granted the department of business regulation, the department may impose

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an administrative penalty of not more than five hundred dollars ($500) for any violation or failure

to comply with the provisions of this chapter or with any rule or regulation promulgated by the

department.

     (b) If the director has reason to believe that any person or entity is violating any provision

of this chapter or rule or regulation promulgated thereunder, the director may issue an order to

that person or entity commanding them to appear before the department at a hearing to show

cause why the director should not issue an order to that person or entity to cease and desist from

the violation. By decision after hearing, approved by the director, the department may issue an

order to cease and desist which shall be enforceable in superior court for Providence county.

     SECTION 12. Chapter 42-14 of the General Laws entitled "Department of Business

Regulation" is hereby amended by adding thereto the following sections:

     42-14-14.1. Inspection power. – The director of the department of business regulation,

or their agent, shall have the power to enter, examine and inspect in a manner reasonable under

the circumstances the licensed premises of any person who is licensed by the department or who

is entitled to an exemption from licensing. Upon receipt of a report or complaint, the director, or

their agent, shall be entitled to conduct an inspection of the premises of any person who may be

engaging upon such premises in activity(ies) requiring a license from the department in order to

determine whether any violation or unlicensed activity has occurred.

     42-14-20. Applications; processing fee. – In connection with any application for a

license, permit and/or registration, or any renewal thereof, that is subject to the jurisdiction of the

department of business regulation and as to which the department has an electronic system for

applicants to file such applications, if an applicant submits its application in paper copy and not

electronically, the department shall be entitled to charge and collect from the applicant a

processing fee in the amount of fifty dollars ($50.00). The processing fee shall be paid by the

applicant at the time of its application and shall be in addition to any licensing, permit and/or

registration fee or any renewal thereof.

     SECTION 13. Chapter 42-14.2 of the General Laws entitled "Department of Business

Regulation - Automobile Wrecking and Salvage Yards" is hereby amended by adding thereto the

following section:

     42-14.2-22. Civil penalties for violations. – In addition to every other power granted the

department of business regulation, the department may fine a licensee not more than one

thousand dollars ($1,000) for any violation or failure to comply with the provisions of this chapter

or with any rule or regulation promulgated by the department.

     SECTION 14. Section 5-20.5-17 of the General Laws in Chapter 5-20.5 entitled "Real

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Estate Brokers and Salespersons" is hereby repealed.

     5-20.5-17. Penalties for violations. -- (a) Any person acting as a broker or as a

salesperson without first obtaining a license is guilty of a misdemeanor and upon conviction, is

punishable by a fine of not less than one hundred dollars ($100) nor more than five hundred

dollars ($500), or by imprisonment for a term not to exceed one year, or both; and if a

corporation, is punishable by a fine of not less than one thousand dollars ($1,000) nor more than

two thousand dollars ($2,000). Any person upon conviction of a second or subsequent offense is

punishable by a fine of not less than five hundred dollars ($500) nor more than one thousand

dollars ($1,000), or by imprisonment for a term not to exceed two (2) years, or both; and if a

corporation, by a fine of not less than two thousand dollars ($2,000) nor more than five thousand

dollars ($5,000).

      (b) In case any person has received any money, or the equivalent, as a fee, commission,

compensation, or profit by or in consequence of a violation of any provision of this chapter, he or

she, in addition, is liable to a penalty of not less than the amount of the sum of money received

and not more than three (3) times the sum received, as may be determined by the court, which

penalty may be recovered in any court of competent jurisdiction by any person aggrieved.

     SECTION 15. Section 5-20.7-21 of the General Laws in Chapter 5-20.7 entitled "Real

Estate Appraiser Certification Act" is hereby repealed.

