1688-1693
CIVIL CODE
SECTION 1688-1693
1688. A contract is extinguished by its rescission.
1689. (a) A contract may be rescinded if all the parties thereto
consent.
(b) A party to a contract may rescind the contract in the
following cases:
(1) If the consent of the party rescinding, or of any party
jointly contracting with him, was given by mistake, or obtained
through duress, menace, fraud, or undue influence, exercised by or
with the connivance of the party as to whom he rescinds, or of any
other party to the contract jointly interested with such party.
(2) If the consideration for the obligation of the rescinding
party fails, in whole or in part, through the fault of the party as
to whom he rescinds.
(3) If the consideration for the obligation of the rescinding
party becomes entirely void from any cause.
(4) If the consideration for the obligation of the rescinding
party, before it is rendered to him, fails in a material respect from
any cause.
(5) If the contract is unlawful for causes which do not appear in
its terms or conditions, and the parties are not equally at fault.
(6) If the public interest will be prejudiced by permitting the
contract to stand.
(7) Under the circumstances provided for in Sections 39, 1533,
1566, 1785, 1789, 1930 and 2314 of this code, Section 2470 of the
Corporations Code, Sections 331, 338, 359, 447, 1904 and 2030 of the
Insurance Code or any other statute providing for rescission.
1689.2. A participant in an endless chain scheme, as defined in
Section 327 of the Penal Code, may rescind the contract upon which
the scheme is based, and may recover all consideration paid pursuant
to the scheme, less any amounts paid or consideration provided to the
participant pursuant to the scheme. In addition, the court may, upon
motion, award reasonable attorney's fees to a prevailing plaintiff.
1689.3. Any patient who contracts directly with a dental office or
plan for services may rescind the contract or plan until midnight of
the third business day after the day on which the patient signs the
contract or plan. If services have been provided to the patient, the
dental office shall be entitled to compensation for those services.
1689.5. As used in Sections 1689.6 to 1689.11, inclusive, and in
Section 1689.14:
(a) "Home solicitation contract or offer" means any contract,
whether single or multiple, or any offer which is subject to
approval, for the sale, lease, or rental of goods or services or
both, made at other than appropriate trade premises in an amount of
twenty-five dollars ($25) or more, including any interest or service
charges. "Home solicitation contract" does not include any contract
under which the buyer has the right to rescind pursuant to Title 1,
Chapter 2, Section 125 of the Federal Consumer Credit Protection Act
(P.L. 90-321) and the regulations promulgated pursuant thereto.
(b) "Appropriate trade premises," means premises where either the
owner or seller normally carries on a business, or where goods are
normally offered or exposed for sale in the course of a business
carried on at those premises.
(c) "Goods" means tangible chattels bought for use primarily for
personal, family, or household purposes, including certificates or
coupons exchangeable for these goods, and including goods that, at
the time of the sale or subsequently, are to be so affixed to real
property as to become a part of the real property whether or not
severable therefrom, but does not include any vehicle required to be
registered under the Vehicle Code, nor any goods sold with this
vehicle if sold under a contract governed by Section 2982, and does
not include any mobilehome, as defined in Section 18008 of the Health
and Safety Code, nor any goods sold with this mobilehome if either
are sold under a contract subject to Section 18036.5 of the Health
and Safety Code.
(d) "Services" means work, labor and services, including, but not
limited to, services furnished in connection with the repair,
restoration, alteration, or improvement of residential premises, or
services furnished in connection with the sale or repair of goods as
defined in Section 1802.1, and courses of instruction, regardless of
the purpose for which they are taken, but does not include the
services of attorneys, real estate brokers and salesmen, securities
dealers or investment counselors, physicians, optometrists, or
dentists, nor financial services offered by banks, savings
institutions, credit unions, industrial loan companies, personal
property brokers, consumer finance lenders, or commercial finance
lenders, organized pursuant to state or federal law, that are not
connected with the sale of goods or services, as defined herein, nor
the sale of insurance that is not connected with the sale of goods or
services as defined herein, nor services in connection with the sale
or installation of mobilehomes or of goods sold with a mobilehome if
either are sold or installed under a contract subject to Section
18036.5 of the Health and Safety Code, nor services for which the
tariffs, rates, charges, costs, or expenses, including in each
instance the time sale price, is required by law to be filed with and
approved by the federal government or any official, department,
division, commission, or agency of the United States or of the state.
