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AB-2880 Negotiable instruments: identification.(1989-1990)

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AB2880:v93#DOCUMENT

Assembly Bill No. 2880
CHAPTER 637

An act to add Section 1725 to the Civil Code, relating to negotiable instruments.

[ Filed with Secretary of State  September 11, 1990. Approved by Governor  September 08, 1990. ]

LEGISLATIVE COUNSEL'S DIGEST


AB 2880, Areias. Negotiable instruments: identification.
Existing law does not specifically prohibit a person accepting a negotiable instrument as payment in full or in part for goods or services from requiring the person paying with a negotiable instrument to use a credit card as a form of identification.
This bill would specifically prohibit a person accepting a negotiable instrument as payment in full or in part for goods or services from, among other things, requiring, as a condition of acceptance of the negotiable instrument, or causing, the person paying with a negotiable instrument to provide a credit card, as defined, as a means of identification, or for any other purpose. The bill would provide that any person who intentionally violates this prohibition is subject to a civil penalty not to exceed $250 for a first violation, and to a civil penalty not to exceed $1,000 for a second or subsequent violation, to be assessed and collected in a civil action brought by the person paying with a negotiable instrument, or by the Attorney General, or by the district attorney or city attorney of the county or city in which the violation occurred, as specified, and that a violation may be enjoined, as specified. The bill would provide, however, that this prohibition does not prohibit any person from, among other things, requiring reasonable forms of identification, other than a credit card, as a condition of the acceptance of a negotiable instrument.

The people of the State of California do enact as follows:


SECTION 1.

 Section 1725 is added to the Civil Code, to read:

1725.
 (a)  No person accepting a negotiable instrument as payment in full or in part for goods or services shall do any of the following:
(1)  Require the person paying with a negotiable instrument to provide a credit card as a condition of acceptance of the negotiable instrument, as a means of identification, or for any other purpose.
(2)  Require, as a condition of acceptance of the negotiable instrument, or cause the person paying with a negotiable instrument to sign a statement agreeing to allow his or her credit card to be charged to cover the negotiable instrument if returned as no good.
(3)  Record a credit card number in connection with any part of the transaction described in this subdivision.
(4)  Contact a credit card issuer to determine if the amount of any credit available to the person paying with a negotiable instrument will cover the amount of the negotiable instrument.
(b)  Any person who violates this section is subject to a civil penalty not to exceed two hundred fifty dollars ($250) for a first violation, and to a civil penalty not to exceed one thousand dollars ($1,000) for a second or subsequent violation, to be assessed and collected in a civil action brought by the person paying with a negotiable instrument, by the Attorney General, or by the district attorney or city attorney of the county or city in which the violation occurred. However, no civil penalty shall be assessed for a violation of this section if the defendant shows by a preponderance of the evidence that the violation was not intentional and resulted from a bona fide error made notwithstanding the defendant’s maintenance of procedures reasonably adopted to avoid such an error. When collected, the civil penalty shall be payable, as appropriate, to the person paying with a negotiable instrument who brought the action or to the general fund of whichever governmental entity brought the action to assess the civil penalty.
(c)  The Attorney General, or any district attorney or city attorney within his or her respective jurisdiction, may bring an action in the superior court in the name of the people of the State of California to enjoin violation of subdivision (a) and, upon notice to the defendant of not less than five days, to temporarily restrain and enjoin the violation. If it appears to the satisfaction of the court that the defendant has, in fact, violated subdivision (a), the court may issue an injunction restraining further violations, without requiring proof that any person has been damaged by the violation. In these proceedings, if the court finds that the defendant has violated subdivision (a), the court may direct the defendant to pay any or all costs incurred by the Attorney General, district attorney, or city attorney in seeking or obtaining injunctive relief pursuant to this subdivision.
(d)  Actions for collection of civil penalties under subdivision (b) and for injunctive relief under subdivision (c) may be consolidated.
(e)  For the purposes of this section, the following terms have the following meanings:
(1)  “Credit card” has the meaning specified in Section 1747.02, and does not include a check guarantee card.
(2)  “Negotiable instrument” has the meaning specified in Section 3104 of the Commercial Code.
(f)  This section does not prohibit any person from doing any of the following:
(1)  Requiring the production of reasonable forms of positive identification, other than a credit card, which may include a driver’s license or a California state identification card, as a condition of acceptance of a negotiable instrument.
(2)  Requesting a purchaser to display a credit card as an indicia of creditworthiness or financial responsibility, or as an additional identification, provided the only information concerning the credit card which is recorded is the type of credit card displayed, the issuer of the card, or the expiration date of the card.
(3)  Requesting production of, or recording, a credit card number as a condition for cashing a check, provided the person has agreed with the credit card issuer to cash checks as a service to cardholders of the issuer, the issuer has agreed to guarantee cardholder checks cashed by that person, and the cardholder has given actual, apparent, or implied authority for the use of his or her card number in the manner and for the purpose described in this paragraph.
(4)  Requesting, receiving, or recording a credit card number in lieu of requiring a deposit to secure payment in event of default, loss, damage, or other occurrence.
(g)  This section does not require acceptance of a negotiable instrument whether or not a credit card is presented.