House Bill 1057

AN ACT TO AMEND SECTION 97-23-103, MISSISSIPPI CODE OF 1972, TO REVISE PROVISIONS REGARDING HOME REPAIR FRAUD; TO PROVIDE FOR THE OFFENSE OF AGGRAVATED HOME REPAIR FRAUD AND PROVIDE PENALTIES FOR VIOLATIONS; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 97-23-103, Mississippi Code of 1972, is amended as follows:

97-23-103. (1) As used in this section, unless the context clearly requires otherwise:

(a) "Home repair" means the fixing, replacing, altering, converting, modernizing, improving of or the making of an addition to any real property primarily designed or used as a residence.

(i) Home repair shall include the construction, installation, replacement or improvement of driveways, swimming pools, porches, kitchens, chimneys, chimney liners, garages, fences, fallout shelters, central air-conditioning, central heating, boilers, furnaces, hot water heaters, electrical wiring, sewers, plumbing fixtures, storm doors, storm windows, awnings, carpets and other improvements to structures within the residence or upon the land adjacent thereto.

(ii) Home repair shall include home construction, which means the building or placing of a new structure, primarily designed or used as a residence, on real property.

(iii) Home repair shall not include the sale of goods or materials by a merchant who does not directly or through a subsidiary perform any work or labor in connection with the installation or application of the goods or materials; the repair, installation, replacement or connection of any home appliance, including, but not limited to, disposals, refrigerators, ranges, garage door openers, television antennas, washing machines, telephones or other home appliances when the person replacing, installing, repairing or connecting such home appliance is an employee or agent of the merchant that sold the home appliance; or landscaping.

(b) "Legitimate business reason" means a reason for a breach of contract that would be recognized under contract law as a nonfraudulent excuse for the breach of the contract, such as serious illness, inability to access the worksite due to conditions beyond the control of the contractor, inability to obtain building materials due to conditions beyond the control of the contractor, and the common-law doctrines of impossibility and frustration of purpose.

(d) "Residence" means a single- or multiple-family dwelling, including, but not limited to, a single-family home, apartment building, condominium, duplex, townhouse or mobile home which is used or intended to be used by its occupants as their dwelling place.

(e) "Transaction" means the formation, performance, or discharge of an agreement or contract.

(2) A person commits the offense of home repair fraud when he knowingly:

(a) Enters into an agreement or contract, written or oral, with a person for home repair, and he knowingly:

(i) Misrepresents a material fact relating to the terms of the contract or agreement or the preexisting or existing condition of any portion of the property involved, or creates or confirms another's impression which is false and which he does not believe to be true, or promises performance which he does not intend to perform or knows will not be performed;

(ii) Uses or employs any deception, false pretense or false promises in order to induce, encourage or solicit such person to enter into any contract or agreement;

(iii) Misrepresents or conceals either his real name, the name of his business or his business address; or

(iv) Uses deception, coercion or force to obtain the victim's consent to modification of the terms of the original contract or agreement;

(b) Fails substantially to perform the work required by the agreement or contract, unless there exists a legitimate business reason for the breach of the agreement or contract and the breaching party notifies the other party or parties to the agreement or contract of that legitimate business reason in writing within thirty (30) days of the time when he or she knows of the existence of that legitimate business reason;

(d) Misrepresents himself or another to be an employee or agent of any unit of the federal, state or municipal government or any other governmental unit, or an employee or agent of any public utility, with the intent to cause a person to enter into, with himself or another, any contract or agreement for home repair; or

(e) Misrepresents himself to another as a party to a contract or agreement for any insurance or bond covering the performance of the home repair.

(3) Intent and knowledge shall be determined by an evaluation of all circumstances surrounding a transaction and the determination shall not be limited to the time of contract or agreement. Intent may be formed at any time during the course of the transaction.

(4) Substantial performance shall not include work performed in a manner of little or no value or work that fails to comply with the appropriate municipal, county, state or federal regulations or codes.

