H. B. 4410
(By Delegate Hartman)
(Originating in the Committee on the Judiciary)
[February 19, 2014]
A BILL to amend and reenact §19-2C-1, §19-2C-3, §19-2C-5, §19-2C-5a, §19-2C-6, §19-2C-6b, §19-2C-8 and §19-2C-9 of the Code of West Virginia, 1931, as amended; and to amend said code by adding thereto a new section, designated §19-2C-9a, all relating to auctioneers and apprentice auctioneers, generally; redefining auctioneer exceptions; adding definitions; amending license renewal for expired licenses; allowing certain fees to be set by legislative rule; increasing length of record retention; clarifying qualifying test scores; restricting length of apprenticeship; adding duties of sponsoring auctioneer; increasing criminal penalties; requiring contracts to have certain provisions; and requiring escrow accounts.
Be it enacted by the Legislature of West Virginia:
That §19-2C-1, §19-2C-3, §19-2C-5, §19-2C-5a, §19-2C-6, §19-2C-6b, §19-2C-8 and §19-2C-9 of the Code of West Virginia, 1931, as amended, be amended and reenacted; and that said code be amended by adding thereto a new section, designated §19-2C-9a, all to read as follows:
ARTICLE 2C. AUCTIONEERS.
For the purposes of this article:
(a) The term "auctioneer" means and includes a person who sells goods or real estate at public auction for another on commission or for other compensation. The term "auctioneer" does not include: (1) Persons conducting sales at auctions conducted by or under the direction of any public authority or pursuant to any judicial order or direction or to any sale required by law to be at auction; (2) the owner of any real or personal property when personally sold at auction by such the owner and such the owner has not personally conducted an auction within the previous twelve-month period; (3) persons conducting sales pursuant to a deed of trust or other security agreement; (4) fiduciaries of estates when selling real or personal property of such the estate; (5) persons conducting sales on behalf of charitable, religious, fraternal or other nonprofit organizations; and (6) persons properly licensed pursuant to the provisions of article twelve, chapter forty-seven of this code when conducting an auction, any portion of which contains any leasehold or any estate in land whether corporeal or incorporeal, freehold or nonfreehold, when such the person is retained to conduct an auction by a receiver or trustee in bankruptcy, a fiduciary acting under the authority of a deed of trust or will, or a fiduciary of a decedent's estate: Provided, That nothing contained in this article exempts persons conducting sales at public markets from the provisions of article two-a of this chapter, where the sale is confined solely to livestock, poultry and other agriculture and horticulture products.
(b) The term "public auction" means any public sale of real or personal property when offers or bids are made by prospective purchasers and the property sold to the highest bidder.
(c) The term "commissioner" means the Commissioner of Agriculture of West Virginia.
(d) The term "department" means the West Virginia Department of Agriculture.
(e) The term “escrow account” means a separate custodial or trust fund account maintained by the auctioneer.
§19-2C-3. Procedure for license; Department of Agriculture as statutory agent for licensees; fee.
Any person who wishes to conduct an auction as an auctioneer may apply for a license on forms prescribed by the commissioner and containing such information as the commissioner may require by a legislative rule promulgated in accordance with article three, chapter twenty-nine-a of this code. A nonreturnable application fee of $50 shall accompany each application as well as a license fee of $50. All fees collected under this article shall be paid into a special revenue fund in the State Treasury to be used by the Department of Agriculture for the expressed purpose of administering and enforcing this article and for providing continuing education for auctioneers: Provided, That for the fiscal year ending June 30, 1997, fees collected under this article shall be paid into the state fund, general revenue.
In addition to the payment of fees, an applicant shall file with his or her application a bond as required in section four of this article.
The commissioner shall, within thirty days after the receipt of an application, notify the applicant of his or her eligibility to be examined at the next regularly scheduled examination, as well as the date of the examination.
In the event If the license is denied, the commissioner shall refund the license fee submitted with the application to the applicant.
Licenses issued expire on December 31, of each year but are renewable upon the payment of the annual license fee within sixty days of the expiration date. Renewals received more than sixty days after the expiration date are subject to a late renewal fee of $25 in addition to the annual renewal fee. Renewals received more than one hundred-twenty days after the expiration date are subject to a late renewal fee of $50 in addition to the annual renewal fee; and renewals received more than one hundred-eighty days after the expiration date are subject to a late renewal fee of $75 in addition to the annual renewal fee. The commissioner shall may not renew licenses which have been expired for more than two years and the auctioneer or apprentice auctioneer shall take the written and oral examination and pay the examination fee in order to renew his or her license. The commissioner shall may not renew a license unless the applicant complies with the other requirements of this article.
