Senate Bill 0938c2
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Florida Senate - 2000 CS for CS for SB 938
By the Committees on Judiciary, Transportation and Senator
Bronson
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1 A bill to be entitled
2 An act relating to motor vehicle damage
3 disclosure; creating pt. VI of ch. 501, F.S.;
4 consisting of s. 501.98, F.S.; providing
5 definitions; prescribing the duty of motor
6 vehicle manufacturers and dealers to disclose
7 and repair certain damage to motor vehicles;
8 apportioning liability for certain damage and
9 repairs; prescribing duties of dealers with
10 respect to cooperation with manufacturers;
11 providing remedies for purchasers of damaged
12 motor vehicles, including injunctive relief and
13 attorney's fees; amending s. 320.27, F.S.;
14 revising provisions relating to denial,
15 suspension, or revocation of a motor vehicle
16 dealer's license; providing penalties;
17 providing an effective date.
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19 Be It Enacted by the Legislature of the State of Florida:
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21 Section 1. Part VI of chapter 501, Florida Statutes,
22 consisting of section 501.98, is created to read:
23 PART VI
24 NEW MOTOR VEHICLE DAMAGE DISCLOSURE
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26 501.98 New motor vehicle damage; disclosure;
27 repairs.--
28 (1) DEFINITIONS.--As used in this section, the term:
29 (a) "Dealer" means a motor vehicle dealer as defined
30 in s. 320.27, but does not include a motor vehicle auction as
31 defined in s. 320.27(1)(c)4.
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Florida Senate - 2000 CS for CS for SB 938
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1 (b) "Manufacturer" means a manufacturer as defined in
2 s. 320.60.
3 (c) "Manufacturer's suggested retail price" means the
4 retail price of a new motor vehicle suggested by the
5 manufacturer set forth in 15 U.S.C. s. 1232, including the
6 retail delivery price suggested by the manufacturer for each
7 accessory or item of optional equipment physically attached to
8 the new motor vehicle at the time it is delivered to the motor
9 vehicle dealer.
10 (d) "Motor vehicle" means any new automobile or truck
11 the equitable or legal title to which has never been
12 transferred by a manufacturer, distributor, importer, or
13 dealer to an ultimate purchaser. The term does not include
14 motor vehicles with a gross vehicle weight of 14,001 pounds or
15 more.
16 (e) "Threshold amount" means 3 percent of the
17 manufacturer's suggested retail price of a motor vehicle or
18 $650, whichever is less.
19 (2) RESPONSIBILITIES OF MANUFACTURER.--
20 (a) A manufacturer shall disclose, in writing, to a
21 dealer at the time of delivery of a motor vehicle, damage and
22 repair to the motor vehicle which is actually known to the
23 manufacturer and which occurred at any time after the
24 manufacturing process was completed, but before delivery of
25 the vehicle to the dealer, if the cost of repairing the
26 damage, including diminution in value, exceeds the threshold
27 amount.
28 (b)1. Notwithstanding the terms of any franchise
29 agreement, the manufacturer is liable for any and all damage
30 to a motor vehicle which is actually known to the manufacturer
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Florida Senate - 2000 CS for CS for SB 938
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1 and which occurred at any time after the manufacturing process
2 was complete, but before or during delivery to the dealer.
3 2. Whenever a new motor vehicle is damaged in transit
4 or otherwise damaged before delivery to the dealer, the dealer
5 shall:
6 a. Notify the manufacturer, or the manufacturer's
7 transportation agent, in writing, of the damage within 3
8 business days after the date the vehicle is delivered to the
9 dealer; and
10 b. Request from the manufacturer, or the
11 manufacturer's transportation agent, in writing, authorization
12 to replace the components, parts, and accessories damaged or
13 to otherwise repair the damage.
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15 Nothing in this section relieves the dealer's obligation to
16 cooperate with the manufacturer as necessary on filing any
17 transportation damage claim with the manufacturer's
18 transportation agent.
19 (c) It is unlawful for any manufacturer to fail to
20 compensate, or provide compensation by the manufacturer's
21 transportation agent to, any dealer for repairs effected by
22 the dealer to a damaged motor vehicle or to a motor vehicle
23 damaged in transit or otherwise damaged before delivery to the
24 dealer, provided that written authorization is given to the
25 dealer by the manufacturer. Compensation shall include:
26 1. The sum of any sublet for repairs or, if the dealer
27 repairs the vehicle, the dealer's warrant rate for parts and
28 labor; and
29 2. Diminution in value of the vehicle if the dealer is
30 to retain and sell the vehicle by agreement between the dealer
31 and the manufacturer.
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Florida Senate - 2000 CS for CS for SB 938
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1 (d) If the manufacturer, or the manufacturer's
2 transportation agent, refuses or fails to authorize repair of
3 any damage within 10 business days after receiving
4 notification given under this section, ownership of the motor
5 vehicle shall revert to the manufacturer, and the dealer shall
6 have no obligation, financial or otherwise, with respect to
7 the motor vehicle. If the damage exceeds the threshold amount
8 in (1)(f), the manufacturer may elect to repurchase the motor
9 vehicle from the dealer or provide reasonable and adequate
10 compensation to the dealer to assist in selling the vehicle.
11 If the manufacturer repurchases the motor vehicle, the dealer
12 shall have no obligation, financial or otherwise, with respect
13 to the motor vehicle.
