Laws of the State of New York

within sixty days after the holder is notified thereof in writing by the lessee or, in the absence of such notice, the lessor or holder may voluntarily correct any such failure to comply and, if so corrected, neither the lessor nor the holder shall be liable to a lessee for any penalty under this section. Within sixty days after discovering a violation of the disclosure provisions of this article, and prior to the institution of an action under this section or the receipt of written notice of the violation from the lessee, the lessor or holder may correct the disclosure violation and, if so corrected, neither the lessor nor the holder shall be subject to any penalty under this section.

(b) Nothing in this subdivision shall be construed so as to nullify or impair the right of the attorney general to proceed, under subdivision seven of this section or subdivision twelve of section sixty-three of the executive law, against a lessor or holder who has violated this

article lessor or holder may not be held liable in an action brought un

der this article for a violation of this article that was unintentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid any such error. Examples of a bona fide error include, but are not limited to, clerical, calculation, computer malfunction and programming, and printing errors, except that an error of legal judgment with respect to a person's obligations under this article is not a bona fide error.

10. An action shall not be brought under this article more than four years after the occurrence of the act, method or practice which is the subject of the action or more than one year after the last payment in a transaction involving the method, act or practice which is the subject of_the_action, whichever is later.

§ 347. Liability of assignees. Except where the assignment is involuntary or as otherwise specifically provided in this article, any civil action for a violation of this article which may be brought against a lessor may be maintained against any subsequent assignee of the lessor only if the violation for which the action or proceeding is brought is apparent on the face of the lease application or the retail lease agreement. For purposes of this section, a violation is apparent on the face of these documents if:

1. The agreement contains a disclosure which can be determined to be incomplete or inaccurate from the face of the agreement or other documents assigned; or

2. The agreement or application either contains a prohibited provision or does not contain the notices, legend or items required by this article.

$348. Transactions subject to article by agreement. Parties to a motor vehicle lease agreement that is not a retail lease agreement, defined in subdivision five of section three hundred thirty-one of this article, because the vehicle is not being leased by a natural person primarily for personal, family or household use may agree in a writing signed by then that the agreement is subject to this article. If the parties so agree, the agreement is a retail lease agreement for the purposes of this article.

$349. Applicability of certain provisions hereof to retail lease of a motor vehicle for any use. The provisions of subdivision one of section three hundred thirty-five, section three hundred thirty-six and subdivision eleven of section three hundred thirty-seven of this article shall to a retail lease of a single motor vehicle for any use.

apply to lease. of the provisions of this article by

the lessee shall be unenforceable and void.

§ 351. Supplementary general principles of law applicable. Unless displaced by the particular provisions of this article, other statutes of this state applicable to personal property leases and the principles of law and equity, including the law relative to capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, or other validating or invalidating cause supplement its provisions. In the event of an inconsistency between another statute of this state applicable to personal property leases and this article, the provisions of this article shall control.

$352. Construction against implicit repeal. This article being a general act intended as a unified coverage of its subject matter, no part of it shall be construed to be impliedly repealed by subsequent legislation if that construction can reasonably be avoided.

353. Severability. If any provision of this article or the application thereof to any person or circumstances is held invalid, the inval

idity does not affect other provisions or applications of this article which can be given effect without the invalid provision or application, and to this end the provisions of this article are severable.

§ 32. Paragraph (a) of subdivision 1 of section 5-327 of the general obligations law, as added by chapter 294 of the laws of 1983, is amended to read as follows:

(a) "Consumer contract" means a written agreement entered into between a creditor [or], seller or lessor as one party with a natural person who is the debtor for], buyer or lessee as the second party, and the money, other personal property or services which are the subject of the action are primarily for personal, family or household purposes;

trans

$ 33. Subdivision 1 of section 5-327 of the general obligations law is amended by adding a new paragraph (d) to read as follows:

(d) "Lessor" means a person who regularly leases, or arranges for the lease of, personal property which is the subject of a consumer contract. § 34. Subdivision 2 of section 5-327 of the general obligations law, as added by chapter 294 of the laws of 1983, is amended to read as follows:

