HB 0367

1
A bill to be entitled
2An act relating to the sale of used motor vehicles;
3providing a popular name; creating the "Used Motor Vehicle
4Warranty Act"; providing legislative intent; providing
5definitions; requiring express warranties with respect to
6the sale of used motor vehicles; providing exceptions;
7providing requirements for used motor vehicle dealers in
8honoring warranties; providing for extension of warranty
9terms under certain circumstances; providing for inability
10of dealer to conform the motor vehicle to the warranty;
11providing certain remedies; providing for duties of the
12Department of Legal Affairs; providing for establishment
13of resource center and toll-free consumer number;
14providing liability for bad faith claims; declaring
15certain agreements void; declaring violation by a dealer
16of the act an unfair and deceptive trade practice;
17providing for application of the Used Motor Vehicle
18Warranty Act; amending s. 320.27, F.S.; providing
19additional circumstances under which the Department of
20Highway Safety and Motor Vehicles may suspend certain
21vehicle dealers' licenses; providing for collection of a
22fee on each sale of a used motor vehicle; providing for
23deposit of fee proceeds into the Motor Vehicle Warranty
24Trust Fund; providing an effective date.
25
26Be It Enacted by the Legislature of the State of Florida:
27
28     Section 1.  Popular name.--Sections 1-12 of this act may be
29cited as the "Used Motor Vehicle Warranty Act."
30     Section 2.  Legislative intent.--The Legislature recognizes
31that the procurement of a used motor vehicle is a major consumer
32purchase and that a defective used motor vehicle undoubtedly
33creates a hardship for the consumer. The Legislature recognizes
34that a dealer has superior knowledge about the structural and
35mechanical condition of a used motor vehicle which a consumer
36relies upon when purchasing such vehicle. The Legislature also
37recognizes that a dealer has superior knowledge of the warranty
38terms arising from the sale of a used motor vehicle which a
39consumer relies upon when purchasing such vehicle. It is the
40intent of the Legislature to provide minimum warranty rights to
41consumers who purchase used motor vehicles from dealers in this
42state. It is further the intent of the Legislature that a
43consumer receive a comparable motor vehicle or a full refund
44when a good faith warranty complaint cannot be resolved within a
45specified period of time. However, this act does not limit or
46expand the rights or remedies that are otherwise available to a
47consumer under any other law.
48     Section 3.  Definitions.--As used in this act, the term:
49     (1)  "Collateral expenses" means those additional expenses
50incurred by the consumer as a result of acquiring the motor
51vehicle, and all earned finance and credit charges incurred by
52the consumer.
53     (2)  "Comparable motor vehicle" means, with respect to a
54replacement motor vehicle, a used motor vehicle similar or
55equivalent in price to the price for which the replaced motor
56vehicle was purchased.
57     (3)  "Consumer" means any person who is not a dealer as
58defined in s. 320.27(1)(c), Florida Statutes, excluding any
59person who has purchased a leased vehicle as a result of the
60exercise of a purchase option in a lease-purchase agreement that
61has a lease term of 1 year or more.
62     (4)  "Dealer" means a motor vehicle dealer as defined in s.
63320.27(1)(c), Florida Statutes, and subject to licensure under
64s. 320.27(2), Florida Statutes.
65     (5)  "Department" means the Department of Legal Affairs.
66     (6)  "Incidental expenses" means those reasonable costs
67incurred by the consumer which are directly caused by a defect
68in or condition of the vehicle.
69     (7)  "Motor vehicle" means a motor vehicle propelled by
70power other than muscular power, which is sold in this state,
71with a gross vehicle weight rating of less than 8,500 lbs., but
72excludes recreational vehicles, motorcycles, mopeds, traction
73engines, truck tractors, road rollers, trailers, and
74semitrailers, off-road vehicles, and vehicles run only upon
75tracks or water.
76     (8)  "Purchase price" means the cash price as defined in s.
77520.31(2), Florida Statutes, inclusive of any net allowance for
78a trade-in vehicle.
79     (9)  "Reasonable offset for use" means an amount not
80exceeding 10 cents per mile driven or 10 percent of the purchase
81price, whichever is less.
82     (10)  "Service contract" means a written contract to
83perform, over a fixed period of time or for a specified
84duration, services relating to the maintenance or repair, or
85both, of a consumer product.
86     (11)  "Used motor vehicle" means a used or secondhand motor
87vehicle as defined in s. 320.60(13), Florida Statutes.
