NY Pers Prop L § 337 (2021)
2021 New York Laws PEP - Personal Property Article 9-A - Motor Vehicle Retail Leasing Act 337 - Requirements as to Retail Lease Agreements.

§  337.  Requirements as to retail lease agreements. 1. A retail lease agreement shall be in a writing and, except  as  otherwise  provided  in subdivision  two  of  section  three hundred forty-five of this article, signed contemporaneously  by  the  lessor  and  the  lessee.  Except  as provided  in  sections  three  hundred  thirty-five  and  three  hundred thirty-six of this article, a retail lease agreement shall contain in  a single document all the agreements of the parties.   2.  The  printed portion of the agreement shall be printed in at least eight-point type  in  ink  that  contrasts  with  the  paper  used.  The agreement shall contain the following items printed or written in a size equal to at least ten-point bold type:  (a)  Both  at  the  top  of the agreement and directly above the space reserved for the signature of the lessee, the words  "LEASE  AGREEMENT", "RETAIL LEASE AGREEMENT" or "MOTOR VEHICLE LEASE AGREEMENT";  (b)  A  specific statement that physical damage or liability insurance coverage for bodily injury and property damage caused to others  is  not included, if that is the case; and  (c)  Directly  above the acknowledgment permitted by subdivision three of this section to appear above the space reserved for the signature  of the  lessee,  a written notice informing the lessee that: (i) the lessee should not sign the agreement before  he  or  she  reads  it  or  if  it contains  any  blank  space;  and  (ii)  the  lessee  is  entitled  to a completely filled in copy of the agreement when he or she  signs  it.  A notice  substantially  similar to the following notice complies with the requirements of this paragraph: "NOTICE TO THE LESSEE: 1.  Do  not  sign this agreement before you read it or if it contains any blank space.   2.  You  are entitled to a completely filled in copy of this agreement when you sign it."   3. The lessor shall deliver to the lessee, or mail to him  or  her  at his  or  her  address  shown  on  the agreement, a copy of the agreement signed by the lessor. Until the lessor does so, a  lessee  who  has  not received delivery of the motor vehicle shall have an unconditional right to  cancel  the  agreement  and  to  receive  an immediate refund of all payments made and redelivery of all goods traded-in  to  the  lessor  on account  of  or in contemplation of the agreement. Any acknowledgment by the lessee of delivery of a copy of the agreement shall  be  printed  or written  in  a  size  equal  to  at  least eight-point bold type and, if contained in the agreement,  shall  appear  directly  above  the  legend required  by  paragraph (a) of subdivision two of this section to appear directly above the space reserved for the signature of the lessee.   4. The agreement shall contain the names of the lessor and the lessee, the place of business of the lessor, the residence or place of  business of  the lessee as specified by the lessee and a description of the motor vehicle including its make, year model, model and identification  number or marks.   5. The agreement shall contain:  (a) All items required to be disclosed by the act of Congress entitled "Consumer  Leasing  Act of 1976" and the regulations thereunder, as such act and regulations may from time to time be amended; provided, however, that the disclosures required by the  "Consumer  Leasing  Act  of  1976" shall  be  made  in  all  leasing  transactions  covered by this article regardless of the exemption in the "Consumer Leasing Act  of  1976"  for lease  transactions  in  which  the total contractual obligation exceeds twenty-five thousand dollars;  (b) The capitalized cost, using the  term  "capitalized  cost"  and  a descriptive  explanation  such  as  "the sum of the adjusted capitalized cost and any capitalized cost reduction. The capitalized  cost  and  the amount of the rental payment may be negotiable";  (c)  The  adjusted  capitalized  cost  of  the vehicle, using the term "adjusted capitalized cost", a  descriptive  explanation  such  as  "the amount  which is capitalized in connection with the lease and is used in determining  the  amount  of  your  periodic  payment"  and  immediately thereafter one of the following additional explanatory statements:  (i)  In  the  case  of  an agreement which provides for an "additional early  termination  charge"  and  whose  early  termination   provisions expressly  refer  to  the  "adjusted capitalized cost," a statement that "this amount plus the additional early termination charge will  be  used in determining your early termination liability";  (ii)  In  the  case  of an agreement which provides for an "additional early termination charge" and whose early termination provisions do  not expressly  refer  to  the  "adjusted capitalized cost," a statement that "this amount plus the additional early termination charge will  be  used in determining the legal limit on your early termination liability";  (iii)  In  the  case  of  an  agreement  which does not provide for an "additional  early  termination  charge"  and  whose  early  termination provisions  expressly  refer  to  the  "adjusted  capitalized  cost,"  a statement that "this amount will  be  used  in  determining  your  early termination liability"; or  (iv)  In  the  case  of  an  agreement  which  does not provide for an "additional  early  termination  charge"  and  whose  early  termination provisions  do not expressly refer to the "adjusted capitalized cost," a statement that "this amount will be used in determining the legal  limit on your early termination liability";  (d)  The  amount,  if  any, included for insurance and other benefits, specifying and describing the coverages and the amount included for each type of coverage;  (e) In close proximity to the  adjusted  capitalized  cost  disclosure required  by  paragraph  (c) of this subdivision and only as applicable, any  additional  early  termination  charge  provided  for   under   the agreement, using the term "additional early termination charge", and one of the following descriptive explanations:  (i)  In  the  case  of an agreement whose early termination provisions expressly refer to the "adjusted additional early termination charge," a descriptive explanation such as "an additional  amount  the  unamortized portion  of  which  will  be  used in determining your early termination liability"; or  (ii) In the case of an agreement whose  provisions  do  not  expressly refer  to  the  "additional  early  termination  charge,"  a descriptive explanation such as "an additional amount  the  unamortized  portion  of which  will  be  used  in  determining  the  legal  limit  on your early termination  liability";   and   immediately   after   the   descriptive explanation   additional   explanatory   statements  that  "this  amount represents the total costs and damages,  in  addition  to  the  adjusted capitalized  cost,  which  we  would  incur if this agreement were to be terminated before you had made any rental payments."  (f)  In  close  proximity  to  the  "adjusted  capitalized  cost"  and "additional early termination charge" disclosures required by paragraphs (c) and (e) of this subdivision, one of the following statements:  (i)  In  the  case  of  an agreement which provides for an "additional early termination charge" and whose early termination provisions do  not expressly  refer  to  either  the  "adjusted  capitalized  cost"  or the "additional early termination charge," a statement that  "although  they are  not  referred to in the early termination provisions of this lease, the 'adjusted capitalized cost' and the  'additional  early  termination charge'  may  be  used  to  compare  the early termination provisions of competing lessors";  (ii) In the case of an agreement which  provides  for  an  "additional early  termination charge" and whose early termination provisions do not expressly  refer  to  the  "additional  early  termination  charge,"   a statement  that  "although  the 'additional early termination charge' is not  referred  to in the early termination provisions of this lease, the 'additional early termination  charge'  and  the  'adjusted  capitalized cost'  may  be  used  to  compare  the  early  termination provisions of competing lessors";  (iii) In the case of an agreement which provides  for  an  "additional early  termination charge" and whose early termination provisions do not expressly refer to the "adjusted capitalized  cost,"  a  statement  that "although  the  'adjusted  capitalized  cost'  is not referred to in the early termination provisions of this lease,  the  'adjusted  capitalized cost'  and  the  'additional  early  termination  charge' may be used to compare the early termination provisions of competing lessors";  (iv) In the case of an agreement which  provides  for  an  "additional early   termination  charge"  and  whose  early  termination  provisions expressly refer  to  both  the  "adjusted  capitalized  cost,"  and  the "additional  early  termination charge," a statement that "the 'adjusted capitalized cost' and the 'additional early termination charge'  may  be used to compare the early termination provisions of competing lessors";  (v)  In  the  case  of  an  agreement  which  does not provide for any "additional  early  termination  charge"  and  whose  early  termination provisions  do not expressly refer to the "adjusted capitalized cost," a statement that "although the 'adjusted capitalized cost' is not referred to in the early termination provisions  of  this  lease,  the  'adjusted capitalized   cost'  may  be  used  to  compare  the  early  termination provisions of competing lessors"; or  (vi) In the case of an  agreement  which  does  not  provide  for  any "additional  early  termination  charge"  and  whose  early  termination provisions  expressly  refer  to  the  "adjusted  capitalized  cost,"  a statement  that  "the 'adjusted capitalized cost' may be used to compare the early termination provisions of competing lessors."  (g) A statement in at least eight-point bold type informing the lessee that he or she has the right to terminate the agreement  voluntarily  at any  time  after  the  first fifty percent of the total number of months constituting the full scheduled lease term, or earlier if the  agreement so  provides,  if  he or she is in full compliance with the terms of the agreement and satisfies his or her early termination obligation;  (h) A statement in at least eight-point bold type to the  effect  that "early termination may require you to pay a substantial charge";  (i)  A  statement  in  at least eight-point bold type stating that the lessee shall not be liable for an early termination fee if he or she has deceased before the end of the lease;  (j) A provision permitting a lessee whose default consists  solely  of the  failure  to  make timely rental payments to cure his or her default and reinstate the  agreement,  without  losing  any  rights  or  options previously  acquired  under the agreement, by paying all past due rental and  delinquency  charges  and,  if  the  agreement   so   provides,   a reinstatement  fee  not  to  exceed  ten  dollars  and  the  actual  and reasonable costs of repossession, storage, pickup and redelivery  within twenty-five  days  after the lessee is sent written notice of his or her reinstatement rights. The reinstatement right granted pursuant  to  this paragraph  may  be  restricted  to  a lessee who has not previously been afforded the opportunity to reinstate the  agreement.  