Are Auto-Renewing Contracts Legal in Illinois?

It was a perfect fall day and you were enjoying a delicious beer on the porch when you felt your phone vibrate. Not one to let a message go unchecked, you reached into your pocket and pulled out your phone. There it was: “Thank you for renewing your yearly subscription to Ultimate Extreme Cat Videos. Your credit card has been charged $99.99 for your convenience!”

What. The. Heck. You don’t recall signing up for Ultimate Extreme Cat Videos. Fuming, you walk into the kitchen and ask your husband if he signed up for another stupid cat video subscription. Just as he opens his mouth, your seven-year-old daughter starts laughing and says, “No, Mommy. Remember? You got it for us during our road trip to Disneyland!” Now you remember. During a moment of weakness—after hours of “are we there yet?” —you ordered the kids some cat videos just to keep them quiet.

Sighing, you figure you will log in and try to end the subscription, or at least prevent another automatic renewal next year. Once logged in to your account, you click the billing tab and are surprised to see that there is no option to cancel or change your auto-renew preferences. Instead, there is a phone number: “Call (888) 888-8888 to update your subscription!”

“Seriously,” you think, “I don’t have time for this.” You pick up the phone, are greeted with a menu, and—finally—the tenth option is to cancel your subscription. You punch in the code to be connected with the cancellation department and are greeted by a friendly voice informing you that your business is valued and the estimated wait time is 20 minutes. 20 minutes! You slam the down the phone and figure that you have a whole year to enjoy cat videos. You vow to cancel before the next automatic renewal is due.

Auto-renewing contracts have become the new norm. In fact, it sometimes seems like you can’t actually own anything anymore. Instead, you pay a monthly fee for things that used to have a one-time charge, and many companies make it nearly impossible to cancel.

When people are stuck in the auto-renewing contract trap, they often wonder if there are laws that regulate these contracts. Fortunately, for Illinois residents, there are. This article will address the question, “Are auto-renewing contracts legal in Illinois?”

Are Auto-Renewing Contracts Legal in Illinois?

The simple answer to the question is that, yes, automatically renewing contracts are legal in Illinois so long as the business selling the goods or services complies with the Illinois Automatic Contract Renewal Act (815 ILCS 601)

What Contracts Are Subject to the Illinois Automatic Contract Renewal Act?

Not every contract is regulated by the Act. The following are specifically excluded:

Contracts with governmental entities (federal, state, or local);

Business-to-business contracts; and

Contracts with banks, trust companies, savings and loan associations, savings banks, or credit unions.

What Are the Requirements for a Legal Auto-Renewing Contract?

The Illinois Automatic Contract Renewal Act sets forth several requirements for a legal automatically renewing contract, and these requirements vary depending on the original length of the contract.

All automatically renewing contracts must clearly and conspicuously disclose the automatic renewal clause. The contract must also include the cancellation procedure.

In addition to clearly and conspicuously disclosing the renewal provision and cancellation procedure, companies must also provide a notice prior to renewing contracts that had an original term of 12 or more months and have a renewal term of more than one month. The notice of renewal must:

Be written;

Be provided to the consumer no more than 60 days in advance of the cancellation deadline and no less than 30 days prior to the deadline;

Clearly and conspicuously disclose that the contract will automatically renew unless the consumer cancels the contract; and

Clearly and conspicuously disclose information about where the consumer can obtain details regarding the automatic renewal provision and cancellation procedure.

The Good Faith Exemption

If a company violates the Illinois Automatic Contract Renewal Act, it can escape liability for the violation if it is able to prove the following:

At the time of the violation, the company had already established, implemented, and enforced written procedures to comply with the Act;

The failure to comply was an error; and

The company refunded the consumer’s money.

In sum, a company is allowed to correct the error by refunding the consumer’s money if the company normally complies with the act and has a written plan for compliance, but in one particular case, it did not comply (such as forgetting to send the written notice of renewal).

What Are the Victim’s Rights If the Act Is Violated?

A violation of the Illinois Automatic Contract Renewal Act is considered an unlawful practice under the Illinois Consumer Fraud and Deceptive Business Practices Act. Under 815 ILCS 505/10a, a consumer that suffers actual harm as a result of a violation of the Act (such as paying a subscription fee) can assert a claim against the wrongdoer. This claim includes compensation for the harm suffered as well as attorney fees. The court may also award punitive damages and order the wrongdoer to cease illegal conduct.

In the Ultimate Extreme Cat Videos example above, the consumer could file a claim against the company since it did not send a notice with information about the renewal and cancellation processes. (It was required to do so under Illinois law since the original contract was for a one-year term and the renewal period was for an additional year.) The consumer would be entitled to recovering the $99.99 subscription fee in addition to the cost of attorney fees and possibly punitive damages.


The Illinois Automatic Contract Renewal Act mandates most companies clearly and conspicuously disclose automatic renewal provisions in contracts along with information about how the consumer can cancel the renewal.

For contracts with a longer term, the Act also requires companies to send a notice of automatic renewal well in advance of the renewal date so the consumer has time to cancel before the renewal.

If the company breaks the law, the consumer can bring a claim under the Consumer Fraud Act to recover the money that was lost in addition to attorney’s fees. The court can also award punitive damages or issue an injunction if appropriate.

If you believe a company has automatically renewed a contract in violation of the law, you can click here to contact our firm.