Florida Senate - 2017                              CS for SB 466
       By the Committee on Transportation; and Senators Hutson, Gainer,
       and Broxson
       596-02448-17                                           2017466c1
    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 applications to be submitted monthly,
   17         as necessary, through the manufacturer’s, factory
   18         branch’s, distributor’s, or importer’s warranty
   19         application system or certain other system or process;
   20         providing for calculation of the amount of
   21         compensation; reenacting s. 320.6992, F.S., relating
   22         to applicability of specified provisions to systems of
   23         distribution of motor vehicles in this state, to
   24         incorporate the amendments made to s. 320.64, F.S.,
   25         and to incorporate s. 320.6407, F.S., as created by
   26         the act, in references thereto; providing an effective
   27         date.
   29  Be It Enacted by the Legislature of the State of Florida:
   31         Section 1. Subsection (41) is added to section 320.64,
   32  Florida Statutes, to read:
   33         320.64 Denial, suspension, or revocation of license;
   34  grounds.—A license of a licensee under s. 320.61 may be denied,
   35  suspended, or revoked within the entire state or at any specific
   36  location or locations within the state at which the applicant or
   37  licensee engages or proposes to engage in business, upon proof
   38  that the section was violated with sufficient frequency to
   39  establish a pattern of wrongdoing, and a licensee or applicant
   40  shall be liable for claims and remedies provided in ss. 320.695
   41  and 320.697 for any violation of any of the following
   42  provisions. A licensee is prohibited from committing the
   43  following acts:
   44         (41) Notwithstanding the terms of any franchise agreement,
   45  and except as authorized under subsection (25), a licensee may
   46  not deny a claim of a motor vehicle dealer, reduce the amount of
   47  compensation to a motor vehicle dealer, or process a chargeback
   48  to a motor vehicle dealer for performing covered warranty
   49  repairs or required recall repairs on a used motor vehicle due
   50  to either of the following circumstances:
   51         (a)Discovery by the motor vehicle dealer of the need for
   52  warranty or recall repairs during the course of a separate
   53  repair requested by the consumer.
   54         (b)Notification by the motor vehicle dealer to the
   55  consumer of the need for recall repairs after the licensee or an
   56  authorized governmental agency issues a notice of an outstanding
   57  recall for a safety-related defect.
   59  A motor vehicle dealer who can demonstrate that a violation of,
   60  or failure to comply with, any of the preceding provisions by an
   61  applicant or licensee will or can adversely and pecuniarily
   62  affect the complaining dealer, shall be entitled to pursue all
   63  of the remedies, procedures, and rights of recovery available
   64  under ss. 320.695 and 320.697.
   65         Section 2. Section 320.6407, Florida Statutes, is created
   66  to read:
   67         320.6407 Recall notices under franchise agreements;
   68  compensation.—
   69         (1) As provided in subsection (3), a licensee that has
   70  entered into a franchise agreement with a motor vehicle dealer
   71  must compensate the motor vehicle dealer for a used motor
   72  vehicle:
   73         (a) That was originally manufactured, imported, or
   74  distributed by the licensee;
   75         (b) That is subject to a recall notice issued by the
   76  licensee or an authorized governmental agency, regardless of
   77  whether the vehicle is identified by its vehicle identification
   78  number;
   79         (c) That is held by the motor vehicle dealer in the
   80  dealer’s inventory at the time the recall notice is issued or
   81  that is taken by the motor vehicle dealer into the dealer’s
   82  inventory after the recall notice as a result of a trade-in,
   83  lease return, or otherwise;
   84         (d)That cannot be repaired due to the unavailability,
   85  within 30 days after issuance of the recall notice, of remedy or
   86  parts necessary for the motor vehicle dealer to make the recall
   87  repair; and
   88         (e) For which the licensee has not issued a written
   89  statement to the motor vehicle dealer indicating that the used
   90  motor vehicle may be sold or delivered to a retail customer
   91  before completion of the recall repair.
   92         (2) The licensee shall pay the required compensation within
   93  30 days after the motor vehicle dealer’s application for
   94  payment. Applications for compensation payments must be
   95  submitted monthly, as necessary, through the licensee’s existing
   96  warranty application system or another system or process
   97  established by the licensee which is not unduly burdensome or
   98  which does not require information unnecessary for the payment.
   99         (3) Compensation under this section must be the greater of:
  100         (a) Payment at a rate of at least 2 percent per month of
  101  the motor vehicle value, as determined by the average Black Book
  102  value of corresponding model year vehicle of average condition,
  103  of each eligible used motor vehicle in the motor vehicle
  104  dealer’s inventory for each month that the dealer does not
  105  receive a remedy or parts to complete the required repair. Such
  106  payment must be prorated for any period less than a month based
  107  on the number of days during the month each eligible used motor
  108  vehicle is in the motor vehicle dealer’s inventory. Payments
  109  shall be calculated from the date the recall was issued or the
  110  vehicle was acquired, whichever is later.
  111         (b) Payment under a national program applicable to all
  112  motor vehicle dealers holding a franchise agreement with the
  113  licensee for the motor vehicle dealer’s costs associated with
  114  holding the eligible used motor vehicles.
  115         Section 3. For the purpose of incorporating the amendment
  116  made by this act to section 320.64, Florida Statutes, and
  117  section 320.6407, Florida Statutes, as created by this act, in
  118  references thereto, section 320.6992, Florida Statutes, is
  119  reenacted to read:
  120         320.6992 Application.—Sections 320.60-320.70, including
  121  amendments to ss. 320.60-320.70, apply to all presently existing
  122  or hereafter established systems of distribution of motor
  123  vehicles in this state, except to the extent that such
  124  application would impair valid contractual agreements in
  125  violation of the State Constitution or Federal Constitution.
  126  Sections 320.60-320.70 do not apply to any judicial or
  127  administrative proceeding pending as of October 1, 1988. All
  128  agreements renewed, amended, or entered into subsequent to
  129  October 1, 1988, shall be governed by ss. 320.60-320.70,
  130  including any amendments to ss. 320.60-320.70 which have been or
  131  may be from time to time adopted, unless the amendment
  132  specifically provides otherwise, and except to the extent that
  133  such application would impair valid contractual agreements in
  134  violation of the State Constitution or Federal Constitution.
  135         Section 4. This act shall take effect upon becoming a law.