2. Whenever a consumer contract provides that the creditor [or], seller or lessor may recover attorney's fees and expenses incurred as the result of a breach of any contractual obligation by the debtor [or], buyer or lessee, it shall be implied that the creditor [or], seller or lessor shall pay the attorney's fees and expenses of the debtor [or], buyer or lessee incurred as the result of a breach of any contractual obligation by the creditor [or], seller or lessor, or in the successful defense of any action arising out of the contract commenced by the creditor [or], seller or lessor. Any limitations on attorney's fees recoverable by the creditor [or], seller or lessor shall also be applicable to attorney's fees recoverable by the debtor [or], buyer or lessee under this section. Any waiver of this section shall be void as against public polic 35. Paragraph (d) of subdivision 1 of section 5-328 of the general obligations law, as added by chapter 708 of the laws of 1985, is amended to read as follows:

(d) "Account" means a loan account, a retail credit account or an obligation under a retail lease agreement, retail instalment contract or retail instalment obligation or a retail instalment credit agreement, defined in [section] sections three hundred one, three hundred thirtyone and four hundred one of the personal property law.

§ 36. Subdivision a of section 5-702 of the general obligations law, as amended by chapter 199 of the laws of 1978, is amended to read follows:

a. Every written agreement entered into after November first, nineteen hundred seventy-eight, for the lease of space to be occupied for residential purposes, for the lease of personal property to be used primarily for personal, family or household purposes or to which a consumer is a party and the money, property or service which is the subject of the transaction is primarily for personal, family or household purposes must be:

1. Written in a clear and coherent manner using words with common and every day meanings;

2. Appropriately divided and captioned by its various sections.

Any creditor, seller or lessor who fails to comply with this subdivision shall be liable to a consumer who is a party to a written agreement governed by this subdivision in an amount equal to any actual damages sustained plus a penalty of fifty dollars. The total class action penalty against any such creditor, seller or lessor shall not exceed ten thousand dollars in any class action or series of class actions arising out of the use by a creditor, seller or lessor of an agreement which fails to comply with this subdivision. No action under this subdivision may be brought after both parties to the agreement have fully performed their obligation under such agreement, nor shall any creditor, seller or lessor who attempts in good faith to comply with this subdivision be liable for such penalties. This subdivision shall not apply to a good faith attempt to describe the constant yield or other method of determining the lease charge and depreciation portions of each base rental payment under a lease of personal property. It also shall not apply to agreements involving amount's in excess of fifty thousand dollars nor prohibit the use of words or phrases or forms of agreement required by EXPLANATION-Matter in italics is new; matter in brackets [ ] is old law to be omitted.

state or federal law, rule or regulation or by a governmental instrumentality. § 37. Subdivision 2 of section 396-z of the general business law is repealed and 14 are renumbered subdivivision2,33,44,55,68,77,88.9.110.111.122 13 and. and 13. § 38. Paragraph (b) of subdivision 1 of section 396-z of the general business law is repealed and paragraphs (c) and (d) are relettered paragraphs (b) and (c);

§ 39. Paragraph (b) of subdivision 1 of section 396-z of the general business law, as added by chapter 784 of the laws of 1988 and as relettered by section thirty-eight of this act, is amended to read as follows:

(b) "Rental agreement" means any written agreement setting forth terms and conditions governing the authorized driver's use of [the] a rental vehicle, as defined in section one hundred thirty-seven-a of the vehicle and traffic law, for a period not to exceed thirty continuous days.

§ 40. Subparagraph (d) of paragraph 3 of subdivision a of section 198-b of the general business law, as amended by chapter 444 of the laws of 1989 is amended to read as follows:

(d) ta lessor selling] the sale of a leased vehicle to that vehicle's lessee, a family member of the lessee, or an employee of the lessee, or

§ 41. Paragraph (e) of subdivision 13 of section 302 of the personal property law, as amended by chapter 504 of the laws of 1964 and as relettered by chapter 602 of the laws of 1971, is amended to read as follows:

(e) the buyer executes a power of attorney appointing the seller or holder of the contract, or other person acting on his behalf, as the buyer's agent in collection of payments under the contract or in the repossession of the motor vehicle; provided, however, that this paragraph shall not prohibit the inclusion in a retail instalment contract of a limited power of attorney or other provision authorizing the holder to execute in the name of the buyer any proofs of insurance claims or losses or to endorse the name of the buyer on any insurance settlement draft or check;

§ 42. Paragraph (f) of subdivision 2 of section 403 of the personal property law, as amended by chapter 299 of the laws of 1970 and renumbered by chapter 237 of the laws of 1973, is amended to read as follows:

(f) The buyer executes a power-of-attorney appointing the seller or holder of the contract or obligation, or other person acting on his behalf, as the buyer's agent in collection of payments under the contract or obligation or in the repossession of goods; provided, however, that this paragraph shall not prohibit the inclusion in a contract or obligation of a limited power of attorney or other provision authorizing the holder to execute in the name of the buyer any proofs of insurance claims or losses or to endorse the name of the buyer on any insurance settlement draft or check.