14 (3) RESPONSIBILITIES OF DEALER.--A dealer shall
15 disclose, in writing, to the motor vehicle purchaser,
16 including a purchaser for resale, damage and repair to the
17 motor vehicle which is actually known to the dealer, before
18 entering into a sales contract, if the cost of repairing the
19 damage exceeds the threshold amount. For purposes of this
20 subsection, the threshold amount shall be calculated at the
21 rate of the dealer's authorized warranty rate for labor and
22 parts. The disclosure must be acknowledged by the purchaser
23 in writing on a form presented by the dealer. The dealer
24 shall retain a copy of the acknowledgement for his or her
25 records.
26 (4) CONSUMER REMEDIES.--
27 (a) If disclosure is required under this section and
28 the motor vehicle dealer fails to make the required
29 disclosure, a purchaser may either seek recovery of damages
30 under subparagraph l. or, if within 30 days from the date of
31 purchase, may rescind the sales contract under subparagraph 2.
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1 1. In an action to recover damages under this
2 paragraph, the court shall award a purchaser who prevails in
3 such action only the amount of any pecuniary loss, litigation
4 costs, and reasonable attorney's fees. The court shall not
5 award damages for loss of use, lost profit, incidental damage,
6 or any other claim. The action must be commenced within 1 year
7 after the discovery of the damage or within 1 year after the
8 time discovery reasonably should have been made by the
9 purchaser, but in no event shall the action be brought more
10 than 2 years or 30,000 miles after delivery of the vehicle to
11 the purchaser. A motor vehicle purchaser seeking recovery of
12 damages under this section is not precluded from pursuing
13 remedies available under any other law, including remedies
14 available under chapter 681; or
15 2. To rescind the sales contract, the buyer must
16 return the motor vehicle to the dealer within 30 days from the
17 date of purchase with an accompanying written notice of the
18 grounds for rescission. The dealer shall accept the motor
19 vehicle and refund any payments made to the dealer or
20 financial institution in connection with the transaction, less
21 a reasonable allowance for the purchaser's use of the motor
22 vehicle based upon the mileage attributable to the consumer as
23 of the date of return of the motor vehicle to the dealer,
24 multiplied by the purchase price of the vehicle and divided by
25 120,000. The dealer shall also pay off the balance of any loan
26 due to the lienholder as of the date the vehicle is returned
27 and any costs for early lease termination.
28 (b) If disclosure is not required under this section,
29 the purchaser may not bring a civil action against the dealer
30 or manufacturer for damages or rescind a sales contract as
31 provided in subsection (4) based solely upon the fact that the
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Florida Senate - 2000 CS for CS for SB 938
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1 new motor vehicle was damaged and repaired before completion
2 of the sale.
3 Section 2. Paragraph (n) of subsection (9) of section
4 320.27, Florida Statutes, is amended to read:
5 320.27 Motor vehicle dealers.--
6 (9) DENIAL, SUSPENSION, OR REVOCATION.--The department
7 may deny, suspend, or revoke any license issued hereunder or
8 under the provisions of s. 320.77 or s. 320.771, upon proof
9 that a licensee has failed to comply with any of the following
10 provisions with sufficient frequency so as to establish a
11 pattern of wrongdoing on the part of the licensee:
12 (n) Failure to disclose damage to a new motor vehicle
13 as defined in s. 320.60(10) as required under s. 501.98 of
14 which the dealer had actual knowledge if the dealer's actual
15 cost of repair, excluding tires, bumpers, and glass, exceeds 3
16 percent of the manufacturer's suggested retail price;
17 provided, however, if only the application of exterior paint
18 is involved, disclosure shall be made if such touch-up paint
19 application exceeds $100.
20 Section 3. This act shall take effect July 1, 2000.
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Florida Senate - 2000 CS for CS for SB 938
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1 STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
COMMITTEE SUBSTITUTE FOR
2 CS/SB 938
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4 The bill addresses circumstances where a new motor vehicle is
damaged after it has been manufactured but before the vehicle
5 is delivered to a dealer for sale.
6 The CS for CS removes from the bill the definition of
"replacement parts" which were parts of the vehicle not
7 included in determining the dollar amount of damage to the
vehicle for purposes of determining when damage had to be
8 disclosed by the manufacturer to the dealer and by the dealer
to the purchaser.
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The period for which the manufacturer must disclose damage to
10 the dealer is amended to include damage during delivery as
well as prior to delivery. The definition of damage for
11 purposes of the threshold that requires disclosure is amended
to include diminution in value of the vehicle in addition to
12 the cost of repairs.
13 The amount the court may award a buyer who prevails in an
action to recover damages is limited to only the amount of any
14 pecuniary loss, litigation costs and reasonable attorney's
fees. The court is prohibited from awarding damages for loss
15 of use, lost profit, incidental damages, or other claims.
16 The CS for CS provides that an action under the bill may not
be brought more than 2 years or 30,000 miles after purchase of
17 the vehicle.
18 When a vehicle is returned to a dealer for failure to
disclose, a definition is provided to determine the reasonable
19 allowance for the purchaser's use of the motor vehicle during
the period prior to the time the vehicle is returned to the
20 dealer.
21 The bill further limits the right of a purchaser to bring an
action under the bill if the dealer is not required to
22 disclose the damage because it is less than the threshold
amount.
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