Bill Text: CT HB05222 | 2010 | General Assembly | Comm Sub
Bill Title: An Act Concerning Residential Retail Heating Oil And Propane Contracts.
Spectrum: Committee Bill
Status: (Introduced - Dead) 2010-04-05 - Referred by House to Committee on Judiciary [HB05222 Detail]
Download: Connecticut-2010-HB05222-Comm_Sub.html
General Assembly |
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February Session, 2010 |
*_____HB05222GL____031610____* |
AN ACT CONCERNING RESIDENTIAL RETAIL HEATING OIL AND PROPANE CONTRACTS.
Be it enacted by the Senate and House of Representatives in General Assembly convened:
Section 1. Section 16a-21 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2010):
(a) [No person, firm or corporation shall sell at retail fuel oil or propane gas to be used for residential heating without placing the unit price, clearly indicated as such, the total number of units sold and the amount of any delivery surcharge in a conspicuous place on the delivery ticket given to the purchaser or an agent of the purchaser at the time of delivery. No person, firm or corporation may bill or otherwise attempt to collect from any purchaser of fuel oil or propane gas an amount which exceeds the unit price multiplied by the total number of units stated on the delivery ticket, plus the amount of any delivery surcharge stated on the ticket.] For the purpose of this section, [unit price] (1) "unit price" means the price per gallon computed to the nearest tenth of a whole cent; (2) "associated equipment" means a gas regulator, gas line, sacrificial anode, interconnecting hardware and such other equipment necessary for the installation and operation of a propane tank; and (3) "residential heating" means heat provided for a structure with at least one but not more than four dwelling units.
(b) (1) No person, firm or corporation shall sell at retail fuel oil or propane gas to be used for residential heating and to be delivered to a dealer-owned fuel oil or propane gas storage tank that is being leased or lent to a consumer and is installed underground on property owned by the consumer without a written contract that contains all the terms and conditions for delivery of such fuel oil or propane gas and the amount of fees, charges or penalties allowed under this subsection assessed to the consumer under such contract. No such written contract shall contain any fees, charges or penalties except for tank rental fees, tank removal fees or liquidated damages. Such fees may increase during the contract term provided the amount of such fees are clearly and conspicuously disclosed. No contract for the delivery of fuel oil or propane gas under this section shall include a provision for liquidated damages for a consumer breach of such contract where the liquidated damages exceed the actual damages to the fuel oil or propane gas retailer caused by such breach. Any contract entered into with a consumer after the effective date of this section for the lease or loan of an underground fuel oil or propane storage tank and associated equipment shall contain an option allowing the consumer to purchase the underground fuel oil or propane storage tank and associated equipment for a specified commercially reasonable amount at the expiration of the first term of the contract not later than sixty months after the date of commencement of the contract or at such other earlier time as provided in such contract, which option may be conditioned upon the consumer executing a mutually acceptable equipment sales agreement containing reasonable waiver of liability, transfer of warranty and such other applicable terms and conditions, which shall be stated in the contract. Any fuel oil or propane gas retailer may enter into a separate contract with the purchaser for additional services, including, but not limited to, maintenance, repair and warranty of equipment, provided such contract complies with the provisions of this section.
(2) No person, firm or corporation shall sell at retail fuel oil or propane gas to be used for residential heating and to be delivered to a dealer-owned fuel oil or propane gas storage tank that is being leased or lent to such consumer and is installed above-ground on property owned by the consumer without a written contract if the consumer is to be charged a tank removal fee. Any such contract entered into after the effective date of this section shall contain all the terms and conditions for delivery of such fuel oil or propane gas and the amount of fees, charges or penalties allowed under this subsection assessed to the consumer under such contract. No written contract shall be for an initial term of greater than thirty-six months. Such contract shall not contain any fees, charges or penalties except for propane tank rental fees, propane tank removal fees or liquidated damages. Such fees may increase during the contract term provided the amount of such fees are clearly and conspicuously disclosed. No contract for the delivery of fuel oil or propane gas under this section shall include a provision for liquidated damages for a consumer breach of such contract where the liquidated damages exceed the actual damages to the fuel oil or propane gas retailer caused by such breach. Any fuel oil or propane gas retailer may enter into a separate contract with the purchaser for additional services, including, but not limited to, maintenance, repair and warranty of equipment, provided such contract complies with the provisions of this section.
(3) Any written contract required by this section shall be in plain language pursuant to section 42-152, provided any fee, charge or penalty disclosed in such contract shall be in twelve-point, boldface type of uniform font.
