Prohibits unfair residential real estate service agreements which are certain service agreements which are not to be performed within two years following the time such agreement is entered into.
If this bill is enacted, it would add a new section to the New York General Business Law that explicitly makes unfair real estate service agreements unenforceable. It provides clarity and legal backing to affected homeowners by stipulating that these agreements cannot be recorded, thus preventing any legal cloudiness that could affect property transactions for future buyers. The legislation aims to maintain integrity in the real estate market by ensuring that homeowners are not bound by unfair contractual terms.
Bill A05886, known as the 'Prohibition of Unfair Real Estate Service Agreements Act', is designed to protect consumers, specifically homeowners, from potentially exploitative or unfair real estate service agreements. The bill prohibits real estate service agreements that are not to be performed within two years of entry and outlines specific conditions that define what constitutes unfair practices in these agreements. Such agreements are deemed unacceptable if they encumber real estate in ways that may bind future owners or do not include proper consent clauses for assignment of service rights.
Some points of contention may arise around the definitions of what is considered 'unfair' and the potential impact on legitimate service contracts in the real estate sector. There are concerns from stakeholders about whether the restrictions could inadvertently hamper some services that might be beneficial to homeowners. Moreover, questions about enforcement mechanisms are raised, specifically how the Attorney General or local authorities would operationalize these protections and address violations of the act.
The bill includes strong enforcement provisions, allowing not only the Attorney General to take action against violators but also empowering injured parties to seek damages or injunctions in civil court. This dual approach can serve as a significant deterrent against unfair practices in the real estate market, increasing accountability among service providers while offering legal recourse to consumers who might be affected.