S T A T E O F N E W Y O R K
________________________________________________________________________
175
2009-2010 Regular Sessions
I N A S S E M B L Y
(PREFILED)
January 7, 2009
___________
Introduced by M. of A. PHEFFER -- read once and referred to the Commit-
tee on Consumer Affairs and Protection
AN ACT to amend the general business law, in relation to the signature
of authorized representatives on certain instruments
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The general business law is amended by adding a new article
38-B to read as follows:
ARTICLE 38-B
SIGNATURE OF AUTHORIZED REPRESENTATIVES
SECTION 825. DEFINITIONS.
826. SIGNATURE BY AUTHORIZED REPRESENTATIVE.
S 825. DEFINITIONS. AS USED IN THIS ARTICLE:
(A) "ACCOUNT" MEANS ANY ACCOUNT WITH A BANK AND INCLUDES A CHECKING,
TIME, INTEREST, SAVINGS, OR NEGOTIABLE ORDER OF WITHDRAWAL ACCOUNT;
(B) "BANK" MEANS AND INCLUDES ANY ENTITY ENGAGED IN THE BUSINESS OF
BANKING;
(C) "CONSUMER" MEANS ANY NATURAL PERSON;
(D) "CONSUMER TRANSACTION" MEANS THE PURCHASE OR LEASE OF OR THE
ATTEMPT TO PURCHASE OR LEASE ANY GOODS OR SERVICES BY A CONSUMER, OR THE
EXTENSION OF OR THE ATTEMPT TO EXTEND CREDIT TO ANY CONSUMER, FOR
PERSONAL, HOUSEHOLD, OR FAMILY PURPOSES;
(E) "ENTITY" MEANS A NATURAL PERSON, PARTNERSHIP, CORPORATION, LIMITED
LIABILITY COMPANY, ASSOCIATION, OR OTHER LEGAL ORGANIZATION;
(F) "ITEM" MEANS ANY INSTRUMENT FOR THE PAYMENT OF MONEY, INCLUDING
BUT NOT LIMITED TO A NONNEGOTIABLE INSTRUMENT, BUT DOES NOT INCLUDE
MONEY; AND
(G) "NEGOTIABLE ORDER OF WITHDRAWAL ACCOUNT" MEANS AN ACCOUNT AUTHOR-
IZED BY SUBDIVISION A OF SECTION EIGHTEEN HUNDRED THIRTY-TWO OF TITLE
TWELVE OF THE UNITED STATES CODE.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01948-01-9
A. 175 2
S 826. SIGNATURE BY AUTHORIZED REPRESENTATIVE. (A) NOTWITHSTANDING THE
PROVISIONS OF ANY OTHER LAW, NO ENTITY SHALL SEEK TO ACQUIRE, SHALL
ACQUIRE, OR SHALL EXERCISE THE POWERS OR AUTHORITY OF AN AUTHORIZED
REPRESENTATIVE OF A CONSUMER, AS PROVIDED IN PART FOUR OF ARTICLE THREE
OF THE UNIFORM COMMERCIAL CODE, IN A CONSUMER TRANSACTION FOR THE
PURPOSE OF SIGNING ANY ITEM, UNLESS SUCH POWERS OR AUTHORITY ARE
CONFERRED IN A WRITING THAT IS SIGNED BY THE CONSUMER WHO IS TO BE BOUND
THEREBY AND IN WHICH THE SCOPE OF THE AUTHORIZED REPRESENTATIVE'S
AUTHORITY IS CLEARLY AND SPECIFICALLY DESCRIBED IN SUCH CONSUMER'S HAND-
WRITING.
(B) ANY ITEM SIGNED BY AN AUTHORIZED REPRESENTATIVE IN A CONSUMER
TRANSACTION IN VIOLATION OF SUBDIVISION (A) OF THIS SECTION IS NOT PROP-
ERLY PAYABLE FROM THE ACCOUNT OF ANY CONSUMER AT A BANK. IF SUCH ITEM IS
PAID BY A BANK IN VIOLATION OF THIS SECTION, THE CONSUMER IS ENTITLED TO
A CREDIT FOR THE AMOUNT OF THE ITEM ON THE DAY FOLLOWING THE DATE ON
WHICH SUCH CONSUMER DEMANDS SUCH CREDIT.
(C) IN CASE OF A DISPUTE AS TO WHETHER OR NOT A SIGNATURE BY AN
AUTHORIZED REPRESENTATIVE ON AN ITEM IN A CONSUMER TRANSACTION COMPLIES
WITH THE REQUIREMENTS OF THIS SECTION, A BANK HAS THE BURDEN OF PROVING
COMPLIANCE AND, UNTIL IT DOES SO, SHALL CREDIT THE CONSUMER'S ACCOUNT
FOR THE FULL AMOUNT OF SUCH ITEM ON THE BANKING DAY FOLLOWING THE DATE
ON WHICH THE CONSUMER HAS DEMANDED SUCH CREDIT AS PROVIDED IN SUBDIVI-
SION (B) OF THIS SECTION.
(D) ANY ENTITY THAT SIGNS AN ITEM AS AN AUTHORIZED REPRESENTATIVE OF A
CONSUMER IN A CONSUMER TRANSACTION IN VIOLATION OF THE PROVISIONS OF
THIS SECTION, AND ANY BANK THAT FAILS TO CREDIT A CONSUMER'S ACCOUNT IN
ACCORDANCE WITH THE PROVISIONS SPECIFIED IN THIS SECTION, IS LIABLE TO
SUCH CONSUMER FOR THREE TIMES THE AMOUNT OF SUCH ITEM OR FIVE HUNDRED
DOLLARS, WHICHEVER IS GREATER, PLUS COURT COSTS AND REASONABLE ATTOR-
NEY'S FEES.
S 2. This act shall take effect immediately.