(e) "Business day" means any calendar day except Sunday, or the
following business holidays: New Year's Day, Washington's Birthday,
Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans'
Day, Thanksgiving Day, and Christmas Day.
(f) This section shall become operative on January 1, 2006.
1689.6. (a) (1) Except for a contract written pursuant to Section
7151.2 or 7159.10 of the Business and Professions Code, in addition
to any other right to revoke an offer, the buyer has the right to
cancel a home solicitation contract or offer until midnight of the
third business day after the day on which the buyer signs an
agreement or offer to purchase which complies with Section 1689.7.
(2) In addition to any other right to revoke an offer, the buyer
has the right to cancel a home solicitation contract written pursuant
to Section 7151.2 of the Business and Professions Code until
midnight of the third business day after the buyer receives a signed
and dated copy of the contract or offer to purchase that complies
with Section 1689.7 of this code.
(3) (A) In addition to any other right to revoke an offer, the
buyer has the right to cancel a home solicitation contract or offer
to purchase written pursuant to Section 7159.10 of the Business and
Professions Code, until the buyer receives a signed and dated copy of
a service and repair contract that complies with the contract
requirements specified in Section 7159.10 of the Business and
Professions Code and the work commences.
(B) For any contract written pursuant to Section 7159.10 of the
Business and Professions Code, or otherwise presented to the buyer as
a service and repair contract, unless all of the conforming
requirements listed under subdivision (a) of that section are met,
the requirements set forth under Section 7159 of the Business and
Professions Code shall be applicable, regardless of the aggregate
contract price, including the right to cancel as set forth under this
section.
(b) In addition to any other right to revoke an offer, any buyer
has the right to cancel a home solicitation contract or offer for the
purchase of a personal emergency response unit until midnight of the
seventh business day after the day on which the buyer signs an
agreement or offer to purchase which complies with Section 1689.7.
This subdivision shall not apply to a personal emergency response
unit installed with, and as part of, a home security alarm system
subject to the Alarm Company Act (Chapter 11.6 (commencing with
Section 7590) of Division 3 of the Business and Professions Code)
which has two or more stationary protective devices used to enunciate
an intrusion or fire and is installed by an alarm company operator
operating under a current license issued pursuant to the Alarm
Company Act, which shall instead be subject to subdivision (a).
(c) In addition to any other right to revoke an offer, a buyer has
the right to cancel a home solicitation contract or offer for the
repair or restoration of residential premises damaged by a disaster
that was not void pursuant to Section 1689.14, until midnight of the
seventh business day after the buyer signs and dates the contract
unless the provisions of Section 1689.15 are applicable.
(d) Cancellation occurs when the buyer gives written notice of
cancellation to the seller at the address specified in the agreement
or offer.
(e) Notice of cancellation, if given by mail, is effective when
deposited in the mail properly addressed with postage prepaid.
(f) Notice of cancellation given by the buyer need not take the
particular form as provided with the contract or offer to purchase
and, however expressed, is effective if it indicates the intention of
the buyer not to be bound by the home solicitation contract or
offer.
(g) "Personal emergency response unit," for purposes of this
section, means an in-home radio transmitter device or two-way radio
device generally, but not exclusively, worn on a neckchain, wrist
strap, or clipped to clothing, and connected to a telephone line
through which a monitoring station is alerted of an emergency and
emergency assistance is summoned.
1689.7. (a) (1) Except for contracts written pursuant to Sections
7151.2 and 7159.10 of the Business and Professions Code, in a home
solicitation contract or offer, the buyer's agreement or offer to
purchase shall be written in the same language, e.g., Spanish, as
principally used in the oral sales presentation, shall be dated,
shall be signed by the buyer, and except as provided in paragraph
(2), shall contain in immediate proximity to the space reserved for
his or her signature, a conspicuous statement in a size equal to at
least 10-point boldface type, as follows: "You, the buyer, may
cancel this transaction at any time prior to midnight of the third
business day after the date of this transaction. See the attached
notice of cancellation form for an explanation of this right."
(2) The statement required pursuant to this subdivision for a home
solicitation contract or offer for the purchase of a personal
emergency response unit, as defined in Section 1689.6, that is not
installed with and as part of a home security alarm system subject to
the Alarm Company Act (Chapter 11.6 (commencing with Section 7590)
of Division 3 of the Business and Professions Code) that has two or
more stationary protective devices used to enunciate an intrusion or
fire and is installed by an alarm company operator operating under a
current license issued pursuant to the Alarm Company Act, is as
follows: "You, the buyer, may cancel this transaction at any time
prior to midnight of the seventh business day after the date of this
transaction. See the attached notice of cancellation form for an
explanation of this right."
