1

A bill to be entitled

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An act relating to motor vehicle dealers; amending s.

3

320.27, F.S.; revising the definition of "motor vehicle

4

dealer" to authorize such dealers to apply for

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certificates of title to certain vehicles using a

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manufacturer's statement of origin; eliminating

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exceptions; deleting a provision requiring that certain

8

vehicles be titled as used vehicles; adding provisions

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pursuant to which the Department of Highway Safety and

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Motor Vehicle may deny, suspend, or revoke certain

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licenses; providing that a franchised motor vehicle dealer

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of the same line-make has a cause of action against a

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motor vehicle dealer who engages, with sufficient

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frequency so as to establish a pattern of wrongdoing, in

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the business of an unauthorized and unlawful additional

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motor vehicle dealership location as described by state

17

law; providing for venue for such causes of action;

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creating s. 320.6425, F.S.; providing that certain

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activities or the fulfillment of certain criteria

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constitute the operation of an unlawful and additional

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motor vehicle dealership; defining the term "sale for

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retail purposes"; providing that certain actions by motor

23

vehicle dealers constitute violations of state law;

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authorizing any same line-make motor vehicle dealer who

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suffers damages as a result of an unlawful and additional

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motor vehicle dealership location to seek damages;

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providing for the application and nonapplication of

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certain provisions of state law; amending s. 501.975,

29

F.S.; defining the term "advertised price" for purposes of

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to motor vehicle sales; amending s. 501.976, F.S.;

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requiring that the advertised price include all costs,

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fees, or charges that the customer must pay, with certain

33

exclusions; requiring a conspicuous label containing a

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disclosure regarding the predelivery service fee;

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providing exceptions; providing an effective date.

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Be It Enacted by the Legislature of the State of Florida:

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     Section 1.  Paragraph (c) of subsection (1) and paragraph

40

(b) of subsection (9) of section 320.27, Florida Statutes, are

41

amended, and subsection (15) is added to that section, to read:

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     320.27  Motor vehicle dealers.--

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     (1)  DEFINITIONS.--The following words, terms, and phrases

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when used in this section have the meanings respectively ascribed

45

to them in this subsection, except where the context clearly

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indicates a different meaning:

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     (c)  "Motor vehicle dealer" means any person engaged in the

48

business of buying, selling, or dealing in motor vehicles or

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offering or displaying motor vehicles for sale at wholesale or

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retail, or who may service and repair motor vehicles pursuant to

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an agreement as defined in s. 320.60(1). Any person who buys,

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sells, or deals in three or more motor vehicles in any 12-month

53

period or who offers or displays for sale three or more motor

54

vehicles in any 12-month period shall be prima facie presumed to

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be engaged in such business. The terms "selling" and "sale"

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include lease-purchase transactions. A motor vehicle dealer may,

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at retail or wholesale, sell a recreational vehicle as described

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in s. 320.01(1)(b)1.-6. and 8., acquired in exchange for the sale

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of a motor vehicle, provided such acquisition is incidental to

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the principal business of being a motor vehicle dealer. However,

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a motor vehicle dealer may not buy a recreational vehicle for the

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purpose of resale unless licensed as a recreational vehicle

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dealer pursuant to s. 320.771. A motor vehicle dealer may apply

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for a certificate of title to a motor vehicle required to be

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registered under s. 320.08(2)(b), (c), and (d), s. 320.08(3)(a),

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(b), and (c), or s. 320.08(4)(a)-(n), using a manufacturer's

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statement of origin as permitted by s. 319.23(1), only if such

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dealer is authorized by a franchised agreement as defined in s.

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320.60(1), to buy, sell, or deal in such vehicle and is

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authorized by such agreement to perform delivery and preparation

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obligations and warranty defect adjustments on the motor vehicle;

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provided this limitation shall not apply to recreational vehicles

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or, van conversions, or any other motor vehicle manufactured on a

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truck chassis. The transfer of a motor vehicle by a dealer not

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meeting these qualifications shall be titled as a used vehicle.

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The classifications of motor vehicle dealers are defined as

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follows:

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     1.  "Franchised motor vehicle dealer" means any person who

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engages in the business of repairing, servicing, buying, selling,

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or dealing in motor vehicles pursuant to an agreement as defined

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in s. 320.60(1).

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     2.  "Independent motor vehicle dealer" means any person

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other than a franchised or wholesale motor vehicle dealer who

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engages in the business of buying, selling, or dealing in motor

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vehicles, and who may service and repair motor vehicles.