(5) For purposes of subsection 2(a)(i), it shall be a rebuttable presumption of intent or knowledge that a person promises performance which he or she does not intend to perform or knows will not be performed when, after no substantial performance by the contractor, he fails or refuses to return payments made by the victim and he:

(a) Fails to acknowledge or respond to a written demand for commencement or completion of home repair within ten (10) days after such demand is mailed or presented to him by the victim or by the victim's legal representative or by a law enforcement or consumer agency acting on behalf of the victim;

(b) Fails to notify the victim in writing of a change of business name or address prior to the completion of the home repair;

(d) Uses deception to obtain the victim's consent to modification of the terms of the original agreement or contract;

(e) Fails to employ qualified personnel necessary to perform the home repair;

(f) Fails to order or purchase the basic materials required for performance of the home repair; or

(g) Fails to comply with relevant municipal, county, state, or federal regulations or codes.

(6) Violation of this section shall be punished as follows:

(a) A first conviction under this section shall be a misdemeanor when the amount of the fraud is less than Five Thousand Dollars ($5,000.00) and shall be punished by a fine not to exceed One Thousand Dollars ($1,000.00) or imprisonment in the county jail not to exceed six (6) months, or both.

(b) A second or subsequent conviction under this section shall be punished as follows:

(i) As a felony punishable by imprisonment in the custody of the Department of Corrections not to exceed two (2) years when the amount of the fraud is more than One Thousand Dollars ($1,000.00) but less than Five Thousand Dollars ($5,000.00).

(ii) As a misdemeanor punishable by imprisonment in the county jail for not more than six (6) months when the amount of the fraud is One Thousand Dollars ($1,000.00) or less.

(c) A first or subsequent conviction under this section shall be a felony when the amount of the fraud is over Five Thousand Dollars ($5,000.00) and shall be punished as follows:

(i) By imprisonment in the custody of the Department of Corrections not to exceed five (5) years or a fine not to exceed Ten Thousand Dollars ($10,000.00) or both when the amount of the fraud is Five Thousand Dollars ($5,000.00) or more, but less than Ten Thousand Dollars ($10,000.00).

(ii) By imprisonment in the custody of the Department of Corrections not to exceed ten (10) years or a fine not to exceed Ten Thousand Dollars ($10,000.00) when the amount of the fraud is Ten Thousand Dollars ($10,000.00) or more.

(7) Aggravated home repair fraud.

(a) A person commits the offense of aggravated home repair fraud when he commits home repair fraud:

(i) Against a person who is sixty (60) years of age or older or is a vulnerable person as defined in Chapter 47, Title 43, Mississippi Code of 1972; or

(ii) In connection with a home repair project intended to assist such a person.

(b) A first conviction for aggravated home repair fraud shall be a felony and shall be punished as follows:

(i) By imprisonment in the custody of the Department of Corrections not to exceed five (5) years or a fine not to exceed Twenty-five Thousand Dollars ($25,000.00), or both, when the amount of the fraud is less than Five Hundred Dollars ($500.00).

(ii) By imprisonment in the custody of the Department of Corrections not to exceed ten (10) years or a fine not to exceed Twenty-five Thousand Dollars ($25,000.00), or both, when the amount of the fraud is Five Hundred Dollars ($500.00) or more.

(c) A second or subsequent conviction for aggravated home repair fraud shall be a felony and shall be punished by imprisonment in the custody of the Department of Corrections not to exceed ten (10) years or a fine not to exceed Twenty-five Thousand Dollars ($25,000.00), or both, regardless of the amount of the fraud.

(d) If a person commits aggravated home repair fraud, then any state or local license or permit held by that person that relates to the business of home repair may be appropriately suspended or revoked by the issuing authority, commensurate with the severity of the offense.

(e) A defense to aggravated home repair fraud does not exist merely because the accused reasonably believed the victim to be a person less than sixty (60) years of age.

(8) In addition to any other sentence it may impose, the court shall order that the defendant shall make restitution to the victim, either within a specified period of time or in specified installments. The order shall not be enforceable during the period of imprisonment unless the court expressly finds that the defendant has assets to pay the amounts ordered at the time of sentencing. Intentional refusal to obey the restitution order or a failure by a defendant to make a good faith effort to make such restitution may be considered a violation of the defendant's probation and may be cause for revocation of his probation or suspension of sentence.

SECTION 2. This act shall take effect and be in force from and after July 1, 2012.