Request By:
Richard E. Akers, Administrator
Department of Consumer Protection
Jefferson County Public Protection
and Regulation Cabinet
527 West Jefferson Street
Louisville, KY 40202-2816
Opinion
Opinion By: Steven L. Beshear, Attorney General; By: Kathleen F. Beyer, Assistant Attorney General
You request the opinion of this office regarding the definition of the term "business day" as it appears in Kentucky's new Buying Club Law (KRS 367.395-407) and in the Kentucky Home Solicitation Sales Law (KRS 367.410-460).
Kentucky's new law regulating the practices of buying clubs provides at KRS 367.397 that:
(1) Any person who has elected to become a member of a club may cancel such membership by:
(a) Giving written notice any time before midnight of the fifth business day following the date on which membership was attained. (Emphasis added.)
Similarly, the Home Solicitation Sales Act provides a "cooling-off period" for buyers who purchase goods from door-to-door salesmen. KRS 367.420 reads as follows:
(1) Except as provided in subsection (5), in addition to any right otherwise to revoke an offer, the buyer has the right to cancel a home solicitation sale until midnight of the third business day after the day on which the buyer signs an agreement or offer to purchase which complies with this part. (Emphasis added.)
Specifically, you ask whether, since neither statute cited above defines the term "business day," one may assume that Saturday is considered to be a "business day" as defined in the Federal Trade Commission's Rule on the Cooling-Off Period for Door-to-Door Sales, 16 C.F.R. § 429 (1981).
The FTC rule referred to has the force and effect of federal law, and is similar to the Kentucky Home Solicitation Sales Act in the protection it affords to consumers. The rule requires a door-to-door salesman to provide the buyer with a conspicuous notice on the contract of sale which states that the buyer is entitled to cancel the transaction at any time prior to midnight of the third business day after the date of the transaction. Note 1 of the rule defines the term "business day" as follows:
(f) Business day-Any calendar day except Sunday or the following business holidays: New Year's Day, Washington's Birthday, Memorial Day, Independence Day, Labor Day, Columbus Day, Veteran's Day, Thanksgiving Day, and Christmas Day.
Thus, the FTC rule includes Saturday as a business day for purposes of cancellation of a home solicitation sale. Since the Kentucky Home Solicitation Sales Act provides no definition of business day, we believe that compliance with the federal rule in this regard constitutes compliance with KRS 367.410 - 460. (See OAG 74-729 in which this office expressed the opinion that compliance by a business with the notice provision of the FTC rule involving home solicitations would be interpreted by Kentucky courts to be in substantial compliance with the notice requirement of the Kentucky Home Solicitation Sales Act. )
Unlike the FTC rule discussed above, there is no federal law or regulation directly analogous to Kentucky's Buying Club Law, KRS 367.395-407. Since the term "business day" is not defined in Kentucky's law, we are forced to turn to the common sense meaning of the term, and to examine other related laws which have defined the phrase.
Common sense and plain meaning dictate that a "business day" is a day on which a company or other business entity is open for business or conducts business. However, we feel it safe to say that a certain amount, or type, of business must be conducted on a given day in order to qualify it as a "business day," absent a statutory definition. In our opinion, certain factors to be considered would be whether and for how many hours the business' offices were open to the public on that day, whether normal office functions were being conducted, etc.
Regulation Z, the implementing regulation of the Federal Truth-In-Lending Act (15 U.S.C. 1601, et seq.), defines "business day" for purposes of providing consumers with rights of rescission in certain credit transactions, in the same manner as does the FTC rule discussed above, i.e. as including all calendar days except Sundays and legal holidays. However, for other purposes it defines the term in the following way:
(6) "Business day" means a day on which a creditor's offices are open to the public for carrying on substantially all of its business functions. [§ 226.2(a)(6)]
It is our opinion that this definition could apply to a determination of whether a given day is a "business day" for any business, and that for purposes of the Kentucky Buying Club Law, a factual determination must be made on a case-by-case basis to determine whether Saturday is indeed a "business day" for a company.