(3) Except for contracts written pursuant to Sections 7151.2 and
7159.10 of the Business and Professions Code, the statement required
pursuant to this subdivision for the repair or restoration of
residential premises damaged by a disaster pursuant to subdivision
(c) of Section 1689.6 is as follows: "You, the buyer, may cancel this
transaction at any time prior to midnight of the seventh business
day after the date of this transaction. See the attached notice of
cancellation form for an explanation of this right."
(4) A home solicitation contract written pursuant to Section
7151.2 of the Business and Professions Code shall be written in the
same language, e.g., Spanish, as principally used in the oral sales
presentation. The contract, or an attachment to the contract that is
subject to Section 7159 of the Business and Professions Code shall
include in immediate proximity to the space reserved for his or her
signature, the following statement in a size equal to at least
12-point boldface type, which shall be dated and signed by the buyer:
"Three-Day Right to Cancel
You, the buyer, have the right to cancel this contract within
three business days. You may cancel by e-mailing, mailing, faxing, or
delivering a written notice to the contractor at the contractor's
place of business by midnight of the third business day after you
received a signed and dated copy of the contract that includes this
notice. Include your name, your address, and the date you received
the signed copy of the contract and this notice.
If you cancel, the contractor must return to you anything you paid
within 10 days of receiving the notice of cancellation. For your
part, you must make available to the contractor at your residence, in
substantially as good condition as you received it, any goods
delivered to you under this contract or sale. Or, you may, if you
wish, comply with the contractor's instructions on how to return the
goods at the contractor's expense and risk. If you do make the goods
available to the contractor and the contractor does not pick them up
within 20 days of the date of your notice of cancellation, you may
keep them without any further obligation. If you fail to make the
goods available to the contractor, or if you agree to return the
goods to the contractor and fail to do so, then you remain liable for
performance of all obligations under the contract."
(b) The agreement or offer to purchase shall contain on the first
page, in a type size no smaller than that generally used in the body
of the document, the following: (1) the name and address of the
seller to which the notice is to be mailed, and (2) the date the
buyer signed the agreement or offer to purchase.
(c) Except for contracts written pursuant to Sections 7151.2 and
7159.10 of the Business and Professions Code, or except as provided
in subdivision (d), the agreement or offer to purchase shall be
accompanied by a completed form in duplicate, captioned "Notice of
Cancellation" which shall be attached to the agreement or offer to
purchase and be easily detachable, and which shall contain in type of
at least 10-point the following statement written in the same
language, e.g., Spanish, as used in the contract:
"Notice of Cancellation"
/enter date of transaction/
______________________________
(Date)
"You may cancel this transaction, without any penalty or
obligation, within three business days from the above date.
If you cancel, any property traded in, any payments made by you
under the contract or sale, and any negotiable instrument executed by
you will be returned within 10 days following receipt by the seller
of your cancellation notice, and any security interest arising out of
the transaction will be canceled.
If you cancel, you must make available to the seller at your
residence, in substantially as good condition as when received, any
goods delivered to you under this contract or sale, or you may, if
you wish, comply with the instructions of the seller regarding the
return shipment of the goods at the seller's expense and risk.
If you do make the goods available to the seller and the seller
does not pick them up within 20 days of the date of your notice of
cancellation, you may retain or dispose of the goods without any
further obligation. If you fail to make the goods available to the
seller, or if you agree to return the goods to the seller and fail to
do so, then you remain liable for performance of all obligations
under the contract."
To cancel this transaction, mail or deliver a
signed and dated copy of this cancellation
notice, or any other written notice, or send a
telegram
to__________________,
/name of seller/
at_________________________________________
/address of seller's place of business/
not later than midnight of____________.
(Date)
I hereby cancel this transaction. ________
(Date)
_______________________________
(Buyer's signature)
(d) Any agreement or offer to purchase a personal emergency
response unit, as defined in Section 1689.6, which is not installed
with and as part of a home security alarm system subject to the Alarm
Company Act which has two or more stationary protective devices used
to enunciate an intrusion or fire and is installed by an alarm
company operator operating under a current license issued pursuant to
the Alarm Company Act, shall be subject to the requirements of
subdivision (c), and shall be accompanied by the "Notice of
Cancellation" required by subdivision (c), except that the first
paragraph of that notice shall be deleted and replaced with the
following paragraph:
You may cancel this transaction, without any penalty or
obligation, within seven business days from the above date.
