(a) False, misleading, or deceptive acts or practices, including, but not limited to those listed in this chapter, are hereby declared unlawful and are subject to action by the Attorney General or any person as permitted pursuant to this chapter or other provisions of Guam law. A violation consisting of any act prohibited by this title is in itself actionable, and may be the basis for damages, rescission, or equitable relief. The provisions of this chapter are to be liberally construed in favor of the consumer, balanced with substantial justice, and violation of such provisions may be raised as a claim, defense, crossclaim or counterclaim.

(b) The term false, misleading, or deceptive acts or practices includes, but is not limited to, the following acts by any person or merchant, which acts are hereby prohibited and declared illegal and contrary to public policy if committed by any person or merchant:

(1) Passing off goods or services as those of another; or

(2) Causing confusion or misunderstanding as to the source, sponsorship, approval or certification of goods or services; or

(3) Causing confusion or misunderstanding as to affiliation, connection, or association with, or certification by, another; or

(4) Using deceptive representations or designations of geographic origin in connection with goods or services; or

(5) Representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities which they do not have or that a person has a sponsorship, approval, status, affiliation, or connection which he does not; or

(6) Representing that goods are original or new if the goods are deteriorated or used:

(A) Motor vehicles shall be considered new or used based on the definitions of new and used motor vehicles as defined by the U.S. Federal Trade Commission; or
(7) In selling or attempting to sell goods or services by making statements; or representations in violation of §§ 40120 or 40121, Title 10, Guam Code Annotated, or false
medical claims or false health claims; or

(8) Representing by statements of fact that consumer goods or consumer services offered for sale have a grossly inflated value which the seller knows to be false and which is not based on the true retail value of the goods or services or comparables. Merely marking a grossly inflated price on an item or requesting a grossly inflated price is not by itself a violation of this subsection; or

(9) Knowingly billing a consumer for goods or services knowing that the consumer has already paid the amounts billed; or

(10) Charging or attempting to charge a consumer for goods or services not provided or not to be provided; or

(11) Charging or attempting to charge a consumer who has previously contracted to buy goods or services additional charges, including taxes, not previously agreed to in the contract as a condition of performance; or

(12) Knowingly representing that an agreement confers or involves rights, remedies, or obligations which it does not have or involve, or which are prohibited by law when the person making the representations knows such representations to be false; or

(13) Knowingly misrepresenting the authority of a salesman, representative or agent to negotiate the final terms of a consumer transaction; or

(14) Disconnecting, turning back, or resetting the odometer of any motor vehicle so as to reduce the number of miles indicated on the odometer gauge; or

(15) Selling or offering to sell, either directly or associated with the sale of goods or services, a right of participation in a multi-level distributorship. As used herein, multi-level distributorship means a sales plan for the distribution of goods or services in which promises of rebateor payment are made to individuals, conditioned upon those individuals recommending or securing additional individuals to assume positions in the sales operation, and where the rebate or payment is not exclusively conditioned on or in relation to proceeds from the retail sales of goods, provided that nothing herein shall prohibit the sale of a sales or presentation kit to prospective salespersons for Five Hundred Dollars ($500) or less; provided, that the kit is sold at not more than the actual cost to the seller, that no commission is paid on the sale of the kit, and that a full refund (less any demonstration products used) is offered to the buyer for thirty (30) days after the delivery of the kit if the buyer returns the kit to the seller, whether or not the kit is used; and provided further that if the kit was purchased on Guam the kit can be returned to a location in Guam and the refund immediately collected thereat and if purchased off-island can be returned to the place of purchase for the refund; or

(16) Representing that work or services have been performed on, or parts replaced in, goods when the work or services were not performed or the parts replaced; all replaced parts must be given to the consumer who may, if he chooses, return such replaced parts to the repairer for rebuilding; or

(17) Using the term corporation, incorporated, limited, or an abbreviation of any of those terms in the name of a business entity that is not incorporated under the laws of Guam or other jurisdiction; or

(18) Retaining deposits for goods and services without actually delivering the goods or services as promised and after a written demand for immediate performance or refund has been made by the consumer; or

