To what contracts does a 3-day right of rescission apply to?
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To what contracts does a 3-day right of rescission apply to?
I recently signed a service agreement with MyCity.com to assist me with social networking to build my design business. However, after revisiting my budget and assessing other critical, unforeseen circumstances, I needed to cancel. I contacted them within 3 days yet I have not gotten acknowledgement despite numerous attempts to reach them. What recourse do I have? May I stop future authorizations for payments through my bank?
Asked on July 15, 2011 under Business Law, Arizona
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
Generally speaking, the three-day right of rescission only applies to mortgages. It does not apply to service agreements or contracts. Therefore, since you signed it, you are obligated to the contract, except in the situation of the other party breaching or violating its obligations in some way that gives you the right to terminate the contract without penalty. Stopping payments through you bank will NOT stop you from being legally obligated to pay--it just means that MyCity will need to sue you to get its money. In addition, doing this will likely make things worse--if you are sued, you'll have to pay for your defense and, since you are doing something which you have no legal right or basis to do, they may be able to recover their cost and legal fees as well.
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