Where an auctioneer or apprentice auctioneer requires a duplicate or replacement license or a license reflecting a change in information, the auctioneer or apprentice auctioneer shall submit a fee of $5 with the request.
The fees set forth in this subsection remain in effect until subsequently modified by legislative rule.
The state Department of Agriculture is the agent for the purpose of service of process on any licensed auctioneer for any action occasioned by the performance of the duties of the auctioneer. Every licensed auctioneer, by virtue of his or her application for a license, shall be considered to have consented to the statutory agency.
§19-2C-5. Requirements for license; rules and regulations; duties of licensee.
(1) Each person seeking a license hereunder after the effective date of this section shall submit satisfactory evidence to the commissioner showing:
(a) That he or she has successfully completed the written and oral examinations provided for in this article;
(b) That he or she has a good reputation;
(c) That he or she is of trustworthy character;
(d) That he or she has met the apprenticeship requirements set forth in this article, if applicable;
(e) That he or she is a citizen of the United States; and
(f) That he or she has a general knowledge of the auctioneering profession and the principles involved in conducting an auction.
(2) The commissioner shall promulgate propose such reasonable rules and regulations as he or she considers necessary to carry out the intent and the administration and enforcement of this article, which said rules and regulations shall be promulgated proposed for legislative approval in accordance with the applicable provisions of chapter twenty-nine-a of this code.
(3) Each licensee shall promptly produce for inspection such the license at all sales conducted by or participated in by such the licensee when requested to do so by any person and shall keep complete and accurate records of all transactions engaged in for a period of six months, which three years. For the purpose of this section the term “record” includes, but is not limited to, copies of signed contracts; the names of buyers and their addresses; clerk sheets showing items sold, including buyers numbers or names and the selling prices; and final settlement papers. The records shall be open to inspection by the commissioner or his or her authorized representative.
§19-2C-5a. Examinations of applicants; excuse for illness; fee renewal.
Examinations shall be held in April and October of each year, at a time and place to be designated by the commissioner or his or her authorized representative.
Any individual auctioneer applicant may take the examination for auctioneer or apprentice auctioneer at the regularly scheduled time and place. The apprentice auctioneer's examination shall consist of a written examination. The auctioneer's examination will consist of both a written and oral examination. The passing grade for any written examination shall be seventy percent out of one hundred percent. The passing grade for any oral examination shall be seventy percent out of one hundred percent. The oral portion will be scored by the commissioner or his or her authorized representative. If the applicant fails either the written or oral portion of the examination, no license will be issued and he or she shall may not be administered the examination again until the next regularly scheduled examination date. A person who is qualified for a auctioneer's license as provided for in this article is considered to be a professional in his or her trade.
One notice only of the examination shall be mailed to the applicant at the address given on the application. If the applicant fails to appear for such examination, except as provided herein, a new application and a new fee shall be required. No fee shall may be returned except when the applicant fails to take the examination because of illness evidenced by a doctor's certificate sent to the commissioner. If excused because of illness the applicant shall be admitted to the next scheduled examination without paying an additional fee. No applicant shall may be excused from taking the scheduled examination for any reason other than illness unless in the judgment of the commissioner the applicant would suffer undue hardship by not being excused.
An examination fee of $50, in addition to any other fees required by this article, shall be collected from each person taking such examination. If the applicant has previously paid the examination fee and successfully completed the apprentice auctioneer's examination, no additional examination fee will be required to take the auctioneer's examination as provided for in this article.
The fees set forth in this subsection remain in effect until subsequently modified by legislative rule.
If the commissioner determines that an applicant does not qualify for a license, he or she shall so notify the applicant by certified mail. The notice shall state the reason for refusal to grant a license and the applicant's right to appeal the commissioner's decision within twenty days of receipt of the notice.
An examination shall may not be required for the renewal of any license unless such license has been revoked or suspended, in which case the applicant may be required, by the commissioner, to take and pass any written or oral examination required by the department. In cases where a license has been expired for more than two years and not been revoked or suspended, the applicant is required to take and pass any written and oral examinations required by the department. The commissioner is hereby authorized to promulgate may propose rules for legislative approval promulgated in accordance with article three, chapter twenty-nine-a of this code as he or she considers necessary for the renewal of auctioneer licenses, including, but not limited to, requirements for continuing education of auctioneers and apprentice auctioneers.