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     3.  "Wholesale motor vehicle dealer" means any person who

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engages exclusively in the business of buying, selling, or

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dealing in motor vehicles at wholesale or with motor vehicle

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auctions. Such person shall be licensed to do business in this

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state, shall not sell or auction a vehicle to any person who is

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not a licensed dealer, and shall not have the privilege of the

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use of dealer license plates. Any person who buys, sells, or

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deals in motor vehicles at wholesale or with motor vehicle

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auctions on behalf of a licensed motor vehicle dealer and as a

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bona fide employee of such licensed motor vehicle dealer is not

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required to be licensed as a wholesale motor vehicle dealer. In

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such cases it shall be prima facie presumed that a bona fide

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employer-employee relationship exists. A wholesale motor vehicle

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dealer shall be exempt from the display provisions of this

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section but shall maintain an office wherein records are kept in

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order that those records may be inspected.

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     4.  "Motor vehicle auction" means any person offering motor

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vehicles or recreational vehicles for sale to the highest bidder

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where buyers are licensed motor vehicle dealers. Such person

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shall not sell a vehicle to anyone other than a licensed motor

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vehicle dealer.

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     5.  "Salvage motor vehicle dealer" means any person who

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engages in the business of acquiring salvaged or wrecked motor

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vehicles for the purpose of reselling them and their parts.

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The term "motor vehicle dealer" does not include persons not

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engaged in the purchase or sale of motor vehicles as a business

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who are disposing of vehicles acquired for their own use or for

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use in their business or acquired by foreclosure or by operation

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of law, provided such vehicles are acquired and sold in good

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faith and not for the purpose of avoiding the provisions of this

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law; persons engaged in the business of manufacturing, selling,

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or offering or displaying for sale at wholesale or retail no more

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than 25 trailers in a 12-month period; public officers while

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performing their official duties; receivers; trustees,

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administrators, executors, guardians, or other persons appointed

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by, or acting under the judgment or order of, any court; banks,

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finance companies, or other loan agencies that acquire motor

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vehicles as an incident to their regular business; motor vehicle

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brokers; and motor vehicle rental and leasing companies that sell

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motor vehicles to motor vehicle dealers licensed under this

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section. Vehicles owned under circumstances described in this

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paragraph may be disposed of at retail, wholesale, or auction,

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unless otherwise restricted. A manufacturer of fire trucks,

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ambulances, or school buses may sell such vehicles directly to

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governmental agencies or to persons who contract to perform or

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provide firefighting, ambulance, or school transportation

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services exclusively to governmental agencies without processing

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such sales through dealers if such fire trucks, ambulances,

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school buses, or similar vehicles are not presently available

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through motor vehicle dealers licensed by the department.

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     (9)  DENIAL, SUSPENSION, OR REVOCATION.--

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     (b)  The department may deny, suspend, or revoke any license

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issued hereunder or under the provisions of s. 320.77 or s.

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320.771 upon proof that a licensee has committed, with sufficient

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frequency so as to establish a pattern of wrongdoing on the part

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of a licensee, violations of one or more of the following

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activities:

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     1.  Representation that a demonstrator is a new motor

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vehicle, or the attempt to sell or the sale of a demonstrator as

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a new motor vehicle without written notice to the purchaser that

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the vehicle is a demonstrator. For the purposes of this section,

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a "demonstrator," a "new motor vehicle," and a "used motor

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vehicle" shall be defined as under s. 320.60.

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     2.  Unjustifiable refusal to comply with a licensee's

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responsibility under the terms of the new motor vehicle warranty

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issued by its respective manufacturer, distributor, or importer.

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However, if such refusal is at the direction of the manufacturer,

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distributor, or importer, such refusal shall not be a ground

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under this section.

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     3.  Misrepresentation or false, deceptive, or misleading

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statements with regard to the sale or financing of motor vehicles

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which any motor vehicle dealer has, or causes to have,

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advertised, printed, displayed, published, distributed,

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broadcast, televised, or made in any manner with regard to the

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sale or financing of motor vehicles.

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     4.  Failure by any motor vehicle dealer to provide a

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customer or purchaser with an odometer disclosure statement and a

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copy of any bona fide written, executed sales contract or

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agreement of purchase connected with the purchase of the motor

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vehicle purchased by the customer or purchaser.

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     5.  Failure of any motor vehicle dealer to comply with the

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terms of any bona fide written, executed agreement, pursuant to

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the sale of a motor vehicle.

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     6.  Failure to apply for transfer of a title as prescribed

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in s. 319.23(6).

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     7.  Use of the dealer license identification number by any

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person other than the licensed dealer or his or her designee.

