What's happening
This bill raises the threshold for plain language requirements in consumer contracts from $100,000 to $250,000 in New York.
Why it matters
More high-value contracts exempted. By raising the threshold to $250,000, this bill means that businesses can use more complex or technical language in contracts above that amount, potentially making large transactions less accessible to non-expert consumers.
Potential shift in consumer protection. Fewer contracts will require plain language, which could make it harder for consumers involved in higher-value deals to fully understand their rights and obligations without legal help.
Reduced liability for businesses. Sellers, creditors, and lessors dealing in contracts above $250,000 will face less risk of penalties for not using plain language, possibly reducing compliance costs for those handling larger transactions.
Reflects inflation or business realities. The change acknowledges that the value of money and the nature of large transactions may have evolved since the original threshold was set, but it also means the law’s protective scope is narrowed.
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Who cares
Headline styles
Raise Plain Language Threshold
Plain English, a few words. Used as the page title.
Sponsors
Senator · Senate District 26
1 Co-sponsor
History
- Substituted by A2653A
- Advanced to third reading
- 2nd report cal.
- 1st report cal.699
- Referred to judiciary
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Raise Plain Language Threshold
Signed by Governor · Sponsor Jeffrey Dinowitz
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3704
2019-2020 Regular Sessions
IN SENATE
February 13, 2019
Introduced by Sen. KAVANAGH -- read twice and ordered printed, and when printed to be committed to the Committee on Judiciary
AN ACT to amend the general obligations law, in relation to requirements for the use of plain language in consumer transactions
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The closing paragraph of subdivision a of section 5-702 of the general obligations law, as amended by chapter 484 of the laws of 2018, is amended to read as follows:
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 amounts in excess of [one] two hundred fifty thousand dollars nor prohibit the use of words or phrases or forms of agreement required by state or federal law, rule or regulation or by a governmental instrumentality.
§ 2. This act shall take effect on the one hundred eightieth day after it shall have become a law and shall apply to any contract entered into after such effective date; provided, however, that if chapter 484 of the laws of 2018 shall not have taken effect on or before such date then section one of this act shall take effect on the same date and in the same manner as such chapter of the laws of 2018 takes effect.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD09472-01-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the general obligations law, in relation to requirements for the use of plain language in consumer transactions
Purpose
Increases the applicability of the plain language law to consumer contracts involving amounts up to $250,000
Summary of provisions
Section One amends the closing paragraph of subdivision a of section 5-702 of the general business law to increase the threshold for the use of "plain language" in consumer contracts from $100,000 to $250,000.
Section Two is the effective date.
Justification
New York State first enacted the plain language law in 1977. The statute requires "plain language" in certain written agreements to which a consumer is a party, and where the subject money, property or services are primarily used for personal, family, or household purposes. A dollar threshold was placed on the definition of "consumer contracts", making the statute only applicable to transactions valued at less than $50,000. This bill proposes to increase the threshold from $100,000 to $250,000. Since the enactment of this statute, several states have followed New York's lead and have adopted its own "plain language" statutes.
Legislative history
2019: A2653 - referred to judiciary
2018: S7074/A1085A - DELIVERED TO GOVERNOR AND SIGNED CHAP. 484
2017: A1085A - referred to codes
Fiscal impact on the state
None.
Effective date
This act shall take effect on the one hundred eightieth day after it shall have become a law and shall apply to any contract entered into after such effective date.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.