Pasadena Municipal Code Ch. 5.60 Sales and Close-Outs

This chapter shall be known and cited as "the close-out sale ordinance."

(Ord. 4558 § 14, 1961)

For the purpose of this chapter, the following words and phrases shall have the meanings attributed to them as hereinafter provided.

A. "Advertise" means any and all means, whether verbal or written, used for conveying to the public, or any part thereof, notice of the conduct of a close-out sale, fire sale or bankruptcy sale, as defined herein, or notice of intention to conduct such sale.

B. "Bankruptcy sale" means any sale of, or offer to sell, to the public, or any part thereof, goods, wares or merchandise in stock which have been involved in any business failure or have been derived from any business which has been adjudicated bankrupt, has been closed, has been discontinued, has been liquidated or has been placed in receivership.

C. "Close-out sale" means any sale of, or offer to sell, to the public, or any part thereof, goods, wares or merchandise in stock, in furtherance of a declared purpose, as advertised, when the sale is anticipatory of or to avoid the termination, liquidation, revision, windup, discontinuance, removal, relocation, dissolution, closing or abandonment of a business conducted at any location.

D. "Fire sale" means any sale of, or offer to sell, to the public, or any part thereof, goods, wares or merchandise in stock which has been damaged as the result of contact with, or exposure to, fire, smoke or water.

E. "Permit" means a permit issued pursuant to this chapter.

F. "Permittee" means any person, firm, association or corporation to whom a permit has been issued pursuant to this chapter.

G. "Person" means any individual, firm, association, corporation or partnership, or the agent of any of the aforesaid.

H. The preceding subsections B, C and D shall apply to any and all sales advertised in such manner as to convey to the public, or to that portion of the public to which the advertising is directed, the belief that upon disposal of the goods to be placed on sale, the business or that portion thereof being conducted at any location will cease, be removed or relocated.

(Ord. 4558 § 1, 1961)

It is unlawful for any person to advertise or conduct a close-out sale, fire sale or bankruptcy sale, as herein defined, without first obtaining a permit therefor from the city assessor, tax and license collector of the city in the manner hereinafter provided.

(Ord. 4558 § 3, 1961)

The provisions of this chapter shall not apply to, or affect, the following persons:

A. Persons acting in their official capacities as public officials;

B. Persons acting pursuant to process issued by a court of competent jurisdiction;

C. Duly licensed auctioneers, selling at auction;

D. Any publisher of a newspaper, magazine or other periodical or publication, who publishes in good faith any advertisement without knowledge of its false, deceptive or misleading character, or without knowledge that compliance has not been had with the provisions of this chapter.

(Ord. 4558 § 4, 1961)

Any person who has held a sale, regulated hereunder, at the same location as stated in the application, within 1 year preceding the date of the application, shall not be granted a permit.

(Ord. 4558 § 5, 1961)

In the event a person, applying for a permit hereunder operates more than 1 place of business, any permit issued hereunder shall apply only to the 1 store for which application is made, and no other store or branch shall advertise or represent that it is cooperating with it, or in any way participating in the sale, nor shall the store at which such sale is conducted advertise or represent that any other store or branch is cooperating with it or participating in any way in such sale.

(Ord. 4558 § 6, 1961)

A. Any person desiring to advertise and conduct a sale regulated by this chapter shall make a written application therefor, under oath, accompanied by a fee in the sum of $335.40, to the city assessor, tax and license collector, hereinafter referred to as "license collector." The application shall state the following information:

1. The true name and address of the owner of the goods, wares or merchandise to be sold;

2. The true name and address of the person from whom the applicant purchased the goods, wares or merchandise to be sold and the price thereof, or, if not purchased, the manner of acquisition;

3. If applicable, the price at which the goods, wares or merchandise were offered for sale to the public immediately prior to such application;

4. The address of the place where such sale is to be conducted;

5. The nature of the occupancy of applicant at the place where the sale is to be conducted, whether by lease, sublease or otherwise, and the effective date of termination of such occupancy;

6. The date or dates when the sale is to be conducted;

7. A full and complete statement of the facts relating to the sale, including the reason for the urgent and expeditious disposal of goods, wares or merchandise thereby, and the manner in which the sale will be conducted;

8. The means proposed for advertising the sale, together with the proposed content of such advertising, if any;

9. An inventory of the goods, wares and merchandise to be offered for sale, together with the cost at which the same were obtained by the owner thereof or the person conducting the sale. The inventory shall describe all such goods, wares and merchandise listed in such inventory shall be described in detail by manufacturer's name and lot number, the number of articles so described, colors, sizes and other such information so that the identity of such goods with the goods listed on such inventory can be readily determined.

The application fee required by this section is in addition to any business license tax required by Chapters 5.04 through 5.16.

B. All goods included in such inventory shall have been purchased by the applicant for resale on bona fide orders without cancellation privileges, in the ordinary course of business, and shall not comprise goods held on consignment.

C. Such inventory shall not include goods, wares or merchandise ordered in expectation or contemplation of conducting a sale of the type regulated hereby. Any purchase, or additions to the stock of goods of the person applying for a permit hereunder within 60 days preceding the filing of an application for a permit hereunder, shall be presumed to be a purchase made in expectation or contemplation of a sale as herein regulated. Such presumption may be rebutted by evidence that such purchases or additions were not made in expectation or contemplation thereof.

D. Such inventory shall include only goods which are, at the time the inventory is taken and prepared, on the premises of the applicant and at the location where the sale is proposed to be conducted.

