The New Jersey Supreme Court has given the green light to a lawsuit claiming a health club’s initiation fee violated the Retail Installment Sales Act.

The court ruled that the plain language of RISA makes it applicable to service contracts such as the one at the center of the case. Its decision strikes down an Appellate Division ruling, Mellet v. Aquasid, holding that the act applies only where there is a financing arrangement. The justices also rejected an assertion by the state Department of Banking and Insurance, raised in an amicus curiae brief, that a contract must include a financing arrangement to be covered by RISA.