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     8.  Failure to continually meet the requirements of the

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licensure law.

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     9.  Representation to a customer or any advertisement to the

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public representing or suggesting that a motor vehicle is a new

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motor vehicle if such vehicle lawfully cannot be titled in the

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name of the customer or other member of the public by the seller

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using a manufacturer's statement of origin as permitted in s.

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319.23(1).

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     10.  Requirement by any motor vehicle dealer that a customer

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or purchaser accept equipment on his or her motor vehicle which

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was not ordered by the customer or purchaser.

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     11.  Requirement by any motor vehicle dealer that any

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customer or purchaser finance a motor vehicle with a specific

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financial institution or company.

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     12.  Requirement by any motor vehicle dealer that the

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purchaser of a motor vehicle contract with the dealer for

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physical damage insurance.

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     13.  Perpetration of a fraud upon any person as a result of

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dealing in motor vehicles, including, without limitation, the

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misrepresentation to any person by the licensee of the licensee's

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relationship to any manufacturer, importer, or distributor.

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     14.  Violation of any of the provisions of s. 319.35 by any

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motor vehicle dealer.

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     15.  Sale by a motor vehicle dealer of a vehicle offered in

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trade by a customer prior to consummation of the sale, exchange,

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or transfer of a newly acquired vehicle to the customer, unless

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the customer provides written authorization for the sale of the

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trade-in vehicle prior to delivery of the newly acquired vehicle.

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     16.  Willful failure to comply with any administrative rule

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adopted by the department or the provisions of s. 320.131(8).

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     17.  Violation of chapter 319, this chapter, or ss. 559.901-

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559.9221, which has to do with dealing in or repairing motor

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vehicles or mobile homes. Additionally, in the case of used motor

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vehicles, the willful violation of the federal law and rule in 15

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U.S.C. s. 2304, 16 C.F.R. part 455, pertaining to the consumer

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sales window form.

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     18.  Failure to maintain evidence of notification to the

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owner or coowner of a vehicle regarding registration or titling

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fees owed as required in s. 320.02(17).

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     19.  Failure to register a mobile home salesperson with the

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department as required by this section.

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     20. Any violation of s. 320.6425 by any motor vehicle

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dealer, including the operation of an unlawful additional motor

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vehicle dealership location or unlawful supply of motor vehicles.

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     (15) PRIVATE ENFORCEMENT.--A franchised motor vehicle

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dealer of the same line-make has a cause of action under this

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section against a motor vehicle dealer who engages, with

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sufficient frequency so as to establish a pattern of wrongdoing,

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in the business of an unauthorized and unlawful additional motor

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vehicle dealership location as described in s. 320.6425. The

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cause of action for injunctive relief and actual damages,

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including lost profit, court costs, and reasonable attorney's

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fees, may be brought in any court of competent jurisdiction.

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     Section 2.  Section 320.6425, Florida Statutes, is created

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to read:

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     320.6425 Unauthorized and additional motor vehicle

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dealerships.--

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     (1) An unlawful and additional motor vehicle dealership

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location, as contemplated by s. 320.642, exists if motor vehicles

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are sold from a location in this state for retail purposes if the

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motor vehicle dealer transacting such sales:

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     (a) Is not located in this state;

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     (b) Is not a licensed motor vehicle dealer authorized by

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a franchise agreement to sell the specific line-make of vehicle;

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or

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     (c) Is a licensed motor vehicle dealer authorized by a

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franchise agreement to sell the specific line-make of vehicle,

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but such sales are transacted at a location other than that

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permitted by a license issued to the motor vehicle dealer by the

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Department of Highway Safety and Motor Vehicles.

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     (2) A sale for retail purposes is the first sale of the

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motor vehicle to a customer for personal use or the first sale of

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the motor vehicle for commercial use, such as leasing, if a motor

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vehicle sold for commercial use is not resold within 90 days.

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This section applies regardless of whether the title issued

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pursuant to such sale, in this state or another state, is

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designated as new or used. However, this section does not

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prohibit a motor vehicle dealer from reselling any motor vehicle

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it receives in trade for the sale of another motor vehicle.

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     (3) Any motor vehicle dealer, whether located inside or

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outside this state, which supplies any motor vehicle to the

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unlawful and additional motor vehicle dealership location

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established pursuant to subsection (1), unlawfully:

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     (a) Establishes an additional motor vehicle dealership

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location in violation of s. 320.642; and

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     (b) Conducts business within this state as a distributor

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and licensee, as contemplated by s. 320.60, in violation of ss.

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320.61 and 320.642.

