Legal Question in Business Law in California

Re: right to refuse service

Why complicate things? Just don't do business with them. If you really insist on language, you can say (or print): "We reserve the right to refuse to do business with anyone." Period!

Re: right to refuse service

First, every significant action a business takes, no matter how well intentioned, carries with it some possibility of a lawsuit. Some things are riskier than others; I would put telling particular customers that you don't want to do business with them somewhere in the middle of the risk list.

I would avoid putting anything in writing to the customer unless its absolutely necessary because of the way you do business, e.g. you might have to cancel an account in writing. If so, I would avoid stating a reason.

The most important thing to do, however, is to document your reason internally ... collect and maintain all records relating to the customer and the account. Good documentation showing a sound business reason for declining that person's trade provides a strong defense to a charge that you were acting from an improper motive.