S T A T E   O F   N E W   Y O R K
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                                  9544

                          I N  A S S E M B L Y

                             March 16, 2016
                               ___________

Introduced  by M. of A. DINOWITZ, WEINSTEIN -- read once and referred to
  the Committee on Consumer Affairs and Protection

AN ACT to amend the general  business  law,  in  relation  to  requiring
  mandatory  arbitration  clauses  in  certain  consumer contracts to be
  printed in large font type

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Section  399-c  of  the general business law, as added by
chapter 946 of the laws of 1984, is amended to read as follows:
  S 399-c. Mandatory arbitration clauses in certain  consumer  contracts
[prohibited]. 1.  Definitions.
  a.  The  term  "consumer" shall mean a natural person residing in this
state.
  b. The term "consumer goods" shall mean goods, wares, paid merchandise
or services purchased or paid for by a consumer,  the  intended  use  or
benefit  of  which  is  intended  for  the personal, family or household
purposes of such consumer.
  c. The term "mandatory  arbitration  clause"  shall  mean  a  term  or
provision  contained  in  a written contract for the sale or purchase of
consumer goods which requires the parties to such contract to submit any
controversy thereafter arising under such contract to arbitration  prior
to  the  commencement  of  any legal action to enforce the provisions of
such contract and which also further provides  language  to  the  effect
that  the  decision  of  the  arbitrator  or panel of arbitrators in its
application to the consumer party shall be  final  and  not  subject  to
court review.
  d.  The  term  "arbitration"  shall  mean the use of a decision making
forum conducted by an arbitrator or  panel  of  arbitrators  within  the
meaning  and  subject  to  the provisions of article seventy-five of the
civil practice law and rules.
  E. THE TERM "LARGE PRINT FORMAT" SHALL MEAN A  PRINTED  FONT  SIZE  OF
SIXTEEN POINTS OR LARGER.
  2.  a.  Prohibition.  No  written contract for the sale or purchase of
consumer goods, entered into on or after  the  effective  date  of  this

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

                                                           LBD14285-01-6

A. 9544                             2

section, to which a consumer is a party, shall contain a mandatory arbi-
tration clause.  Nothing contained herein shall be construed to prohibit
a non-consumer party from incorporating a provision within such contract
that  such non-consumer party agrees that the decision of the arbitrator
or panel of arbitrators shall be final in its application to  such  non-
consumer party and not subject to court review.
  b.  Mandatory  arbitration  clause  null and void. The provisions of a
mandatory arbitration clause shall be null and void.  The  inclusion  of
such  clause  in a written contract for the sale or purchase of consumer
goods shall  not  serve  to  impair  the  enforceability  of  any  other
provision of such contract.
  3.  LARGE PRINT ARBITRATION CLAUSES IN CONTRACTS. EACH AND EVERY BUSI-
NESS SHALL, IN EACH  INITIAL  CONTRACT  FOR  GOODS  OR  SERVICES,  WHICH
CONTAINS  AN  ARBITRATION CLAUSE PROVIDE THE CONSUMER WITH A COPY OF THE
CONTRACT IN WHICH THE ARBITRATION CLAUSE IS  DISPLAYED  IN  LARGE  PRINT
FORMAT.
  4.  A VIOLATION BY ANY PERSON OR BUSINESS OF SUBDIVISION THREE OF THIS
SECTION, IF SUCH VIOLATION CONSTITUTES THE FIRST SUCH  OFFENSE  BY  SUCH
PERSON, IS PUNISHABLE BY A CIVIL PENALTY NOT TO EXCEED TWO HUNDRED FIFTY
DOLLARS.  A  SECOND  OFFENSE  AND  ANY  OFFENSE  COMMITTED THEREAFTER IS
PUNISHABLE BY A CIVIL PENALTY NOT TO EXCEED FIVE HUNDRED DOLLARS.
  S 2. This act shall take effect on the one hundred eightieth day after
it shall have become a law.