Indiana 2023 Regular Session

Indiana Senate Bill SB0244 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2	Introduced Version
3	3	SENATE BILL No. 244
4	4	_____
5	5	DIGEST OF INTRODUCED BILL
6	6	Citations Affected: IC 24-5-11.
7	7	Synopsis: Surety bond for home improvement suppliers. Amends the
8	8	statute governing residential real property improvement contracts
9	9	(statute) to provide that before entering into a real property
10	10	improvement contract (contract) after June 30, 2023, and throughout
11	11	the duration of the contract, a real property improvement supplier
12	12	(supplier) must be covered by a surety bond in the amount of $50,000.
13	13	Provides that the bond must be payable to the state and must secure the
14	14	payment of restitution to a person aggrieved by a violation of the
15	15	statute by the supplier. Provides that the terms of a contract entered
16	16	into after June 30, 2023, between a supplier and a consumer must
17	17	include the name of the issuer of the supplier's bond, along with the
18	18	bond number or similar identifier. Amends provisions concerning a
19	19	consumer's right to cancel a contract to provide that a consumer may
20	20	cancel a contract before midnight on the third business day after the
21	21	latest of the following occurs: (1) The date the contract is signed by the
22	22	consumer and the supplier. (2) If applicable, the date the consumer
23	23	receives written notice from the consumer's insurance company as to
24	24	whether all or any part of the consumer's claim or the contract is a
25	25	covered loss. (3) For a contract entered into after June 30, 2023, the
26	26	date the supplier provides the consumer with the name of the issuer of
27	27	the supplier's required bond, along with the bond number or similar
28	28	identifier. (Current law provides that a consumer may cancel a contract
29	29	before midnight on the third business day after the later of the
30	30	following: (1) The date the contract is signed by the consumer and the
31	31	supplier. (2) If applicable, the date the consumer receives written
32	32	notice from the consumer's insurance company as to whether all or any
33	33	part of the consumer's claim or the contract is a covered loss.)
34	34	Effective: July 1, 2023.
35	35	Sandlin
36	36	January 11, 2023, read first time and referred to Committee on Commerce and Technology.
37	37	2023 IN 244—LS 6939/DI 101 Introduced
38	38	First Regular Session of the 123rd General Assembly (2023)
39	39	PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
40	40	Constitution) is being amended, the text of the existing provision will appear in this style type,
41	41	additions will appear in this style type, and deletions will appear in this style type.
42	42	Additions: Whenever a new statutory provision is being enacted (or a new constitutional
43	43	provision adopted), the text of the new provision will appear in this style type. Also, the
44	44	word NEW will appear in that style type in the introductory clause of each SECTION that adds
45	45	a new provision to the Indiana Code or the Indiana Constitution.
46	46	Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
47	47	between statutes enacted by the 2022 Regular Session of the General Assembly.
48	48	SENATE BILL No. 244
49	49	A BILL FOR AN ACT to amend the Indiana Code concerning trade
50	50	regulation.
51	51	Be it enacted by the General Assembly of the State of Indiana:
52	52	1 SECTION 1. IC 24-5-11-10, AS AMENDED BY P.L.170-2017,
53	53	2 SECTION 18, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
54	54	3 JULY 1, 2023]: Sec. 10. (a) A real property improvement supplier shall
55	55	4 provide a completed real property improvement contract to the
56	56	5 consumer before it is signed by the consumer. Except as provided in
57	57	6 subsection (c), and subject to subsection (e) and section 10.6 of this
58	58	7 chapter for contracts entered into after June 30, 2017, the contract must
59	59	8 contain at a minimum the following:
60	60	9 (1) The name of the consumer and the address of the real property
61	61	10 that is the subject of the real property improvement.
62	62	11 (2) The following information:
63	63	12 (A) The name and address of the real property improvement
64	64	13 supplier and, for a real property improvement contract
65	65	14 executed after June 30, 2017, an electronic mail address
66	66	15 maintained and used by the real property improvement
67	67	16 supplier to communicate with consumers.
68	68	17 (B) The following information with respect to each owner,
69	69	2023 IN 244—LS 6939/DI 101 2
70	70	1 officer, employee, or agent of the real property improvement
71	71	2 supplier to whom consumer problems and inquiries can be
72	72	3 directed:
73	73	4 (i) Name.
