NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A2285B
SPONSOR: Perry TITLE OF BILL:
An act to amend the general business law, in relation to the cancella-
tion of a health club contract
PURPOSE:
Requires that health club contracts and memberships need not exceed 24
hours in immediate cancellation at the buyer's request and can be
canceled online.
SUMMARY OF PROVISIONS:
Section one of the bill adds subdivision 4 to § 624 of the general busi-
ness law requiring every health club contract to include a provision
which requires the health club to accept the cancellation of a member-
ship by the buyer or buyer's estate within twenty-four hours of receiv-
ing notice of the cancellation through methods which include, but are
not limited to, the Internet, telephone, or in person and requires the
cancellation to be effective within twenty-four hours. For the cancella-
tion of a membership to be accepted within twenty-four hours, the
cancellation must be submitted within the first thirty-six hours of the
purchase of the membership or after the full term of the membership is
completed.
Section two of the bill provides the effective date.
JUSTIFICATION:
This legislation mandates health clubs' membership cancelation to be
effective within the first twenty-four hours. According to the Interna-
tional Health, Racquet & Sportsclub Association, there are 2,111 health
clubs in New York. On average, 4,383,454 constituents in New York use
the health club facilities available. In observance of the New York
Health Club Services Act, all health club contracts are cancelable with-
in three days of the signing of the contract, and at any time for any of
the following reasons: if the health club ceases to offer the services
stated in the contract; if the consumer moves 25 miles from any health
club operated by the seller; and if upon a doctor's order, the consumer
cannot receive the services as stated in the contract because of signif-
icant physical disability for a period in excess of six months. Such
notices must appear on all health club contracts.
The health club must provide refunds within 15 days of such cancella-
tion. Clubs are exempted from this requirement if they do not offer
pre-paid memberships, if payments do not exceed $150, memberships do not
exceed one year, and the contract does not contain an automatic renewal
provision. Yet, buyers of health club memberships are still required to
pay fees throughout the remainder of a contract year despite wanting
immediate cancellation.
To add, many of the cancelation processes for health clubs involve
in-person meetings to cancel memberships. New York's Health Club Law
authorizes gym members to cancel their membership under certain circum-
stances, including after the services are no longer available or
substantially available as provided in the contract because of the gym's
permanent discontinuance of operation or substantial change in operation
and require gym owners to offer prorated refunds for such cancellations
within 15 days. This bill will allow buyers to feel unrestricted by
health club contracts' circumstantial terms and given a chance to
discontinue their services online instead of strictly in person.
PRIOR LEGISLATIVE HISTORY:
2020: A.11162/S.9067 - Referred to Consumer Affairs and Protection /
Rules FISCAL IMPLICATIONS: None.
EFFECTIVE DATE:
Immediately.
STATE OF NEW YORK
________________________________________________________________________
2285--B
2021-2022 Regular Sessions
IN ASSEMBLY
January 14, 2021
___________
Introduced by M. of A. PERRY -- read once and referred to the Committee
on Consumer Affairs and Protection -- committee discharged, bill
amended, ordered reprinted as amended and recommitted to said commit-
tee -- again reported from said committee with amendments, ordered
reprinted as amended and recommitted to said committee
AN ACT to amend the general business law, in relation to the cancella-
tion of a health club contract
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 624 of the general business law is amended by
2 adding a new subdivision 4 to read as follows:
3 4. Every contract for services shall provide that such health club
4 shall accept cancellation of a membership by the buyer or the buyer's
5 estate within twenty-four hours of receiving notice of the cancellation.
6 Such health clubs shall accept cancellation of a membership through
7 methods including, but not limited to, the internet, telephone, or in
8 person. For such cancellation of a membership to be required to be
9 accepted within twenty-four hours of receiving notice under this subdi-
10 vision, the cancellation shall be submitted either within the first
11 thirty-six hours of the purchase of a membership or after the full term
12 of the membership is completed.
13 § 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD03557-05-1
