SECTIONS 17577-17577.6 - California Statutes

BUSINESS AND PROFESSIONS CODE

SECTION 17577-17577.6

17577. (a) The Legislature finds and declares that there have been
situations where homeowners have been subjected to fraud, deception,
and unfair dealing by certain promoters of water treatment devices.
Water contamination problems throughout the nation have created
concern among homeowners concerning the quality and healthfulness of
home water for drinking. Some promoters of water treatment devices
have made false, misleading, and unfair statements in connection with
sale of water treatment devices, including, but not limited to,
false, misleading, and unfair statements regarding general levels of
water contamination, water contamination problems actually or
potentially affecting particular homeowners, actual or potential
health risks associated with the consumption of water, and the
features and performance of water treatment devices. As a result of
false, misleading, and unfair statements, including statements that
have the purpose or effect of alarming the public about the condition
of water, many homeowners have been pressured into purchasing water
treatment devices without the opportunity to verify the accuracy of
the sales representations.
(b) The Legislature also finds and declares that current law does
not afford homeowners who enter transactions for the acquisition of
water treatment devices the right in all instances to cancel the
transaction within three days of its consummation. Moreover,
homeowners may be subjected to the loss of their homes through the
foreclosure of liens securing financing of water treatment devices.
(c) The Legislature further finds and declares that the protection
of homeowners and consumers from untrue and misleading statements
and from unfair dealing is of the utmost importance.
(d) The intent and purposes of this article are to safeguard the
public against deceit; to ensure, foster, and encourage fair dealing
in the sale of water treatment devices; to prohibit misleading
representations; to prohibit certain liens on real property; and to
afford homeowners a reasonable and meaningful opportunity to rescind
transactions for the acquisition of water treatment devices.
(e) This article shall be liberally construed to effectuate the
intent and to achieve the purposes described in subdivision (d).

17577.1. For the purposes of this article, the following terms have
the following meanings:
(a) "Contaminant" or "contamination" means any health-related
physical, chemical, biological, or radiological substance or matter
in water.
(b) "Water treatment device" means any product that (1) is
designed to alter the chemical or physical properties or
characteristics of water or plumbing or the seller, lessor, or renter
claims can alter the chemical or physical properties or
characteristics of water or plumbing and (2) is used or sold, leased,
or rented for use on residential real property primarily for
personal, family, or household purposes. "Water treatment device"
does not include any device that is regulated pursuant to Chapter 7.5
(commencing with Section 4040) of Part 1 of Division 5 of the Health
and Safety Code.
(c) "Person" means any individual, partnership, firm, corporation,
or association, or any employee or agent thereof.

17577.2. It is unlawful for any person to do any of the following
in connection with the sale, lease, rental, offer to sell, lease,
rent, or other disposition of water treatment devices:
(a) Make any untrue or misleading oral or written statements
regarding the presence of one or more contaminants in water, or the
performance of water treatment devices, including, but not limited
to, the following oral or written statements:
(1) (A) Any contaminant exists in the water of any person to whom
the statement is directed unless the statement is true, is reasonably
based on factual data, and at least a written summary of the factual
data, that has been prepared or approved by the source of the
factual data, is disclosed to the person to whom the statement is
directed before that person executes any contract for the purchase,
lease, or rental of a water treatment device.
(B) Any contaminant may exist in the water of any person to whom
the statement is directed unless the statement is true and is
reasonably based on factual data.
(2) A relationship between water quality and acute or chronic
illness exists as a scientific certainty unless that statement is
true.
(3) The public water system, utility, or treatment plant that
supplies water to the person to whom the statement is directed does
not test, treat, or remove particular substances from water treated
by it unless the statement is true.
(4) A water treatment device removes particular contaminants or
other substances from water unless the statement is true, is
reasonably based on factual data in existence at the time the
statement is made, and the requirements of subparagraphs (A) through
(C) are satisfied.
(A) If the particular contaminants or other substances mentioned
in the statement described in paragraph (4) are not necessarily in
the water of the person to whom the statement is made, the following
disclosure or its equivalent must be clearly and conspicuously made:
"The contaminants or other substances removed or reduced by this
water treatment device are not necessarily in your water."
(B) If the statement described in paragraph (4) is oral, the
disclosure described in subparagraph (A) shall be made orally and
shall immediately follow the statement. If the statement is in
writing, the disclosure shall be in writing and shall be placed
immediately next to the written statement.
(C) Notwithstanding subparagraph (A), no statement about the
ability of a water treatment device to remove particular contaminants
or other substances shall be used to imply falsely that any of those
contaminants or other substances are present in the water of the
person to whom the statement is made.
(5) Use news events, reports, or descriptions of water quality
problems or health hazards associated with water systems or suppliers
different from the systems or suppliers of the intended consumer
unless, at the same time, the seller sets forth conspicuously and
prominently a statement, if true, that the seller has no information
that the intended consumer's water supply has the water quality
problems or health hazards referred to in the news events, reports,
or descriptions.
(6) A water treatment device would provide a health benefit or
diminish a health risk unless it would do so.
(7) A water treatment device will solve or contribute to the
solution of any problem unless the statement is true.
(b) Perform precipitation tests of the individual consumer's
drinking water without also clearly informing the consumer of the
results, scope, and limits of the test. Precipitation tests may only
be used to demonstrate the hardness or other nonhealth-related
characteristics of the water being tested.
(c) Notwithstanding subdivision (a), make product performance
claims or product benefit claims that the device affects health or
the safety of drinking water, unless the device has been certified by
the State Department of Health Services pursuant to Article 3
(commencing with Section 116825) of Chapter 5 of Part 12 of Division
104 of the Health and Safety Code. This subdivision does not apply to
the making of truthful and nonmisleading claims regarding the
removal or reduction of contaminants for which certification is not
available pursuant to Article 3 (commencing with Section 116825) of
Chapter 5 of Part 12 of Division 104 of the Health and Safety Code.
This subdivision shall become operative one year after the
effective date of the regulations adopted pursuant to Section 116830
of the Health and Safety Code.
(d) Use pictures, exhibits, graphs, charts, other graphic
portrayals, endorsements, or testimonials in any untrue or misleading
manner.
(e) Fail to disclose clearly and conspicuously, in writing, to the
purchaser, lessee, or renter, prior to the time of purchase, lease,
or rent, the importance of maintaining the water treatment device
according to the manufacturer's instructions, including, if
applicable, replacement of screens and filters. In addition, a
separate printed gummed label, tag, or other convenient form of
reminder of the importance of proper maintenance shall be provided to
the purchaser, lessee, or renter.