(e) A home solicitation contract written pursuant to Section
7151.2 of the Business and Professions Code for the repair or
restoration of residential premises damaged by a disaster that is
subject to subdivision (c) of Section 1689.6, shall be written in the
same language, e.g., Spanish, as principally used in the oral sales
presentation. The contract, or an attachment to the contract that is
subject to Section 7159 of the Business and Professions Code shall
include, in immediate proximity to the space reserved for his or her
signature, the following statement in a size equal to at least
12-point boldface type, which shall be signed and dated by the buyer:
"Seven-Day Right to Cancel
You, the buyer, have the right to cancel this contract within
seven business days. You may cancel by e-mailing, mailing, faxing, or
delivering a written notice to the contractor at the contractor's
place of business by midnight of the seventh business day after you
received a signed and dated copy of the contract that includes this
notice. Include your name, your address, and the date you received
the signed copy of the contract and this notice.
If you cancel, the contractor must return to you anything you paid
within 10 days of receiving the notice of cancellation. For your
part, you must make available to the contractor at your residence, in
substantially as good condition as you received it, any goods
delivered to you under this contract or sale. Or, you may, if you
wish, comply with the contractor's instructions on how to return the
goods at the contractor's expense and risk. If you do make the goods
available to the contractor and the contractor does not pick them up
within 20 days of the date of your notice of cancellation, you may
keep them without any further obligation. If you fail to make the
goods available to the contractor, or if you agree to return the
goods to the contractor and fail to do so, then you remain liable for
performance of all obligations under the contract."
(f) The seller shall provide the buyer with a copy of the contract
or offer to purchase and the attached notice of cancellation, and
shall inform the buyer orally of his or her right to cancel and the
requirement that cancellation be in writing, at the time the home
solicitation contract or offer is executed.
(g) Until the seller has complied with this section the buyer may
cancel the home solicitation contract or offer.
(h) "Contract or sale" as used in subdivision (c) means "home
solicitation contract or offer" as defined by Section 1689.5.
1689.8. (a) Every home solicitation contract or offer for home
improvement goods or services which provides for a lien on real
property is subject to the provisions of Chapter 1 (commencing with
Section 1801) of Title 2 of Part 4 of Division 3.
(b) For purposes of this section, "home improvement goods or
services" means goods and services, as defined in Section 1689.5,
which are bought in connection with the improvement of real property.
Such home improvement goods and services include, but are not
limited to, burglar alarms, carpeting, texture coating, fencing, air
conditioning or heating equipment, and termite extermination. Home
improvement goods include goods which, at the time of sale or
subsequently, are to be so affixed to real property as to become a
part of real property whether or not severable therefrom.
1689.9. Where the goods sold under any home solicitation contract
are so affixed to real property as to become a part thereof, whether
or not severable therefrom, the buyer shall not have the right to
cancel as provided in Section 1689.6 or Section 1689.7 if, subsequent
to his signing such contract, he has sold or encumbered such real
property to a bona fide purchaser or encumbrancer who was not a party
to such sale of goods or to any loan agreement in connection
therewith.
1689.10. (a) Except as provided in Sections 1689.6 to 1689.11,
inclusive, within 10 days after a home solicitation contract or offer
has been canceled, the seller must tender to the buyer any payments
made by the buyer and any note or other evidence of indebtedness.
(b) If the downpayment includes goods traded in, the goods must be
tendered in substantially as good condition as when received.
(c) Until the seller has complied with the obligations imposed by
Sections 1689.7 to 1689.11, inclusive, the buyer may retain
possession of goods delivered to him by the seller and has a lien on
the goods for any recovery to which he is entitled.
1689.11. (a) Except as provided in subdivision (c) of Section
1689.10, within 20 days after a home solicitation contract or offer
has been canceled, the buyer, upon demand, must tender to the seller
any goods delivered by the seller pursuant to the sale or offer, but
he is not obligated to tender at any place other than his own
address. If the seller fails to demand possession of goods within 20
days after cancellation, the goods become the property of the buyer
without obligation to pay for them.
