By Hilbert H.B. No. 3159
75R2832 MCK-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to cancellation of certain contracts under the Health Spa
1-3 Act.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 12(f), Health Spa Act (Article 5221l,
1-6 Vernon's Texas Civil Statutes), is amended to read as follows:
1-7 (f) Each contract shall state in at least 10-point type that
1-8 is boldfaced, capitalized, underlined, or otherwise set out from
1-9 surrounding written material so as to be conspicuous:
1-10 (1) "NOTICE TO PURCHASER: DO NOT SIGN THIS CONTRACT
1-11 UNTIL YOU READ IT OR IF IT CONTAINS BLANK SPACES."
1-12 (2) "IF YOU DECIDE YOU DO NOT WISH TO REMAIN A MEMBER
1-13 OF THIS HEALTH SPA, YOU MAY CANCEL THIS CONTRACT BY MAILING TO THE
1-14 HEALTH SPA BY MIDNIGHT OF THE THIRD BUSINESS DAY AFTER THE DAY YOU
1-15 SIGN THIS CONTRACT A NOTICE STATING YOUR DESIRE TO CANCEL THIS
1-16 CONTRACT. THE WRITTEN NOTICE MUST BE MAILED BY CERTIFIED MAIL TO
1-17 THE FOLLOWING ADDRESS:
1-18 (Address of the health spa home office)."
1-19 (3) "IF THE HEALTH SPA GOES OUT OF BUSINESS AND DOES
1-20 NOT PROVIDE FACILITIES WITHIN 10 MILES OF THE FACILITY IN WHICH YOU
1-21 ARE ENROLLED OR IF THE HEALTH SPA MOVES MORE THAN 10 MILES FROM THE
1-22 FACILITY IN WHICH YOU ARE ENROLLED, YOU MAY CANCEL THIS CONTRACT BY
1-23 MAILING A NOTICE TO THE HEALTH SPA STATING YOUR DESIRE TO CANCEL
1-24 THIS CONTRACT, ACCOMPANIED BY PROOF OF PAYMENT ON THE CONTRACT.
2-1 THE WRITTEN NOTICE MUST BE MAILED BY CERTIFIED MAIL TO THE
2-2 FOLLOWING ADDRESS:
2-3 (Address of the health spa home office)."
2-4 "YOU MAY ALSO BE ENTITLED TO FILE A CLAIM FOR A REFUND OF YOUR
2-5 UNUSED MEMBERSHIP FEES AGAINST THE BOND OR OTHER SECURITY POSTED BY
2-6 THE HEALTH SPA WITH THE TEXAS SECRETARY OF STATE. TO MAKE A CLAIM
2-7 AGAINST THE SECURITY SEND A COPY OF YOUR CONTRACT TOGETHER WITH
2-8 PROOF OF PAYMENTS MADE ON THE CONTRACT TO THE TEXAS SECRETARY OF
2-9 STATE. THE WRITTEN NOTICE MUST BE MAILED BY CERTIFIED MAIL TO THE
2-10 FOLLOWING ADDRESS:
2-11 OFFICE OF THE SECRETARY OF STATE
2-12 STATUTORY DOCUMENTS SECTION
2-13 P.O. BOX 12887
2-14 AUSTIN, TEXAS 78711-2887."
2-15 (4) "IF YOU DIE OR BECOME TOTALLY AND PERMANENTLY
2-16 DISABLED AFTER THE DATE THIS CONTRACT TAKES EFFECT, YOU OR YOUR
2-17 ESTATE MAY CANCEL THIS CONTRACT AND RECEIVE A PARTIAL REFUND OF
2-18 YOUR UNUSED MEMBERSHIP FEE BY MAILING A NOTICE TO THE HEALTH SPA
2-19 STATING YOUR DESIRE TO CANCEL THIS CONTRACT. THE HEALTH SPA MAY
2-20 REQUIRE PROOF OF DISABILITY OR DEATH. THE WRITTEN NOTICE MUST BE
2-21 MAILED BY CERTIFIED MAIL TO THE FOLLOWING ADDRESS:
2-22 (Address of the health spa home office)."
