S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5246
 
                        2017-2018 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 7, 2017
                                ___________
 
 Introduced  by  M.  of A. DINOWITZ, WEINSTEIN, WEPRIN, SEPULVEDA -- 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:
   § 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.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD03789-01-7
              

 A. 5246                             2
 
   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
 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.
   § 2. This act shall take effect on the one hundred eightieth day after
 it shall have become a law.