TRADING STAMPS ‑- REDEEMABLE IN CASH OR CREDIT TOWARD THE PURCHASE OF INSURANCE ‑- INSURANCE ‑- USE OF TRADING STAMPS TOWARD PURCHASE OF INSURANCE

TRADING STAMPS ‑- REDEEMABLE IN CASH OR CREDIT TOWARD THE PURCHASE OF INSURANCE ‑-INSURANCE ‑- USE OF TRADING STAMPS TOWARD PURCHASE OF INSURANCE.

(1) Trading stamps which may be redeemable in cash or for credit toward the purchase of any type insurance are covered by the trading stamp act, chapter 19.84 RCW.

(2) Such trading stamps do not come within the licensing provisions of chapter 36.91 RCW.

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                                                                 August 20, 1958

Honorable Frank Connor
State Senator, 33rd District
408 20th South
Seattle 44, Washington                                                                                           Cite as:  AGO 57-58 No. 215

Dear Sir:

            You have requested the opinion of this office on the following questions:

            (1) Do insurance trading stamps which may be redeemable in cash or for credit toward the purchase of any type insurance come within the provisions of RCW chapter 19.84?

            (2) Must such trading stamps be licensed under RCW chapter 36.91?

            We answer your first question in the affirmative and the second question in the negative.

                                                                     ANALYSIS

            Briefly the facts presented are as follows: The stamps will be distributed by various retail outlets, upon the basis of one stamp for every ten cents of purchase, and books will be provided to the recipients for collecting and redeeming them.  The stamps are to be redeemable in cash or in credit toward the purchase of any type insurance.

             [[Orig. Op. Page 2]]

            When redeemed these stamps entitle recipients to a "cashier's check" made payable to the holder and to the insurance company designated by him; or, if the holder desires, he will receive the cash value instead.  Redemption will be made available either at the store of purchase, the neighborhood bank, the trustee bank or the home office of the company conducting the program.

            In answer to your first question, the provisions of RCW chapter 19.84 apply to any trading stamp or similar device "which will entitle the holder thereof, on presentation thereof, either singly or in definite number, to receive, either directly from the vendor or indirectly through any other person, money or goods, wares or merchandise."

            While there is some doubt as to whether insurance would be considered "goods, wares or merchandise" within the meaning of the above statutes, the determination of that question is not necessary here.  The stamps in question will be redeemable in money, and therefore would fall within the alternate provisions of the chapter.  They are, therefore, subject to the following requirements:

            (1) Each must have printed or written upon its face its redeemable value in cents.  (RCW 19.84.010.)

            (2) They must be redeemable in money or in goods, wares or merchandise at the option of the holder, at the value in cents printed upon the face thereof.

            (3) It shall not be necessary for the holder thereof to have any stipulated number of the same before demand for redemption may be made and granted.  (RCW 19.84.020 and 19.84.030.)

            In answer to your second question, the provisions of RCW 36.91.010,et seq. requiring licenses for the use, furnishing, or selling of trading stamps, refer only to devices "which entitle the purchaser to procure anygoods free of charge or for less than the retail market price thereof," as distinguished from the phrase "money or goods, wares or merchandise" used throughout the earlier chapter.  The term "goods" has a more restrictive meaning than "goods, wares or merchandise," and does not include choses in action, generally.  Utica Carting Storage and Contracting Co., Inc. v. World Fire and Marine Ins. Co. Inc., 100 N.Y.S. (2d) 941; Basset v. City of Boston, 226 Mass. 64, 114 N.E. 1035.  An insurance contract is uniformly held to be a "chose in action."  See Vol. 7, Words & Phrases, p. 175; also, Glasford v. Baker, 1 Wash. Ter. 224, 226.

             [[Orig. Op. Page 3]]

            Following the rule stated above, on the construction of penal statutes, we conclude that in using the word "goods" only, as distinguished from the phrase "money or goods, wares or merchandise," the legislature has excluded from the licensing provisions of chapter 36.91 RCW trading stamps redeemable in money or in choses of action, such as policies of insurance.

            We trust that this information will be of assistance to you.

Very truly yours,

JOHN J. O'CONNELL
Attorney General

ROBERT F. HAUTH
Assistant Attorney General