Maryland Quickly Moves to a 5-Day and 7-Day Rescission

May 27, 2016 | from AdminBerenson No Comments

Fresh burdensome legislation signed by Governor Hogan brings a new rescission right to door-to-door sales of home improvements in Maryland. As of June 1, Maryland is expanding the cancellation period for home improvement contracts from 3 business days to 5 business days – but if the consumer is at least 65 years old then the cancellation period is extended to a full 7 business days.

In addition to this extended time in which to cancel, this legislation also eliminates the ability of a contractor to integrate the Notice of Cancellation form into the home improvement contract itself – instead the form must now be a separate document.

These changes also require that: (i) the statement explaining the right to cancel — the one that must be in close proximity to the signature line in the contract— must be updated to reflect the extended time period to cancel, (ii) the Notice of Cancellation itself must also be updated to account for the extended time period a consumer has to cancel, and (iii) a new acknowledgment must be signed by the consumer.

Unfortunately, and inexcusably, the Governor only signed the law a few days ago, and has accelerated the compliance date from October 1 to June 1.

Eventually all Maryland home improvement contracts will need to be revised to reflect these changes, but given the short time frame we are facing, Berenson LLP has prepared a stand-alone form that may be easily reproduced and used with your existing contract documents until you are able to print new forms.

Please contact D.S. Berenson or Kevin Tierney at (703) 759-1055 for more information or to obtain the new Maryland interim compliance form we have created.

The Maryland Department of Labor, Licensing, and Regulation, in collaboration with the Consumer Protection Division of the Office of the Attorney General, intends to convene a workgroup to study issues relating to door-to-door sales of home improvement services. Berenson LLP will be a participant in that workgroup in an effort to improve the overreach and cost of this legislation, and we will update you accordingly.