(19) Accepting a deposit (including money taken for a reservation) by a developer or merchant from a purchaser of land, building (including homes) or condominium unit without first fixing in a written contract a firm dollar price for the land, building, or condominium, which writing shall be enforceable against the buyer and the seller. Any such deposit must be placed in escrow in a interest bearing accountwith a duly licensed title insurance company or bank, with the interest to the credit of the purchaser. If a deposit is taken in violation of this subsection for the purchase of land, building, or condominium, the purchaser may at his option revoke the transaction with penalty as provided below or at his request the court may order specific performance of the contract at a price the same as the court finds the seller paid to purchase or acquire the land plus one-half (1/2) of any increase in the fair market value of the land as of the time the deposit was accepted, plus the actual costs of constructing any building or condominium unit on the land, exclusive of administrative costs, sales costs, and administrative overhead. In the alternative, in the event of a violation of this subsection, at the sole option of the consumer, the consumer may revoke the transaction and shall be entitled to a refund of three (3) times the amount of deposit and all other sums paid to the seller; or

(20) Knowingly selling or offering to sell goods to any person which the seller has no right to sell or goods for which the seller cannot deliver clear title to the person as agreed. Nothing herein shall prevent the sale of goods which are subject to liens and encumbrances if revealed in writing to the buyer at or before the time of sale. Nothing in this chapter shall excuse compliance with the Bulk Sales Act; or

(21) Knowingly misrepresenting to a purchaser that goods are immediately available for delivery. Unless a contract or receipt provides otherwise, goods must be delivered to the consumer within fourteen (14) days of the payment therefor; or

(22) Knowingly selling or offering to sell goods or services which the seller thereof is not licensed to sell or offer for sale; or

(23) Knowingly selling or offering to sell services which the seller thereof is not capable of providing; or

(24) Knowingly selling or offering to sell goods which the seller thereof does not have and cannot reasonably obtain for delivery to the consumer in a reasonable time; or
(25) Knowingly making false statements of fact as to the results of purchasing or using goods or services; or

(26) Threatening economic retaliation or physical damage to any person or to any person’s property if goods or services are not purchased; or

(27) Violating any rule or regulation of the U.S. Federal
Trade Commission; or

(28) Violating any rule or regulation of the U.S. Food and Drug Administration; or

(29) Doing any other act which is prohibited by the laws of Guam to mislead a consumer to his detriment or to induce another person to buy or sell goods or services to such person’s detriment.

(c) The term false, misleading, or deceptive acts or practices includes, but is not limited to, the following acts committed by merchants. The following acts are hereby prohibited and declared illegal and contrary to public policy when done by any merchant:

(1) Knowingly representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or mode, if they are of another; or

(2) Disparaging the goods, services, or business of another by false or grossly misleading representation of facts; or

(3) Advertising goods or services with intent not to sell them as advertised; or

(4) (“Bait and switch” prohibited) Advertising goods or services with intent not to sell them as advertised, but rather to induce a consumer into purchasing similar but more expensive goods or services; or

(5) Advertising goods or services with intent not to supply a reasonably expectable public demand, unless the advertisements disclose a limitation of quantity; or

(6) Making false or misleading statements of fact concerning the reasons for, existence of, or amount of price
reductions; provided, that nothing herein shall prohibit a “sale”, clearance sale, seasonal or holiday sale, or a sale based on reasons which are not misleading and which do not falsely imply a distressed or forced sale; or

(7) Inducing consumers into a business establishment by offering free gifts as an inducement to enter the establishment and then refusing to give such free gifts as promised; or

(8) Falsely stating that one is selling or liquidating goods which are distressed, damaged or misrouted when the goods are not distressed, damaged, or misrouted; or

(9) Failing or refusing to apply against the purchase price of goods or services a deposit made by the consumer; or

(10) Advertising any sale by fraudulently representing that a person is going out of business; or

(11) Basing a charge for the repair of any item in whole or in part on a guaranty or warranty instead of on the value of the actual repairs made or work to be performed on the item without stating separately the charges for the work and the charge for the warranty or guaranty, if any; or

(12) Inducing a consumer to purchase repair services or repair parts by knowingly making false or misleading statements of fact concerning the need for parts, replacement, or repair service; or