(4) No written contract between a dealer and consumer for the retail sale of fuel oil or propane gas or lease of equipment that contains a provision for automatic renewal of the contract or lease is valid unless the consumer is provided with the right to terminate the contract or lease at the end of the initial term or subsequent anniversary date of such contract upon not less than thirty days' prior written notice to the dealer. After the initial term, no contract renewal period shall be for more than twelve months.
(c) The requirement that contracts be in writing, as set forth in this section, may be satisfied pursuant to the provisions of: (1) The Connecticut Uniform Electronic Transactions Act, sections 1-266 to 1-286, inclusive; (2) sections 42a-7-101 to 42a-7-106, inclusive; and (3) the Electronic Signatures in Global and National Commerce Act, 15 USC 7001 et seq. Except as provided in subsection (d) of this section, verbal telephonic communications shall not satisfy the writing requirement of this section.
(d) The requirement that contracts be in writing pursuant to this section and section 16a-23n, as amended by this act, may be satisfied telephonically by a person, firm or corporation selling at retail fuel oil or propane gas, only if such person, firm or corporation: (1) Has provided to the consumer prior to any telephonic communication all terms and conditions of the contract, in writing, except for the contract duration, the unit price and the maximum number of units covered by the contract; (2) employs an interactive voice response system or similar technology which provides the consumer with the contract duration, the unit price and the maximum number of units covered by the contract to complete the contract; (3) retains, in a readily retrievable format, a recording of the consumer agreeing to each such term and condition for the period of the contract plus one year; (4) sends the consumer a letter confirming the consumer's agreement to such terms and conditions, with the written stipulation that the consumer is bound by such terms and conditions unless the agreement is rescinded by the consumer, in writing, not later than three business days after receipt of such letter by said consumer; and (5) retains a copy of each such letter for not less than the period of the contract plus one year.
(e) (1) No person, firm or corporation shall deliver fuel oil or propane gas to be used for residential heating, without placing the unit price, clearly indicated as such, the total number of units sold and the amount of any delivery surcharge in a conspicuous place on the delivery ticket given to the purchaser or an agent of the purchaser at the time of delivery. Except where the delivery of fuel oil or propane gas is placed in a common tank from which individual customers draw such fuel oil or propane gas and are billed according to a meter that measures such customer's usage from the common tank, no person, firm or corporation may bill or otherwise attempt to collect from any purchaser of fuel oil or propane gas an amount that exceeds the unit price multiplied by the total number of units stated on the delivery ticket, plus the amount of any delivery surcharge stated on the ticket.
(2) The requirement that contracts be in writing, as set forth in this section, shall not apply to any retail fuel oil or propane gas contract where no fee, charge or penalty is assessed, except for stating the unit price of the retail fuel oil or propane gas delivered to a consumer.
(f) The provisions of this section shall not apply to existing customers of a person, firm or corporation selling at retail fuel oil or propane gas on October 1, 2010, who have valid written contracts on said date.
(g) The provisions of this section shall not apply to existing customers of a person, firm or corporation selling at retail fuel oil or propane gas on October 1, 2010, to be used for residential heating, who does not have a valid written contract in effect on said date if such existing customer is not assessed any new fee or an increase in the amount of any fee greater than the fees charged to such existing customer as of October 1, 2010. Such existing customer may terminate on thirty days' written notice without any tank removal charge. No person, firm or corporation selling fuel oil or propane gas to be used for residential heating to an existing customer who does not have a valid written contract in effect on October 1, 2010, shall charge a new fee or increase the amount of any fee greater than the fees charged to such existing customer as of October 1, 2010, unless the customer receives prior written notice not less than sixty days and not more than ninety days prior to the effective date of the assessment of the new or increased fee and the customer is further notified that the customer's payment of the new or increased fee shall be deemed to be acceptance thereof.
(h) No person, firm or corporation shall condition the sale of fuel oil or propane to a consumer upon an agreement to purchase a fuel oil or propane tank from such person, firm or corporation. No person, firm or corporation shall condition the sale of a fuel oil or propane tank to a consumer upon an agreement to purchase fuel oil or propane from such person, firm or corporation.
[(b)] (i) Any person, firm or corporation who violates [subsection (a)] any provision of this section shall be fined not more than [one] five hundred dollars for the first offense, [nor] not more than [five] seven hundred fifty dollars for [each subsequent offense] a second offense occurring not more than three years after a prior offense and not more than one thousand five hundred dollars for a third or subsequent offense occurring not more than three years after a prior offense.
