New Mexico
In New Mexico, money paid up front counts as a payment toward the work unless the written agreement shows it is kept when the client breaks the booking, and a clear agreement is read by its words. The state’s deposit cases are about real estate and turn on what the parties wrote: with nothing in writing about a deposit, the buyers got theirs back, and a sum held as a forfeit to make someone perform was read as a penalty. A term saying the deposit is kept, written as compensation for the shop’s lost appointment, in an amount not unreasonably large, is on firmer ground than a forfeit meant to make the client show up.
Does a non-refundable deposit hold up in New Mexico?
The law’s word for a set sum agreed in advance is liquidated damages.
New Mexico has no statute on deposits for a personal service, and its courts decide whether a deposit is kept by what the parties wrote. In Ashley v. Fearn (1958), the New Mexico Supreme Court reversed a judgment letting sellers keep a $1,650 deposit, because nothing in writing said what happened to it, and earnest money, a buyer’s deposit toward a purchase, is never treated as liquidated damages unless the parties so intend. The same court read a signed promise to pay, left as a forfeit only to make sure the contract was carried out, as a penalty in Keinath, Schuster & Hudson v. Reed (1913), and the Court of Appeals, in Nearburg v. Yates Petroleum Corp. (1997), calls a term setting unreasonably large damages a penalty that goes beyond compensation into punishment.
“Whether the amount deposited is to be construed as liquidated damages depends on the intent of the parties. It is well to state that where the terms of an agreement in writing are clear, intent must be ascertained from the language used.” Ashley v. Fearn, 64 N.M. 51, 323 P.2d 1093 (1958) · Keinath, Schuster & Hudson v. Reed, 18 N.M. 358 (1913) · Nearburg v. Yates Petroleum Corp., 1997-NMCA-069, 123 N.M. 526, 943 P.2d 560
Showing your refund policy
No refund-policy disclosure statute was found. The Unfair Practices Act’s list of unfair or deceptive trade practices and its definition of an unconscionable, or grossly unfair, trade practice (NMSA 1978, § 57-12-2(D) and (E)) were read, as the City of Albuquerque reproduces their June 14, 2019 version, and neither requires a business to post or disclose a refund policy.
Body-art rules and money
Nothing about client deposits, refunds, prices or payment records in the body art rules (16.36 NMAC, Body Artists and Operators, parts 1 to 10) or the Body Art Safe Practices Act. The rules use the word “non-refundable” only for the application and license fees paid to the Board of Body Art Practitioners.
This page summarizes public law in plain language, with the source each point comes from, read at the source on 2026-09-23. It is not legal advice.