§ 43. Paragraph (g) of subdivision 13 of section 302 of the personal property law, as amended by chapter 72 of the laws of 1975, is amended to read as follows:

(g) the maturity of any part or all of the amount owing thereon is accelerated where, following [the buyer's] a default consisting solely of the failure to make timely instalment payments and the subsequent repossession of the motor vehicle, the buyer makes timely tender of an amount which would be sufficient to redeem the vehicle in the absence of such provision;

§ 44. Subdivision 3 of section 403 of the personal property law, as added by chapter 504 of the laws of 1964 and as renumbered by chapter 883 of the laws of 1980, is amended to read as follows:

3. No retail instalment contract shall contain any provision by which the maturity of any part or all of the amount owing thereon is accelerated where, following [the buyer's] a default consisting solely of the failure to make timely instalment payments and the subsequent repossession of the goods, the buyer makes timely tender of an amount which would be sufficient to redeem the goods in the absence of such provision.

§ 45. Subdivision 6 of section 301 of the personal property law, as added by chapter 633 of the laws of 1956, is amended to read as follows: 6. "Cash sale price" means the cash sale price stated in a retail instalment contract for which the seller would sell to the buyer, and the

buyer would buy from the seller, the motor vehicle which is the subject matter of the retail instalment contract if the sale were a sale for cash instead of a retail instalment sale. The cash sale price may include any taxes, registration, license and other fees and charges for insurance, for accessories and their installation and for delivering, servicing, repairing or improving the motor vehicle and for other services incidental to the agreement. It also may include the unpaid balance of any amount financed under an outstanding motor vehicle loan agreement or motor vehicle retail instalment contract or the unpaid portion of the early termination obligation under an outstanding motor vehicle retail lease agreement.

$46. Section 396-g of the general business law, as added by chapter 105 of the laws of 1979, subdivision 2 as amended by chapter 22 of the laws of 1980, subdivision 3 as amended by chapter 173 of the laws of 1986, subdivision 4 as added and subdivision 5 as renumbered by chapter 177 of the laws of 1990, subdivision 5 as amended by chapter 282 of the laws of 1983, is amended to read as follows:

§ 396-q. New motor vehicles; sales and leases. 1. Whenever a consumer agrees to purchase or lease a new motor vehicle, as defined in section one hundred twenty-five of the vehicle and traffic law and excluding class A, B and C limited use motorcycles as defined in section one hundred twenty-one-b of the vehicle and traffic law, from a dealer and signs a contract supplied by such dealer, the dealer or an employee of the dealer shall also sign the contract. [Such] For purposes of contract formation, such signature shall be presumed to be an authorized signature.

2. If a [trade in] trade-in allowance is agreed upon between a consumer and a dealer, such allowance must be contained in writing within the contract. If a consumer signs a contract supplied by a dealer for the purchase or lease of a motor vehicle and the contract contains a [trade in] trade-in allowance, such allowance shall not be reduced upon delivery of the [trade in] trade-in vehicle; provided that the value of the [trade in] trade-in vehicle is not materially diminished as a result of physical damage, alteration or deterioration in mechanical condition other than normal wear and tear.

3. If an interest rate on the financing of the sale of a car is offered to the consumer by the dealer, at the time a deposit is made or a bona fide customer order is executed, that interest rate shall be guaranteed by the dealer as of the date of the deposit or order, if the financing of the sale is to be provided by the dealer. If an interest rate on the financing of the sale of a car is offered to the consumer by a manufacturer, through a dealer, at the time a deposit is made or a bona fide customer order is executed, that interest rate shall be guaranteed by the manufacturer as of the date of the deposit or order, if the financing of the sale is to be provided by the manufacturer. an interest rate on the financing of the sale of a car is offered to the consumer by a financing agency as defined by subdivision nine of section three hundred one of the personal property law, through a dealer, at the time a deposit is made or a bona fide customer order is executed, that

interest rate shall be guaranteed by such financing agency as of the date of the deposit or order, if the financing of the sale is to be provided by such financing agency.