(13) As to comprehensive and collision insurance insuring the vehicle of an insured on policies written after the effective date of this chapter, an insurer may not pay a consumer less than the face amount of an insurance policy for a covered loss, and the insurer is estopped from denying that the face amount of the policy, whether an original or renewal policy, showing the vehicle’s value upon which the insurance premium was based, is the true value of the vehicle, unless the insurer can show by a preponderance of the evidence:

(A) That the vehicle insured was damaged by an uninsured cause since the policy was written; or(B) That the vehicle has accumulated mileage in excess of sixteen thousand (16,000) miles per year or part thereof since the vehicle was first registered, and that the excess mileage situation did not exist when the policy was written; or

(C) That the insured fraudulently and materially misrepresented material facts concerning the value of the property insured (the insured’s statement as to the estimated of the value of the vehicle is not a misrepresentation of fact concerning the value of the vehicle); or

(D) That because of multiple insurance policies, a co-insurance situation exists.

An insurer may include in a policy of insurance a schedule showing the depreciated value of the vehicle at various times during the life of the policy, but in such case, the premium shall be based upon the average daily value of the vehicle over the life of the policy. In such case, for purposes of this subsection, the face amount of the policy indicating the vehicle’s value shall be considered to be the value of the vehicle as shown in the depreciation schedule on the date of loss.

(14) Including a co-insurance clause in any policy of casualty or liability insurance which would limit the liability of the insurance carrier based upon a theory of self-insurance by the insured. Co-insurance shall apply only when there is overlapping insurance by two (2) or more policies. In any case of dual insurance coverage, the policy limits of insurance shall be the total limits of all policies, with payment of claims pro-rated among the various policies. The provisions of this subsection do not apply to insurance for typhoons or earthquakes; provided, that in such cases a seller of insurance shall provide in a separate writing to the insured who purchases a policy of typhoon or earthquake insurance subject to a co-insurance clause an explanation of co- insurance, with the insured to sign an acknowledgement of having read the explanation. Nothing in this subsection shall prohibit the use in casualty or liability insurance policies of”deductible” clauses whereby specific sums are deducted from the losses before payment by the insurer.

(15) Representing that a guarantee or warranty confers or involves rights or remedies which it does not have or involve; provided, however, that nothing in this chapter shall be construed to expand the implied warranty of merchantability as defined in §§ 2314 through 2318, Title 13, Guam Code Annotated, to include obligations in excess of those which are appropriate to the goods; or

(16) Representing that parts have been replaced in goods with new parts in making repairs for a consumer when in fact used parts were used for replacement. When used parts are used in repairs, the exact description of used parts to be used shall be revealed in a writing signed and approved by the consumer prior to commencing repairs or prior to installing or selling such parts. The description of the used parts revealed prior to use and also on the final billing may not be a printed part of any pre-printed contract, but shall be hand written, typed, or computer printed in at least 10 point type. A consumer need not pay for any goods or services used for any repair job in which used parts are used in violation of this subsection, and is entitled to a refund of any amounts already paid therefor. This subsection does not apply to used parts for which the consumer is not charged, nor does it apply to used parts having a total value of Five Dollars ($5) or less and which are essentially the same as new parts. A merchant hired by a consumer to repair an appliance or vehicle must give the consumer in advance of repair a written estimate of the cost of such repair, and must notify the consumer in writing when the repairs will cost more than the estimate; after receipt of which notice the consumer shall have twenty- four (24) hours to decide whether to pay the additional charges, failing which agreement the repairer shall undertake no additional repairs and shall return the item to the consumer, charging only for the work performed, and in no case more than the estimate.

(17) Failing to disclose information concerning goods or services which was known at the time of the transaction if
such failure to disclose such information was intended to induce the consumer into a transaction into which the consumer would not have entered had the information been disclosed. A merchant of vehicles shall reveal to a consumer in writing prior to sale all previous damage to a vehicle and known to the merchant and all repair work done on a vehicle by the merchant or at the merchant’s instruction prior to signing a contract of sale or selling a vehicle, and revealing any used parts which were used in the repairs; or

(18) Charging consumers different prices for the same goods or services on account of the race, ethnic origin, color, creed, sex, sexual preference, handicap or age of the consumers; provided however, that nothing in this subsection shall prevent a merchant from giving discounts to local residents.

