Sec. 625

General Business Law, Section 625, “Assignment of Contracts for Services”

1. No assignee who takes a note or other obligation as consideration for a contract containing the disclosure requirements of section six hundred twenty-four of this article [Rights of Cancellation of Contracts for Services] shall fail to honor the consumer’s right of cancellation as provided in this article.

2. No creditor holding a note or other obligation, to which a consumer has obligated himself in order to purchase a contract shall fail to honor the consumer’s right of cancellation under this article if:
(a) the creditor is a person related to the seller of services; or
(b) the seller prepares documents used in connection with the loan; or
(c) the creditor supplies forms to the seller used by the consumer in obtaining the loan; or
(d) the creditor makes twenty or more loans in any calendar year, the proceeds of which are used in transactions with the same seller or with a person related to the same seller; or
(e) the consumer is referred to the creditor by the seller; or
(f) the creditor, directly or indirectly, pays the seller any consideration whether or not it is in connection with the particular transactions; or
(g) the creditor participated in or was connected with the sale.

3. No assignee of a contract shall fail to give notice of the assignment to the consumer. A notice of assignment shall be in writing addressed to the consumer at the address shown on the contract and shall identify the contract.

For more information about New York State’s General Business Law regarding Health Club Services, please read this blog post.

About the Author

Alex T. Roshuk is a New York State attorney. He has two law degrees from McGill University, Faculty of Law, Montreal, Canada (B.C.L./LL.B., 1997) and has been practicing law in New York City since 1998 advising businesses, individuals and not-for-profit organizations in transactional and litigation related matters. He was the first legal adviser to the Wikimedia Foundation, Inc. (Wikipedia) from 2003 to 2005 assisting with the organization's tax exempt application to the IRS, trademark applications, and various copyright related issues. Prior to becoming a lawyer Mr. Roshuk worked in the entertainment industry as a film editor, radio announcer, television producer and director and as an administrator and/or director of numerous not-for-profit media arts organizations in the United States and Canada. He studied electrical engineering at Princeton University in the 1970s. He currently lives in Park Slope, Brooklyn.