If you like to see sausage made, then you should enjoy SB 143 (Statesman, March 12) by Sen. Ed Perlmutter, D-Golden, which drastically amends the Colorado Consumer Protection Act.
The original bill excluded ANY private civil actions under the Consumer Protection Act against developers, builders, or sellers of new residential or commercial construction if a certificate of occupancy or other final disposition or approval was issued by a local government.
Key to the Consumer Protection Act for 30 years has been the provision for treble damages. While the main purpose of SB 143 was to protect real estate groups from being sued under that law, the bill also substantially decreased treble damage recoveries against many other potential defendants, as this column will explain.
The final version which passed the legislature keeps real estate sellers, developers and builders within the treble damage portion of the statute. But in order to win treble damages, plaintiff is required to provide clear and convincing evidence (MORE than just the "preponderance of evidence") that a defendant engaged in bad faith conduct. Under the bill, bad faith conduct means "fraudulent, willful, knowing or intentional conduct that causes injury".
Would a home builder who ignores or deliberately doesn't check for swelling clay soil before building still be included? I think so. Home builders are probably not happy with the bill since they wanted "out", as provided in the original bill.
Definitely not happy will be all those other non-real estate plaintiffs caught in the cross-fire of the fight between developers and plaintiffs attorneys, and who will find it much harder to halt deceptive trade practices. Why harder? The change in the evidence required to be proven.
Imagine the Statute of Justice, blindfolded and holding scales in her left hand. The scale to her right is slightly lower than the left scale. That's "preponderance of the evidence". But if the right scale is much lower than the left, that's "clear and convincing evidence". And if the right scale is almost at the bottom of the weight, that's "beyond a reasonable doubt".
The Consumer Protection Act ALREADY has a number of violations based on what is called in SB 143 "bad faith conduct". Examples in CRS 6-1-105: Knowingly makes a false representation as to source of goods, services, or property; uses deceptive representation as to origin; represents goods as new if he knows or should have known they are used; disparages goods of another by false or misleading misrepresentation of fact; advertising with intent to "bait and switch."
Presently treble damages can be awarded by proving "preponderance of the evidence". Under SB 143, it has to be "clear and convincing evidence", which means more cases lost by honest, injured consumers and more cases won by the spreading scum at the bottom of the business pool.
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Occupational regulation laws were really ignored by the legislature this year (Statesman columns, Feb. 19, April 9). This final report shows nine different occupations were considered for regulation.
CRS 24-34-104.1 states: "The general assembly shall not consider the regulation of more than five occupations or professions in any one session of the general assembly." The same statute requires a report from the Dept. of Regulatory Agencies (DORA) BEFORE an occupation or profession is considered for regulation.
"Consider" (I finally discovered) is a term in the constitution to describe what happens to a bill. Article 5, Section 20. "No bill shall be considered or become a law unless referred to a committee ....Every measure referred to a committee of reference...shall be considered by the committee upon its merits...."
The Colorado Supreme Court decided in 1894 what "consider" means.
The first bill with a committee report (Jan.20) and a pre-introduction DORA report was HB 1051 by Rep. Russ George, R-Rifle, licensing naturopathic physicians. It was killed in the Senate. This was Occupation No. 1.
The second bill was HB 1132 by Rep. Brad Young, R-Lamar, with a committee report dated Jan.22. The bill began as a licensing bill, but was amended to be a regulation of commercial feed manufacturers and commercial feed guarantors. The requirements for "regulation" were the same requirements as for "licensing". This bill passed, and provide Occupations No. 2 and 3.
HB 1302 by Rep. Ron Tupa, D-Boulder, would have regulated the practice of body piercing. The committee report was dated Feb. 12th and the bill was killed.
There were two other occupational bills with committee reports dated Feb. 12th. One was SB 99 by Sen. Norma Anderson, R-Lakewood. Part of the bill licensed time share salesmen. That occupation was removed and the bill passed. The other measure was SB 154 by Sen. John Evans, R-Parker. It established an "apprentice teacher program" with educational standards, training requirements and removal upon failure to perform. This bill also passed.
So we have three bills with committee reports dated Feb. 12th, which are Occupations 4, 5, and 6. To find the first two (which conform to the five occupation statute) will require checking the date and time of actual committee votes. If the apprentice teaching program was sixth, it can be challenged.
Occupation No. 7 is HB 1270 by Rep. Lola Spradley, R-Beulah, to regulate sellers of manufactured homes. The committee report was dated Feb. 19th, and the bill passed.
On Feb. 19th, Dept. of Regulatory Agencies (DORA) issued its report on manufactured housing and HB 1347 by Rep. Matt Smith, R-Grand Junction was introduced. It had a committee report dated April 6th. While HB 1347 included regulation of manufactured home sellers, it also regulated installers of those homes (Occupation No.8) as suggested by the DORA report.
DORA wrote: "Eighty percent of the complaints received by the Division of Housing involve improper installation...most compaints about manufacture defects are actually installation related damages." The bill was killed.
Occupation No. 9 is HB 1329 by Rep. Doug Dean, R-Colorado Springs, regarding professional cash bond agents. This includes licensing, training, setting standards for, and subjecting the licensee to loss of license. The committee report was April 9th, and the bill passed.
If first committee reports meet the definition of "consider", then the bills which passed regulating manufactured home sellers and professional cash bond agents are definitely out of the running. They have passed the legislature but can be challenged in court by anyone who is refused regulation or licensing.
Jerry Kopel writes a column for the Statesman based on 22 years past experience as a state legislator.
Copyright 2015 Jerry Kopel & David Kopel