74	74	5 (ii) Telephone number.
75	75	6 (iii) For a real property improvement contract executed after
76	76	7 June 30, 2017, an electronic mail address maintained and
77	77	8 used by the owner, officer, employee, or agent to
78	78	9 communicate with consumers.
79	79	10 (3) The date the real property improvement contract was
80	80	11 submitted to the consumer and any time limitation on the
81	81	12 consumer's acceptance of the real property improvement contract.
82	82	13 (4) A reasonably detailed description of the proposed real
83	83	14 property improvements.
84	84	15 (5) If the description required by subdivision (4) does not include
85	85	16 the specifications for the real property improvement, a statement
86	86	17 that the specifications will be provided to the consumer before
87	87	18 any work is commenced under the real property improvement
88	88	19 contract and that the real property improvement contract is
89	89	20 subject to the consumer's separate written and dated approval of
90	90	21 the specifications.
91	91	22 (6) The approximate starting and completion dates of the real
92	92	23 property improvements.
93	93	24 (7) A statement of any contingencies that would materially
94	94	25 change the approximate completion date.
95	95	26 (8) The real property improvement contract price.
96	96	27 (9) Subject to subsections (b) and (c)(8), for a real property
97	97	28 improvement contract executed after June 30, 2017, a statement
98	98	29 as to whether any third party, including any:
99	99	30 (A) subcontractor;
100	100	31 (B) vendor; or
101	101	32 (C) other person;
102	102	33 that is not a party to the contract, will lease or furnish any labor,
103	103	34 services, material, equipment, or machinery to, or on behalf of,
104	104	35 the real property improvement supplier in connection with the
105	105	36 real property improvement.
106	106	37 (10) For a real property improvement contract entered into
107	107	38 after June 30, 2023, the name of the issuer of the bond
108	108	39 required by section 10.7 of this chapter, along with the bond
109	109	40 number or similar identifier.
110	110	41 (10) (11) Signature lines for the real property improvement
111	111	42 supplier or the supplier's agent and for each consumer who is to
112	112	2023 IN 244—LS 6939/DI 101 3
113	113	1 be a party to the real property improvement contract with a legible
114	114	2 printed or a typed version of that person's name placed directly
115	115	3 after or below the signature.
116	116	4 (b) The real property improvement contract must be in a form that
117	117	5 each consumer who is a party to it can reasonably read and understand.
118	118	6 (c) If a real property improvement contract is entered into for
119	119	7 damage, loss, or expense that is to be paid, in whole or in part, from the
120	120	8 proceeds of an insurance policy, or for damage, loss, or expense for
121	121	9 which a third party is liable, the following conditions and requirements
122	122	10 apply to the real property improvement contract:
123	123	11 (1) For the purpose of subsection (a)(4) through (a)(7), the
124	124	12 description, completion dates, and statement of contingencies
125	125	13 must be prepared for the proposed real property improvements to
126	126	14 the extent that the damage, loss, or expense is reasonably known
127	127	15 by the real property improvement supplier.
128	128	16 (2) For the purpose of subsection (a)(4), the requirement that a
129	129	17 reasonably detailed description be included in the contract may be
130	130	18 satisfied with a statement that the subject real estate will be
131	131	19 repaired or restored to the same condition in which the real estate
132	132	20 existed before the damage, loss, or expense occurred, or to a
133	133	21 comparable condition.
134	134	22 (3) For the purpose of subsection (a)(6), the starting and
135	135	23 completion dates may be expressed in terms of the number of
136	136	24 days elapsed from the date when sufficient approval of the
137	137	25 insurance carrier terms allowing for adequate repair or restoration
138	138	26 is obtained.
139	139	27 (4) For the purpose of subsection (a)(8), the consumer or insured
140	140	28 consumer may agree to a contract price expressed in terms of the
141	141	29 consumer's or insured consumer's liability for payment after the
142	142	30 application of insurance proceeds or payments from a liable third
143	143	31 party.