88     (12)  "Warranty" means any undertaking in writing,
89excluding a service contract, in connection with the sale by a
90dealer of a used motor vehicle, to refund, repair, replace,
91maintain, or take other action with respect to a used motor
92vehicle and provided at no extra charge beyond the purchase
93price, or any affirmation of fact or promise made by the dealer
94in connection with the sale of a used motor vehicle to a
95consumer upon which the consumer relied in entering into the
96transaction.
97     Section 4.  Express warranties.--
98     (1)  Each contract entered into by a dealer for the sale to
99a consumer of a used motor vehicle pursuant to this act must
100include an express warranty, covering the full cost of both
101parts and labor, that the vehicle is both structurally and
102mechanically operational and sound and will remain so for at
103least 60 days or 3,000 miles of operation, whichever period ends
104first, but excluding routine maintenance items and damage
105resulting from an accident or neglect or abuse of the vehicle by
106the consumer, and that the dealer shall repair or replace any
107defect or condition, or, at the dealer's option, accept return
108of the used motor vehicle from the consumer and replace the
109vehicle with a comparable motor vehicle acceptable to the
110consumer or provide a refund of the purchase price.
111     (2)  An express warranty required pursuant to this section
112may not contain language that attempts to exclude or modify the
113consumer's remedy for breach of an express warranty.
114     (3)  A dealer may not limit a warranty required by this
115section by the use of such phrases as "fifty-fifty," "labor
116only," "drive train only," or other words attempting to disclaim
117the dealer's responsibility.
118     (4)  The consumer may waive a warranty required by this
119section only as to a particular defect in the vehicle which the
120dealer has disclosed to the consumer as being defective. Such
121waiver is not effective unless the waiver:
122     (a)  Is in writing.
123     (b)  Is conspicuous and in plain language.
124     (c)  Identifies the particular disclosed defect in the
125vehicle for which such warranty is to be waived.
126     (d)  Is signed by both the consumer and dealer prior to
127sale.
128     (5)  This section does not apply to:
129     (a)  The sale of a used motor vehicle having a purchase
130price of less than $2,000; or
131     (b)  The sale of a used motor vehicle with over 100,000
132miles at the time of sale if the mileage is indicated in writing
133at the time of sale. If the true mileage of the vehicle is
134unknown, the exemption provided by this paragraph does not
135apply.
136     (6)  Except as otherwise provided, the obligations of a
137manufacturer under an express warranty issued by the
138manufacturer are not diminished. The warranty created by this
139section does not require a nonauthorized dealer to repair a
140defect or condition if the defect or condition is covered by a
141manufacturer's warranty, or the manufacturer otherwise agrees to
142repair, unless the manufacturer or its agent refuses or is
143unable to repair. Repairs by a manufacturer or dealer under this
144subsection may be considered as repair attempts under section 7.
145     Section 5.  Duty of dealer.--
146     (1)  A dealer or his or her agent shall honor any warranty
147required by section 4, notwithstanding the fact that the
148warranty period has expired, if the consumer notifies the dealer
149of a defect or condition within the applicable warranty period.
150     (2)  If a dealer does not have a repair facility, the
151dealer shall designate a reasonably accessible facility where
152the vehicle must be taken for repair.
153     (3)  If the defect or condition occurs at a location that
154makes it impossible or unreasonable to return the vehicle to the
155dealer, the consumer may have the repair completed elsewhere
156with the consent of the dealer, which consent may not be
157unreasonably withheld.
158     (4)  If a dealer fails to provide the written warranty as
159required by section 4, the dealer is deemed to have given such
160warranty.
161     (5)  A dealer or the dealer's agent shall provide to the
162consumer, each time a used motor vehicle is returned for
163examination or repair under the warranty, a fully itemized,
164legible statement or repair order indicating any test drive
165performed and the approximate length of the test drive, any
166diagnosis made, and all work performed on the vehicle,
167including, but not limited to, a general description of the
168problem reported by the consumer or an identification of the
169defect or condition, parts and labor, the date, the odometer
170reading when the motor vehicle was submitted for examination or
171repair, and the date when the repair or examination was
172completed.
173     (6)  A dealer may not refuse any consumer the opportunity
174to have an independent prepurchase inspection of any used motor
175vehicle offered for sale. If the consumer requests an
176inspection, it shall be conducted by a person chosen by the
177consumer, but the dealer may establish reasonable conditions
178regarding the place, time, and extent of the inspection.
179     Section 6.  Extension of warranty term.--
180     (1)  The term of any warranty required by section 4 shall
181be extended by any time period during which the used motor
182vehicle is in the possession of the dealer or the dealer's agent
183for the purpose of repairing the used motor vehicle under the
184terms and obligations of the warranty.