§19-2C-6. Apprentice licenses; fees.
The Department of Agriculture may grant apprentice auctioneer's licenses to those persons considered qualified by the commissioner. Every applicant for an apprentice auctioneer's license must take and pass a written examination relating to the skills and knowledge and statutes and regulations governing auctioneers. Every applicant shall furnish to the commissioner on forms provided by the department satisfactory proof of the following:
(a) That he or she has a good reputation;
(b) That he or she is a trustworthy character; and
(c) That he or she is a citizen of the United States.
Any apprentice auctioneer may take the examination to become an auctioneer after serving a two-year apprenticeship under a licensed auctioneer: Provided, That if the apprentice auctioneer has attended a nationally accredited graduate school of auctioneering, approved by the commissioner, he or she shall serve an apprenticeship of only six months. Before an apprentice auctioneer may take the auctioneer's examination, the apprentice auctioneer shall conduct at least six auction sales under the direct supervision of the sponsoring auctioneer. The commissioner may waive the requirements of this section, on an individual basis, upon the presentation of written evidence that the applicant has educational training or exceptional experience in the auctioneering profession and that the applicant has been unable to obtain sponsorship by a licensed auctioneer: Provided, however, That the commissioner shall promulgate propose rules and regulations promulgated in accordance with article three, chapter twenty-nine-a of this code setting forth educational and experience qualifications which would entitle an individual to a waiver of the provisions of this section: Provided further, That the commissioner shall may not waive apprenticeship requirements for any applicant without the concurrence of the board of review.
When any apprentice auctioneer is discharged or terminates his or her employment with an auctioneer for any reason, the auctioneer shall immediately provide written notification to the commissioner. No discharged or terminated apprentice auctioneer shall may thereafter perform any acts under the authority of his or her license until such the apprentice auctioneer receives a new license bearing the name and address of his or her new employer. No more than one license shall may be issued to any apprentice auctioneer for the same period of time. The fee for the transfer of the license of an apprentice auctioneer to a new employer auctioneer is $15.
The fee for the annual renewal of the apprentice auctioneer's license is $50. Bond requirements for an apprentice auctioneer shall be established by reasonable rules and regulations promulgated by the commissioner, and both the annual renewal fee and the bond must be filed with the Department of Agriculture: Provided, That the bond required by this section shall may not be less than $5,000 $10,000. The department shall may not issue an apprentice auctioneer's license until bond has been filed in accordance with this article. All apprentice auctioneer licenses expire on December 31, of each year but are renewable upon the payment of the annual fee.
The fees set forth in this subsection remain in effect until subsequently modified by legislative rule.
An apprentice auctioneer may not serve a term to exceed three years without the apprentice applying for an auctioneer license. Should an apprentice auctioneer allow the three year limit to lapse, that apprentice shall be required to take the apprentice exam and meet all requirements stated in this article. An individual may only serve as an apprentice auctioneer a maximum of six years.
§19-2C-6b. Duties and responsibilities of an apprentice auctioneer and a sponsoring auctioneer.
An apprentice auctioneer shall only conduct or assist in auctions under the direct supervision of his or her sponsoring auctioneer. A licensed apprentice auctioneer may not enter into a contract to conduct an auction unless the contract is cosigned by his or her sponsoring auctioneer.
The sponsoring auctioneer is responsible for the actions of an apprentice auctioneer. It is his or her responsibility to insure ensure adherence to this and all applicable sections of state law. The sponsoring auctioneer is responsible for training the apprentice auctioneer in all aspects of practical business functions and duties related to the auctioneering profession. Should an apprentice auctioneer fail to pass both the written and oral examinations to become a fully licensed auctioneer in two consecutive testing sessions, the sponsorship will be terminated. The apprentice auctioneer will be permitted one additional opportunity to pass the oral and written auctioneer examinations only after serving another six month apprenticeship under a different sponsoring auctioneer. A sponsoring auctioneer relieved of his or her sponsorship will not be considered for another sponsorship unless he or she provides a written affidavit to the commissioner that he or she fully understands the responsibilities of a sponsoring auctioneer and gives the details as to what additional training will be provided to a new apprentice auctioneer. Should the commissioner or his or her representative approve of the presented plan an auctioneer may be permitted to sponsor a new apprentice auctioneer: Provided, That if the apprentice auctioneer conducts auctions without the consent of his or her sponsor, only the apprentice auctioneer is subject to the penalties in section eight of this article.
