Bill > S04996

This bill amends New York's general business law to define and regulate unconscionable terms in standard form contracts, which are contracts where only one party (typically an individual) does not draft the agreement. The bill creates a rebuttable presumption that certain contract provisions are unconscionable, including requirements for legal claims to be resolved in inconvenient venues, waivers of statutory rights or punitive damages, unreasonable filing deadlines, excessive legal fees, and contracts that do not clearly advise individuals to consult legal counsel. The bill establishes that including these terms is an unfair and deceptive practice, for which a prevailing party can receive $1,000 in statutory damages per violation. Notably, the bill allows employees to bring claims against employers even if not typically permitted by labor law. When determining unconscionability, courts should consider common law principles and the Uniform Commercial Code. The bill also creates a presumption against severability of unconscionable terms, meaning if one term is found unconscionable, the entire provision may be invalidated. The law will take effect on the first of January following its passage and will apply to contracts entered into on or after that date.

Business and Industry

https://www.nysenate.gov/legislation/bills/2025/S4996