In April 2016, the Maryland Legislature enacted important changes and modifications to the laws affecting Maryland home improvement contractors. The new legislation, which was signed into law by Governor Larry Hogan on May 10, 2016, makes significant changes to what is commonly known as the “Door-to-Door Sales Act,” a consumer protection law enacted to protect homeowners from high pressure sales. The changes affect almost all Maryland home improvement sales in the State of Maryland and therefore warrant immediate attention.
Prior to the new legislation, the Maryland Door-to-Door Sales Act afforded homeowners a three-day right to cancel a home improvement contract. This three-day right of rescission mirrored the “Cooling-Off Rule,” the federal version of the Maryland Door-to-Door Sales Act. The new Maryland legislation extends the rescission period from three days to five days, and therefore goes beyond the protections afforded by the Cooling-Off Rule. In addition, the new legislation affords homeowners over the age of 65 with seven days to cancel their contracts. The new deadlines must be explained in home improvement contracts, along with specific notice language required by the law.
The new legislation also requires other modifications to home improvement contracts and the accompanying notices. For example, while the old law required two “Notices of Cancellation” to be “easily detachable” from the contract, the new law requires that the Notices of Cancellation be on separate forms that are not a part of the contract. Additionally, the new law requires that all home improvement contracts include a special acknowledgment by homeowners confirming they have received oral notice of their rescission rights. Finally, for those contractors who engage in emergency services, the new law also makes changes to any waiver forms presented to homeowners at the time of the emergency.
The new legislation goes into effect on June 1, 2016. Home improvement contractors should immediately begin reviewing their contracts for compliance to avoid missing this deadline. Failure to follow the correct procedures can result in criminal and civil liability under Maryland’s consumer protection laws, including those laws governing unfair and deceptive trade practices.
ABOUT BRIAN LOFFREDO
Brian is a commercial litigator with more than fifteen years of experience representing clients in the franchise industry. Brian routinely assists clients during the licensing and franchise/FDD review process, as well as with the resolution of franchise-related disputes, including those involving terminations, territorial disputes, fraud, disclosure/relationship law violations and breaches of contract.
In addition, Brian represents and counsels clients in the construction industry on matters involving litigation, construction defects, licensing and compliance, collections, mechanic’s liens, payment bond and Miller Act claims, contract drafting, and compliance with home improvement laws and other construction industry laws.
Brian also has extensive experience representing financial institutions with workouts, collections and residential / commercial foreclosures.
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