A07597 Summary:

BILL NOA07597
 
SAME ASNo Same As
 
SPONSORDinowitz
 
COSPNSRWeinstein, Gottfried, Seawright, Weprin, Stirpe, Carroll, Colton, Jacobson, Griffin, Simon
 
MLTSPNSR
 
Amd §7501, add §7516, CPLR; add §5-337, amd §5-702, Gen Ob L; amd §94-a, Exec L; add §2801-h, Pub Health L
 
Relates to contracts in small print, procedural reciprocity for arbitration agreements in consumer transactions and consumer arbitration; relates to the prohibition of certain and wrongful death claims; relates to powers and duties of the consumer protection division and contracts of adhesion; relates to protecting against certain contracts of adhesion in the provision of health care.
Go to top    

A07597 Actions:

BILL NOA07597
 
05/13/2019referred to judiciary
05/30/2019reported referred to codes
06/04/2019reported referred to rules
01/08/2020referred to codes
Go to top

A07597 Committee Votes:

JUDICIARY Chair:Dinowitz DATE:05/30/2019AYE/NAY:15/5 Action: Favorable refer to committee Codes
DinowitzAyePalumboNay
TitusAyeMontesanoExcused
LavineAyeGoodellNay
ZebrowskiAyeNorrisNay
WeprinAyeWalshNay
BraunsteinAyeByrnesNay
SimotasAye
QuartAye
BuchwaldAye
SteckAye
SeawrightAye
JoynerAye
AbinantiAye
WrightAye
WallaceAye

CODES Chair:Lentol DATE:06/04/2019AYE/NAY:20/2 Action: Favorable refer to committee Rules
LentolAyeRaNay
SchimmingerAyeGiglioAye
PretlowAyeMontesanoAye
CookAyeMorinelloAye
CymbrowitzAyePalumboAye
O'DonnellAyeGarbarinoNay
LavineAye
PerryAye
ZebrowskiAye
AbinantiAye
WeprinAye
MosleyAye
HevesiAye
FahyAye
SeawrightAye
RosenthalAye

Go to top

A07597 Floor Votes:

There are no votes for this bill in this legislative session.
Go to top

A07597 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          7597
 
                               2019-2020 Regular Sessions
 
                   IN ASSEMBLY
 
                                      May 13, 2019
                                       ___________
 
        Introduced  by  M.  of  A.  DINOWITZ,  WEINSTEIN,  GOTTFRIED, SEAWRIGHT,
          WEPRIN, STIRPE -- (at request of the Office of  Court  Administration)
          -- read once and referred to the Committee on Judiciary
 
        AN  ACT  to  amend  the  civil  practice  law  and rules, in relation to
          contracts in  small  print,  procedural  reciprocity  for  arbitration
          agreements in consumer transactions and consumer arbitration; to amend
          the general obligations law, in relation to the prohibition of certain
          contractual agreements to arbitrate personal injury and wrongful death
          claims;  to  amend the executive law, in relation to powers and duties
          of the consumer protection division and contracts of adhesion; and  to
          amend the public health law, in relation to protecting against certain
          contracts of adhesion in the provision of health care
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. This act shall be known as the access  to  justice  act  of
     2  2019:  remedying  injustices arising out of contracts of adhesion in the
     3  context of consumer contracts.
     4    § 2. Legislative intent. The legislature finds that it is  the  public
     5  policy  of  this  state to ensure access to justice for all New Yorkers.
     6  The unified court system in this state  supports  and  encourages  arbi-
     7  tration in the civil practice context and arbitration is one of a varie-
     8  ty  of  alternative  dispute resolution tools which help parties resolve
     9  disputes without a trial.  Arbitration has proven to be most  successful
    10  when  agreed  to between parties of equal bargaining power as part of an
    11  arm's length agreement. A vital component of access  to  justice  is  to
    12  preserve,  when  possible,  the  ability of New Yorkers to choose either
    13  arbitration or litigation when seeking a remedy if an injury or  dispute
    14  has  occurred.  When  an arbitration clause is foisted upon a party to a
    15  contract, that choice is precluded; thus access to justice may be denied
    16  at the very commencement of the parties' relationship.  The  legislature
    17  further finds that the prevalence of arbitration agreements in contracts
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD11632-01-9

