Florida Senate - 2017                                     SB 466
       By Senator Hutson
       7-00154B-17                                            2017466__
    1                        A bill to be entitled                      
    2         An act relating to motor vehicle warranty repairs and
    3         recall repairs; amending s. 320.64, F.S.; prohibiting
    4         a manufacturer, factory branch, distributor, or
    5         importer from denying a claim of a motor vehicle
    6         dealer, reducing compensation to a motor vehicle
    7         dealer, or processing a chargeback to a motor vehicle
    8         dealer because of specified circumstances; creating s.
    9         320.6407, F.S.; requiring a manufacturer, factory
   10         branch, distributor, or importer to compensate a motor
   11         vehicle dealer for a used motor vehicle under
   12         specified circumstances; requiring the manufacturer,
   13         factory branch, distributor, or importer to pay the
   14         compensation within a specified timeframe after the
   15         motor vehicle dealer’s application for payment;
   16         requiring such application to be made through the
   17         manufacturer’s, factory branch’s, distributor’s, or
   18         importer’s warranty application system or certain
   19         other system or process; providing for calculation of
   20         the amount of compensation; reenacting s. 320.6992,
   21         F.S., relating to applicability of specified
   22         provisions to systems of distribution of motor
   23         vehicles in this state, to incorporate the amendments
   24         made to s. 320.64, F.S., and to incorporate s.
   25         320.6407, F.S., as created by the act, in references
   26         thereto; providing an effective date.
   28  Be It Enacted by the Legislature of the State of Florida:
   30         Section 1. Subsection (41) is added to section 320.64,
   31  Florida Statutes, to read:
   32         320.64 Denial, suspension, or revocation of license;
   33  grounds.—A license of a licensee under s. 320.61 may be denied,
   34  suspended, or revoked within the entire state or at any specific
   35  location or locations within the state at which the applicant or
   36  licensee engages or proposes to engage in business, upon proof
   37  that the section was violated with sufficient frequency to
   38  establish a pattern of wrongdoing, and a licensee or applicant
   39  shall be liable for claims and remedies provided in ss. 320.695
   40  and 320.697 for any violation of any of the following
   41  provisions. A licensee is prohibited from committing the
   42  following acts:
   43         (41) Notwithstanding the terms of any franchise agreement,
   44  and except as authorized under subsection (25), a licensee may
   45  not deny a claim of a motor vehicle dealer, reduce the amount of
   46  compensation to a motor vehicle dealer, or process a chargeback
   47  to a motor vehicle dealer for performing covered warranty
   48  repairs or required recall repairs on a used motor vehicle due
   49  to either of the following circumstances:
   50         (a)Discovery by the motor vehicle dealer of the need for
   51  such repairs during the course of a separate repair requested by
   52  the consumer.
   53         (b)Notification by the motor vehicle dealer to the
   54  consumer of the need for such repairs after the licensee or an
   55  authorized government agency issues a notice of an outstanding
   56  recall for a safety-related defect.
   58  A motor vehicle dealer who can demonstrate that a violation of,
   59  or failure to comply with, any of the preceding provisions by an
   60  applicant or licensee will or can adversely and pecuniarily
   61  affect the complaining dealer, shall be entitled to pursue all
   62  of the remedies, procedures, and rights of recovery available
   63  under ss. 320.695 and 320.697.
   64         Section 2. Section 320.6407, Florida Statutes, is created
   65  to read:
   66         320.6407Recall notices under franchise agreements;
   67  compensation.—
   68         (1) As provided in subsection (3), a licensee under s.
   69  320.61 which has entered into a franchise agreement with a motor
   70  vehicle dealer must compensate the motor vehicle dealer for a
   71  used motor vehicle that:
   72         (a) Was originally manufactured, imported, or distributed
   73  by the licensee;
   74         (b) Is subject to a recall notice issued by the licensee or
   75  an authorized government agency, regardless of whether the
   76  vehicle is identified by its vehicle identification number;
   77         (c) Is held by the motor vehicle dealer in the dealer’s
   78  inventory at the time the recall notice is issued or is taken by
   79  the motor vehicle dealer into the dealer’s inventory after the
   80  recall notice as a result of a trade-in, lease return, or other
   81  transaction; and
   82         (d)Cannot be repaired due to the unavailability, within 15
   83  days after issuance of the recall notice, of the remedy or parts
   84  necessary for the motor vehicle dealer to make the repair.
   85         (2) The licensee shall pay the required compensation within
   86  30 days after the motor vehicle dealer’s application for
   87  payment, such application to be made through the licensee’s
   88  existing warranty application system or another system or
   89  process established by the licensee which may not be unduly
   90  burdensome or require information unnecessary for the payment.
   91         (3) Compensation under this subsection must be the greater
   92  of:
   93         (a) Payment at a rate of at least 2.43 percent of the motor
   94  vehicle value, as determined by the average Black Book value of
   95  the corresponding model year vehicle of average condition, of
   96  each eligible used motor vehicle in the motor vehicle dealer’s
   97  inventory for each month or portion of a month that the dealer
   98  does not receive a remedy or parts to complete the required
   99  repair, calculated from the date the recall was issued or the
  100  vehicle was acquired, whichever is later.
  101         (b) Payment under a national program applicable to all
  102  motor vehicle dealers holding a franchise agreement with the
  103  licensee for the motor vehicle dealer’s costs associated with
  104  holding the eligible used motor vehicles.
  105         Section 3. For the purpose of incorporating the amendment
  106  made by this act to section 320.64, Florida Statutes, and
  107  section 320.6407, Florida Statutes, as created by this act, in
  108  references thereto, section 320.6992, Florida Statutes, is
  109  reenacted to read:
  110         320.6992 Application.—Sections 320.60-320.70, including
  111  amendments to ss. 320.60-320.70, apply to all presently existing
  112  or hereafter established systems of distribution of motor
  113  vehicles in this state, except to the extent that such
  114  application would impair valid contractual agreements in
  115  violation of the State Constitution or Federal Constitution.
  116  Sections 320.60-320.70 do not apply to any judicial or
  117  administrative proceeding pending as of October 1, 1988. All
  118  agreements renewed, amended, or entered into subsequent to
  119  October 1, 1988, shall be governed by ss. 320.60-320.70,
  120  including any amendments to ss. 320.60-320.70 which have been or
  121  may be from time to time adopted, unless the amendment
  122  specifically provides otherwise, and except to the extent that
  123  such application would impair valid contractual agreements in
  124  violation of the State Constitution or Federal Constitution.
  125         Section 4. This act shall take effect upon becoming a law.