Bill Text: NY S00303 | 2021-2022 | General Assembly | Introduced

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Bill Title: Requires health club contracts to allow a buyer to cancel with thirty days' notice; allows a buyer to submit a notice of cancellation by electronic mail in addition to in person, by phone or by mail; requires a health club to accept notice of cancellation via website if such contract was entered into via website; decreases the time necessary for a disability cancellation from six months to three months.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2022-01-05 - REFERRED TO CONSUMER PROTECTION [S00303 Detail]

Download: New_York-2021-S00303-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                           303

                               2021-2022 Regular Sessions

                    IN SENATE

                                       (Prefiled)

                                     January 6, 2021
                                       ___________

        Introduced  by  Sen.  THOMAS -- read twice and ordered printed, and when
          printed to be committed to the Committee on Consumer Protection

        AN ACT to amend the general business law, in relation to  the  cancella-
          tion of a health club contract

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Section 624 of the general business law, as added by  chap-
     2  ter 630 of the laws of 1978, is amended to read as follows:
     3    §  624.  Rights  of  cancellation of contracts for services. 1.  Every
     4  contract for services at a planned health club or a  health  club  under
     5  construction shall, at the option of the buyer, be voidable in the event
     6  that  the  health  club and the services to be provided pursuant to such
     7  contract are not available within one year from the date the contract is
     8  executed by the buyer.
     9    2. Every contract for services shall provide that such contract may be
    10  cancelled within three business days after the date of  receipt  by  the
    11  buyer  of  a copy of the written contract. [Notice of cancellation shall
    12  be delivered by certified  or  registered  United  States  mail  at  the
    13  address  specified  in  the  contract.]  Such contract shall contain the
    14  following written notice in at least  ten  point  bold  type:  CONSUMERS
    15  RIGHT  TO CANCELLATION. YOU MAY CANCEL THIS CONTRACT WITHOUT ANY PENALTY
    16  OR FURTHER OBLIGATION WITHIN THREE (3) DAYS FROM THIS DATE . . . .  .  .
    17  [Notice  of cancellation shall be in writing subscribed by the buyer and
    18  mailed by registered or certified United States mail to  the  seller  at
    19  the  address specified in such form. Such notice shall be accompanied by
    20  the contract forms,] A buyer who cancels  a  contract  pursuant  to  the
    21  provisions of this subdivision shall return all membership cards and any
    22  other  documents  or  evidence of membership previously delivered to the
    23  buyer.  All moneys paid pursuant to  such  contract  shall  be  refunded
    24  within  [fifteen  business  days]  forty-eight  hours of receipt of such
    25  notice of cancellation.  If the buyer has executed any  credit  or  loan
    26  agreement to pay for all or part of health club services, any such nego-

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD02863-01-1
        S. 303                              2

     1  tiable  instrument  executed  by the buyer shall also be returned within
     2  [fifteen days] forty-eight hours.
     3    3. (a) Every contract for services shall provide that after such three
     4  day  period  for  cancellation  as  provided  in subdivision two of this
     5  section, the buyer's estate may cancel a contract for  services  if  the
     6  buyer  dies.  The  buyer  may  also cancel after three days if the buyer
     7  becomes significantly physically disabled for  a  period  in  excess  of
     8  [six]  three  months,  or  moves his or her residence to a location more
     9  than twenty-five miles from a health club operated  by  the  seller,  or
    10  after the services are no longer available or substantially available as
    11  provided  in  the  contract because of the seller's permanent discontin-
    12  uance of operation or substantial change in operation. Nothing contained
    13  herein shall restrict or prohibit the seller from offering or  providing
    14  in  such  contract  additional  or broader reasons for cancellation. The
    15  seller may require reasonable evidence for a  cancellation  pursuant  to
    16  this subdivision.
    17    (b)  Every  contract  for services shall provide that after such three
    18  day period for cancellation as  provided  in  subdivision  two  of  this
    19  section, the buyer may cancel the contract upon thirty days' notice.
    20    (c)  Such  contract shall contain the following notice captioned in at
    21  least ten point bold type: ADDITIONAL RIGHTS TO CANCELLATION:
    22    You may also cancel this contract for any of the following reasons:
    23    If upon a doctor's order, you cannot physically receive  the  services
    24  because  of  significant  physical  disability for a period in excess of
    25  [six] three months.
    26    If you die, your estate shall be relieved of  any  further  obligation
    27  for payment under the contract not then due and owing.
    28    If you move your residence more than twenty-five miles from any health
    29  club operated by seller.
    30    If the services cease to be offered as stated in the contract.
    31    For any reason upon thirty days' notice.
    32    (d)  All  moneys  paid  pursuant  to  such  contract cancelled for the
    33  reasons contained in this subdivision shall be refunded within  [fifteen
    34  days]  forty-eight  hours  of  receipt  of  such notice of cancellation;
    35  provided however that the seller may retain the  expenses  incurred  and
    36  the  portion  of  the  total  price  representing  the  services used or
    37  completed, and further provided that the seller may demand  the  reason-
    38  able  cost  of goods and services which the buyer has consumed or wishes
    39  to retain after cancellation of  the  contract.  The  seller  shall  not
    40  demand  more than one month's fee or the equivalent thereof from a buyer
    41  who cancels a contract pursuant to paragraph (b) of this subdivision. In
    42  no instance shall the seller demand more than the  full  contract  price
    43  from  the  buyer. If the buyer has executed any credit or loan agreement
    44  to pay for all or part of health  club  services,  any  such  negotiable
    45  instrument  executed by the buyer shall also be returned within [fifteen
    46  days] forty-eight hours.
    47    4. (a) Every contract for services shall provide that such health club
    48  shall accept notice of cancellation of such contract in person, by mail,
    49  over the phone or by electronic mail.
    50    (b) If a health club allows a buyer  to  enter  into  a  contract  for
    51  services  through  a  website, such health club shall accept a notice of
    52  cancellation of such contract through such website in  addition  to  the
    53  methods provided pursuant to paragraph (a) of this subdivision.
    54    § 2. This act shall take effect immediately; provided that section one
    55  of  this  act  shall  apply  to contracts entered into, issued, renewed,
    56  modified, altered, or amended on or after such effective date.