Current Status Introducing Body:House Bill Number:3377 Ratification Number:81 Act Number:38 Primary Sponsor:Gregory Type of Legislation:GB Subject:Auctioneer Recovery Fund Companion Bill Number:570 Date Bill Passed both Bodies:Apr 10, 1991 Computer Document Number:3377 Governor's Action:S Date of Governor's Action:Apr 24, 1991 Introduced Date:Jan 31, 1991 Date of Last Amendment:Mar 20, 1991 Last History Body:------ Last History Date:Apr 24, 1991 Last History Type:Act No. 38 Scope of Legislation:Statewide All Sponsors:Gregory Nettles Short Boan Wilkins Kirsh J. Brown Type of Legislation:General Bill
Bill Body Date Action Description CMN
---- ------ ------------ ------------------------------ ---
3377 ------ Apr 24, 1991 Act No. 38
3377 ------ Apr 24, 1991 Signed by Governor
3377 ------ Apr 18, 1991 Ratified R 81
3377 Senate Apr 10, 1991 Read third time, enrolled for
ratification
3377 Senate Apr 02, 1991 Read second time, passed and
ordered to third reading, to
be substituted in place of S.
570 on the calendar.
3377 Senate Apr 02, 1991 Recalled from Committee 08
3377 Senate Mar 21, 1991 Introduced, read first time, 08
referred to Committee
3377 House Mar 21, 1991 Read third time, sent to
Senate
3377 House Mar 20, 1991 Amended, read second time
3377 House Mar 19, 1991 Debate adjourned
3377 House Mar 06, 1991 Committee Report: Favorable 26
with amendment
3377 House Jan 31, 1991 Introduced, read first time, 26
referred to Committee
View additional legislative information at the LPITS web site.
(A38, R81, H3377)
AN ACT TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTIONS 40-6-200, 40-6-210, 40-6-220, AND 40-6-230 SO AS TO PROVIDE FOR AN AUCTIONEER RECOVERY FUND; TO AMEND SECTION 40-6-40, RELATING TO THE AUCTIONEERS' COMMISSION, SO AS TO CHANGE THE REFERENCE TO EXPERIENCED AUCTIONEER MEMBERS TO LICENSED AUCTIONEER MEMBERS, REQUIRE AT LEAST ONE MEMBER NOT TO BE CONNECTED WITH THE AUCTION BUSINESS, AND DELETE OBSOLETE PROVISIONS; TO AMEND SECTION 40-6-60, AS AMENDED, RELATING TO GENERAL REQUIREMENTS FOR LICENSES, SO AS TO DELETE THE RESIDENCY REQUIREMENT; TO AMEND SECTION 40-6-70, RELATING TO APPRENTICE AUCTIONEER LICENSES, SO AS TO DELETE THE REQUIREMENT FOR STATEMENTS ON CHARACTER; TO AMEND SECTION 40-6-80, AS AMENDED, RELATING TO APPLICATION AND EXAMINATION FOR LICENSES, SO AS TO CHANGE THE REQUIRED TIME TO SERVE AS AN APPRENTICE FROM TWO YEARS TO ONE YEAR AND DELETE THE REQUIREMENT FOR STATEMENTS ON CHARACTER; TO AMEND SECTION 40-6-130, RELATING TO AUCTIONEERS LICENSED IN ANOTHER STATE, SO AS TO REVISE THE CIRCUMSTANCES UNDER WHICH NONRESIDENT AUCTIONEERS MAY BE GRANTED A SOUTH CAROLINA LICENSE; TO AMEND SECTION 40-6-140, AS AMENDED, RELATING TO LICENSE FEES, SO AS TO DELETE THE REFERENCES TO SPECIFIC FEES AND PROVIDE FOR THE COMMISSION TO ESTABLISH THEM BY REGULATION; TO REPEAL SECTION 40-6-100 RELATING TO BONDS OF LICENSEES; AND TO REAUTHORIZE THE EXISTENCE OF THE AUCTIONEERS' COMMISSION FOR SIX YEARS.
Be it enacted by the General Assembly of the State of South Carolina:
Auctioneer Recovery Fund
SECTION 1. The 1976 Code is amended by adding:
"Section 40-6-200. (A) The `Auctioneer Recovery Fund' is created to be maintained by the commission for the payment of claims to persons injured by licensees under this chapter. Monies in the fund must be held and carried forward by the State Treasury separate from the general fund. At least one hundred thousand dollars for recovery and guaranty purposes must be maintained in the fund. Fund monies may be invested and reinvested by the State Treasurer in interest bearing accounts, interest accruing to the fund. Sufficient liquidity must be maintained so that there are monies available to satisfy claims processed through the commission. Expenditures from the fund must be made in accordance with this chapter without legislative appropriation. Warrants for expenditures must be drawn by the Comptroller General pursuant to claims approved and signed by the chairman of the commission.