        A. 7597                             2
 
     1  of  adhesion  in transactions for personal, family or household services
     2  New Yorkers cannot do without - e.g., telephone, internet, nursing home,
     3  credit cards - and the interpretation of such arbitration agreements  by
     4  the courts has resulted in conflicting decisions and substantial inequi-
     5  ty  between the parties.  One area of concern is reflected in the effect
     6  of recent arbitrations on contracts affecting the  rights,  remedies  or
     7  obligations  between  health  care  providers  and  patients relative to
     8  personal injuries to, or wrongful death of, patients.  This  act  amends
     9  the  law to preclude predatory behavior against some of the most vulner-
    10  able New Yorkers against the public policy of  this  state,  to  protect
    11  fairness  in  consumer transactions and other types of transactions that
    12  affect the health and well-being of  New  Yorkers,  to  create  remedies
    13  targeting  unconscionable  contracts  at  the  state level and to ensure
    14  access to justice for consumers.
    15    § 3. Section 7501 of the civil practice law and rules, as  amended  by
    16  chapter 532 of the laws of 1963, is amended to read as follows:
    17    §  7501.  Effect  of  arbitration  agreement.   A written agreement to
    18  submit any controversy thereafter arising or any existing controversy to
    19  arbitration is enforceable without regard to the  justiciable  character
    20  of  the  controversy and confers jurisdiction on the courts of the state
    21  to enforce it and to enter judgment on  an  award.  In  determining  any
    22  matter  arising under this article, the court shall not consider whether
    23  the claim with respect to which arbitration is  sought  is  tenable,  or
    24  otherwise  pass  upon the merits of the dispute.  The commencement of an
    25  action in a court of law by any person to  enforce  a  contract  entered
    26  into  by,  or  delivered  to,  a  resident of this state that involves a
    27  consumer transaction, as defined in section  forty-five  hundred  forty-
    28  four of this chapter, shall constitute a waiver of the enforceability of
    29  the  arbitration clause in that contract or agreement. Such waiver shall
    30  not apply to any action brought to enforce the  arbitration  clause,  to
    31  stay arbitration or in aid of arbitration.
    32    §  4.  The  civil  practice  law  and rules is amended by adding a new
    33  section 7516 to read as follows:
    34    § 7516. Arbitration of disputes regarding contracts or agreements in a
    35  consumer transaction. (a) 1. This section shall govern  arbitrations  of
    36  disputes regarding contracts or agreements entered into by, or delivered
    37  to, a resident of this state or entered into in this state that involves
    38  a consumer transaction.
    39    2.  Proceedings  pursuant  to  this  section  shall  be  commenced and
    40  conducted in accordance with this article, except as otherwise  provided
    41  by this section and in accordance with rules promulgated and approved by
    42  the superintendent of the department of financial services.
    43    3.  The  term  "consumer transaction" shall be defined as set forth in
    44  section forty-five hundred forty-four of this chapter.
    45    4. Except as provided by an express waiver contained in such  contract
    46  or  agreement,  either  party  to  a consumer dispute may seek relief in
    47  arbitration by way of class action in accordance  with  the  regulations
    48  promulgated  by  the  superintendent  of  the  department  of  financial
    49  services pursuant to article nine of this chapter.
    50    (b) 1. The rules promulgated by the superintendent of  the  department
    51  of  financial  services shall set forth standards for panels of arbitra-
    52  tors under this section and establish qualifications and compensation of
    53  individuals seeking appointment to the arbitration panels. These  stand-
    54  ards shall require that an arbitrator be impartial and that the arbitra-
    55  tor  be competent to arbitrate the subject matter of each arbitration to
    56  which he or she is appointed as a panel member.