For  purposes  of this  paragraph,  a  rental  charge is past due if it is not paid by its scheduled  due  date  or  within  any  grace  period  specified  in  the agreement;  (k)  The  estimated  residual  value  of  the  vehicle, using the term "estimated residual value";   * (l)  In  the case of an agreement which does not obligate the lessee upon a total loss of the vehicle occasioned by  its  theft  or  physical damage  for  any  of  the  items  specified in paragraphs (e) and (f) of subdivision one of section three hundred forty-one of  this  article,  a conspicuous notice that the lessee has no such obligation.   * NB There are 2 par (l)'s   * (l)  The  liability of the lessee in the case of a total loss of the vehicle or the vehicle is rendered inoperable. Disclosure  of  liability pursuant  to this paragraph shall include the financial liability of the lessee and the lessor's rules, policies and procedures in the event  the car  is  declared a total loss or rendered inoperable during the term of the lease.   * NB There are 2 par (l)'s   Nothing in this subdivision  prevents  a  holder  from  attempting  to repossess  a  vehicle,  accepting  its voluntary surrender or selling it during the reinstatement period,  but  such  a  repossession,  voluntary surrender,  or  sale  shall  not  affect  the reinstatement right of the lessee. Upon reinstatement, the holder shall provide the lessee with the same vehicle leased by the lessee prior to  reinstatement  or,  if  that vehicle  is  not  available,  a  substitute vehicle of comparable worth, quality and condition.   6. (a) (i) The amount, if any, included  for  liability  insurance  or insurance  on  the vehicle, shall not exceed the premiums charged by the insurance company for  such  insurance.  The  holder,  if  the  cost  of liability  insurance  or insurance on the motor vehicle is included in a retail lease agreement and the policy or policies are delivered  to  the holder,  shall  within  thirty  days after execution of the retail lease agreement, send or cause to be sent to the lessee a copy of  the  policy or  policies  of insurance, issued by an insurance company authorized to do that kind of insurance business in this state, clearly setting  forth the  amount of the premium, the kind or kinds of insurance and the scope of the coverage and all the terms, exceptions, limitations, restrictions and conditions of the contract or contracts of insurance.  (ii) The lessee of a motor vehicle  under  a  retail  lease  agreement shall  have  the privilege of purchasing such insurance from an agent or broker of his or her own selection and of selecting an insurance company acceptable to the lessor; provided, however, that the inclusion  of  the insurance  premium in the retail lease agreement when the lessee selects the agent, broker or company, shall be optional with the lessor  and  in such  case  the  lessor or assignee shall have no obligation to send, or cause to be sent, to the lessee a copy of the policy of insurance.  (b) If any such policy of liability  insurance  or  insurance  on  the motor  vehicle  is  cancelled,  the  unearned  insurance  premium refund received or receivable by the holder of the agreement or, if the  amount included therefor in the agreement exceeds the cost to the holder of the agreement  for  such  insurance,  the  unearned portion of the amount so included, shall be  either:  (i)  refunded  to  the  lessee  within  ten business  days  after  it  is  received by the holder; or (ii) credited, together with the  unearned  portion  of  the  lease  charge  applicable thereto,  to the final maturing rental payments or, at the option of the holder, to the end of term obligations under the retail lease  agreement except  to  the  extent  applied  toward  payment  for similar insurance protecting the interests of the lessee and the holder of  the  agreement or  either  of them, provided that no such credit or refund need be made if the amount thereof would be less than one dollar.  (c) The amount, if any, included for group  credit  insurance  or  for insurance  other than gap insurance, liability insurance or insurance on the motor vehicle shall not exceed the premiums charged by the insurance company for such insurance. If such group credit or other  insurance  is cancelled  the  refund  for  unearned  insurance  premiums  received  or receivable by the holder of the agreement, or the excess of  the  amount included  in  the agreement for group credit or other insurance over the premiums paid or payable by the holder of the agreement  therefor  shall be  either: (i) refunded to the lessee within ten business days after it is received by the holder; or (ii) credited, together  with,  in  either case,  the  unearned  portion of the lease charge applicable thereto, to the final maturing rental payments or, at the option of the  holder,  to the  end  of term obligations under the retail lease agreement, provided that no such credit or refund need be made if the amount  thereof  would be less than one dollar.  (d)  The  amount  of  any separate charge included for a waiver by the lessor of its contractual right to hold the lessee liable  for  the  gap amount  shall  not  exceed the cost of lessor gap insurance covering the retail lease transaction.   7. (a) If the lessee is obligated in  connection  with  the  lease  to maintain  liability  insurance or insurance on the motor vehicle that is the subject of the agreement and if subsequent to the execution  of  the agreement  the  lessee  fails  to  maintain  the required insurance, the holder may make advances to procure the equivalent limits  of  insurance for either the interests of the lessee and the holder or the interest of either of them, and any amount so advanced may be the subject of a lease charge as though such amount was part of the initial lease value.  (b)  If  under subdivision two of section three hundred thirty-five of this article, the lessor waives its contractual right to hold the lessee liable for the gap amount, and lessor gap insurance coverage  which  the lessor   or   holder   purchased  in  connection  with  the  transaction subsequently is terminated prior to the filing of a  claim  due  to  the insolvency  of  the insurance company, notwithstanding the provisions of paragraph three of subsection (b) of section one  thousand  one  hundred one  of  the  insurance  law  the  holder may make an advance to procure equivalent limits of lessor gap insurance covering the  transaction  and any  amount  so  advanced may be the subject of a lease charge as though such amount was part of the capitalized cost.  (c) Each amount so advanced shall be subject to the default provisions of the lease agreement if so provided in the agreement and if the holder notifies the lessee in writing of the advance of such amount and of  his or her option to repay such amount in any one of the following ways:  (i)  Full  payment  within ten days from the date of giving or mailing the notice;  (ii) Full amortization  during  the  term  of  the  insurance  or  the remaining term of the agreement, at the option of the holder;  (iii) If offered by the holder, as a final balloon payment payable one month after the last scheduled payment under the agreement;  (iv) If offered by the holder, full amortization after the term of the agreement,  to  be  made  in  periodic  payments which do not exceed the average periodic payment under the agreement; or  (v) If offered by the holder, any other amortization plan.   If the lessee neither pays in full the amount so advanced nor notifies the holder in writing of his or her choice  regarding  the  amortization options  before  the  expiration  of ten days from the date of giving or mailing the notice by the holder, the holder shall amortize  the  amount so  advanced  pursuant  to  subparagraph  (ii)  of paragraph (c) of this subdivision.    8. (a) The holder of a retail lease agreement may, if the agreement so provides, collect a delinquency and collection  charge  on  each  rental payment  in default for a period not less than ten days in an amount not in excess of the amount or  amounts  agreed  to  in  the  agreement.  In addition  to  a  delinquency  and  collection  charge,  the retail lease agreement may provide for the payment of reasonable attorneys' fees  not exceeding  fifteen  percent  of  the  amount  due  and payable under the agreement where the agreement is referred to an attorney not a  salaried employee  of  the holder of the agreement for collection, plus the court costs.  (b) The holder may not assess or collect a delinquency and  collection charge  under  paragraph  (a)  of  this subdivision on a rental payment, which payment is otherwise a full payment for the applicable period  and is  paid  within ten days after its scheduled or deferred due date, when the only delinquency  is  attributable  to  delinquency  and  collection charges assessed on an earlier rental payment or payments.   9. No retail lease agreement shall be signed by any party thereto when it contains blank spaces to be filled in after it has been signed except that,  if  delivery  of the motor vehicle is not made at the time of the execution of the agreement, the identifying  numbers  or  marks  of  the motor  vehicle  or  similar  information  and  the due date of the first payment may be inserted  in  the  agreement  after  its  execution.  The lessee's  written  acknowledgment,  conforming  to  the  requirements of subdivision three of  this  section,  of  delivery  of  a  copy  of  the agreement  shall  be conclusive proof of such delivery and of compliance with this subdivision in any action  or  proceeding  by  or  against  an assignee  of  the agreement without knowledge to the contrary when he or she purchases the agreement.   10. No retail lease agreement shall contain any provision by which the lessee agrees not to assert against a  holder  a  claim  or  defense  or require  or  entail  the execution of any note or series of notes which, when separately negotiated, will cut off as to third parties  any  right of  action  or defense which the lessee may have against the lessor. The holder of a retail lease agreement shall be subject to  all  claims  and defenses  of  the  lessee  against  the  lessor  arising  from the lease notwithstanding  any  agreement  to  the  contrary,  but  the   holder's liability  under  this  subdivision shall not exceed the amount owing to the holder at the time the claim or  defense  is  asserted  against  the holder.  