(B) To initially establish the fund and when monies, including principal and interest, are less than forty-five thousand dollars at the end of the fiscal year after payment of claims and expenses, each licensee shall pay, in addition to the license fees required under this chapter, an annual fee determined by the commission. However, the fee may not exceed fifty dollars.
(C) If monies, including principal and interest, in the fund exceed one hundred twenty-five thousand dollars at the end of the fiscal year after payment of claims and expenses, the amount in excess must be deposited in the state general fund.
Section 40-6-210. (A) A person aggrieved by the conduct of a licensee may apply for monies from the fund if the following conditions have been met:
(1) The facts giving rise to the claim are based on a specific violation of this chapter or related regulations.
(2) The applicant has made demand upon the licensee by certified mail, return receipt requested, for his actual damages, and demand has been refused or ignored.
(3) The applicant is not:
(a) licensed under this chapter; or
(b) a party jointly responsible for the claim.
(4) Application for recovery has been made not later than one year from the date of discovery of the loss.
(B) Application for monies must be made under oath and upon a form the commission prescribes. It must contain the following minimum information:
(1) name and address of the applicant;
(2) name and address of the licensee and his last known working address;
(3) amount of monies sought and evidence supporting the claim;
(4) copies of complaints and other legal process initiated;
(5) disclosure of partial satisfaction received, offered, or otherwise available from the licensee, a bond, a policy of insurance or other source;
(6) detailed statement of the events precipitating the loss and documents and other evidence supporting the claim.
(C) Upon receiving a claim in proper form, the commission shall forward the claim by certified mail, return receipt requested, to the last known address of the licensee. The licensee within thirty days shall file a verified answer to the claim. If no answer is filed within thirty days, the licensee is in default, and the commission shall schedule a hearing on the claim. If the licensee files a timely answer, the commission shall investigate the claim for not more than sixty days and promptly schedule a hearing on the claim. The licensee, commission, and claimant may present evidence and question and cross-examine witnesses as parties to the hearing.
(D) Failure of the applicant to comply with this section is a waiver of rights under it.
Section 40-6-220. (A) Applications for payment from the fund must be heard and decided by a majority of the members of the commission. After a hearing, if the commission finds that the claim must be paid from the fund, the commission or the courts, if appealed, shall enter an order requiring payment in accordance with the limitations in this chapter. Subject to commission approval, a claim based upon an application for monies may be compromised. However, the commission is not bound by the compromise or stipulation of the licensee.
(B) Upon payment of a claim, the license of the person against whom the claim was applied is revoked. The licensee must not be issued another license until he repays the monies from his claim to the fund, including interest at the rate of eight percent a year. Nothing in this section prevents the commission or other authority from pursuing other remedies at law or equity.
(C) An applicant receiving monies from the fund shall subrogate rights relative to the claim to the commission to the extent of monies paid, including interest, and shall cooperate with the commission in the prosecution of the subrogated claim. Amounts recovered against the licensee or other responsible parties must be deposited into the fund, less costs and expenses of collection.
Section 40-6-230. Payments from the fund are limited as follows:
(1) Only the applicant's actual damages may be paid from the fund. No applicant may recover punitive, special, or consequential damages or attorney's fees.
(2) The fund is not liable for more than ten thousand dollars for each transaction, regardless of the number of persons aggrieved.
(3) The liability of the fund may not exceed in the aggregate twenty thousand dollars for one licensee in one calendar year.
(4) If the maximum liability of the fund is insufficient to pay in full the valid claims of aggrieved persons whose claims relate to the same transaction or to the same licensee, the amount for which the fund is liable must be distributed among the claimants in a ratio that their respective claims bear to the total claims or in a manner the commission considers equitable. The commission in its sole discretion may join in one action claims having a common factual basis so that an equitable distribution from the fund may be achieved.
(5) A party aggrieved and awarded payment by a final commission decision has a vested right for payment. Claims against the fund must be made in the same order as the awards were authorized. If claims against the fund exceed the monies in it, the commission shall satisfy unpaid claims as soon as sufficient monies are deposited. An award is not a claim against the State if it cannot be paid due to a lack of monies in the fund."
Commission; experienced members changed to licensed; no connection with the auction business required
SECTION 2. Section 40-6-40 of the 1976 Code is amended to read:
"Section 40-6-40. At least three members of the commission must be licensed auctioneers and must be active in the auction profession. At least one member must not be connected with the auction business. Action taken by the commission may be taken by a vote of three members. A quorum consists of three members. The members shall elect from among themselves a chairman who serves for one year and until his successor is elected and qualifies. No member may serve more than two successive terms as chairman. The members of the commission shall receive the same per diem, mileage, and subsistence provided by law for members of state boards, committees, and commissions. The commission shall employ an executive director who must have a minimum of five years experience as an auctioneer, an investigator or investigators, and other employees necessary to carry out the duties prescribed by this chapter. Employees serve at the pleasure of the commission. The commission shall issue, suspend, and revoke licenses for auctioneers and apprentice auctioneers provided in this chapter and may promulgate regulations necessary to carry out its provisions."
