Re: Automatic Renewal Prohibited

[secure15 <secure15@xxxxxxxxxxxxx>]

Everywhere Man wrote:
> Nomen Nescio wrote:
>> J. @netscape.net said:
>>
>>> I'm curious as to what legally happens once the contract expires.
>>> Does the relationship between the alarmco and subscriber legally cease
>>> to exist?  who is responsible for initiating a new contract?   If
>>> something goes wrong after the contract expires like a failure to
>>> dispatch resulting in a death, does the alarmco bear no responsibility
>>> since there was no contract in place at the time?  If the alarmco
>>> continues billing and the subscriber continues paying, does this imply
>>> a voluntary extention of the contract.  It makes since to me that if a
>>> subscriber wants to cancel service on a system they own, there should
>>> be no reason why an alarmco should be able to hold them to a contract.
>>> However, automatic renewals clauses ensure the conditions of the
>>> service being provided are legally defined regardless of the terms of
>>> the contract.    If the system is being leased, the customer would be
>>> bound by the terms of the lease agreement regardless of services being
>>> provided.
>> Here's my guess.  When the contract expires, if the alarm company sends out
>> a bill, that's an offer to renew the contract for the length of time
>> covered by the bill.  If the subscriber pays it, he's accepted the offer,
>> but is only bound for the period the bill covers (quarterly billing =
>> quarterly contract, annual billing = annual contract).
>>
>> If automatic renewals are prohibited, then the alarm company has no further
>> contractual obligations once the contract expires, assuming the subscriber
>> doesn't pay the renewal bill.
>>
>> The sticky legal problem arises if the contract hits its expiration date
>> and the subscriber is a month late sending in his next payment.  I would
>> argue that if the subscriber continues to use the system, he's agreeing to
>> the same terms that were previously in effect.
>>
>> But listen, you have ADT's lawyers on speed-dial.  Why not call them and
>> ask, and let us know what they have to say?
>>
>> - badenov <
>
> In NY the renewal offer needs to be sent either certified mail or hand
> delivered to the end user 30 days prior to the conclusion of the
> original term, and requires the end user's signature. Without that the
> service becomes a month to month term.
> It keeps alarm companies on their toes.
>
> NY CLS Gen Oblig § 5-903 (2006)
>
> § 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.