(b) The buyer has a duty to take reasonable care of the goods in
his possession both prior to cancellation and during the 20-day
period following. During the 20-day period after cancellation, except
for the buyer's duty of care, the goods are at the seller's risk.
(c) If the seller has performed any services pursuant to a home
solicitation contract or offer prior to its cancellation, the seller
is entitled to no compensation. If the seller's services result in
the alteration of property of the buyer, the seller shall restore the
property to substantially as good condition as it was at the time
the services were rendered.
1689.12. Any waiver or confession of judgment of the provisions of
Sections 1689.5 to 1689.11, inclusive, shall be deemed contrary to
public policy and shall be void and unenforceable.
1689.13. Sections 1689.5, 1689.6, 1689.7, 1689.10, 1689.12, and
1689.14 do not apply to a contract that meets all of the following
requirements:
(a) The contract is initiated by the buyer or his or her agent or
insurance representative.
(b) The contract is executed in connection with making of
emergency or immediately necessary repairs that are necessary for the
immediate protection of persons or real or personal property.
(c) The buyer gives the seller a separate statement that is dated
and signed that describes the situation that requires immediate
remedy, and expressly acknowledges and waives the right to cancel the
sale within three or seven business days, whichever applies.
(d) This section shall become operative on January 1, 2006.
1689.14. (a) Any home solicitation contract or offer for the repair
or restoration of residential premises signed by the buyer on or
after the date on which a disaster causes damage to the residential
premises, but not later than midnight of the seventh business day
after this date, shall be void, unless the buyer or his or her agent
or insurance representative solicited the contract or offer at the
appropriate trade premises of the seller. Any contract covered by
this subdivision shall not be void if solicited by the buyer or his
or her agent or insurance representative regardless of where the
contract is made. For purposes of this section, buyer solicitation
includes a telephone call from the buyer to the appropriate trade
premises of the seller whether or not the call is in response to a
prior home solicitation.
(b) As used in this section and Section 1689.6, "disaster" means
an earthquake, flood, fire, hurricane, riot, storm, tidal wave, or
other similar sudden or catastrophic occurrence for which a state of
emergency has been declared by the President of the United States or
the Governor or for which a local emergency has been declared by the
executive officer or governing body of any city, county, or city and
county.
1689.15. Notwithstanding any other provision of law, a contractor
who is duly licensed pursuant to Chapter 9 (commencing with Section
7000) of Division 3 of the Business and Professions Code may commence
work on a service and repair project as soon as the buyer receives a
signed and dated copy of a service and repair contract that meets
all of the contract requirements specified in Section 7159.10 of the
Business and Professions Code. The buyer retains any right of
cancellation applicable to home solicitations under Sections 1689.5
to 1689.14, inclusive, until such time as the buyer receives a signed
and dated copy of a service and repair contract that meets all of
the contract requirements specified in Section 7159.10 of the
Business and Professions Code and the licensee in fact commences that
project, at which time any cancellation rights provided in Sections
1689.5 to 1689.14, inclusive, are extinguished by operation of law.
1689.20. (a) In addition to any other right to revoke an offer, the
buyer has the right to cancel a seminar sales solicitation contract
or offer until midnight of the third "business day" after the day on
which the buyer signs an agreement or offer to purchase which
complies with Section 1689.21.
(b) Cancellation occurs when the buyer gives written notice of
cancellation to the seller at the address specified in the agreement
or offer.
(c) Notice of cancellation, if given by mail, is effective when
deposited in the mail properly addressed with postage prepaid.
(d) Notice of cancellation given by the buyer need not take the
particular form as provided with the contract or offer to purchase
and, however expressed, is effective if it indicates the intention of
the buyer not to be bound by the seminar sales solicitation contract
or offer.
1689.21. (a) In a seminar sales solicitation contract or offer, the
buyer's agreement or offer to purchase shall be written in the same
language, e.g., Spanish, as principally used in the oral sales
presentation, shall be dated, signed by the buyer, and shall contain
in immediate proximity to the space reserved for his or her
signature, a conspicuous statement in a size equal to at least
10-point bold type, as follows: "You, the buyer, may cancel this
transaction at any time prior to midnight of the third business day
after the date of this transaction. See the attached notice of
cancellation form for an explanation of this right."
(b) The agreement or offer to purchase shall contain on the first
page, in a type size no smaller than that generally used in the body
of the document, each of the following:
(1) The name and address of the seller to which the notice is to
be mailed.
