Rhode Island § 5-50-7 - Health Clubs

§ 5-50-7. Pre-opening sales — Permit and bond required — Facilities unopened — Under construction and planned.

(a) Any health club that is not fully operative or established and that conducts a pre-opening sales campaign must, before advertising or hold a pre-opening sales campaign, obtain a permit from the director of business regulation. The permit shall not be issued until a surety bond is posted in the amount stipulated in § 5-50-3.

(b) Any person, firm, corporation, or other entity intending to offer health club services at a facility under construction or planned shall register as required by § 5-50-2 before opening for business, entering into any contracts, or accepting any fees and shall maintain a surety bond as required by § 5-50-3.

(c)(1) A health club shall not enter into a contract with a buyer more than twelve (12) months prior to the intended opening of the health club.

(2) A buyer shall be entitled to a full refund from an unopened seller as provided in § 5-50-4(d).

(3) When the facility is substantially completed and fully operational and available for use, the seller shall mail or personally deliver to each buyer a written notice informing the buyer that:

(i) The facility is available for inspection and use; and

(ii) The buyer has fifteen (15) days after the date of the mailing of the notice to inspect the facility and determine whether it substantially conforms to the written contract, any written materials provided by the seller, or any advertisement by the seller.

(4) If it is found that the facilities do not conform, the buyer may cancel by giving notice to the seller in person or by mail and the buyer shall receive a full refund.

(5) If upon reasonable investigation the buyer ascertains that the promised facility was not open and available for use within sixty (60) days after the date promised, and no substantial work was performed to prepare the facility for opening for a period of more than thirty (30) days thereafter, the buyer may request a refund from the seller and the buyer shall receive a full refund.

(d) The director of the department of business regulation may promulgate rules and regulations as may be necessary to carry out the provisions of this section.