17577.3. (a) A contract or offer which is subject to approval, for
the sale, lease, or rental of a water treatment device shall be
deemed a home solicitation contract or offer, as defined in
subdivision (a) of Section 1689.5 of the Civil Code regardless of
where the contract or offer was made, and shall be subject to the
provisions of Sections 1689.5 to 1689.13, inclusive, of the Civil
Code if the contract or offer arises out of a scheduled presentation
to promote the sale, lease, or rental of a water treatment device to
a person invited to attend the presentation at a location other than
a private residence.
(b) No water treatment device or any other materials that are the
subject of a contract offer described in subdivision (a) shall be
delivered and no installation or other services shall be performed
until the expiration of the rescission period provided in Sections
1689.5 to 1689.13, inclusive, of the Civil Code.

17577.4. Any violation of this article is a misdemeanor punishable
by imprisonment in the county jail not exceeding six months, or by a
fine not exceeding two thousand five hundred dollars ($2,500), or by
both.

17577.5. (a) No contract or offer for the sale, lease, or rental of
a home water treatment device and no purchase money loan, as defined
in subdivision (b), shall provide for a lien on real property. Any
lien taken in violation of this section is void and unenforceable.
(b) For the purpose of this section, "purchase money loan" means a
loan or an advance under an open-end credit account if both of the
following occur:
(1) The primary purpose of the loan or the primary purpose of
establishing the open-end credit account is to finance all or a
portion of the purchase price or any of the lease or rental payments
for a water treatment device.
(2) The creditor knows the primary purpose of the loan or the
primary purpose of establishing the open-end credit account when the
loan is initially made or the open-end credit account is established.
(c) The creditor shall be deemed to know that the primary purpose
of the loan or the primary purpose of establishing the open-end
credit account is the primary purpose described in paragraph (1) of
subdivision (b) if any of the following occur:
(1) The consumer's application for credit or any other document in
the creditor's possession before the loan is made or the open-end
account is established indicates the primary purpose of the loan or
the open-end credit account.
(2) The seller, lessor, or renter arranges or guarantees the loan
or open-end account, or participates in the preparation of the
consumer's application for credit or other loan documents, or
receives from the creditor a loan commission, brokerage, or referral
fee.
(d) For the purpose of this section, "open-end credit" has the
same meaning as used in Section 226.2 of Title 12 of the Code of
Federal Regulations.
(e) This section does not apply to mechanics' liens established
pursuant to Chapter 2 (commencing with Section 3109) of Title 15 of
Part 4 of Division 3 of the Civil Code.

17577.5. (a) No contract or offer for the sale, lease, or rental of
a home water treatment device and no purchase money loan, as defined
in subdivision (b), shall provide for a lien on real property. Any
lien taken in violation of this section is void and unenforceable.
(b) For the purpose of this section, "purchase money loan" means a
loan or an advance under an open-end credit account if both of the
following occur:
(1) The primary purpose of the loan or the primary purpose of
establishing the open-end credit account is to finance all or a
portion of the purchase price or any of the lease or rental payments
for a water treatment device.
(2) The creditor knows the primary purpose of the loan or the
primary purpose of establishing the open-end credit account when the
loan is initially made or the open-end credit account is established.
(c) The creditor shall be deemed to know that the primary purpose
of the loan or the primary purpose of establishing the open-end
credit account is the primary purpose described in paragraph (1) of
subdivision (b) if any of the following occur:
(1) The consumer's application for credit or any other document in
the creditor's possession before the loan is made or the open-end
account is established indicates the primary purpose of the loan or
the open-end credit account.
(2) The seller, lessor, or renter arranges or guarantees the loan
or open-end account, or participates in the preparation of the
consumer's application for credit or other loan documents, or
receives from the creditor a loan commission, brokerage, or referral
fee.
(d) For the purpose of this section, "open-end credit" has the
same meaning as used in Section 226.2 of Title 12 of the Code of
Federal Regulations.
(e) This section does not apply to mechanics liens established
pursuant to Chapter 4 (commencing with Section 8400) of Title 2 of
Part 6 of Division 4 of the Civil Code.

17577.6. (a) A buyer, lessee, or renter of a water treatment device
may bring an action against any person who violates this article for
the recovery of actual damages, exemplary damages, reasonable
attorney's fees and costs, and appropriate equitable relief.
(b) The rights and remedies provided in this article are in
addition to, and not a limitation of, any other rights and remedies
provided by law.
(c) Any action brought pursuant to this section shall be commenced
within three years of the discovery by the party of the alleged
violation.
(d) Any waiver of this article shall be void and unenforceable as
contrary to public policy.