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A BILL TO BE ENTITLED
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AN ACT
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relating to certain contract and notice requirements for the |
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cancellation of a health spa membership. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 702.304, Occupations Code, is amended to |
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read as follows: |
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Sec. 702.304. CANCELLATION AND REFUND NOTICE. (a) Except |
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as provided by Subsection (b), a contract must state in at least |
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10-point type that is boldfaced, capitalized, underlined, or |
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otherwise conspicuously distinguished from surrounding written |
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material: |
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(1) "NOTICE TO PURCHASER: DO NOT SIGN THIS CONTRACT |
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UNTIL YOU READ IT OR IF IT CONTAINS BLANK SPACES." |
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(2) "IF YOU DECIDE YOU DO NOT WISH TO REMAIN A MEMBER |
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OF THIS HEALTH SPA, YOU MAY CANCEL THIS CONTRACT BY PROVIDING NOTICE |
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[MAILING] TO THE HEALTH SPA BY MIDNIGHT OF THE THIRD BUSINESS DAY |
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AFTER THE DAY YOU SIGN THIS CONTRACT [A NOTICE] STATING YOUR DESIRE |
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TO CANCEL THIS CONTRACT. [THE WRITTEN NOTICE MUST BE MAILED BY |
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CERTIFIED MAIL TO THE FOLLOWING ADDRESS: |
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[(Address of the health spa home office).]" |
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(3) "IF AFTER MIDNIGHT OF THE THIRD BUSINESS DAY AFTER |
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THE DAY YOU SIGN THIS CONTRACT YOU DECIDE YOU DO NOT WISH TO REMAIN A |
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MEMBER OF THIS HEALTH SPA, YOU MAY CANCEL THIS CONTRACT BY PROVIDING |
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30 DAYS' NOTICE TO THE HEALTH SPA." |
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(4) [(3)] "IF THE HEALTH SPA GOES OUT OF BUSINESS AND |
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DOES NOT PROVIDE FACILITIES WITHIN 10 MILES OF THE FACILITY IN WHICH |
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YOU ARE ENROLLED OR IF THE HEALTH SPA MOVES MORE THAN 10 MILES FROM |
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THE FACILITY IN WHICH YOU ARE ENROLLED, YOU MAY: |
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(A) CANCEL THIS CONTRACT BY PROVIDING [MAILING BY |
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CERTIFIED MAIL A WRITTEN] NOTICE STATING YOUR DESIRE TO CANCEL THIS |
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CONTRACT, ACCOMPANIED BY PROOF OF PAYMENT ON THE CONTRACT TO THE |
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HEALTH SPA [AT THE FOLLOWING ADDRESS: |
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[(Address of the health spa home office)]; AND |
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(B) FILE A CLAIM FOR A REFUND OF YOUR UNUSED |
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MEMBERSHIP FEES AGAINST THE BOND OR OTHER SECURITY POSTED BY THE |
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HEALTH SPA WITH THE TEXAS SECRETARY OF STATE. TO MAKE A CLAIM |
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AGAINST THE SECURITY PROVIDE A COPY OF YOUR CONTRACT TOGETHER WITH |
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PROOF OF PAYMENTS MADE ON THE CONTRACT TO THE TEXAS SECRETARY OF |
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STATE. THE REQUIRED CLAIM INFORMATION MUST BE RECEIVED BY THE |
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SECRETARY OF STATE NOT LATER THAN THE 90TH DAY AFTER THE DATE NOTICE |
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OF THE CLOSURE OR RELOCATION IS FIRST POSTED ON THE SECRETARY OF |
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STATE'S INTERNET WEBSITE." |
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(5) "IF YOU MOVE YOUR RESIDENCE MORE THAN 25 MILES FROM |
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A HEALTH SPA OPERATED BY (insert: the name of the health spa |
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registration holder), YOU MAY CANCEL THIS CONTRACT BY PROVIDING |
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NOTICE TO THE HEALTH SPA STATING YOUR DESIRE TO CANCEL THIS |
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CONTRACT. THE HEALTH SPA MAY REQUIRE REASONABLE PROOF OF THE MOVE." |
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(6) "IF ON A DOCTOR'S ORDER, YOU CANNOT PHYSICALLY |
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RECEIVE THE SERVICES PROVIDED BY THE HEALTH SPA FOR A PERIOD OF MORE |
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THAN THREE MONTHS BECAUSE OF A SIGNIFICANT PHYSICAL DISABILITY, YOU |
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MAY CANCEL THIS CONTRACT BY PROVIDING NOTICE TO THE HEALTH SPA. THE |
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HEALTH SPA MAY REQUIRE REASONABLE PROOF OF THE DISABILITY." |
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(7) [(4)] "IF YOU DIE OR BECOME TOTALLY AND |
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PERMANENTLY DISABLED AFTER THE DATE THIS CONTRACT TAKES EFFECT, YOU |
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OR YOUR ESTATE MAY CANCEL THIS CONTRACT AND RECEIVE A PARTIAL REFUND |
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OF YOUR UNUSED MEMBERSHIP FEE BY PROVIDING [MAILING A] NOTICE TO THE |
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HEALTH SPA STATING YOUR DESIRE TO CANCEL THIS CONTRACT. THE HEALTH |
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SPA MAY REQUIRE REASONABLE PROOF OF DISABILITY OR DEATH. [THE |
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WRITTEN NOTICE MUST BE MAILED BY CERTIFIED MAIL TO THE FOLLOWING |
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ADDRESS: |
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[(Address of the health spa home office).]" |
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(b) A health spa operator is required to include the |
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statement under Subsection (a)(4)(B) [(a)(3)(B)] in a contract only |
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if the operator is required to post security with the secretary of |
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state under Subchapter D. |
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(c) A health spa operator shall include a statement in a |