144	144	32 (5) The consumer or insured consumer may elect, in writing, to
145	145	33 authorize the commencement of work on the real property before
146	146	34 the consumer or insured consumer receives complete
147	147	35 specifications. However, a consumer or an insured consumer who
148	148	36 elects to authorize the commencement of work under this
149	149	37 subdivision is obligated for the real property improvements
150	150	38 specified and, if applicable, agreed to by the insurance carrier.
151	151	39 (6) This subdivision applies to a real property improvement
152	152	40 contract that is entered into by a real property improvement
153	153	41 supplier and an insured consumer after June 30, 2012, and before
154	154	42 July 1, 2017, and that includes one (1) or more exterior
155	155	2023 IN 244—LS 6939/DI 101 4
156	156	1 improvements. Before entering into a real property improvement
157	157	2 contract that is to be paid, in whole or in part, from the proceeds
158	158	3 of an insurance policy, the real property improvement supplier
159	159	4 must inform the insured consumer of the insured consumer's
160	160	5 rights under section 10.5(b) of this chapter by doing the
161	161	6 following:
162	162	7 (A) Furnishing to the insured consumer the following
163	163	8 statement: "You may cancel this contract at any time before
164	164	9 midnight on the third business day after you have received
165	165	10 written notification from your insurance company that all or
166	166	11 any part of the claim or contract is not a covered loss under the
167	167	12 insurance policy. See attached notice of cancellation form for
168	168	13 an explanation of this right.".
169	169	14 (B) Furnishing to the insured consumer a form, in duplicate,
170	170	15 that is captioned "NOTICE OF CANCELLATION" and is
171	171	16 attached to the contract but easily detachable, and that
172	172	17 contains the following statement in at least 10 point, boldface
173	173	18 type:
174	174	19 "NOTICE OF CANCELLATION
175	175	20 If you are notified by your insurance company that all or any
176	176	21 part of the claim or contract is not a covered loss under the
177	177	22 insurance policy, you may cancel the contract by mailing or
178	178	23 delivering a signed and dated copy of this cancellation notice
179	179	24 or any other written notice to (name of real property
180	180	25 improvement supplier) at (address of real property
181	181	26 improvement supplier's place of business) at any time before
182	182	27 midnight on the third business day after you have received
183	183	28 such notice from your insurance company.
184	184	29 If you cancel the contract, any payments made by you under
185	185	30 the contract will be returned to you within ten (10) business
186	186	31 days following receipt by (name of real property improvement
187	187	32 supplier) of your cancellation notice, minus any amounts you
188	188	33 may owe for work already done by (name of real property
189	189	34 improvement supplier).
190	190	35 I HEREBY CANCEL THIS TRANSACTION
191	191	36 _______________________________
192	192	37 (date)
193	193	38 _______________________________
194	194	39 (insured consumer's signature)".
195	195	40 (7) This subdivision applies to a real property improvement
196	196	41 contract that is entered into as a result of damage, loss, or expense
197	197	42 that is to be paid, in whole or in part, from the proceeds of an
198	198	2023 IN 244—LS 6939/DI 101 5
199	199	1 insurance policy. However, this subdivision does not apply to a
200	200	2 consumer and a real property improvement supplier that have a
201	201	3 prior business relationship. After June 30, 2012, a real property
202	202	4 improvement supplier may not enter into a real property
203	203	5 improvement contract to which this subdivision applies unless
204	204	6 one (1) or more of the following apply:
205	205	7 (A) The real property improvement supplier resides, is
206	206	8 domiciled, or is authorized to do business in Indiana.
207	207	9 (B) The real property improvement supplier maintains in
208	208	10 Indiana one (1) or more fixed physical locations from which
209	209	11 the real property improvement supplier engages in or solicits
210	210	12 real property improvement contracts.
211	211	13 (C) The real property improvement supplier has appointed a
212	212	14 resident agent in Indiana for service of legal process.
213	213	15 (8) This subdivision applies to a real property improvement
214	214	16 contract that is entered into by a real property improvement
215	215	17 supplier and an insured consumer after June 30, 2017, and in
216	216	18 connection with which a third party described in subsection (a)(9)
217	217	19 will lease or furnish labor, services, material, equipment, or
218	218	20 machinery to, or on behalf of, the real property improvement
219	219	21 supplier. Subject to subsection (b), a real property improvement
220	220	22 contract to which this subdivision applies must include, in
221	221	23 addition to the statement required under subsection (a)(9), a
222	222	24 statement that neither the real property improvement supplier nor
223	223	25 a third party described in subsection (a)(9) may initiate or pursue
224	224	26 a claim with the insured consumer's insurance company.