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     (4) Any same line-make motor vehicle dealer suffering

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damages as a result of the unlawful and additional motor vehicle

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dealership location may seek damages against any motor vehicle

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dealer deemed to be a distributor or licensee pursuant to

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subsection (3) and may seek all remedies, procedures, and rights

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of recovery available under ss. 320.695 and 320.697.

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     (5) This section does not prohibit the transfer of a motor

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vehicle, by sale or trade, from one franchised dealer to another

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dealer authorized by franchise agreement to sell the same line-

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make of motor vehicles.

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     Section 3.  Section 501.975, Florida Statutes, is amended to

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read:

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     501.975  Definitions.--As used in s. 501.976, the following

275

terms shall have the following meanings:

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     (1)  "Customer" includes a customer's designated agent.

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     (2)  "Dealer" means a motor vehicle dealer as defined in s.

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320.27, but does not include a motor vehicle auction as defined

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in s. 320.27(1)(c)4.

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     (3)  "Replacement item" means a tire, bumper, bumper fascia,

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glass, in-dashboard equipment, seat or upholstery cover or trim,

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exterior illumination unit, grill, sunroof, external mirror and

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external body cladding. The replacement of up to three of these

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items does not constitute repair of damage if each item is

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replaced because of a product defect or damaged due to vandalism

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while the new motor vehicle is under the control of the dealer

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and the items are replaced with original manufacturer equipment,

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unless an item is replaced due to a crash, collision, or

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accident.

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     (4)  "Threshold amount" means 3 percent of the

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manufacturer's suggested retail price of a motor vehicle or $650,

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whichever is less.

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     (5)  "Vehicle" means any automobile, truck, bus,

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recreational vehicle, or motorcycle required to be licensed under

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chapter 320 for operation over the roads of Florida, but does not

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include trailers, mobile homes, travel trailers, or trailer

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coaches without independent motive power.

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     (6) "Advertised price" means the price as expressed in any

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statements that are transmitted orally, through written material,

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or through electronic means, or any illustration that is

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disseminated to the public or affixed to a motor vehicle and that

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is used in selling a motor vehicle or otherwise used to induce a

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person to enter into any obligation related to the motor vehicle.

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     Section 4.  Section 501.976, Florida Statutes, is amended to

305

read:

306

     501.976  Actionable, unfair, or deceptive acts or

307

practices.--It is an unfair or deceptive act or practice,

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actionable under the Florida Deceptive and Unfair Trade Practices

309

Act, for a dealer to:

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     (1)  Represent directly or indirectly that a motor vehicle

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is a factory executive vehicle or executive vehicle unless such

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vehicle was purchased directly from the manufacturer or a

313

subsidiary of the manufacturer and the vehicle was used

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exclusively by the manufacturer, its subsidiary, or a dealer for

315

the commercial or personal use of the manufacturer's,

316

subsidiary's, or dealer's employees.

317

     (2)  Represent directly or indirectly that a vehicle is a

318

demonstrator unless the vehicle complies with the definition of a

319

demonstrator in s. 320.60(3).

320

     (3)  Represent the previous usage or status of a vehicle to

321

be something that it was not, or make usage or status

322

representations unless the dealer has correct information

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regarding the history of the vehicle to support the

324

representations.

325

     (4)  Represent the quality of care, regularity of servicing,

326

or general condition of a vehicle unless known by the dealer to

327

be true and supportable by material fact.

328

     (5)  Represent orally or in writing that a particular

329

vehicle has not sustained structural or substantial skin damage

330

unless the statement is made in good faith and the vehicle has

331

been inspected by the dealer or his or her agent to determine

332

whether the vehicle has incurred such damage.

333

     (6)  Sell a vehicle without fully and conspicuously

334

disclosing in writing at or before the consummation of sale any

335

warranty or guarantee terms, obligations, or conditions that the

336

dealer or manufacturer has given to the buyer. If the warranty

337

obligations are to be shared by the dealer and the buyer, the

338

method of determining the percentage of repair costs to be

339

assumed by each party must be disclosed. If the dealer intends to

340

disclaim or limit any expressed or implied warranty, the

341

disclaimer must be in writing in a conspicuous manner and in lay

342

terms in accordance with chapter 672 and the Magnuson-Moss

343

Warranty--Federal Trade Commission Improvement Act.

344

     (7)  Provide an express or implied warranty and fail to

345

honor such warranty unless properly disclaimed pursuant to

346

subsection (6).

347

     (8)  Misrepresent warranty coverage, application period, or

348

any warranty transfer cost or conditions to a customer.