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contract that any notice a member provides to cancel a contract may |
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be given to a health spa: |
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(1) in person, by e-mail, by certified mail, or by |
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telephone; or |
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(2) for a contract entered into through an Internet |
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website, through an Internet website. |
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(d) A health spa operator shall include a statement in a |
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member contract describing the information a member must include in |
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a notice to cancel the member's contract. |
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SECTION 2. Section 702.307(a), Occupations Code, is amended |
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to read as follows: |
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(a) A member may cancel a contract and receive a full refund |
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of the payments made under the contract by providing to the |
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certificate holder for the health spa [sending], not later than |
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midnight of the third business day after the contract date, |
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[written] notice of cancellation, accompanied by proof of payment |
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made under the contract [, by certified mail to the certificate |
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holder's home office]. |
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SECTION 3. Section 702.308, Occupations Code, is amended by |
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amending Subsections (a), (b), and (c) and adding Subsections |
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(a-1), (a-2), and (a-3) to read as follows: |
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(a) A member may cancel a contract and receive a refund of |
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unearned payments made under the contract by providing to the |
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certificate holder for the health spa 30 days' notice accompanied |
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by proof of payment made under the contract. |
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(a-1) A member may cancel a contract and receive a refund of |
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unearned payments made under the contract by providing [sending |
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written] notice of cancellation, accompanied by proof of payment |
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made under the contract, [by certified mail] to the certificate |
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holder for the health spa [holder's home office] if the certificate |
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holder: |
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(1) closes the health spa and fails to provide |
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alternative facilities not more than 10 miles from the location of |
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the health spa; |
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(2) relocates the health spa more than 10 miles from |
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its location preceding the relocation; or |
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(3) fails to provide advertised services. |
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(a-2) Subject to Subsection (a-3), a member may cancel a |
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contract and receive a refund of unearned payments made under the |
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contract by providing notice of cancellation, accompanied by proof |
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of payment made under the contract to the certificate holder for the |
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health spa, if the member: |
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(1) moves the member's residence more than 25 miles |
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from any health spa operated by the seller; or |
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(2) on a doctor's order, cannot physically receive the |
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services provided by the health spa for more than three months |
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because of a significant physical disability. |
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(a-3) If required by the certificate holder for the health |
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spa, a member is only entitled to cancel the member's contract and |
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receive a refund under Subsection (a-2) if the member provides the |
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required reasonable proof of the move under Subsection (a-2)(1) or |
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disability under Subsection (a-2)(2), as applicable. |
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(b) A member who dies or becomes totally and permanently |
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disabled after the date a contract is entered into, or the member's |
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estate, may cancel the contract and receive a refund of the unearned |
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payments made under the contract by providing to the certificate |
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holder for the health spa [sending written] notice of cancellation |
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[by certified mail to the certificate holder's home office]. The |
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certificate holder may require the member, or the member's estate, |
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to provide reasonable proof of the member's death or disability. |
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(c) A certificate holder who receives notice under |
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Subsection (a), (a-1), (a-2), or (b) shall refund the unearned |
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payments made under the contract to the member, or the member's |
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estate, as appropriate, not later than [that] the 30th day after the |
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date notice is received. |
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SECTION 4. This Act takes effect September 1, 2023. |