2-23 (5) "IF YOUR DOCTOR DETERMINES THAT YOU ARE ILL OR
2-24 INJURED TO THE EXTENT THAT IN YOUR DOCTOR'S OPINION YOU ARE UNABLE
2-25 TO USE THE FACILITIES AFTER THE DATE THIS CONTRACT TAKES EFFECT,
2-26 YOU MAY CANCEL THIS CONTRACT AND RECEIVE A PARTIAL REFUND OF YOUR
2-27 UNUSED MEMBERSHIP FEE BY MAILING A NOTICE TO THE HEALTH SPA STATING
3-1 YOUR DESIRE TO CANCEL THIS CONTRACT. THE HEALTH SPA MAY REQUIRE
3-2 PROOF OF ILLNESS OR INJURY. THE WRITTEN NOTICE MUST BE MAILED BY
3-3 CERTIFIED MAIL TO THE FOLLOWING ADDRESS:
3-4 (Address of the health spa home office)."
3-5 SECTION 2. Section 13, Health Spa Act (Article 5221l,
3-6 Vernon's Texas Civil Statutes), is amended to read as follows:
3-7 Sec. 13. CANCELLATION OF CONTRACTS. (a) A member may cancel
3-8 a contract before the fourth business day after the date on which
3-9 the contract is signed by notifying the health spa registrant of
3-10 the cancellation in writing. Written notification is considered
3-11 given if the notification is mailed by certified mail to the home
3-12 office of the health spa registrant and postmarked not later than
3-13 midnight of the third business day. The health spa registrant
3-14 shall refund all money paid to the purchaser exercising the right
3-15 to cancel.
3-16 (b) A member may cancel a contract on written notice by
3-17 certified mail to the home office of the health spa registrant if
3-18 the health spa registrant goes out of business and fails to provide
3-19 facilities within 10 miles or moves its facilities more than 10
3-20 miles from the location in which the member is enrolled. A member
3-21 may cancel a contract in the same manner if the health spa
3-22 registrant fails to provide advertised services.
3-23 (c) A member may cancel a contract if the member's doctor
3-24 determines that the member is injured or ill to the extent that in
3-25 the doctor's opinion the member is unable to use the health spa
3-26 registrant's facilities to the benefit of the member.
3-27 (d) A purchaser of a membership may cancel a contract if the
4-1 member dies or becomes totally and permanently disabled after the
4-2 date on which the contract takes effect. The health spa registrant
4-3 may require a purchaser or the purchaser's estate to provide
4-4 reasonable proof of total and permanent disability or death.
4-5 (e) [(d)] If a purchaser or an estate elects to cancel a
4-6 membership contract pursuant to Subsection (b), [or] (c), or (d) of
4-7 this section the health spa registrant shall refund to the
4-8 purchaser or the purchaser's estate any unearned sums paid under
4-9 the contract. "Unearned sums" shall be calculated by multiplying
4-10 the gross monthly payment by the total of months remaining on a
4-11 contract at the time of cancellation minus any payments not made.
4-12 For the purposes of this section:
4-13 (1) The gross monthly payment shall be calculated by
4-14 determining the total of payments, including down payments and
4-15 initiation fees required by the contract, divided by the total
4-16 number of months in the term of the contract.
4-17 (2) The date of cancellation and the date of the
4-18 contract expiration shall be rounded to the nearest full month.
4-19 The total months remaining on the contract shall be calculated by
4-20 subtracting the date of cancellation from the expiration date of
4-21 the contract. The result shall be expressed in whole months.
4-22 (f) [(e)] A health spa registrant shall make a refund
4-23 required under this section before the 31st day after the date the
4-24 health spa registrant receives the notice of cancellation
4-25 accompanied by proof of payment. The receipt given to the
4-26 purchaser by the health spa at the time the purchaser made a
4-27 payment under the contract constitutes proof of payment.
5-1 SECTION 3. This Act takes effect September 1, 1997.
5-2 SECTION 4. The importance of this legislation and the
5-3 crowded condition of the calendars in both houses create an
5-4 emergency and an imperative public necessity that the
5-5 constitutional rule requiring bills to be read on three several
5-6 days in each house be suspended, and this rule is hereby suspended.