Sec. 2. Subsection (b) of section 16a-23m of the 2010 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2010):
(b) Each person, firm or corporation seeking registration as a home heating oil or propane gas dealer shall apply annually for a certificate of registration with the Department of Consumer Protection on forms prescribed by the Commissioner of Consumer Protection. Such forms shall require the dealer to disclose all affiliated companies registered with the Department of Consumer Protection that are under common ownership or have interlocking boards of directors. Each applicant shall pay a registration fee of two hundred dollars. The commissioner shall require all applicants for registration as a home heating oil or propane gas dealer to provide evidence of general liability insurance coverage and insurance to cover any potential environmental damage due to fuel oil spills or propane gas leaks caused by such applicant as a registered dealer which coverage shall be not less than one million dollars. Each registered dealer shall provide the department with evidence of each renewal of or change to such insurance coverage not later than five days after such renewal or change during the period of registration, which renewal or change shall meet the requirements of this subsection.
Sec. 3. Section 16a-23n of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2010):
(a) As used in this section:
(1) "Capped price contract" means an agreement where the cost to the consumer of heating oil or propane may not increase above a specified price per gallon and the consumer may pay less than the specified price under circumstances specified in such contract;
(2) "Fixed price contract" means an agreement where the cost to the consumer of heating oil or propane is set at a specific price during the term of the contract;
(3) "Futures contract" means a standardized, transferable, exchange-traded agreement that requires delivery of heating oil or propane at a specified price on a specified future date;
(4) "Guaranteed price contract" means a fixed price or capped price contract or any other agreement where the per gallon price for heating oil or propane is set at a specified amount unless certain circumstances occur;
(5) "Physical supply contract" means an agreement for wet barrels of oil or gallons of propane that has been secured by the heating oil or propane dealer from a wholesaler; and
(6) "Surety bond" means a bond issued by a licensed insurance company on behalf of a dealer, guaranteeing that such company will reimburse any consumer losses incurred as a result of the failure of the dealer to fulfill an obligation to a consumer.
[(a)] (b) A contract or a renewal or extension of a contract for the retail sale of home heating oil or propane gas that offers a guaranteed price [plan] contract, including fixed or capped price contracts and any other similar terms, shall be in writing and the terms and conditions of such price plan shall be disclosed, including a plain language description of the circumstances under which the price may increase or decrease. A capped price contract shall specify how the price will or will not decrease in relation to the heating oil or propane commodities market. Such disclosure shall be in plain language and shall immediately follow the language concerning the price or service that could be affected and shall be printed in no less than twelve-point boldface type of uniform font.
[(b)] (c) A home heating oil or propane gas dealer that advertises a price shall offer such price for a period of no less than twenty-four hours or until the next advertised price is publicized, whichever occurs first.
[(c)] (d) No home heating oil or propane gas dealer shall enter into, renew or extend a [prepaid home heating oil or propane gas contract or a capped price per gallon home heating oil] guaranteed price contract unless such dealer has, not later than five business days after receipt of such guaranteed price contract, either: (1) Obtained and maintained heating oil or propane gas futures or forwards contracts, physical supply contracts or other similar commitments the total amount of which allow such dealer to purchase, at a fixed price, heating oil or propane gas in an amount not less than eighty per cent of the maximum number of gallons or amount that such dealer is committed to deliver pursuant to all [prepaid home heating oil or propane gas] guaranteed price contracts entered into, renewed or extended by such dealer, [or that such dealer estimates is committed pursuant to all capped price per gallon home heating oil or capped price per unit propane gas contracts, respectively,] or (2) obtained and maintained a surety bond in an amount not less than fifty per cent of the total amount of funds paid to the dealer by consumers [pursuant to prepaid home heating oil or propane gas contracts] or that the dealer estimates will be paid to the dealer by consumers pursuant to all [capped price per gallon home heating oil or capped price per unit propane gas contracts, respectively] guaranteed price contracts. Such dealer shall maintain such total amount of futures or forwards contracts, physical supply contracts or other similar commitments, or the amount of the surety bond required by this subsection for the period of time for which such [prepaid home heating oil or propane gas contracts or capped price per gallon home heating oil or capped price per unit propane gas contracts] guaranteed price contracts are effective, except that the total amount of such futures or forwards contracts, physical supply contracts or other similar commitments, or the amount of the surety bond may be reduced during such period of time to reflect any amount of home heating oil or propane gas already delivered to and paid for by the consumer.
[(d)] (e) No [prepaid home heating oil or propane gas] guaranteed price contract shall require any consumer commitment to purchase home heating oil or propane gas pursuant to the terms of such contract for a period of more than eighteen months.
