N.Y. General Business Law § 399-c: Mandatory arbitration clauses in certain consumer contracts prohibited

§ 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.

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

arbitration 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.