Previously posted by Eric
Hopefully some of the owners, even those that opt out - run away - will still be able to file complaints with the AG based on MGL 93A Consumer Protection -
Chapter 93A: Section 2. Unfair practices; legislative intent; rules and regulations
Section 2. (a) Unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful. (includes fraud, deceit, misrepresentation of facts, pressure sales tactics)
RE04R08: Chapter 93A, Consumer Protection and Business Regulation for Real Estate Brokers and Salespersons
V. ILLEGAL PRACTICES UNDER 93A
A. Fraudulent or willful intent need not be proven.
B. Heightens licensee responsibility for statements and omissions
C. Licensees responsible for everything they know
D. Grey area of responsibility is what a licensee should have known
E. "Puffing’ is now illegal. 93A does not distinguish between opinion and fact.
F. Other illegal actions and misrepresentations
1. Any oppressive or otherwise unconscionable act or statement
2. Failure to comply with laws meant for the protection of the public's health, safety or welfare
3. Fraud or misrepresentation such as misstatements of facts in negotiations that lead to a contract
4. Seller provides a licensee false information and licensee relates this to buyer, without identifying seller as licensee's sole source of information, then broker is liable.
5. Making false claims about a property's construction, durability, safety or strength
6. Making false claims concerning the ease with which a property can be repaired or maintained
7. Making false claims about financing terms or availability
8. Substituting something different than what is advertised ("bait and switch")
9. Offering guarantees without disclosing the nature and extent of the guarantees
10. A broker may be held liable for a misstatement in advertising even if the broker later informs a prospective buyer of the error.
11. Claims or representations concerning any real or personal property which directly, or by omission, serves to deceive a buyer in any material respect.
12. Failing to disclose to a tenant or prospective tenant any fact that may have influenced the tenant not to enter into the transaction
13. Even though the true facts are subsequently made known to the buyer, the law is violated if the first contact or interview is secured by deception.
G. Generally, a violation of M.G.L. c. 142A (Regulation of Home Improvement Contractors) is automatically a violation of M.G.L. c. 93A,
"A practice may be deceptive if it reasonably could be found to have caused the plaintiff to act differently than he otherwise would have acted...."
"It is an unfair and deceptive act under Chapter 93A for real estate sellers to affirmatively misrepresent the truth if they are aware of it."
Fraudulent acts include false advertising; high-pressure sales tactics; “bait and switch schemes” (where one product or service is offered but another actually delivered); billing fraud, and use of contract language that misleads consumers.
The Law
Both Massachusetts and United States laws prohibit the use of "unfair or deceptive" practices by businesses. These practices are regulated by the Federal Trade Commission at the federal level and by the Attorney General's Office of Consumer Protection at the state level.
Both the federal and state laws prohibit a series of specific practices and, in addition, prohibit any other practice that is determined to be unfair or deceptive to the consumer. These laws typically provide both for enforcement by the government to stop the practice and individual actions for damages brought by consumers who are hurt by the practices. This article will describe the kinds of actions that are prohibited by these laws and how consumers can use these laws to their advantage.
Who is covered by the law?
The Massachusetts Act limits coverage to unfair and deceptive acts "in the conduct of trade or commerce." This means that to be covered, the person committing the unfair or deceptive act must be in business. Sales between two private individuals, neither of whom are in the business of regularly selling are generally not covered by the Act. Therefore, a sale of a used car by the owner of the car wouldn't be covered if the owner is not otherwise a car dealer. Other than this basic category of exceptions, however, the law applies very broadly to most commercial transactions including real estate rentals and sales, to service businesses, and to any type of commercial sale of goods.
The Massachusetts law is also limited in its coverage of phone solicitations and other kinds of transactions that involve out of state sellers. These kinds of transactions are covered by the Federal law because they involve actions in more than one state. The federal law is very much like the state one and generally prohibits the same.
Unfair and Deceptive practices are just what they sound like. They take place when someone in the position of a seller acts unfairly to or deceives a buyer. In Massachusetts the common types of unfairness and deception are specifically prohibited by Attorney General regulations but even if not mentioned specifically in the regulations, any other act that meets this definition is unlawful. In deciding whether a practice not specifically mentioned in the law is illegal, the courts consider whether it violates some established concept of fairness, whether it is immoral or unethical, whether it is likely to cause substantial harm to consumers and whether it is dishonest and/or violates the general notion of fair dealing between sellers and buyers.
Some Examples of Unfair or Deceptive Practices
Massachusetts regulations provide some specific examples of actions that are considered unfair and deceptive. Below are some examples of these actions:
False advertising and other misrepresentations - advertising and statements which have the tendency to mislead are illegal. These include:
actual false statement in advertisements about a products quality, ingredients, or effectiveness
fake testimonials and endorsements
pictures of the wrong merchandise in ads trying to sell some other item that imply the picture is of the item being sold
faked pictures of the product performing in a way that it cannot actually perform
Use of prices in ads that are not the real price of the merchandise described or pictured
Advertising sale items that are not actually available to convince people to visit the sellers store or business or sending flyers with some sale items and some sale items where the actual items that are on sale are not clearly identified.
"Bait and Switch" advertising - this is a technique by which the seller advertises an item for sale at a particularly good price or on particularly good terms but does not really want to sell that item. When the consumer comes to their business after seeing the advertisement the seller discourages the purchase of the advertised item and instead tries to convince the buyer to purchase a different item for a higher price or on less favorable terms. The seller's techniques for discouraging the purchase of the object can vary and can include refusing to demonstrate, show or discuss the advertised item, representing that the item is not a good product or it has a poor guarantee or doesn't work properly, demonstrating a defective or poorly performing example of the product, and failing to have the item available to purchase (unless the advertising accurately and clearly stated the limitations on availability).
Deceptive statements of guarantees in advertisements - the statement must identify the nature of the guarantee and who is offering it (the manufacturer, the seller or someone else), what parts of the product are covered and what is required of the consumer to make a claim under the guarantee.
If an ad says that a product is "unconditionally guaranteed" or says "satisfaction or your money back" or words to that effect, the use of the term is deceptive unless the seller will refund the full purchase price, replace the product or repair the product and the BUYER has the right to choose which of these alternatives he or she wants.
Deceptive Pricing Practices - The law also regulates the use of price representations and practices. Below are some of the common pricing practices that the law prohibits:
Claiming that the item is on sale by artificially and untruthfully pretending the product usually sells for a price higher than its normal price. The price represented to be the products "regular" price must be a real price that the product in fact sold for during some significant time in the recent past in the seller's own stores.
Misrepresenting the price that the same product is sold at by competitors
Placing fake price stickers on merchandise with higher than actual prices so that the product appears to be marked down when in fact it isn't
Claiming that a product may be purchased for one price when in fact the actual price is higher
Advertising an item at a very good price to induce customers to come in and then only selling the item at that price if the purchaser also buys another more expensive product.
Using the terms "special price" or "priced for sale" or "clearance priced" or similar terms when the items are not being sold at reduced prices and without clearly disclosing the actual former price or the percentage reduction from the former price that is actually being offered.
Charging for good or services at higher rates than the marked, published or advertised price;
Giving an unrealistically low estimate for a job in order to get it and then charging for a variety of "extras" to increase the price of the job when those extras should clearly have been included in the regular price of the job.
This is by no means a complete list - these are only examples of the kinds of conduct that are covered. If you think the average person would consider a practice unfair or deceptive, it probably is.