185     (2)  The term of the warranty shall be extended by any time
186period during which the consumer has requested the dealer or the
187dealer's agent to repair the vehicle under the terms and
188provisions of the warranty and the repairs are not made or
189replacement parts are not available.
190     (3)  The term of any such warranty shall be extended by any
191time during which repair services are not available to the
192consumer due to war, invasion, strike, fire, flood, or natural
193disaster.
194     Section 7.  Inability of the dealer to conform the motor
195vehicle to the warranty.--
196     (1)  If the dealer is unable to conform the motor vehicle
197to the terms of the warranty by curing any defect or condition
198that substantially impairs the use, value, or safety of the
199vehicle after a reasonable number of attempts, the dealer, at
200the dealer's option, shall either replace the motor vehicle with
201a comparable motor vehicle acceptable to the consumer or refund
202to the consumer the purchase price and all reasonably incurred
203collateral and incidental expenses, less a reasonable offset for
204use. A refund shall be made to the consumer and lienholder of
205record, if any, as their interests may appear. Upon receipt of
206such refund or replacement, the consumer or lienholder must
207furnish to the dealer clear title to and possession of the motor
208vehicle. The Department of Revenue shall refund to the dealer
209any sales tax which the dealer refunded the consumer or
210lienholder under this section, if the dealer provides to the
211Department of Revenue a written request for a refund and
212evidence that the sales tax was paid when the vehicle was
213purchased and that the dealer refunded the sales tax to the
214consumer or lienholder.
215     (2)  It shall be presumed that there has been a reasonable
216opportunity to correct a defect or condition within the term of
217the warranty as set forth under section 4(1) and section 6 if:
218     (a)  The same defect or condition has been subject to
219repair three or more times and such defect or condition
220continues to exist; or
221     (b)  The vehicle has been out of service by reason of
222repair for a cumulative total of 15 or more days.
223     Section 8.  Consumer remedies.--
224     (1)  Any violation of this act by a dealer for which a
225consumer suffers any loss constitutes a violation of chapter
226320, Florida Statutes, for which a consumer may resort to the
227provisions of s. 320.27, Florida Statutes, for relief.
228     (2)  A consumer may file an action to recover damages
229caused by a violation of this act. The court shall award a
230consumer who prevails in such action damages, costs, reasonable
231attorney's fees, and appropriate equitable relief. If the
232consumer establishes that the dealer's failure to comply with
233this chapter was willful, the judgment may include a civil
234penalty which shall not exceed two times the amount of actual
235damages.
236     (3)  An action brought under this act must be commenced
237within 6 months from the expiration of the warranty, or 1 year
238from the date of purchase, whichever occurs later.
239     (4)  This act does not prohibit a consumer from pursuing
240other rights or remedies under any other law.
241     Section 9.  Department duties.--
242     (1)  The Department of Legal Affairs shall establish a
243resource center which, at a minimum, shall include a toll-free
244number which a consumer can contact for information concerning
245the consumer's rights or to file a complaint under this act.
246     (2)  The department shall prepare brochures and other
247educational materials to be distributed to consumers informing
248them of their rights and remedies under this act.
249     (3)  The department may contract with an independent entity
250to perform the services pursuant to this section.
251     Section 10.  Bad faith claims.--Any claim by a consumer
252which is found by the court to have been filed in bad faith or
253solely for the purpose of harassment shall result in the
254consumer being liable for costs and reasonable attorney's fees
255incurred by the dealer, as a direct result of the bad faith
256claim.
257     Section 11.  Certain agreements void.--Except as otherwise
258provided in this act, any agreement entered into by a consumer
259that waives, limits, or disclaims the rights set forth in this
260act is void as contrary to public policy.
261     Section 12.  Unfair or deceptive trade practice.--A
262violation by a dealer of this act is an unfair and deceptive
263trade practice as defined in part II of chapter 501, Florida
264Statutes.
265     Section 13.  The Used Motor Vehicle Warranty Act applies to
266used motor vehicles sold in this state on or after January 1,
2672006.
