Senate Bill S8377

2021-2022 Legislative Session

Defines certain terms in standard form contracts as unconscionable

download bill text pdf

Sponsored By

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


  • Introduced
    • In Committee Assembly
    • In Committee Senate
    • On Floor Calendar Assembly
    • On Floor Calendar Senate
    • Passed Assembly
    • Passed Senate
  • Delivered to Governor
  • Signed By Governor

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2021-S8377 (ACTIVE) - Details

See Assembly Version of this Bill:
A3319
Current Committee:
Senate Consumer Protection
Law Section:
General Business Law
Laws Affected:
Add §349-g, Gen Bus L
Versions Introduced in Other Legislative Sessions:
2015-2016: A10065
2017-2018: A2855
2019-2020: A423
2023-2024: S5386, A4230

2021-S8377 (ACTIVE) - Summary

Defines certain terms in standard form contracts as unconscionable.

2021-S8377 (ACTIVE) - Sponsor Memo

2021-S8377 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8377
 
                             I N  S E N A T E
 
                             February 18, 2022
                                ___________
 
 Introduced  by Sen. HARCKHAM -- 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  unconscionable
   terms in standard form contracts
 
   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
 349-g to read as follows:
   § 349-G. UNCONSCIONABLE TERMS IN STANDARD FORM CONTRACTS.  1.    FIND-
 INGS.  THE  INCLUSION OF UNCONSCIONABLE TERMS IN STANDARD FORM CONTRACTS
 REGARDING DISPUTE RESOLUTION IS UNFAIR NOT ONLY  BECAUSE  ANY  RESULTING
 DISPUTE  RESOLUTION PROCEEDING IS UNFAIR TO THE PARTY FORCED TO AGREE TO
 THE UNCONSCIONABLE TERMS, BUT  ALSO  BECAUSE  THE  UNCONSCIONABLE  TERMS
 DISCOURAGE  VALID  CLAIMS.  FURTHERMORE,  WHEN  THE PROVISIONS ARE CHAL-
 LENGED, COURTS MAY SIMPLY STRIKE THE UNCONSCIONABLE  TERMS  BUT  ENFORCE
 THE  REMAINDER  OF  THE  AGREEMENT  REGARDING  DISPUTE  RESOLUTION. AS A
 RESULT, BUSINESSES HAVE LITTLE INCENTIVE NOT  TO  INCLUDE  THESE  TERMS.
 FURTHERMORE,  IT IS UNLIKELY THAT THERE IS ANY MEETING OF THE MINDS OVER
 A DISPUTE-RESOLUTION AGREEMENT THAT DOES NOT INCLUDE SEVERED UNCONSCION-
 ABLE TERMS.
   2.   DEFINITION. FOR THE PURPOSES  OF  THIS  SECTION,  "STANDARD  FORM
 CONTRACT" SHALL MEAN ANY CONTRACT TO WHICH ONLY ONE OF THE PARTIES IS AN
 INDIVIDUAL  AND THAT INDIVIDUAL DOES NOT DRAFT THE CONTRACT. IN ORDER TO
 BE A STANDARD FORM CONTRACT, THE DOCUMENT CONSTITUTING THE CONTRACT NEED
 NOT BE A PREPRINTED FORM NOR NEED IT CONTAIN LANGUAGE COMPLETELY IDENTI-
 CAL TO ANY OTHER CONTRACT.
   3. UNCONSCIONABLE TERMS. THERE IS A REBUTTABLE  PRESUMPTION  THAT  THE
 FOLLOWING   CONTRACTUAL  TERMS  ARE  SUBSTANTIVELY  UNCONSCIONABLE  WHEN
 INCLUDED IN A STANDARD FORM CONTRACT TO WHICH ONLY ONE OF THE PARTIES TO
 THE CONTRACT IS AN INDIVIDUAL AND THAT INDIVIDUAL  DOES  NOT  DRAFT  THE
 CONTRACT:
   (A)  A  REQUIREMENT  THAT RESOLUTION OF LEGAL CLAIMS TAKES PLACE IN AN
 INCONVENIENT VENUE. AN "INCONVENIENT VENUE" IS, FOR  PURPOSES  OF  STATE
 LAW  CLAIMS,  A PLACE OTHER THAN THE COUNTY WHERE THE INDIVIDUAL RESIDES
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

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