[(e)] (f) Any [prepaid home heating oil or propane gas] guaranteed price contract shall indicate: (1) The amount of funds paid by the consumer to the dealer under such contract, (2) the maximum number of gallons of home heating oil or maximum amount of propane gas committed by the dealer for delivery to the consumer pursuant to such contract, and (3) that performance of such [prepaid home heating oil or propane gas] guaranteed price contract is secured by one of the two options described in subsection [(c)] (d) of this section. Any such contract shall provide that the contract price of any undelivered home heating oil or propane gas owed to the consumer under the contract, on the end date of such contract, shall be reimbursed to the consumer not later than thirty days after the end date of such contract unless the parties to such contract agree otherwise.
[(f)] (g) Each home heating oil or propane gas dealer who enters into, renews or extends [prepaid home heating oil or propane gas contracts or capped price per gallon home heating oil contracts or capped price per unit propane gas] guaranteed price contracts shall inform the Commissioner of Consumer Protection, in writing, that such dealer is entering into, renewing or extending such contracts and shall identify any entity from which the dealer has secured futures or forwards contracts or other similar commitments or surety bonds pursuant to subsection [(c)] (d) of this section. Each such dealer shall notify the commissioner if at any time the total amount of such secured futures or forwards contracts, physical supply contracts or other such similar commitments or surety bonds held by the dealer is less than eighty per cent of the maximum number of gallons or amount that such dealer is committed to deliver pursuant to all such [prepaid home heating oil or propane gas] guaranteed price contracts entered into, renewed or extended by such dealer or that such dealer estimates it is committed to deliver pursuant to all of its [capped price per gallon home heating oil or capped price per unit propane gas] guaranteed price contracts, respectively. The commissioner shall prescribe the form in which such information shall be reported.
[(g)] (h) Each person from which a home heating oil or propane gas dealer has secured a futures [or forwards] contract, a physical supply contract or other similar commitment pursuant to subsection [(c)] (d) of this section or who provides a bond pursuant to this section shall notify the Commissioner of Consumer Protection, in writing, of the cancellation of such contract, [or] other similar commitment or of the cancellation of such bond not later than three business days after such cancellation.
Sec. 4. Section 16a-23r of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2010):
(a) A violation of the provisions of section 16a-23m, as amended by this act, 16a-23n, as amended by this act, or 16a-23o constitutes an unfair trade practice under subsection (a) of section 42-110b.
(b) In accordance with the provisions of section 53a-11, any [home heating oil dealer] person, firm or corporation who knowingly violates the provisions of subsection [(c)] (d) of section 16a-23n, as amended by this act, shall have committed a class A misdemeanor.
(c) Any person, firm or corporation who violates the provisions of section 16a-23m, as amended by this act, section 16a-23n, as amended by this act, except the provisions of subsection (d) of said section 16a-23n, or section 16a-23o, shall be fined not more than five hundred dollars for a first offense, not more than seven hundred fifty dollars for a second offense occurring not more than three years after a prior offense and not more than one thousand five hundred dollars for a third or subsequent offense occurring not more than three years after a prior violation.
Sec. 5. Section 16a-23p of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2010):
The Department of Consumer Protection may suspend or revoke any registration issued under section 16a-23m, as amended by this act, if the holder of such registration is grossly incompetent, engages in malpractice or unethical conduct or knowingly makes false, misleading or deceptive representations regarding such holder's work, violates any provision of section 16a-23n, as amended by this act, fails to comply with any subpoena or violates any regulations adopted under section 16a-23q. Before any such registration is suspended or revoked, such holder shall be given notice and opportunity for hearing as provided in regulations adopted by the Commissioner of Consumer Protection in accordance with the provisions of chapter 54.
Sec. 6. (NEW) (Effective October 1, 2010) Nothing in section 16a-21, subsection (b) of section 16a-23m, section 16a-23n or 16a-23r of the general statutes, as amended by this act, shall validate a provision or clause that would otherwise be unenforceable pursuant to section 42-150u of the general statutes.
This act shall take effect as follows and shall amend the following sections: | ||
Section 1 |
October 1, 2010 |
16a-21 |
Sec. 2 |
October 1, 2010 |
16a-23m(b) |
Sec. 3 |
October 1, 2010 |
16a-23n |
Sec. 4 |
October 1, 2010 |
16a-23r |
Sec. 5 |
October 1, 2010 |
16a-23p |
Sec. 6 |
October 1, 2010 |
New section |
GL |
Joint Favorable Subst. |