        A. 7597                             3
 
     1    2. All costs of arbitration shall be paid by the party  providing  the
     2  money, property or service.
     3    3.  A  consumer that prevails in whole or in part in arbitration under
     4  this section shall be awarded reasonable attorney's fees by the arbitra-
     5  tor.
     6    4. A contract entered into, or delivered to, a resident of this  state
     7  that  provides for arbitration of a dispute shall be void if it provides
     8  for arbitration by any arbitrator contrary to  the  provisions  of  this
     9  section.
    10    (c)  Decisions  by  members  of  the  arbitration panel shall:   1. be
    11  provided to all parties;
    12    2. contain written findings of fact and  conclusions  of  law  and  an
    13  explanation of the calculation of any damages; and
    14    3. be based on the applicable substantive law of this state or the law
    15  of any other jurisdiction that the arbitrator determines, based upon the
    16  choice of law principles of this state.
    17    §  5.  The  general obligations law is amended by adding a new section
    18  5-337 to read as follows:
    19    § 5-337. Prohibition of contractual provisions  requiring  arbitration
    20  of  claims  for  personal  injuries  or  wrongful  death where the party
    21  asserting the contractual right to  arbitrate  has  liability  insurance
    22  applicable  to the claim. Except where otherwise provided by state stat-
    23  ute, any contractual  provision  requiring  arbitration  of  claims  for
    24  personal injuries or wrongful death shall be deemed without effect where
    25  the  party  asserting  the  contractual right to arbitrate has liability
    26  insurance applicable to the claim.
    27    § 6. Subdivision a of section 5-702 of the general obligations law  is
    28  amended by adding a new paragraph 3 to read as follows:
    29    3.  Written  in  clear  and legible print no less than eight points in
    30  depth or five and one-half points in depth  for  upper  case  type.  The
    31  portion of any printed contract or agreement involving a consumer trans-
    32  action  or  a  lease  for  space to be occupied for residential purposes
    33  where the print does not comply with this paragraph may not be  received
    34  in  evidence  in any trial, hearing or proceeding on behalf of the party
    35  who printed or prepared such contract or agreement, or who  caused  said
    36  agreement  or  contract  to  be printed or prepared. No provision of any
    37  contract or agreement waiving the provisions of this  section  shall  be
    38  effective.  The  provisions  of this paragraph shall not apply to agree-
    39  ments or contracts entered into or agreements  effective  prior  to  the
    40  effective date of this paragraph.
    41    §  7.  Paragraphs  14  and  15 of subdivision 3 of section 94-a of the
    42  executive law, as added by section 21 of part A of  chapter  62  of  the
    43  laws of 2011, are amended to read as follows:
    44    (14)  cooperate  with  and assist consumers in class actions in proper
    45  cases; [and]
    46    (15) (i) determine, upon an  application  by  a  consumer,  whether  a
    47  contract  or agreement or any provision therein between the consumer and
    48  any person, firm, corporation or association or agent or employee there-
    49  of violates the public policy of the state of New York under the laws of
    50  this state, including but not limited to the provisions of this section,
    51  article twenty-two-A of the general business law or section twenty-eight
    52  hundred one-h of the public  health  law,  prohibiting  unscrupulous  or
    53  questionable  business practices or unconscionable contracts, or requir-
    54  ing the consumer to enter into an unconscionable contract to obtain  the
    55  benefits  of  such  contract  or agreement, and (ii) refer such determi-