(19) Violating subparagraphs (f) (marking of outdated food, etc), (g) (damaged consumer products), (h) (marking of water-added products), (i) (sale of cans of rusty food), or (j) all of § 40120, Title 10, Guam Code Annotated;

(20) Violating Regulation Z of the United States Federal Reserve Board in the financing of the sale of goods or services; or

(21) Price gouging in time of disaster prohibited.

(A) It shall be an unfair trade practice for any merchant or landlord to increase the price of any goods, services, or dwelling rentals on the basis of shortage anticipated or caused by any disaster. A merchant may add to the normal sales price of goods normally imported by sea incremental freight costs caused as a result of air freight actually incurred, and may pass on to customers actual overtime labor costs for services in addition to regular charges.

(B) After a disaster in which there is serious damage to five hundred (500) or more of the permanent residential units on the island caused by the disaster, after a typhoon bringing sustained winds to Guam of
100 miles per hour or more, or after an earthquake thataffects Guam with a reading on Guam greater than 7.0 on the Richter Scale, the Governor may, by executive order, freeze residential rents to levels in effect the day before the disaster, for up to 120 days from the date of the disaster, which freeze may not be thereafter extended.

(C) If Condition of Readiness 1, 2 or 3, or an equivalent condition is declared, or if I Maga’hågan or Maga’låhen Guåhan declares that a state of emergency exists requiring emergency assistance, or after a disaster which damages two hundred (200) or more of the permanent residential units on the island, or after a typhoon brings sustained winds to Guam of one hundred (100) miles per hour or more, or after an earthquake with a reading on Guam greater than 7.0 on the Richter Scale, I Maga’håga or Maga’låhi may, by Executive Order, freeze mark-ups and prices on designated goods and services which he or she finds to be in short supply or in danger of being in short supply as a result of the disaster to markups and prices in effect the day before the disaster, for up to thirty (30) days after the disaster. Said freeze shall not be extended. A merchant may add to the normal sales prices of the goods the increased import cost of the goods, for all goods normally imported by sea, and incremental freight costs caused as a result of air freight actually incurred.

(D) Merchants and landlords violating this subsection (21) shall be subject to the same damages, penal ties and other liabilities provided in this chapter and for damages equal to three (3) times the amounts of all gross profits on overcharged goods or five (5) times the amount of overcharges for services or rentals, in addition to all other damages and remedies allowed by law or equity, and may be temporarily and permanently restrained and enjoined from further violation without the applicant therefor being required to post bond.

(E) The price on all wholesale and retail goods shall be frozen whenever I Maga’lahen Guåhan declares
Guam to be in Condition of Readiness 1 or 2, or their equivalent, and shall continue to be frozen until seventy- two (72) hours after Guam returns to Condition of Readiness 4, or its equivalent. The normal sales prices of goods shall include the increased import costs of the goods for all goods normally imported by sea, and incremental freight costs caused as a result of air freight actually incurred.

SOURCE: Added by P.L. 21-018:1 (May 10, 1991). Subsection (c)(21) added by P.L. 22-034:1 (Sept 27, 1993). Subsections (c)(21)(iii) and (v) amended by P.L. 29-019:VI:53 and 54 (Sept. 29, 2007). Subsection (c)(21)(C) amended by P.L. 35-074:2 (Mar. 16, 2020).

COURT DECISIONS: As to the second issue of a violation of 11 Guam Code Ann.
§ 26115 and 5 Guam Code Ann. § 32201(b)(29), it is clear in this situation that the Defendant-Appellee misrepresented the inclusion of the GRT as part of the purchase price and, further, misrepresented it as a tax above the purchase
price which was imposed by the government. The overall message of the Attorney General Opinion is that if additional language indicates that the GRT is not being passed on to the consumer as part of the purchase price it is a violation of Section 26115. This is what occurred in this situation.
Guam v. Marfega Trading Co., Inc., dba Islander Rent-a-car, Guam
Supreme Court, 1998 Guam 4 [27].

NOTE: Effective July 17, 2007, reference to Gross Receipts Tax (GRT), amended to Business Privilege Tax (BPT), pursuant to P.L. 29-002:VI:28 (May 18, 2007).

2014 NOTE: Subsection designations were amended in (c)(21) to adhere to the Compiler’s alpha-numeric scheme in accordance with the authority granted by 1 Guam Code Ann. § 1606.