Section 399-W. Total loss notice and waiver of the gap amount for non-motor vehicle retail lease agreements

1.  If  a  non-motor  vehicle
  retail  lease  agreement  provides  that the lessee shall be responsible
  upon a total loss of the goods which are the subject  of  the  agreement
  occasioned by theft, confiscation or physical damage for the gap amount,
  the  lessor,  prior to the execution of the agreement, shall by a notice
  on  a  separate  document  conspicuously  disclose  that  fact  and  the
  obligations  for  which the lessee would remain liable in the event of a
  theft, confiscation or total  loss  of  the  goods.  If  the  lessor  is
  required  under  subdivision  two  of this section to offer to waive its
  contractual right to hold the lessee liable for the gap  amount  in  the
  event  of  a  total  loss  of  the goods occasioned by theft or physical
  damage, the notice shall also: (a) state  that  for  a  separate  charge
  disclosed  in  the notice the lessor will waive its contractual right to
  hold the lessee liable for the gap amount in the event of a  total  loss
  of  the  goods  occasioned  by  theft  or physical damage; (b) contain a
  provision informing the lessee that he or she may as an  alternative  to
  purchasing  a  waiver,  be  able  to purchase insurance covering the gap
  amount from  an  insurance  company  which  has  been  licensed  by  the
  superintendent  of  insurance  to  write  non-motor  vehicle  lessee gap
  insurance in this state; and (c)  contain  a  provision  permitting  the
  lessee  to  indicate  whether  he  or  she wants the lessor to waive its
  contractual right to hold the lessee liable for the gap  amount  in  the
  event  of  a  total  loss  of  the goods occasioned by theft or physical
  damage. The notice shall be signed by the lessee. The lessor or assignee
  shall provide a copy of the signed  notice  to  the  lessee,  and  shall
  maintain  a  copy  in  the lessor's or assignee's files for at least the
  term of the lease. Failure to provide  the  notice  and  to  obtain  the
  lessee's  signature as required by this subdivision shall invalidate any
  provision of the agreement which otherwise would obligate  a  lessee  to
  pay  the  gap  amount  to the lessor or lessor's assignee, after a total
  loss of the goods occasioned by theft, confiscation or physical  damage.
  No  retail  lease  agreement  shall  be  conditioned  upon  the lessee's
  obtaining of non-motor vehicle lessee gap  insurance  as  set  forth  in
  subparagraph  (D)  of  paragraph twenty-six of subsection (a) of section
  one thousand one hundred thirteen of the insurance law.
    2. If the retail lease agreement provides that  the  lessee  shall  be
  responsible  upon  a  total  loss  of  the  goods occasioned by theft or
  physical damage for the gap amount, the lessor, prior to  the  execution
  of the agreement, shall offer to waive its contractual right to hold the
  lessee  liable  for  the  gap amount in the event of a total loss of the
  goods occasioned by theft or physical damage, only if non-motor  vehicle
  lessor  gap  insurance  coverage  is  available  to  the  lessor  or the
  anticipated  assignee   and   such   coverage   is   obtained   from   a
  property/casualty  insurance  company,  which  has  been licensed by the
  superintendent of insurance of this state  to  write  non-motor  vehicle
  lessor  gap  insurance  in this state. This offer may be made contingent
  upon the payment by the lessee of  a  separate  charge  that  shall  not
  exceed  the  cost  of  lessor  gap  insurance  covering the retail lease
  transaction plus an  administrative  fee  not  to  exceed  ten  dollars.
  Nothing  contained  in  this  section  shall be construed to authorize a
  waiver, in connection with a transaction with respect  to  which  lessor
  gap  insurance has not been obtained, of a contractual right to hold the
  lessee liable for the gap amount in the event of a  total  loss  of  the
  goods occasioned by theft or physical damage.
    3.  A  lessor  shall  not  be  obligated under subdivision two of this
  section to offer to waive its  contractual  right  to  hold  the  lessee
  liable for the gap amount if, during the current calendar year or during