(2) The date the buyer signed the agreement or offer to purchase.
(c) The agreement or offer to purchase shall be accompanied by a
completed form in duplicate, captioned "Notice of Cancellation,"
which shall be attached to the agreement or offer to purchase and be
easily detachable, and which shall contain in type of at least
10-point, the following statement written in the same language, e.g.,
Spanish, as used in the contract:
"Notice of Cancellation"
/enter date of transaction/
________________
(Date)
You may cancel this transaction, without any penalty or
obligation, within three business days from the above date.
If you cancel, any property traded in, any payments made by you
under the contract or sale, and any negotiable instrument executed by
you will be returned within 10 days following receipt by the seller
of your cancellation notice, and any security interest arising out of
the transaction will be canceled.
If you cancel, you must make available to the seller at your
residence, in substantially as good condition as when received, any
goods delivered to you under this contract or sale, or you may, if
you wish, comply with the instructions of the seller regarding the
return shipment of the goods at the seller's expense and risk.
If you do make the goods available to the seller and the seller
does not pick them up within 20 days of the date of your notice of
cancellation, you may retain or dispose of the goods without any
further obligation. If you fail to make the goods available to the
seller, or if you agree to return the goods to the seller and fail to
do so, then you remain liable for performance of all obligations
under the contract.
To cancel this transaction, mail or deliver a signed and dated
copy of this cancellation notice, or any other written notice, or
send a telegram to
___________________ at ___________________________
/name of seller/ /Address of sellers
place of business/
not later than midnight of ______________________
(Date)
I hereby cancel this transaction _________________
(Date)
_______________________
(Buyer's signature)
(d) The seller shall provide the buyer with a copy of the contract
or offer to purchase and the attached notice of cancellation, and
shall inform the buyer orally of his or her right to cancel at the
time the seminar sales solicitation contract or offer is executed.
(e) Until the seller has complied with this section, the buyer may
cancel the seminar sales solicitation contract or offer.
(f) "Contract or sale" as used in subdivision (c), means "seminar
sales solicitation contract or offer" as defined by Section 1689.24.
1689.22. (a) Except as provided in Sections 1689.20 and 1689.21,
within 10 days after a seminar sales solicitation contract or offer
has been cancelled, the seller must tender to the buyer any payments
made by the buyer and any note or other evidence of indebtedness.
(b) If the downpayment includes goods traded in, the goods must be
tendered in substantially as good condition as when received.
(c) Until the seller has complied with the obligations imposed by
Sections 1689.20 and 1689.21, the buyer may retain possession of
goods delivered to him or her by the seller and has a lien on the
goods for any recovery to which he or she is entitled.
1689.23. (a) Except as provided in subdivision (c) of Section
1689.22, within 20 days after a seminar sales solicitation contract
or offer has been canceled, the buyer, upon demand, must tender to
the seller any goods delivered by the seller pursuant to the sale or
offer, but he or she is not obligated to tender at any place other
than his or her own address. If the seller fails to demand possession
of goods within 20 days after cancellation, the goods become the
property of the buyer without obligation to pay for them.
(b) The buyer has a duty to take reasonable care of the goods in
his or her possession, both prior to cancellation and during the
20-day period following. During the 20-day period after cancellation,
except for the buyer's duty of care, the goods are at the seller's
risk.
(c) If the seller has performed any services pursuant to a seminar
sales solicitation contract or offer prior to its cancellation, the
seller is entitled to no compensation. If the seller's services
result in the alteration of property of the buyer, the seller shall
restore the property to substantially as good condition as it was at
the time the services were rendered.
1689.24. As used in Sections 1689.20 to 1689.23, inclusive:
(a) "Seminar sales solicitation contract or offer" means any
contract, whether single or multiple, or any offer which is subject
to approval, for the sale, lease, or rental of goods or services or
both, made using selling techniques in a seminar setting in an amount
of twenty-five dollars ($25) or more, including any interest or
service charges. "Seminar sales solicitation contract" does not
include any contract under which the buyer has the right to rescind
pursuant to Title 1, Chapter 2, Section 125 of the Federal Consumer
Credit Protection Act (P.L. 90-321) and the regulations promulgated
pursuant thereto or any contract which contains a written and dated
statement signed by the prospective buyer stating that the
negotiation between the parties was initiated by the prospective
buyer.