225	225	27 (d) A modification to a real property improvement contract is not
226	226	28 enforceable against a consumer unless the modification is stated in a
227	227	29 writing that is signed by the consumer.
228	228	30 (e) This subsection applies to a real property improvement contract
229	229	31 that is executed after June 30, 2017, and in connection with which a
230	230	32 third party described in subsection (a)(9) leases or furnishes labor,
231	231	33 services, material, equipment, or machinery to, or on behalf of, the real
232	232	34 property improvement supplier that is a party to the contract. Neither
233	233	35 the real property improvement supplier nor a party described in
234	234	36 subsection (a)(9) may initiate or pursue a claim with an insured
235	235	37 consumer's insurance company.
236	236	38 (f) A real property improvement contract may not assign any rights
237	237	39 of the consumer to any supplier or third parties.
238	238	40 (g) A real property improvement contract must reflect the full
239	239	41 amount of the contract price less any discounts offered.
240	240	42 (h) A real property improvement supplier or third party who
241	241	2023 IN 244—LS 6939/DI 101 6
242	242	1 recklessly, knowingly, or intentionally impersonates a consumer
243	243	2 commits a Class A misdemeanor.
244	244	3 SECTION 2. IC 24-5-11-10.6, AS ADDED BY P.L.170-2017,
245	245	4 SECTION 20, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
246	246	5 JULY 1, 2023]: Sec. 10.6. (a) This section applies to a real property
247	247	6 improvement contract that is entered into by a real property
248	248	7 improvement supplier and a consumer after June 30, 2017.
249	249	8 (b) Before entering into a real property improvement contract with
250	250	9 a consumer, the real property improvement supplier must inform the
251	251	10 consumer of the consumer's rights under this section by doing the
252	252	11 following:
253	253	12 (1) Furnishing to the consumer the following statement: "You
254	254	13 may cancel this contract at any time before midnight on the third
255	255	14 business day after the later latest of the following: following
256	256	15 occurs:
257	257	16 (A) The date this contract is signed by you and (name of real
258	258	17 property improvement supplier).
259	259	18 (B) If applicable, the date you receive written notification from
260	260	19 your insurance company of a final determination as to whether
261	261	20 all or any part of your claim or this contract is a covered loss
262	262	21 under your insurance policy.
263	263	22 (C) If you are entering into this contract after June 30,
264	264	23 2023, the date (name of real property improvement
265	265	24 supplier) provides you with the name of the issuer of the
266	266	25 bond that (name of real property improvement supplier)
267	267	26 is required to maintain by Indiana law, along with the
268	268	27 bond number or similar identifier.
269	269	28 See attached notice of cancellation form for an explanation of this
270	270	29 right.".
271	271	30 (2) Furnishing to the consumer a form, in duplicate, that is
272	272	31 captioned "NOTICE OF CANCELLATION" and is attached to
273	273	32 the contract but easily detachable, and that contains the following
274	274	33 statement in at least 10 point, boldface type:
275	275	34 "NOTICE OF CANCELLATION
276	276	35 You may cancel this contract by mailing, delivering, or submitting
277	277	36 by electronic mail a signed and dated copy of this cancellation
278	278	37 notice or any other written notice to (name of real property
279	279	38 improvement supplier) at (address of real property improvement
280	280	39 supplier's place of business), or (electronic mail address described
281	281	40 in section 10(a)(2)(A) or 10(a)(2)(B)(iii) of this chapter), at any
282	282	41 time before midnight on the third business day after the later
283	283	42 latest of the following: following occurs:
284	284	2023 IN 244—LS 6939/DI 101 7
285	285	1 (A) The date this contract is signed by you and (name of real
286	286	2 property improvement supplier).
287	287	3 (B) If applicable, the date you receive written notification from
288	288	4 your insurance company of a final determination as to whether
289	289	5 all or any part of your claim or this contract is a covered loss
290	290	6 under your insurance policy.