  the  odd-numbered  calendar year immediately preceding the calendar year
  in which the agreement is entered into, the lessor  or  the  anticipated
  assignee  of  the  lessor  has  received  non-motor  vehicle  lessor gap
  insurance  declination  notices or other evidence of unavailability from
  every insurance company whose name appears on the  insurance  department
  compilation  of insurance companies which during that calendar year were
  authorized to write non-motor  vehicle  lessor  gap  insurance  in  this
  state. Evidence of these declinations shall be retained by such a lessor
  or  the  anticipated assignee of such a lessor for a period of six years
  after the expiration of the calendar year in which they were issued.
    If the lessor is not obligated to waive its contractual right to  hold
  the  lessee  liable  for  the  gap  amount,  then the notice required by
  subdivision one of this section  shall  contain  a  statement  that  the
  lessee  may  be  able  to purchase lessee gap insurance covering the gap
  amount directly from an insurer authorized to do such business  in  this
  state,  but that the purchase of gap insurance is not required under the
  retail lease agreement.
    4. In order to enable lessors or their anticipated assignees to comply
  with the requirements imposed by subdivision two of  this  section,  the
  superintendent   of   insurance  shall  compile  and  make  available  a
  periodically  updated  list  of  those  insurance  companies  which  are
  authorized  to  write non-motor vehicle lessor gap insurance coverage in
  this state.
    5. Nothing in this section shall be construed to apply to the  lessor,
  or  any anticipated assignee of a lessor, under a retail lease agreement
  under which the lessee is not liable upon a  total  loss  of  the  goods
  occasioned by theft, confiscation or physical damage for the gap amount,
  except  that  the  lessor shall provide to the lessee conspicuous notice
  that, in the event of a total loss of  the  goods,  the  lessee  has  no
  obligation for the gap amount.
    6.  Whenever there shall be a violation of this section an application
  may be made by the attorney general in the name of  the  people  of  the
  state of New York to a court or justice having jurisdiction by a special
  proceeding  to  issue an injunction, and upon notice to the defendant of
  not less than five days, to enjoin and restrain the continuance of  such
  violations;  and  if it shall appear to the satisfaction of the court or
  justice that the defendant has,  in  fact,  violated  this  section,  an
  injunction  may  be  issued  by  the  court  or  justice,  enjoining and
  restraining any further violations, without  requiring  proof  that  any
  person  has,  in  fact,  been  injured  or  damaged thereby. In any such
  proceeding, the court may make allowances to  the  attorney  general  as
  provided  in  paragraph  six  of subdivision (a) of section eighty-three
  hundred  three  of  the  civil  practice  law  and  rules,  and   direct
  restitution.  Whenever  the court shall determine in any such proceeding
  that a violation of this section has occurred, the court  may  impose  a
  civil  penalty of not more than five hundred dollars for each violation.
  In connection with any such proposed application the attorney general is
  authorized to take proof and make a determination of the relevant  facts
  and  to  issue  subpoenas  in accordance with the civil practice law and
  rules.
    7. For purposes of  this  section:  (a)  "Goods"  means  all  chattels
  personal,  other than things in action or money, leased for other than a
  commercial or business use or for purpose of sublease. The term includes
  goods which, at the time of the lease or  subsequently,  are  to  be  so
  affixed  to  realty as to become a part thereof whether or not severable
  therefrom, but does not include a motor vehicle as  defined  in  article
  nine-A of the personal property law.

    (b)  "Lessee"  means  a  natural person who leases goods from a lessor
  primarily for personal, family or  household  use  and  who  executes  a
  retail  lease  agreement  in  connection  therewith.  The  term does not
  include a person who leases goods primarily for  agricultural,  business
  or commercial use or for the purpose of subleasing.
    (c)  "Lessor"  means  a  person  regularly  engaged in the business of
  leasing or selling goods who leases goods to a lessee under  or  subject
  to a retail lease agreement.
    (d) "Lease" means a transfer from a lessor to a lessee of the right to
  possession  and  use of goods in return for consideration. The term does
  not include a sale, including a sale on approval or a sale or return,  a
  retail  instalment  sale  as  defined  in  article  ten  of the personal
  property law or the retention or creation of a security interest in  the
  goods.
    (e)  "Retail  lease  agreement"  or  "agreement"  means  an agreement,
  entered into in this state, for the lease of goods and which may include
  the purchase of goods or services incidental thereto by a lessee  for  a
  scheduled  term exceeding four months, whether or not the lessee has the
  option to purchase or otherwise become the owner of  the  goods  at  the
  expiration  of  the  agreement.  The  term  includes  such  an agreement
  wherever entered into if executed by the lessee in  this  state  and  if
  solicited  in person by a person acting on his or her own behalf or that
  of the lessor. The term does not include a retail instalment contract or
  a rental-purchase agreement as defined in articles ten and eleven of the
  personal property law. An agreement  that  substantially  complies  with
  this  article  does  not  create a security interest in the goods as the
  term "security interest"  is  defined  in  subdivision  thirty-seven  of
  section 1-201 of the uniform commercial code.
    (f) "Gap amount" has the meaning ascribed to it in paragraph fifty-two
  of subsection (a) of section one hundred seven of the insurance law.
    (g)  "Gap  insurance"  has  the  meaning  ascribed  to it in paragraph
  twenty-six of  subsection  (a)  of  section  one  thousand  one  hundred
  thirteen of the insurance law.
    (h)   "Person"   means   an   individual,   partnership,  corporation,
  association or other group, however organized.
    * NB There are 2 § 399-w's