268     Section 14.  Paragraph (b) of subsection (9) of section
269320.27, Florida Statutes, is amended to read:
270     320.27  Motor vehicle dealers.--
271     (9)  DENIAL, SUSPENSION, OR REVOCATION.--
272     (b)  The department may deny, suspend, or revoke any
273license issued hereunder or under the provisions of s. 320.77 or
274s. 320.771 upon proof that a licensee has committed, with
275sufficient frequency so as to establish a pattern of wrongdoing
276on the part of a licensee, violations of one or more of the
277following activities:
278     1.  Representation that a demonstrator is a new motor
279vehicle, or the attempt to sell or the sale of a demonstrator as
280a new motor vehicle without written notice to the purchaser that
281the vehicle is a demonstrator. For the purposes of this section,
282a "demonstrator," a "new motor vehicle," and a "used motor
283vehicle" shall be defined as under s. 320.60.
284     2.  Unjustifiable refusal to comply with a licensee's
285responsibility under the terms of the new motor vehicle warranty
286issued by its respective manufacturer, distributor, or importer.
287However, if such refusal is at the direction of the
288manufacturer, distributor, or importer, such refusal shall not
289be a ground under this section.
290     3.  Misrepresentation or false, deceptive, or misleading
291statements with regard to the sale or financing of motor
292vehicles which any motor vehicle dealer has, or causes to have,
293advertised, printed, displayed, published, distributed,
294broadcast, televised, or made in any manner with regard to the
295sale or financing of motor vehicles.
296     4.  Failure by any motor vehicle dealer to provide a
297customer or purchaser with an odometer disclosure statement and
298a copy of any bona fide written, executed sales contract or
299agreement of purchase connected with the purchase of the motor
300vehicle purchased by the customer or purchaser.
301     5.  Failure of any motor vehicle dealer to comply with the
302terms of any bona fide written, executed agreement, pursuant to
303the sale of a motor vehicle.
304     6.  Failure to apply for transfer of a title as prescribed
305in s. 319.23(6).
306     7.  Use of the dealer license identification number by any
307person other than the licensed dealer or his or her designee.
308     8.  Failure to continually meet the requirements of the
309licensure law.
310     9.  Representation to a customer or any advertisement to
311the public representing or suggesting that a motor vehicle is a
312new motor vehicle if such vehicle lawfully cannot be titled in
313the name of the customer or other member of the public by the
314seller using a manufacturer's statement of origin as permitted
315in s. 319.23(1).
316     10.  Requirement by any motor vehicle dealer that a
317customer or purchaser accept equipment on his or her motor
318vehicle which was not ordered by the customer or purchaser.
319     11.  Requirement by any motor vehicle dealer that any
320customer or purchaser finance a motor vehicle with a specific
321financial institution or company.
322     12.  Requirement by any motor vehicle dealer that the
323purchaser of a motor vehicle contract with the dealer for
324physical damage insurance.
325     13.  Perpetration of a fraud upon any person as a result of
326dealing in motor vehicles, including, without limitation, the
327misrepresentation to any person by the licensee of the
328licensee's relationship to any manufacturer, importer, or
329distributor.
330     14.  Violation of any of the provisions of s. 319.35 by any
331motor vehicle dealer.
332     15.  Sale by a motor vehicle dealer of a vehicle offered in
333trade by a customer prior to consummation of the sale, exchange,
334or transfer of a newly acquired vehicle to the customer, unless
335the customer provides written authorization for the sale of the
336trade-in vehicle prior to delivery of the newly acquired
337vehicle.
338     16.  Willful failure to comply with any administrative rule
339adopted by the department.
340     17.  Violation of chapter 319, this chapter, or ss.
341559.901-559.9221, which has to do with dealing in or repairing
342motor vehicles or mobile homes. Additionally, in the case of
343used motor vehicles, the willful violation of the federal law
344and rule in 15 U.S.C. s. 2304, 16 C.F.R. part 455, pertaining to
345the consumer sales window form.
346     18.  Failure to comply with the terms of the Used Motor
347Vehicle Warranty Act.
348     19.  Failure to comply with a court decision rendered
349pursuant to the Used Motor Vehicle Warranty Act, irrespective of
350whether the failure occurs with sufficient frequency so as to
351establish a pattern of wrongdoing on the part of the licensee.
352     20.  Failure to display the Buyer's Guide set forth in
353Title 16, Code of Federal Regulations, Part 455.
354     Section 15.  Fees.--A $1 fee shall be collected by a motor
355vehicle dealer from the consumer at the consummation of the sale
356of a used motor vehicle. Such fees shall be remitted to the
357county tax collector acting as agent for the department. All
358fees shall be transferred to the Department of Legal Affairs for
359deposit into the Motor Vehicle Warranty Trust Fund.
360     Section 16.  This act shall take effect July 1, 2005.


CODING: Words stricken are deletions; words underlined are additions.