Residency requirement deleted
SECTION 3. Section 40-6-60 of the 1976 Code, as last amended by Act 32 of 1987, is further amended to read:
"Section 40-6-60. No person may be licensed under this chapter unless he is at least eighteen years of age. No person may be licensed if, within the preceding five years, he has pleaded guilty to or been convicted of a felony or has had an auctioneer or apprentice auctioneer license revoked.
The credit record of an applicant for a license may be considered by the commission in determining whether or not to issue or renew a license. A fee of ten dollars must be paid to the commission for the applicant's credit investigation."
Statement on character requirement deleted
SECTION 4. Section 40-6-70 of the 1976 Code is amended to read:
"Section 40-6-70. Each applicant for an apprentice auctioneer license shall submit a written application on a form approved by the commission. To receive a license, the applicant shall take an examination approved by the commission and perform on it to the satisfaction of the commission. The examination must test the applicant's understanding of the law relating to auctioneers and auctions, ethical practices for auctioneers, and the mathematics applicable to the auctioneer business. The examination must be given at least twice a year in Columbia and at other times and places the commission designates. However, no person may take the examination within six months after having failed it a second time. Each apprentice auctioneer application and license must name a licensed auctioneer to serve as the supervisor of the apprentice. No apprentice auctioneer may enter into an agreement to conduct an auction or conduct an auction without the express approval of his supervisor. The supervisor regularly shall review the records his apprentice is required to maintain and see that they are accurate and current."
Required time to serve as an apprentice changed; character requirement deleted
SECTION 5. Section 40-6-80 of the 1976 Code, as last amended by Act 34 of 1987, is further amended to read:
"Section 40-6-80. No person may be licensed as an auctioneer unless he has held an apprentice auctioneer license, served as an apprentice auctioneer for the preceding year, and has taken an examination approved by the commission and performed on it to the satisfaction of the commission. The examination must test the applicant's understanding of the law relating to auctioneers and auctions, ethical practices for auctioneers, the mathematics applicable to the auctioneer business, and other matters relating to auctions the commission considers appropriate. The examination must be given at least twice a year in Columbia and at other times and places the commission designates. However, no person may take the examination within six months after having failed it a second time.
A person who successfully has completed the equivalent of at least eighty hours of classroom instruction in a course in auctioneering at an institution approved by the commission may be licensed as an auctioneer without holding an apprentice license and serving as an apprentice for one year. He shall take the examination required by this section and perform on it to the satisfaction of the commission.
An applicant for an auctioneer license shall submit a written application on a form approved by the commission. If the applicant has been licensed previously as an apprentice auctioneer, the application must contain an evaluation by the applicant's supervisor of his performance as an apprentice auctioneer. If the applicant is exempted from apprenticeship because he has completed the equivalent of at least eighty hours of classroom instruction in auctioneering, the application must contain a transcript of his course work in auctioneering. The commission may require verification of information included in an application for an auctioneer license."
Requirements for nonresident auctioneers revised
SECTION 6. Section 40-6-130 of the 1976 Code is amended to read:
"Section 40-6-130. A person who holds a valid auctioneer license in another state may apply for and be granted a South Carolina license if the requirements of that state, as determined by the commission, are at least substantially equivalent to the requirements of this chapter. An applicant under this section is not required to take the examination required under Section 40-6-80 but shall pay the appropriate fee in Section 40-6-140 and shall file with the commission an irrevocable consent that service on the commission is sufficient service or process for actions against the applicant by a resident of this State arising out of his auctioneering activities.
An applicant under this section shall pay the fee required under Section 40-6-200 whether or not he currently is bonded as an auctioneer or apprentice auctioneer in his home state. A license issued under this section must be marked to indicate that its holder is a nonresident."
License fees to be established by regulation
SECTION 7. Section 40-6-140 of the 1976 Code, as last amended by Section 54B, Part II, Act 189 of 1989, is further amended to read:
"Section 40-6-140. A person licensed as an auctioneer shall pay an annual license fee to the commission. Funds derived under this chapter must be paid to the State Treasurer who shall keep them in the manner provided for other agencies and boards of the State. The commission may establish license and examination fees by regulation."
Repeal
SECTION 8. Section 40-6-100 of the 1976 Code is repealed.
Application to claims occurring after June 30, 1991
SECTION 9. Section 40-6-210 of the 1976 Code, added by this act, applies to claims occurring after June 30, 1991.
Auctioneers' Commission reauthorized
SECTION 10. In accordance with Section 1-20-60 of the 1976 Code, the existence of the South Carolina Auctioneers' Commission is reauthorized for six years.
Time effective
SECTION 11. This act takes effect upon approval by the Governor.
Approved the 24th day of April, 1991.