The holder shall have recourse against the lessor to the extent of any liability incurred by the holder  pursuant  to  this  subdivision regardless  of  whether  the  assignment  of  the  agreement was with or without recourse.   11. Notwithstanding any contrary provision of this chapter,  the  lien law,  banking law or other law: (a) a person may purchase a retail lease agreement from a lessor on such terms and conditions and for such  price as  may be mutually agreed upon; and (b) no filing of the assignment, no notice to the lessee of the assignment,  and  no  requirement  that  the lessor  be deprived of dominion over payments upon the agreement or over the vehicle if repossessed by  or  returned  to  the  lessor,  shall  be necessary  to  the  validity  of  a written assignment of a retail lease agreement  as  against  creditors,  subsequent   purchasers,   pledgees, mortgagees or encumbrancers of the lessor.   12. Unless the lessee has notice of actual or intended assignment of a retail  lease  agreement,  payment  thereunder made by the lessee to the last known holder of such agreement shall be binding upon all subsequent holders or assignees. A notification which does not reasonably  identify the  rights  assigned  is  ineffective.  If requested by the lessee, the assignee shall furnish reasonable proof that  the  assignment  has  been  made  and  unless  he  or  she  does  so the lessee may pay the original lessor.   13.  (a)  Upon written request from the lessee, the holder of a retail lease agreement shall give or forward to the lessee a written  statement of  the  dates  and  amounts  of the rental payments that have been made under the agreement  and  the  total  amount  of  the  remaining  rental payments. A lessee shall be given a written receipt for any payment when made in cash.  (b)  Upon  written  request  from  a  lessee  who  is then entitled to terminate the agreement early, the holder of a  retail  lease  agreement shall  give  or  forward to the lessee a written statement of his or her gross early termination liability under the agreement.   14. No retail lease agreement shall contain any  provision  applicable to  a natural person who leases a vehicle primarily for personal, family or household use by which:  (a)  in  the  absence  of  the  lessee's  default,  the  holder   may, arbitrarily and without reasonable cause, accelerate the maturity of any part or all of the amount owing thereon;  (b) a power of attorney is given to confess judgment, or an assignment of wages is given;  (c)  the  lessor  or holder of the agreement or other person acting on his or her behalf is given authority to enter upon the lessee's premises unlawfully, or to commit any breach of the peace in the repossession  of the motor vehicle;  (d) the lessee waives any right of action against the lessor or holder of  the  agreement, or other person acting on his or her behalf, for any illegal act committed in the collection of payments under the  agreement or in the repossession of the motor vehicle;  (e)  the  lessee executes a power of attorney appointing the lessor or holder of the agreement, or other person acting on his or her behalf, as the lessee's agent in collection of payments under the agreement  or  in the  repossession  of  the  motor  vehicle; provided, however, that this paragraph shall not prohibit the inclusion in a retail  lease  agreement of a limited power of attorney or other provision authorizing the holder to  execute  in the name of the lessee any proofs of insurance claims or losses or to endorse the name of the lessee on any insurance  settlement draft or check;  (f)  the  lessor is relieved from liability for any legal remedy which the lessee may have had against the lessor under the agreement,  or  any separate instrument executed in connection therewith;  (g)  the  maturity  of  any part or all of the amount owing thereon is accelerated where, following a default consisting solely of the  failure to  make timely rental payments, a lessee who has the right to reinstate the agreement makes timely tender of an amount which would be sufficient to reinstate the agreement under paragraph (i) of  subdivision  five  of this section;  (h)  the  lessee  waives any right to a trial by jury in any action or proceeding arising out of the agreement; or  (i) a lessee who is not in default of his or her obligations under the agreement would be prohibited from terminating the agreement at any time after the expiration of the first fifty percent of the total  number  of months  of the lease term. The exercise of this right to terminate early voluntarily is contingent upon the lessee discharging fully his  or  her liability under the early termination provisions of the agreement.   15.  Any  such  prohibited  provision  shall  be  void  but  shall not otherwise affect the validity of the agreement.   16. Where necessary to ensure consistency with the  pronoun  usage  in the  underlying  agreement,  any language required by this article to be  used in connection with a required disclosure may be modified  to  refer to the lessee in the first person and the holder in the second person.