412-a. Cancellation of contracts for future consumer services. 1. Contract for future consumer services. As referred to in this section, the term "contract for future consumer services" shall mean any contract entered into for consumer services to be performed in the future on a lesson-by-lesson or class-by-class basis and offered, sold or provided by correspondence schools which for the purposes of this section shall mean any plan or method used by any person or persons, firm, corporation or other organization for giving instruction in any form or manner by correspondence under contract.
2. No person, including any business entity, may contract to receive, or demand, in the event of cancellation of a contract for future services, more than the total of:
(a) five percent of the cash price, but not to exceed fifty dollars, and
(b) a pro rata portion of the total price, representing the proportion of services used or completed.
In addition, the seller may receive or demand the cost of any ancillary goods which the buyer has consumed or wishes to retain after cancellation of the contract. In no instance shall the seller collect more than the full contract price from the buyer.
3. Within ten days after a contract for future consumer services has been cancelled, the seller shall tender to the buyer any payments made in excess of the amounts permitted to be retained pursuant to subdivision two of this section.
4. Cancellation. Cancellation shall occur:
(a) when the buyer mails to the seller notice of his intent to cancel, or
(b) where the seller has actual notice of the buyer's intention to cancel, or
(c) where the buyer fails to attend consecutive scheduled classes or lessons constituting at least twenty-five percent of the total lessons or time contracted for, without informing the seller in writing that he intends to remain enrolled.
5. The contract forms used by the seller shall conspicuously disclose the seller's cancellation provisions in compliance with subdivisions two, three, and four of this section and shall contain the following notice in ten point bold face type:
If you cancel this contract (the seller) may keep only five percent of the cash price, but not to exceed fifty dollars, and a portion of the contract price based upon the lessons or services you have used. You may notify the seller of your intent to cancel by mail, addressed to (the seller) at (seller's address).
6. Nothing in this section shall be construed so as to nullify or impair any right or rights which a buyer may have against a seller at common law, by statute, or otherwise.
Last modified: February 3, 2019