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Senate Bill S899

2009-2010 Legislative Session

Regulates service contracts issued by mercantile establishments

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Sponsored By

Archive: Last Bill Status - In Senate Committee Consumer Protection Committee

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2009-S899 (ACTIVE) - Details

Current Committee:
Senate Consumer Protection
Law Section:
General Business Law
Laws Affected:
Add ยง218-b, Gen Bus L
Versions Introduced in 2011-2012 Legislative Session:
S1947

2009-S899 (ACTIVE) - Summary

Regulates the issuance of lifetime service contracts on goods, wares and merchandise by mercantile establishments; requires proper insurance or establishment of escrow account in guarantee thereof.

2009-S899 (ACTIVE) - Sponsor Memo

2009-S899 (ACTIVE) - Bill Text download pdf 

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                   899

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                            January 21, 2009
                               ___________

Introduced  by  Sen.  KRUGER -- 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  regulating
  service contracts issued by mercantile establishments

  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 section
218-b to read as follows:
  S 218-B.  SERVICE CONTRACTS.  1.  NO RETAIL  MERCANTILE  ESTABLISHMENT
SHALL  SELL  OR  OFFER FOR SALE LIFETIME SERVICE CONTRACTS ON ANY GOODS,
WARES OR MERCHANDISE OFFERED TO THE PUBLIC EXCEPT AS AUTHORIZED IN  THIS
SECTION.
  2.  FOR ANY SERVICE CONTRACT OFFERED BY A RETAIL MERCANTILE ESTABLISH-
MENT  ON  ANY  PRODUCT SOLD, PROPER INSURANCE SHALL BE PURCHASED FOR THE
CORRESPONDING LENGTH OF SAID CONTRACT TO ASSURE THE PURCHASER  THAT  THE
TERMS OF SAID SERVICE CONTRACT SHALL BE CARRIED OUT IN THE CASE THAT THE
RETAIL  MERCANTILE ESTABLISHMENT DECLARES BANKRUPTCY OR INSOLVENCY OR IS
UNABLE TO PERFORM THE TERMS OF SUCH CONTRACT DUE TO  ANY  OTHER  REASON.
IF,  HOWEVER, INSURANCE IS NOT AVAILABLE TO THE RETAIL MERCANTILE ESTAB-
LISHMENT AT A REASONABLE BUSINESS RATE, SAID  ESTABLISHMENT  SHALL  HAVE
THE  OPTION TO ESTABLISH INTEREST BEARING ESCROW ACCOUNTS IN WHICH MONEY
PAID BY THE PURCHASER FOR SERVICE CONTRACTS SHALL BE DEPOSITED.
  3.  THE RETAIL MERCANTILE ESTABLISHMENT MAY WITHDRAW  TEN  PERCENT  OF
THE  MONEY DEPOSITED FOR EACH SUCH CONTRACT EACH YEAR WHICH SHALL BECOME
THE PROPERTY OF THE ESTABLISHMENT.  AT THE TIME WHEN SUCH  ESTABLISHMENT
IS  ENTITLED TO THE FINAL TEN PERCENT OF THE MONEY PAID ON SUCH CONTRACT
OR AGREEMENT, IT MAY ALSO WITHDRAW THE INTEREST EARNED ON SUCH MONEY.
  4.  IF SUCH RETAIL MERCANTILE ESTABLISHMENT IS UNABLE TO  PERFORM  THE
TERMS  OF SUCH CONTRACT OR AGREEMENT BECAUSE OF BANKRUPTCY OR INSOLVENCY
OR FOR ANY OTHER REASON, OR IF IT IS DETERMINED THAT SUCH  ESTABLISHMENT
HAS  BREACHED  THE TERMS OF SUCH CONTRACT OR AGREEMENT, THE PURCHASER OF

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD06493-01-9

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