(b) "Seminar setting" means premises other than the residence of
the buyer.
(c) "Goods" means tangible chattels bought for use primarily for
personal, family, or household purposes, including certificates or
coupons exchangeable for these goods, and including goods which, at
the time of the sale or subsequently, are to be so affixed to real
property as to become a part of the real property whether or not
severable therefrom, but does not include any vehicle required to be
registered under the Vehicle Code, nor any goods sold with a vehicle
if sold under a contract governed by Section 2982, and does not
include any mobilehome, as defined in Section 18008 of the Health and
Safety Code, nor any goods sold with a mobilehome if either are sold
under a contract subject to Section 18036.5 of the Health and Safety
Code.
(d) "Services" means work, labor and services, including, but not
limited to, services furnished in connection with the repair,
alteration, or improvement of residential premises, or services
furnished in connection with the sale or repair of goods as defined
in Section 1802.1, and courses of instruction, regardless of the
purpose for which they are taken, but does not include the services
of attorneys, real estate brokers and salesmen, securities dealers or
investment counselors, physicians, optometrists, or dentists, nor
financial services offered by banks, savings institutions, credit
unions, industrial loan companies, personal property brokers,
consumer finance lenders, or commercial finance lenders, organized
pursuant to state or federal law, which are not connected with the
sale of goods or services, as defined herein, nor the sale of
insurance which is not connected with the sale of goods or services
as defined herein, nor services in connection with the sale or
installation of mobilehomes or of goods sold with a mobilehome if
either are sold or installed under a contract subject to Section
18036.5 of the Health and Safety Code, nor services for which the
tariffs, rates, charges, costs, or expenses, including in each
instance the time sale price, is required by law to be filed with and
approved by the federal government or any official, department,
division, commission, or agency of the United States or of the State
of California.
(e) "Business day" means any calendar day except Sunday, or the
following business holidays: New Year's Day, Washington's Birthday,
Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans'
Day, Thanksgiving Day, and Christmas Day.
1690. A stipulation that errors of description shall not avoid a
contract, or shall be the subject of compensation, or both, does not
take away the right of rescission for fraud, nor for mistake, where
such mistake is in a matter essential to the inducement of the
contract, and is not capable of exact and entire compensation.
1691. Subject to Section 1693, to effect a rescission a party to
the contract must, promptly upon discovering the facts which entitle
him to rescind if he is free from duress, menace, undue influence or
disability and is aware of his right to rescind:
(a) Give notice of rescission to the party as to whom he rescinds;
and
(b) Restore to the other party everything of value which he has
received from him under the contract or offer to restore the same
upon condition that the other party do likewise, unless the latter is
unable or positively refuses to do so.
When notice of rescission has not otherwise been given or an offer
to restore the benefits received under the contract has not
otherwise been made, the service of a pleading in an action or
proceeding that seeks relief based on rescission shall be deemed to
be such notice or offer or both.
1692. When a contract has been rescinded in whole or in part, any
party to the contract may seek relief based upon such rescission by
(a) bringing an action to recover any money or thing owing to him by
any other party to the contract as a consequence of such rescission
or for any other relief to which he may be entitled under the
circumstances or (b) asserting such rescission by way of defense or
cross-complaint.
If in an action or proceeding a party seeks relief based upon
rescission and the court determines that the contract has not been
rescinded, the court may grant any party to the action any other
relief to which he may be entitled under the circumstances.
A claim for damages is not inconsistent with a claim for relief
based upon rescission. The aggrieved party shall be awarded complete
relief, including restitution of benefits, if any, conferred by him
as a result of the transaction and any consequential damages to which
he is entitled; but such relief shall not include duplicate or
inconsistent items of recovery.
If in an action or proceeding a party seeks relief based upon
rescission, the court may require the party to whom such relief is
granted to make any compensation to the other which justice may
require and may otherwise in its judgment adjust the equities between
the parties.
1693. When relief based upon rescission is claimed in an action or
proceeding, such relief shall not be denied because of delay in
giving notice of rescission unless such delay has been substantially
prejudicial to the other party.
A party who has received benefits by reason of a contract that is
subject to rescission and who in an action or proceeding seeks relief
based upon rescission shall not be denied relief because of a delay
in restoring or in tendering restoration of such benefits before
judgment unless such delay has been substantially prejudicial to the
other party; but the court may make a tender of restoration a
condition of its judgment.