4. If at the time a new motor vehicle is delivered by a dealer to the consumer, such motor vehicle is not equipped with the specific options or equipment ordered by the consumer as stipulated in the purchase contract, the dealer shall offer to reduce the price stated in the contract by the dollar amount of the equipment that has not been provided. No dealer shall be entitled to receive or collect payment for any ordered merchandise, accessories or equipment which in fact was not provided at the time of delivery of the vehicle unless the consumer indicates a willingness in writing to wait for a stated period of time for the option or equipment to become available or be installed. Nothing in this subdivision shall in any way limit the rights or remedies which are otherwise available to a consumer under any other provision of law, including, but not limited to, the right to refuse to accept delivery of a vehicle not equipped as stipulated in the purchase contract.

5. Any dealer or employee of a dealer who violates any of the provisions of this section shall be guilty of an offense and subject to fine not to exceed fifty dollars.

EXPLANATION-Matter in italics is new; matter in brackets [ ] is old law to be omitted.

In addition, any individual injured by reason of a violation of subdivision three of this section, may bring an action to recover actual damages and reasonable attorney's fees and costs.

§ 47. Paragraph e of subdivision 9 of section 415 of the vehicle and traffic law, as amended by chapter 470 of the laws of 1992, is amended to read as follows:

e. Has wilfully violated any provisions of the motor vehicle retail instalment sales act or the motor vehicle retail leasing act; or

$48. Subsection (a) of section 107 of the insurance law is amended by adding a new paragraph 52 to read as follows:

(52) "Gap amount" means:

(A) in the case of lessee gap insurance, the difference, if any, between:

(i) the amount owed by the lessee, under the early termination provision of a lease of personal property, as of the date of a total loss of the leased property caused by it's theft or physical damage; and

(ii) the sum of: (1) any unpaid rental payments and other unpaid charges, arising from the failure of the lessee to fulfill his or her obligations under the lease, that had accrued prior to the date of the loss; and (II) the actual cash value of the personal property as of the date of the loss. If the lessee is required under the lease agreement to maintain a physical damage insurance policy on the personal property which is the subject of the lease agreement, and that policy is in effect on the date of the loss, then "actual cash value" shall have the same meaning as under the casualty insurance policy.

(B) In the case of lessor gap insurance, the difference, if any, between:

(1) the amount that would have been owed by the lessee, under the early termination provision of a lease of personal property, as of the date of a total loss of the leased property caused by its theft or physical damage had the lessor not waived the obligation of the lessee l ́iable under the early termination provision in the event of such a total loss; and (11) the Sum of: (I) any unpaid rental payments and other unpaid charges, arising from the failure of the lessee to fulfill his or her obligations under the lease, that had accrued prior to the date of the loss; and (II) the actual cash value of the personal property as of the date of the loss. If the lessee is required under the lease agreement to maintain a physical damage insurance policy on the personal property which is the subject of the lease agreement, and that policy is in effect on the date of the loss, then "actual cash value" shall have the same meaning as under the physical damage insurance policy.

between:

(1) the amount owned by the borrower under the loan as of the date of a total loss of the personal property which is the subject of the loan agreement caused by its theft or physical damage; and

(ii) the sum of: (I) any unpaid loan payments and other unpaid charges, arising from the failure of the borrower to fulfill the obligations under the loan agreement, that had accrued prior to the date of the loss; and (II) the actual cash value of the personal property as of the date of the loss. If the borrower is required under the loan agreement to maintain a physical damage insurance policy on the personal property which is the subject of the loan agreement, and that policy is in effect on the date of the loss, then "actual cash value" shall have the same meaning as under the physical damage insurance policy.

(D) In the case of lender gap insurance, the difference, if any, between:

(1) the amount that would have been owed by the borrower under the loan as of the date of a total loss of the personal property which is the subject of the loan agreement caused by its theft or physical damage, and

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Laws of the State of New York, Volume 1, Parts 1-53