(Ord. 6113 § 26, 1985; Ord. 4558 § 7, 1961)

A. Upon the filing of the application for a permit as hereinabove provided, the city assessor, tax and license collector shall make or cause to be made such examination, audit or investigation of the applicant and his business, history and affairs in relation to the proposed sale as he deems necessary. If the city assessor, tax and license collector finds that the statements in the application are true, that the inventory is complete and accurate, that the advertising proposed to be used is not false, fraudulent, deceptive or misleading in any respect, that purported price reductions are bona fide, and that the methods proposed to be used by the applicant in conducting the sale are not such as, in his opinion, will work a fraud or deception upon prospective purchasers, he shall recommend the issuance to the applicant of a permit to conduct such sale in conformity with the provisions of this chapter; otherwise, he shall recommend a denial of the application. The city assessor, tax and license collector may also refuse to issue a permit to the applicant because of the insufficiency of the information set forth in the application, but in the event of a denial for insufficient information the city assessor, tax and license collector shall grant the applicant permission to file an amended application.

B. No permit shall be issued to any applicant who has been convicted of any crime involving fraud or moral turpitude within 5 years preceding the application. The license collector also may refuse to issue a permit to any person who has violated any provisions of any ordinance of the city regulating the conduct of sales of the type regulated by this chapter. Upon approval of the application by the license collector, the application and a report of the investigation made pursuant thereto shall be sent to the city manager for approval or disapproval. Upon approval of the application by the city manager, the license collector shall issue a permit. In no event shall the application fee specified in subsection A of Section 5.60.070 of this chapter be returned to the applicant.

(Ord. 6113 § 27, 1985; Ord. 4558 § 8, 1961)

Any permit issued hereunder shall be issued on the following terms:

A. The permit shall authorize the sale described in the application for a period not to exceed 30 consecutive calendar days. However, no such sale shall commence until 30 days have passed since the applicant has filed his inventory with the license collector. The license collector, with the approval of the city manager, may, upon application therefor accompanied by a renewal fee of $335.40, renew the permit for a period not to exceed 30 consecutive calendar days. Such application for renewal shall set forth a complete list of those goods, wares or merchandise listed in the original application which remain unsold. No goods, wares or merchandise not listed in the original application may be sold pursuant to any renewal permit. Upon receipt of such application for renewal, the license collector shall make or cause to be made an investigation at once and, if satisfied of the truth of the statements made in the application, shall refer the application and a report of the investigation to the city manager. Upon approval of the renewal application by the city manager, the license collector shall issue a renewal permit. Only one renewal permit may be issued. In no event shall the fee be returned to the renewal applicant.

B. The permit shall authorize only the 1 type of sale described in the application at the location therein described.

C. The permit shall authorize only the sale of the goods, wares or merchandise described in the inventory appended to the application.

D. Any permit or renewal thereof granted as herein provided shall not be assignable or transferable.

(Ord. 6113 § 28, 1985; Ord. 4558 § 9, 1961)

Any applicant to whom a permit is to be issued under the provisions of this chapter shall submit to the city assessor, tax and license collector a corporate surety bond satisfactory to the city, payable to the city, in the penal sum of $1,000.00 conditioned upon compliance with the provisions of this chapter. No permit shall be issued unless and until such bond has been filed with said officer of city.

(Ord. 4558 § 10, 1961)

A. A permittee hereunder shall:

1. Make no additions or substitutions whatever to or of the stock of goods, wares or merchandise described in the inventory attached to the application for a permit during the period subsequent to the filing of the inventory and prior to the termination of any sale or renewal thereof herein authorized;

2. Refrain from any false, deceptive or misleading advertising;

3. Conduct such sale in strict conformity to any advertising or holding out relating thereto;

4. Keep available at the place of sale a duplicate copy of the inventory to the application, for presentation thereof to inspecting officials upon request therefor;

B. At the close of business each day the stock inventory shall be revised and made current. Items on such list disposed of during such day shall be noted thereon. Suitable books and records as prescribed by the city assessor, tax and license collector shall be kept by the permittee and shall be open at all times to inspection by the city assessor, tax and license collector, or his authorized representatives.

(Ord. 4558 § 11, 1961)

No goods, wares or merchandise shall be offered for sale at the place of business where such sale is to be conducted other than those items listed in the inventory filed with the application for the permit.

(Ord. 4558 § 12, 1961)

The city assessor, tax and license collector and the chief of police, or their authorized representatives shall have the power to revoke at any time any permit granted in accordance with the provisions of this chapter whenever any such sale is being conducted in violation of any of the provisions of this chapter; or in such a manner as to deceive or defraud the public; or if:

A. The holder of any such permit has made any material misstatement in the application for such permit;

B. The holder of any such permit has been guilty of any fraudulent practice or practices in the conduct of the sale authorized by such permit;

C. The holder of any such permit has failed to inventory all the goods, wares or merchandise offered for sale pursuant to such permit;

D. The holder of any such permit has added, or caused or permitted to be added any goods, wares or merchandise not described in the original inventory, and has offered such additions for sale under such permit;

E. The holder of any such permit has violated any of the provisions contained in this chapter.

(Ord. 4558 § 13, 1961)

It is unlawful for any person to advertise or otherwise represent to the public, or any part thereof, in any manner a reduction in price of any goods, wares, merchandise, service, facility or accommodation, whether such price reduction is represented in complete price figures or by percentage reduction unless the price from which the reduction is calculated is the price customarily charged by applicant for the goods, wares, merchandise, service, facility or accommodation so offered to the public.

(Ord. 4558 § 2, 1961)

Any person, association or corporation violating any of the provisions of this chapter is deemed guilty of a misdemeanor and upon conviction thereof is punishable by a fine of not more than $500.00, or by imprisonment in the city jail for a period of not more than 6 months, or by both such fine and imprisonment. Each such person, is guilty of a separate offense for every day during any portion of which any violation of any provision of this chapter is committed, continued or permitted by such person, and shall be punishable therefor as provided in this chapter.

(Ord. 4558 § 16, 1961).