§19-2C-8. Penalties for violation of article or rules and regulations.
(a) Criminal penalties. -- Any person, firm, association or corporation violating any of the provisions of this article, or of the rules and regulations adopted pursuant to the provisions thereof, shall be is guilty of a misdemeanor and, upon conviction thereof, shall be fined not less than $50 $250 nor more than $200 $500 for the first offense, and not less than $400 $500 nor more than $1,000 for the second and subsequent offenses. Magistrates have concurrent jurisdiction with circuit courts to enforce the provisions of this article.
(b) Civil penalties. -- (1) Any person violating a provision of this article or any rule or regulation adopted hereunder may be assessed a civil penalty by the commissioner. In determining the amount of any civil penalty, the commissioner shall give due consideration to the history of previous violations of the person, the seriousness of the violation, and the demonstrated good faith of the person charged in attempting to achieve compliance with this article before and after written notification of the violation; (2) the commissioner may assess a penalty of not more than $200 for each first offense, and not more than $1,000 for a second and subsequent offense; and (3) the civil penalty is payable to the State of West Virginia and is collectible in any manner now or hereafter provided for collection of debt. If any person liable to pay the civil penalty neglects or refuses to pay the same penalty, the amount of the civil penalty, together with interest at ten percent, is a lien in favor of the State of West Virginia upon the property, both real and personal, of such a person after the same has been entered and docketed to record in the county where such property is situated. The clerk of the county, upon receipt of the certified copy of such the lien, shall enter same it to record without requiring the payment of costs as a condition precedent to recording.
(c) Notwithstanding any other provision of law to the contrary, the commissioner may promulgate and adopt propose rules for legislative approval in accordance with the provisions of article three, chapter twenty-nine-a of this code which permit consent agreements or negotiated settlements for the civil penalties assessed as a result of violation of the provisions of this article.
(d) No state court may allow for the recovery of damages for any administrative action taken if the court finds that there was probable cause for such action.
§19-2C-9. Written contracts; exception.
No person shall may act as auctioneer on the sale at public auction of any goods, wares, merchandise or of any other property, real or personal, until he or she has entered into a written contract in duplicate with the owner or consignor of the property to be sold, containing the terms and conditions upon which the licensee receives or accepts the property for sale at auction. No apprentice auctioneer shall may be authorized to enter into a contract without the written consent of his or her sponsoring auctioneer. All contracts shall be in the name of and on behalf of the sponsoring auctioneer.
The commissioner may require by rule the following:
(a) That written contracts between the auctioneer and the seller be made in duplicate;
(b) That the original contract is to be retained by the auctioneer for a period of six months three years from date of final settlement;
(c) That one copy of the contract is to be furnished to each person that entered into the contract;
(d) That an apprentice auctioneer may not contract directly with a client but only through his or her sponsoring auctioneer;
(e) That an apprentice auctioneer may not engage in a sale with an auctioneer by whom he or she is not sponsored without first obtaining the written consent of his or her sponsoring auctioneer; and
(f) That on all contracts between an auctioneer and a seller there shall be a prominent statement indicating that the auctioneer is licensed by the Department of Agriculture and bonded in favor of the State of West Virginia; and
(g) That all contracts shall include the following:
(1) The name, address and phone number of owner of the property to be sold or the consignee;
(2) The date of the auction or a termination date of the contract;
(3) The terms and conditions of the auction;
(4) The location of the auction;
(5) The date the owner or consignor is to be paid;
(6) A statement establishing the responsibility for bad checks, debts and unpaid auction items;
(7) A detailed list of all fees to be charged by the auctioneer which shall include commissions, rentals, advertising and labor;
(8) A statement of the auctioneer's policy regarding absentee bidding;
(9) A statement above the owner's signature line: "I have read and accept the terms of the contract"; and
(10) A statement indicating an explanation of settlement of the auction (settlement sheet) will be provided to the owner at the end of each auction.
§19-2C-9a. Escrow Accounts.
Each auctioneer shall maintain an escrow account and deposit all moneys from each sale in said account within twenty-four hours of the completion of the sale or on the first business day following the sale, unless the consignor was paid in cash directly at the end of the sale.