View Daily Data Tracking History
View Bill Text
View Statement of Purpose / Fiscal Impact
H0593................................by JUDICIARY, RULES AND ADMINISTRATION
SALES - UNFAIR - Amends existing law to further define the terms "cost to
the wholesaler" and "freight charges"; to provide for civil penalties for
advertising or selling merchandise at less than cost; to provide that any
civil penalties shall be remitted to the Public School Income Fund; to
authorize private individuals or prosecuting attorneys to bring actions;
and to provide for attorney's fees and costs.
02/08 House intro - 1st rdg - to printing
02/11 Rpt prt - to Jud
02/20 Rpt out - rec d/p - to 2nd rdg
02/21 2nd rdg - to 3rd rdg
02/26 3rd rdg - FAILED - 28-41-1
AYES -- Aikele, Bedke, Bell, Bieter, Block, Boe, Crow, Deal, Denney,
Ellsworth, Field(13), Field(20), Gould, Hammond, Jaquet, Jones, Kunz,
Martinez, McKague, Mortensen, Pearce, Pischner, Ridinger, Shepherd,
Smith(33), Smith(23), Young, Mr. Speaker
NAYS -- Barraclough, Barrett, Black, Bolz, Bradford, Bruneel,
Callister, Campbell, Clark, Collins, Cuddy, Ellis, Eskridge, Gagner,
Hadley, Harwood, Henbest, Higgins, Hornbeck, Kellogg(Duncan),
Kendell, Lake, Langford, Loertscher, Mader, Meyer, Montgomery, Moyle,
Pomeroy, Raybould, Roberts, Robison, Sali, Schaefer, Sellman, Smylie,
Stevenson, Stone, Tilman, Trail, Wheeler
Absent and excused -- Wood
Floor Sponsors - Pearce & Denney
To Chief Clerk
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature Second Regular Session - 2002
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 593
BY JUDICIARY, RULES AND ADMINISTRATION COMMITTEE
1 AN ACT
2 RELATING TO UNFAIR SALES ACTS; AMENDING SECTION 48-403, IDAHO CODE, TO FURTHER
3 DEFINE THE TERMS "COST TO THE WHOLESALER" AND "FREIGHT CHARGES" AND TO
4 MAKE TECHNICAL CORRECTIONS; AND AMENDING SECTION 48-405, IDAHO CODE, TO
5 DELETE CRIMINAL PENALTIES, TO PROVIDE FOR CIVIL PENALTIES FOR VIOLATIONS,
6 TO PROVIDE THAT ANY CIVIL PENALTIES SHALL BE REMITTED TO THE PUBLIC SCHOOL
7 INCOME FUND, TO AUTHORIZE PRIVATE INDIVIDUALS OR PROSECUTING ATTORNEYS TO
8 BRING ACTIONS AND TO PROVIDE FOR ATTORNEY'S FEES AND COSTS.
9 Be It Enacted by the Legislature of the State of Idaho:
10 SECTION 1. That Section 48-403, Idaho Code, be, and the same is hereby
11 amended to read as follows:
12 48-403. DEFINITIONS OF TERMS. (a1) When used in this act, the term "cost
13 to the retailer" shall mean the actual cost of the merchandise to the
14 retailer, or the replacement cost of the merchandise to the retailer at the
15 lowest prices then prevailing in his trade area, whichever is lower; less all
16 trade discounts except customary discounts for cash; to which shall be added:
17 (1a) fFreight charges not otherwise included in the invoice cost or the
18 replacement cost of the merchandise as herein set forth,; and
19 (2b) cCartage to the retail outlet if done or paid for by the retailer,
20 which cartage cost, in the absence of proof of a lesser cost, shall be
21 deemed to be three-fourths (3/4) of one per cent percent (1%) of the cost
22 to the retailer as herein defined after adding thereto freight charges but
23 before adding thereto cartage and markup,; and
24 (3c) aA markup to cover a proportionate part of the cost of doing busi-
25 ness, which markup in the absence of proof of a lesser cost, shall be six
26 per cent percent (6%) of the cost to the retailer as herein set forth
27 after adding thereto freight charges and cartage but before adding thereto
28 a markup.