349

     (9)  Obtain signatures from a customer on contracts that are

350

not fully completed at the time the customer signs or which do

351

not reflect accurately the negotiations and agreement between the

352

customer and the dealer.

353

     (10)  Require or accept a deposit from a prospective

354

customer prior to entering into a binding contract for the

355

purchase and sale of a vehicle unless the customer is given a

356

written receipt that states how long the dealer will hold the

357

vehicle from other sale and the amount of the deposit, and

358

clearly and conspicuously states whether and upon what conditions

359

the deposit is refundable or nonrefundable.

360

     (11)  Add to the cash price of a vehicle as defined in s.

361

520.02(2) any fee or charge other than those provided in that

362

section and in rule 3D-50.001, Florida Administrative Code. All

363

fees or charges permitted to be added to the cash price by rule

364

3D-50.001, Florida Administrative Code, must be fully disclosed

365

to customers in all binding contracts concerning the vehicle's

366

selling price.

367

     (12)  Alter or change the odometer mileage of a vehicle.

368

     (13)  Sell a vehicle without disclosing to the customer the

369

actual year and model of the vehicle.

370

     (14)  File a lien against a new vehicle purchased with a

371

check unless the dealer fully discloses to the purchaser that a

372

lien will be filed if purchase is made by check and fully

373

discloses to the buyer the procedures and cost to the buyer for

374

gaining title to the vehicle after the lien is filed.

375

     (15)  Increase the price of the vehicle after having

376

accepted an order of purchase or a contract from a buyer,

377

notwithstanding subsequent receipt of an official price change

378

notification. The price of a vehicle may be increased after a

379

dealer accepts an order of purchase or a contract from a buyer

380

if:

381

     (a)  A trade-in vehicle is reappraised because it

382

subsequently is damaged, or parts or accessories are removed;

383

     (b)  The price increase is caused by the addition of new

384

equipment, as required by state or federal law;

385

     (c)  The price increase is caused by the revaluation of the

386

United States dollar by the Federal Government, in the case of a

387

foreign-made vehicle;

388

     (d)  The price increase is caused by state or federal tax

389

rate changes; or

390

     (e)  Price protection is not provided by the manufacturer,

391

importer, or distributor.

392

     (16)  Advertise the price of a vehicle unless the vehicle is

393

identified by year, make, model, and a commonly accepted trade,

394

brand, or style name.

395

     (a) The advertised price must include all costs, fees, or

396

charges that the customer must pay, excluding including freight

397

or destination charge, dealer preparation charge, and charges for

398

undercoating or rustproofing. state and local taxes, tag fees

399

tags, registration fees, and title fees, unless otherwise

400

required by local law or standard, need not be disclosed in the

401

advertisement.

402

     (b) When two or more dealers advertise jointly, with or

403

without participation of the franchisor, the advertised price

404

must include the highest price of the vehicles being offered,

405

consistent with paragraph (a), or specify the price for each

406

vehicle, respectively need not include fees and charges that are

407

variable among the individual dealers cooperating in the

408

advertisement, but the nature of all charges that are not

409

included in the advertised price must be disclosed in the

410

advertisement.

411

     (17)  Charge a customer for any predelivery service required

412

by the manufacturer, distributor, or importer for which the

413

dealer is reimbursed by the manufacturer, distributor, or

414

importer.

415

     (18)  Charge a customer for any predelivery service without

416

having printed on all documents that include a line item for

417

predelivery service the following disclosure: "This charge

418

represents costs and profit to the dealer for items such as

419

inspecting, cleaning, and adjusting vehicles, and preparing

420

documents related to the sale."

421

     (19)  Fail to disclose damage to a new motor vehicle, as

422

defined in s. 319.001(8), of which the dealer had actual

423

knowledge, if the dealer's actual cost of repairs exceeds the

424

threshold amount, excluding replacement items.

425

     (20) Fail to attach a conspicuous label to the window of a

426

motor vehicle specifying any charge for predelivery services if

427

the motor vehicle under consideration by a prospective purchaser

428

is available for physical inspection by the purchaser. The label

429

must include the following disclosure: "This charge represents

430

costs and profit to the dealer for items such as inspecting,

431

cleaning, and adjusting vehicles and preparing documents related

432

to the sale." This requirement does not apply to the sale of

433

motorcycles.

434

435

In any civil litigation resulting from a violation of this

436

section, when evaluating the reasonableness of an award of

437

attorney's fees to a private person, the trial court shall

438

consider the amount of actual damages in relation to the time

439

spent.

440

     Section 5.  This act shall take effect July 1, 2008.