Daly City Municipal Code Ch. 5.38 Closing-Out Sales

It is unlawful for any person, firm or corporation to sell, offer for sale, or expose for sale a stock of merchandise where the owner thereof or the creditors of the owners represent to the public that they are engaged in the closing-out of the owner's business.

(Ord. 893 § 1, 1978: prior code § 5-10)

A. The provisions of Section 5.38.010 shall not apply to any bona fide sale of a stock of merchandise where the owner thereof or the creditors of the owner are engaged in a legitimate and final closing-out of the business, and such sale is on the premises where the business has been carried on for not less than one year immediately preceding such sale; provided, however, that no closing-out sale shall be conducted under the provisions of this section unless a permit is first obtained from the chief of police.

B. If the chief of police finds and determines that the sale and the business proposed to be closed out meet all the requirements of subsection (A) of this section, he shall grant the permit applied for.

C. If the chief of police finds that the owner has not carried on the business on the same premises for a period of one year immediately preceding the sale, but that the owner has continuously conducted the same business in the city for a period of not less than one year immediately preceding the sale and that the other requirements of subsection A of this section are satisfied, he may, within his discretion, grant the said permit.

D. The chief of police may designate the number of days that the closing-out sale may be conducted, and in no case shall the sale be advertised and represented as a closing-out sale for a period longer than ninety calendar days at any time; provided, that in no event shall any stock of merchandise be offered for sale or sold at the closing-out sale unless the same has been upon the premises of the owner for a period of not less than ninety days prior to filing of the application for the permit.

(Ord. 893 § 2, 1978: prior code § 5-11)

A. In all cases where a closing-out sale is held under the provisions of Section 5.38.020, an inventory of the stock of merchandise on the premises which is to be sold at the closing-out sale must be made and submitted to the chief of police at the time of the filing of the application for a permit to conduct the sale.

B. The inventory required by this section must show the items of merchandise contained in the stock to be offered for sale on the premises at the closing-out sale, and the applicant must make and subscribe an oath to be attached to the inventory that the inventory contains a true and itemized account of all property to be sold at the closing-out sale, that all of the merchandise so inventoried has been located on the premises for not less than ninety days immediately preceding the filing of the application, and that the same is a bona fide closing-out of the business. No property or merchandise shall be sold under the provisions of Section 5.38.020 except those items shown in the inventory provided for in this section.

C. Upon termination of the closing-out sale, whether at or prior to the termination of the permissible period prescribed in the permit issued under the provisions of Section 5.38.020, the permittee shall forward to the chief of police by mail or otherwise an itemized account of all sales made during the period. This itemized statement shall be subscribed by the permittee, and it is unlawful for any permittee to submit any false or fraudulent itemized statement to the chief of police.

(Ord. 893 § 3, 1978: prior code § 5-12)

A nonrefundable fee plus a percent of the gross retail value of the entire stock of merchandise on hand, as fixed by resolution of the city council, will be charged by the police department for a permit described in Section 5.38.020, for the closing-out sale at the time of application for such permit, whether the sale is to be conducted by auction or otherwise.

(Ord. 1146 § 8, 1991: Ord. 893 § 4, 1978: prior code § 5-12.1)

The provisions of Sections 5.38.010 through 5.38.030 shall not apply to the sale of a stock of merchandise in bulk by an assignee or trustee acting under a bona fide assignment for the benefit of creditors. For the purposes of this section, a sale "in bulk" is defined as a sale of all or a substantial part of a stock of merchandise to a single purchaser.

(Ord. 893 § 5, 1978: prior code § 5-13)

All advertisements, whether by newspaper, throw-away flier, or posting on windows concerning the sale, must contain the name of the owner or the name of the business which is having the closing-out sale.

(Ord. 893 § 6, 1978: prior code § 5-14)