29 (b2) When used in this act, the term "cost to the wholesaler" shall mean
30 the actual cost of the merchandise to the wholesaler, or the replacement cost
31 of the merchandise to the wholesaler, whichever is lower; less all trade dis-
32 counts except customary discounts for cash; to which shall be added:
33 (1a) fFreight charges, not otherwise included in the invoice cost or the
34 replacement cost of the merchandise as herein set forth,; and
35 (2b) cCartage to the retail outlet if done or paid for by the wholesaler,
36 which cartage cost, in the absence of proof of a lesser cost, shall be
37 deemed to be three-fourths (3/4) of one per cent percent (1%) of the cost
38 to the wholesaler as herein set forth after adding thereto freight charges
39 but before adding thereto cartage and markup,; and
40 (3c) Taxes of any kind levied or assessed against the commodity or
41 against the retailer for use or possession of the commodity; and
42 (d) Aa markup to cover a proportionate part of the cost of doing busi-
43 ness, which markup, in the absence of proof of a lesser cost, shall be two
2
1 per cent percent (2%) of the cost to the wholesaler as herein set forth
2 after adding thereto freight charges and cartage but before adding thereto
3 a markup.
4 (b) (aa3) When used in this act, the term "cost to the direct seller"
5 shall mean the actual cost of the merchandise to the direct seller or the
6 replacement cost of the merchandise to the direct seller at the lowest price
7 then prevailing in his trade area, whichever is the lower; less all trade dis-
8 counts except customary discounts for cash; to which shall be added:
9 (1a) fFreight charges not otherwise included in the invoice cost or the
10 replacement cost to of the merchandise as herein set forth,; and
11 (2b) cCartage to the retail outlet if done or paid for by the direct
12 seller, which cartage cost, in the absence of proof of a lesser cost shall
13 be deemed to be one and one-half percent (1 1/2%) of the cost to the
14 direct seller as herein defined after adding thereto freight charges, but
15 before adding thereto cartage and markup,; and
16 (3c) a A markup to cover a proportionate part of the cost of doing busi-
17 ness, which markup, in the absence of proof of a lesser cost shall be
18 eight per cent percent (8%) of the cost to the direct seller as herein set
19 forth after adding thereto freight charges, but before adding thereto
20 cartage and markup.
21 (c4) When used in this act the term "replacement cost" shall mean the
22 cost per unit at which the merchandise sold or offered for sale could have
23 been bought at the nearest source of supply by the retailer, wholesaler or
24 direct seller at any time within thirty (30) days prior to the date of sale or
25 the date upon which it is offered for sale by the retailer, wholesaler or
26 direct seller if bought in the same quantity or quantities as the retailer's,
27 wholesaler's or direct seller's last purchase of the said merchandise.
28 (d5) Where one (1) or more items are advertised, offered for sale, or
29 sold with one (1) or more other items at a combined price, or are advertised,
30 offered as a gift, or given with the sale of one (1) or more other items, each
31 and all of said items shall for the purpose of this act be deemed to be adver-
32 tised, offered for sale, or sold, and the price of each item named shall be
33 governed by the provisions of subsections (a1), (b2) and (b-aa3) of this sec-
34 tion. 48-403 (this section) respectively.
35 (e6) The terms "cost to the retailer" "cost to the wholesaler" and "cost
36 to the direct seller" as defined in subsections (a1), (b2) and (b-aa3) of this
37 section shall mean bona fide costs; and purchases made by retailers, whole-
38 salers and direct sellers at prices which cannot be justified by prevailing
39 market conditions within this state shall not be used in determining cost to
40 the retailer, cost to the wholesaler and cost to the direct seller. Any
41 manufacturer's published list price, less published discounts, in effect in
42 this state at the time any such manufacturer's merchandise is purchased by a
43 wholesaler, retailer or direct seller is deemed to be competent evidence of
44 the cost of such manufacturer's merchandise, in the absence of proof of a
45 lesser cost.
46 (f7) The terms "sell at retail," "sales at retail" and "retail sale"
47 shall mean and include any transfer for a valuable consideration, made in the
48 ordinary course of trade or in the usual prosecution of the seller's business,
49 of title to tangible personal property to the purchaser for consumption or use
50 other than resale or further processing or manufacturing. The above terms
51 shall include any transfer of such property where title is retained by the
52 seller as security for the payment of the purchase price.
53 (g8) The terms "sell at wholesale," "sales at wholesale" and "wholesale
54 sales" shall mean and include any transfer for a valuable consideration made
55 in the ordinary course of trade or the usual conduct of the seller's business,
3
1 of title to tangible personal property to the purchaser for purpose of resale
2 or further processing or manufacturing. The above terms shall include any
3 transfer of such property where title is retained by the seller as security
4 for the payment of the purchase price.