291	291	7 (C) If you are entering into this contract after June 30,
292	292	8 2023, the date (name of real property improvement
293	293	9 supplier) provides you with the name of the issuer of the
294	294	10 bond that (name of real property improvement supplier)
295	295	11 is required to maintain by Indiana law, along with the
296	296	12 bond number or similar identifier.
297	297	13 If you cancel this contract, any payments made by you under the
298	298	14 contract will be returned to you within ten (10) business days
299	299	15 following receipt by (name of real property improvement
300	300	16 supplier) of your cancellation notice, minus any amounts you may
301	301	17 owe for work already done by (name of real property
302	302	18 improvement supplier).
303	303	19 I HEREBY CANCEL THIS TRANSACTION
304	304	20 _______________________________
305	305	21 (date)
306	306	22 _______________________________
307	307	23 (consumer's signature)".
308	308	24 (c) A consumer may cancel a real property improvement contract
309	309	25 under this section before midnight on the third business day after the
310	310	26 later latest of the following: following occurs:
311	311	27 (1) The date the real property improvement contract is signed by
312	312	28 the consumer and the real property improvement supplier.
313	313	29 (2) If applicable, the date the consumer receives written
314	314	30 notification from the consumer's insurance company of a final
315	315	31 determination as to whether all or any part of the consumer's
316	316	32 claim or the real property improvement contract is a covered loss
317	317	33 under the consumer's insurance policy.
318	318	34 (3) For a real property improvement contract entered into
319	319	35 after June 30, 2023, the date the real property improvement
320	320	36 supplier provides the consumer with the name of the issuer of
321	321	37 the bond required by section 10.7 of this chapter, along with
322	322	38 the bond number or similar identifier.
323	323	39 (d) A consumer who seeks to cancel a real property improvement
324	324	40 contract under this section must provide to the real property
325	325	41 improvement supplier, at the address or electronic mail address
326	326	42 specified in the form provided under subsection (b), written notice of
327	327	2023 IN 244—LS 6939/DI 101 8
328	328	1 the consumer's intent not to be bound by the contract. If the notice of
329	329	2 cancellation is sent by mail, the notice is effective upon deposit of the
330	330	3 notice into the United States mail, with postage prepaid and the notice
331	331	4 properly addressed to the real property improvement supplier. If the
332	332	5 notice of cancellation is submitted by electronic mail, the notice is
333	333	6 effective on the date it is electronically submitted. Subject to
334	334	7 subsection (e), not later than ten (10) days after a real property
335	335	8 improvement contract is canceled under this section, the real property
336	336	9 improvement supplier shall tender to the consumer:
337	337	10 (1) any payment or deposit made by the consumer; and
338	338	11 (2) any note or other evidence of indebtedness of the consumer.
339	339	12 (e) If:
340	340	13 (1) a consumer cancels a real property improvement contract
341	341	14 under this section; and
342	342	15 (2) the real property improvement supplier has performed
343	343	16 emergency or temporary services that the consumer
344	344	17 acknowledged in writing before their performance to be necessary
345	345	18 to prevent damage to the real property;
346	346	19 the real property improvement supplier is entitled to the reasonable
347	347	20 value of the emergency or temporary services performed.
348	348	21 SECTION 3. IC 24-5-11-10.7 IS ADDED TO THE INDIANA
349	349	22 CODE AS A NEW SECTION TO READ AS FOLLOWS
350	350	23 [EFFECTIVE JULY 1, 2023]: Sec. 10.7. (a) Before entering into a
351	351	24 real property improvement contract after June 30, 2023, and
352	352	25 throughout the duration of the contract, a real property
353	353	26 improvement supplier must be covered by a surety bond in the
354	354	27 amount of fifty thousand dollars ($50,000).
355	355	28 (b) The bond required by this section must:
356	356	29 (1) be issued by a bonding, surety, or insurance company
357	357	30 authorized to do business in Indiana;
358	358	31 (2) be payable to the state;
359	359	32 (3) secure the payment of restitution to a person aggrieved by
360	360	33 a violation of this chapter by the real property improvement
361	361	34 supplier after judgment has been rendered in favor of the
362	362	35 state; and
363	363	36 (4) secure payment of penalties, costs, and fees included in the
364	364	37 judgment.
365	365	2023 IN 244—LS 6939/DI 101