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North Carolina Automatic Contract Renewal Law

Statutes 75-41

Contracts With Automatic Renewal Clauses


(a)  Any person, firm or corporation engaged in commerce that sells, leases or offers to sell or lease, any products or services to a  consumer pursuant
to a contract, where the contract automatically renews unless the consumer cancels the contract, shall disclose the automatic renewal clause clearly and conspicuously in the contract or contract offer.

(b)  Any person, firm or corporation engaged in commerce that sells, leases or offers to sell or lease, any products or services to a consumer pursuant
 to a contract, where the contract automatically  renews unless the consumer cancels the contract  shall  disclose CLEARLY AND CONSPICUOUSLY HOW TO CANCEL  the contract in the initial contract,  contract offer, or with delivery of products or services.

(c)  A person, firm or corporation that fails to com[ply with the requirements of this section is in violation of this section unless the person, firm
 or corporation demonstrates that all the following are its routine business practice:

(1)  It has established and implemented written procedures to comply with this section and enforces compliance with the procedures.

(2)  Any failure to comply with this section is the result of error.

(3)  Where an error has caused the failure to comply with this section, it   PROVIDES A FULL REFUND OR CREDIT FOR ALL AMOUNTS BILLED TO OR PAID  by the consumer from the date o the renewal unless the date of the termination of the contract, or the date of the subsequent notice of renewal, whichever occurs first.

(d)  This section does not apply to insurers licensed under Chapter 58 of the General Statutes, or to banks, trust companies, savings and loan
 associations, savings banks, or credit unions licensed or organized under the laws of any state or the United States, or any foreign bank maintaining a branch or agency licensed under the laws of the United States or any subsidiary or affiliate thereof.

(e)  A violation of this section renders the automatic renewal clause void and unenforceable.  (2007-288, S. 1: 2007-507, s. 17)

Last modified:  March 28, 2010



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