Re: Self renewing contracts?

[Mike Sokoly <secure15@xxxxxxxxxxxxx>]

Here's the Deal in New York
> NY CLS Gen Oblig § 5-903 (2004)
>
> § 5-903. Automatic renewal provision of contract for service,
> maintenance or repair unenforceable by contractor unless notice
> thereof given to recipient of services
>
> 1. As used in this section, "person" means an individual, firm,
> company, partnership or corporation.
>
> 2. No provision of a contract for service, maintenance or repair to
> or for any real or personal property which states that the term of
> the contract shall be deemed renewed for a specified additional
> period unless the person receiving the service, maintenance or repair
> gives notice to the person furnishing such contract service,
> maintenance or repair of his intention to terminate the contract at
> the expiration of such term, shall be enforceable against the person
> receiving the service, maintenance or repair, unless the person
> furnishing the service, maintenance or repair, at least fifteen days
> and not more than thirty days previous to the time specified for
> serving such notice upon him, shall give to the person receiving the
> service, maintenance or repair written notice, served personally or
> by certified mail, calling the attention of that person to the
> existence of such provision in the contract.
>
> 3. Nothing herein contained shall be construed to apply to a contract
> in which the automatic renewal period specified is one month or less.
>  ould be on firmer ground claiming that the initial contract
> automatically renewed. However, the subscriber might successfully
> defend by claiming the by sending out the proposed new contract which
> never got signed, that the old contract ended and that the
> relationship continued without any written contract, therefore
> terminable at will. It would probably be a better practice to decide
> whether you want to rely on the renewal clause or a new contract, not
> both.

> Automatic Renewal Provision
>
> Why is there such a problem with this topic? Alarm contracts have
> automatic renewal clauses in them. Some contracts are for an initial
> term of 3 to 5 years, some 10 or more. The renewal can be for 1 year,
> 5 years, or whatever you make it.
>
> An automatic renewal clause should and will be enforced (its legal)
> unless:
>
> 1. there is a statute that prohibits it
>
> 2. there is legal case law that refuses to enforce it (usually on the
> grounds that the particular provision is unconscionable [shocks the
> conscience of the court).
>
> I am not aware of a Federal law that deals with the automatic renewal
> clause (if you know of one let me know the statute). Some states do
> have statutes that deal with the issue. In New York for example an
> automatic renewal clause is not enforceable unless the provider of
> the service (the alarm company) sends a separate notice advising the
> customer of the provision. The notice has to be sent by certified
> mail or personally delivered between 15 and 30 days prior to the
> renewal date. Failure to give the notice renders the automatic
> renewal provision unenforceable.
>
> Check the statutes in your state to find out if there is a similar
> provision that you must comply with.
>
> If there is no state law provision then you only need to be concerned
> that your contract term does not run afoul of common sense or
> decency. A 5 year initial term with a 10 year renewal written in
> obscure print buried in the contract may not be enforced. I think you
> get the idea. The standardized contracts that I offer to the trade
> are 5 year initial term and 5 year renewal. We have not had
> difficulty with those terms. We have also had success with 10 year
> initial term contracts with 5 year renewals.
>
> For a list of the standardized contracts see our web site at
>
> Some alarm companies have a policy of sending out new contracts
> rather than relying on their renewal provision. Unless the new
> contract is for an extended period and the renewal is for a shorter
> period, like one year, I don?t see the wisdom in going to the trouble
> of preparing and sending a new contract. If you are required to send
> a notice of the automatic renewal you should comply with that; after
> all, the new contract may not get signed and returned.
>
> Another little mistake I think some companies make is to send out a
> new contract and call it a renewal contract. The phrase "renewal
> contract" has caused many different types of problems in litigation.
> One thing you need to be mindful of is that the contract, now labeled
> a "renewal contract" may have several provisions in it that have
> triggering events that will not be taking place with the renewal
> contract, such as an installation of equipment, or a provision that
> says the contract is for 5 years after the installation of equipment.
> In a renewal situation that provision can cause the subscriber to
> claim that the equipment was installed long time ago when the first
> contract was signed and therefore the 5 years ran before the renewal
> contract was even signed, thereby permitting the subscriber to cancel
> anytime; not a position you need to litigate and one you can easily
> avoid by knowing what is in your contract.
>
> If your contract has an automatic renewal provision in it then I
> suggest you rely on it. If you want to have a new contract signed
> during the term of an existing contract that is fine. You should
> probably offer some incentive for a subscriber to sign a new
> contract, such as a free inspection, free piece of equipment, an
> upgrade in equipment or a rate freeze or decrease. Giving something
> for the new contract will help establish your consideration and avoid
> an issue that the subscriber was duped into signing a new long term
> contract. Let a sense of fairness be your guide.

Many Thanks to Ken Kirschenbaum @www.alarmcontracts.com for the Above Info






thesatguy1@xxxxxxxxxxxxx wrote:
> I can auto renew provided the renewal term is specified in the
> contract and is not limited by other state laws.  In some states it
> can only renew for one year and in some states you must notify the
> customer just before the automatic renewal takes effect.
>
> Tell the customer to send a certified letter to p1 requesting a copy
> of her contract - they have to provide it cause thats the law in
> every state - and when you get it check to see if it is actually a
> valid contract.  If they fail to provide a copy of the contract send
> another letter telling them any agreement is cancelled effective
> immediately.
>
> Now, it may be that the contract they have is not even a contract the
>  customer signed; it may be a contract somebody else signed and then
> they moved into the house and assumed it.  Its not even valid in that
> case.
>
> If the customer signed it and they only lease the property its not
> any good as the actual property owner would have to also sign and
> agree to it.  If its a rental property the contract is pretty much
> worthless.
>
> The contract may not even have an automatic renewal clause in it
>
> If the monthly rate increases you always have the right to cancel at
> that time and not pay any increased rate of course the company could
> then decide not to increase your rate and you couldn't cancel.
>
> You may get lucky and discover nobody representing the company ever
> signed the contract or that the contract cannot be transferred to p1
> from whomever installed the original system.
>
> In many contracts if some fatal happens to the system and you choose
> not to invest the money to replace it the contract will terminate at
> that point.
>
>
>
> <paulctr@xxxxxxxxxxxxx> wrote in message
> news:nv31i1d1veormmtml81ss2841tntapqk0i@xxxxxxxxxx
>
>> Are these legal for monitoring?    I have a potential customer that
>>  has monitored with pro1 for 7 years.  She tried to cancel and they
>>  told her she would have to wait till next July because her 3 year
>> contract had self renewed.
>>
>> I live in SC.    Any comments?
>
>
>