5 (h9) The term "retailer" shall mean and include every person, partner-
6 ship, corporation or association engaged in the business of making sales at
7 retail within this state; provided, that in case of a person, partnership,
8 corporation or association engaged in the business of making both sales at
9 retail and sale at wholesale, such terms shall be applied only to the retail
10 portion of such business.
11 (i10) The term "wholesaler" shall mean and include every person, partner-
12 ship, corporation, or association engaged in the business of making sales at
13 wholesale within this state; provided that in case of a person, partnership,
14 corporation or association engaged in the business of making both sales at
15 wholesale and sales at retail, such term shall apply only to the wholesale
16 portion of such business.
17 (j11) The term "freight charges" when used in this act shall mean minimum
18 rates or charges contained in the lawfully filed tariff of any carriers hold-
19 ing authority from the Idaho Ppublic Uutilities Ccommission of Idaho or the
20 Iinterstate Ccommerce Ccommission or a successor agency which tariff is on
21 file with the said Idaho Ppublic Uutilities Ccommission or the Iinterstate
22 Ccommerce Ccommission or the successor agency.
23 (k12) The term "direct seller" when used in this act shall mean and
24 include every retailer as herein defined who buys processed merchandise direct
25 from the processor for the purpose of selling such processed merchandise at
26 retail, but a retailer shall be a direct seller only as to the processed mer-
27 chandise so purchased.
28 (l13) The term "store or outlet" as used in this act, means any place at
29 which goods, wares or merchandise are sold or offered for sale to the public;
30 provided, however, that the term "store or outlet" shall not be construed to
31 include any place at which the gross sales of goods, wares or merchandise in
32 the last preceding calendar year do not exceed five thousand dollars ($5,000).
33 (m14) The term "person" shall mean any individual, firm, partnership,
34 corporation or association.
35 SECTION 2. That Section 48-405, Idaho Code, be, and the same is hereby
36 amended to read as follows:
37 48-405. CIVIL PENALTY FOR ADVERTISING OR SELLING MERCHANDISE AT LESS THAN
38 COST. Any retailer or direct seller who shall, in contravention of the policy
39 of this act, advertise, offer to sell or sell at retail any item of merchan-
40 dise, which is subject to this act, at less than cost to the retailer or
41 direct seller as defined in this act, or knowingly buys any item of merchan-
42 dise, which is subject to this act, from any wholesaler at less than cost to
43 the wholesaler as herein defined, or any wholesaler who shall, in contraven-
44 tion of the policy of this act, advertise, offer to sell or sell at wholesale
45 any item of merchandise, which is subject to this act, at less than cost to
46 the wholesaler as defined in this act, shall be guilty of a misdemeanor for
47 each single offense, and upon conviction thereof shall be punished by a fine
48 of not more than $500 or by imprisonment not to exceed six (6) months or by
49 both said fine and imprisonment, may be liable for a civil penalty not in
50 excess of five thousand dollars ($5,000) upon a showing that a violation of
51 this act has occurred in the discretion of the court, which civil penalty
52 shall be placed in the public school income fund. A private individual or a
53 prosecuting attorney may bring an action pursuant to this section to allege a
4
1 violation of the provisions of this chapter. Additionally the court, in its
2 discretion, may award attorney's fees and costs to the prevailing party in an
3 action brought pursuant to this section. Proof of any such advertising, offer
4 to sell or sale by any retailer, direct seller or wholesaler in contravention
5 of the policy of this act, shall be prima facie evidence of a violation of
6 this act.
STATEMENT OF PURPOSE
RS 11702Cl
This proposed legislation amends and updates Title 48, Chapter 4 of
the Unfair Sales Act. The proposed amendments update the 1939 Act
to allow taxes to be included in the definition of “cost to
wholesaler;” to increase the penalty from $500 to $5,000; to delete
criminal penalties; to place any civil penalties in the public
school income fund; to allow a private individual, a prosecuting
attorney or the attorney general to bring action; and to allow for
attorney’s fees and costs to be awarded to the prevailing party.
FISCAL IMPACT
There is no fiscal impact.
Contact
Name: Suzanne Budge Schaefer
Phone: 336-1986
Rep. Monty Pearce 332-1000
Rep. Lawrence Denny 332-1120
STATEMENT OF PURPOSE/FISCAL NOTE H 593