        A. 7597                             4
 
     1  nation to the appropriate unit of the department, or federal,  state  or
     2  local agency authorized by law for appropriate action; and
     3    (16)  create  an internet website or webpage pursuant to section three
     4  hundred ninety-c of the general business law.
     5    § 8. Section 94-a of the executive law is  amended  by  adding  a  new
     6  subdivision 6 to read as follows:
     7    6.  Right of action. If within sixty days after an application is made
     8  by a consumer under paragraph  fifteen  of  subdivision  three  of  this
     9  section  an action is not commenced by any federal, state or local agen-
    10  cy, the consumer may bring an action in his or her own name on behalf of
    11  the state to obtain such a determination and seek to enjoin  enforcement
    12  of  the  contract or agreement or any of its provisions determined to be
    13  void under such subdivision, recover his or her actual damages or  both.
    14  In  such  action, preliminary relief may be granted under article sixty-
    15  three of the civil practice  law  and  rules.  The  court  may,  in  its
    16  discretion,  increase  the  award  of damages to an amount not to exceed
    17  three times the actual damages  up  to  one  thousand  dollars  in  each
    18  instance,  if  the  court  finds  the  defendant  willfully or knowingly
    19  engaged in an unscrupulous or questionable business practice or required
    20  the consumer to enter such contract or agreement to obtain its benefits.
    21  Any amount of damages awarded to plaintiff in excess of  actual  damages
    22  shall be payable to the state. The court may award reasonable attorney's
    23  fees to a prevailing plaintiff.
    24    §  9.  The public health law is amended by adding a new section 2801-h
    25  to read as follows:
    26    § 2801-h. Prohibition of contractual provisions in health care provid-
    27  er contracts affecting  the  rights,  remedies  or  obligations  between
    28  health  care providers and patients relative to personal injuries to, or
    29  wrongful death of, patients. 1.  Any written contract that a health care
    30  provider requires a person to sign as a condition  to  providing  health
    31  care  services  which  attempts  to affect any legal rights, remedies or
    32  obligations relative to personal injuries  to,  or  wrongful  death  of,
    33  patients  which  may  be  occasioned  in connection with the health care
    34  services rendered shall be deemed unconscionable and entered into by the
    35  person under duress, and is prohibited as against the public  policy  of
    36  the state.
    37    2.  For  the  purpose of this section, the term "health care provider"
    38  shall include, but is not limited to: (a) hospitals, nursing homes,  and
    39  residential  health  care  facilities as defined in section twenty-eight
    40  hundred one of this article; (b) home care service agencies  as  defined
    41  in  section  thirty-six hundred two of this chapter; and (c) physicians,
    42  nurses,  dentists,  podiatrists,  chiropractors,  orthodontists,   nurse
    43  midwives,  nurse  practitioners,  physician  assistants, acupuncturists,
    44  physical therapists, occupational therapists,  speech  therapists,  home
    45  health  aides, nutritionists, medical technicians and dental hygienists,
    46  as well as any groups, corporations, partnerships or joint ventures that
    47  provides such services.
    48    3. Nothing herein shall be deemed to prohibit or otherwise  invalidate
    49  an  otherwise  legally valid consent form being executed by or on behalf
    50  of a person undergoing a  medical,  dental,  podiatric  or  chiropractic
    51  treatment or procedure where such consent is required, provided that the
    52  document  does not attempt to define any rights, remedies or obligations
    53  relative to personal injuries to, or wrongful death of, patients arising
    54  or resulting from, or  contributed  to  by,  the  health  care  services
    55  rendered.

        A. 7597                             5
 
     1    §  10.  If  any  provision  of  this chapter or its application to any
     2  person or circumstance is held invalid, the invalidity does  not  affect
     3  any  other  provisions or application of the provisions of the remainder
     4  to any other person or circumstance, and to this end the  provisions  of
     5  this chapter are severable.
     6    §  11.  This  act shall take effect immediately and apply to contracts
     7  entered into or agreements effective on or after the date  on  which  it
     8  shall  have  become  a law; provided, however, that section four of this
     9  act shall apply to all pending and future actions in which judgment  has
    10  not yet been entered.
Go to top