     5-20.7-21. Violations -- Penalties. -- (a) Any person upon conviction of acting or

representing themselves to be a state certified or licensed real estate appraiser or performing the

duties of a certified or licensed real estate appraiser as defined within this chapter without first

obtaining a certification or license is guilty of a misdemeanor punishable by a fine of not less than

one hundred dollars ($100) nor more than five hundred dollars ($500), or by imprisonment for a

term not to exceed one year, or both; and if a corporation, by a fine of not less than one thousand

dollars ($1,000) nor more than two thousand dollars ($2,000). Any person upon conviction of a

second or subsequent offense is punishable by a fine of not less than five hundred dollars ($500)

nor more than one thousand dollars ($1,000), or by imprisonment for a term not to exceed two (2)

years, or both; and if a corporation, by a fine of not less than two thousand dollars ($2,000) nor

more than five thousand dollars ($5,000).

      (b) In case any person has received any money, or the equivalent of money as a fee,

commission, compensation, or profit by or in consequence of a violation of any provision of this

chapter, he or she shall, in addition, be liable to a penalty of not less than the amount of this sum

or money so received and not more than three (3) times the sum received, as may be determined

by the court, which penalty may be recovered in any court of competent jurisdiction by any

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person aggrieved together with all reasonable attorneys' fees and costs incurred in the prosecution

of the action.

     SECTION 16. Section 23-26-27 of the General Laws in Chapter 23-26 entitled "Bedding

and Upholstered Furniture" is hereby repealed.

     23-26-27. Penalty for violations. -- Any person who:

      (1) Makes, remakes, renovates, sterilizes, prepares, sells, or offers for sale, exchange, or

lease any article of bedding as defined by § 23-26-1, not properly tagged as required by this

chapter; or

      (2) Uses in the making, remaking, renovating, or preparing of the article of bedding or in

preparing cotton or other material therefor which has been used as a mattress, pillow, or bedding

in any public or private hospital, or which has been used by or about any person having an

infectious or contagious disease, and which after such use has not been sterilized and approved

for use, by the director of business regulation; or

      (3) Counterfeits or imitates any stamp or permit issued under this chapter shall be guilty

of a misdemeanor, punishable by a fine of not more than five hundred dollars ($500) or by

imprisonment for not more than six (6) months or both.

     SECTION 17. Section 41-5-4 of the General Laws in Chapter 41-5 entitled "Boxing and

Wrestling" is hereby repealed.

     41-5-4. Penalty for unlicensed match. -- Any person holding, conducting, or

participating in any match or exhibition held without a license, unless exempted as provided

herein, shall be punished by a fine not exceeding one hundred dollars ($100) or by imprisonment

for a term not exceeding three (3) months, or by both a fine and imprisonment.

     SECTION 18. Section 41-5.2-26 of the General Laws in Chapter 41-5.2 entitled "Mixed

Martial Arts" is hereby repealed.

     41-5.2-26. Penalty for unlicensed match. -- Any person holding, conducting, or

participating in any mixed martial arts match or exhibition held without a license, unless

exempted as provided herein, shall be punished by a fine not exceeding one hundred dollars

($100) or by imprisonment for a term not exceeding three (3) months, or by both a fine and

imprisonment.

     SECTION 19. Section 42-14.2-13 of the General Laws in Chapter 42-14.2 entitled

"Department of Business Regulation - Automobile Wrecking and Salvage Yards" is hereby

repealed.

     42-14.2-13. Penalties. -- Any person, firm, corporation, or association violating any of

the provisions of this chapter shall upon conviction be guilty of a misdemeanor. Any person, firm,

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corporation, or association who is convicted for violation of any section of this chapter shall be

punished by a fine not to exceed five hundred dollars ($500) or by imprisonment for a term not to

exceed one year, or both fine and imprisonment for each violation of the provisions of this

chapter.

     SECTION 20. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO BUSINESS REGULATIONS

***

     This act would amend various statutes in connection with the administrative powers of

the department of business regulation in order to provide consistency with respect to the penalty –

related provisions governing the businesses subject to the statutes.

     This act would take effect upon passage.

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