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§ 4170.
LEGISLATIVE INTENT
The legislature finds and declares that manufacturers, distributors and
importers of new motor vehicles should be obligated to provide speedy and
less costly resolution of automobile warranty problems. Manufacturers
should be required to provide in as expeditious a manner as possible a
refund of the consumer's purchase price or payments to a lessor and lessee
or a replacement vehicle that is acceptable to the consumer whenever the
manufacturer is unable to make the vehicle conform with its applicable
warranty. New motor vehicle dealers and used motor vehicle dealers cannot
be sued under this chapter.
Added 1983, No. 211 (Adj. Sess.), § 1; amended 1987, No. 242 (Adj. Sess.),
§ 1
§ 4171.
DEFINITIONS
As used in this chapter:
(1) "Board"
means, unless otherwise indicated, the Vermont motor vehicle arbitration
board.
(2) "Consumer"
means the purchaser, other than for purposes of resale of a new motor
vehicle or lessee of a new motor vehicle, other than for the purposes of
sub-lease, which has not been previously leased by another person, any
person to whom such motor vehicle is transferred during the duration of an
express warranty applicable to the motor vehicle, and any other person
entitled by the terms of the warranty to enforce the obligations of the
warranty, but "consumer" shall not include any governmental entity or any
business or commercial enterprise which registers or leases three or more
motor vehicles.
(3) "Early termination
costs" mean expenses and obligations incurred by a motor vehicle
lessee as a result of an early termination of a written lease agreement
and surrender of a motor vehicle to a manufacturer under the provisions of
9 V.S.A. § 4172(e), including penalties for prepayment of finance
arrangements.
(4) "Lease or leased"
means a written agreement with a lessee as defined in subdivision (5)
of this section, which shall be for the use of a motor vehicle for
consideration for a term of two or more years.
(5) "Lessee"
means any consumer who leases a motor vehicle pursuant to a written lease
agreement for a term of two or more years.
(6) "Motor vehicle" means a motor vehicle which is purchased or leased, or registered
in the state of Vermont and is registered in Vermont within 15 days of the
date of purchase or lease and shall not include tractors, motorized
highway building equipment, road-making appliances, snowmobiles,
motorcycles, mopeds, or the living portion of recreation vehicles, or
trucks with a gross vehicle weight over 12,000 pounds.
(7) "Manufacturer"
means any person, resident or nonresident, who manufactures or assembles
new motor vehicles or imports for distribution through distributors of
motor vehicles or any partnership, firm, association, joint venture,
corporation or trust, resident or nonresident, which is controlled by a
manufacturer. Additionally, the term "manufacturer" shall include:
(A) "distributor",
meaning any person, resident or nonresident, who in whole or in
part offers for sale , sells, or distributes any new motor vehicle to new
motor vehicle dealers or new motor vehicle lessors or maintains factory
representatives or who controls any person, firm, association,
corporation, or trust, resident or nonresident, who in whole or in part
offers for sale, sells or distributes any new motor vehicle to new motor
vehicle dealers or new motor vehicle lessors; and
(B) "factory branch"
meaning any branch office maintained by a manufacturer for the purpose of
selling, leasing, offering for sale or lease, vehicles to a distributor or
new motor vehicle dealer or for directing or supervising, in whole or in
part, factory distributor representatives.
(8) "Motor vehicle
lessor" means a person who holds title to a motor vehicle leased to
a lessee under a written lease agreement for a term of two or more years,
or who holds the lessor's rights under such an agreement.
(9) A "new motor
vehicle" means a passenger motor vehicle which is still under the
manufacturer's express warranty.
(10) Warranty shall be defined as including
the following:
"Express warranty" means express warranties
as defined in the Uniform Commercial Code§ 2-313, plus any written
warranty of the manufacturer.
Added 1983, No. 211 (Adj. Sess.), § 1; amended 1985, No. 260 (Adj. Sess.),
§ 1; 1987, No. 242 (Adj. Sess.), § 2; 1999, No. 18, § 27, eff. May 13,
1999.
§ 4172.
ENFORCEMENT OF WARRANTIES
(a) Every new motor vehicle as defined in
section 4171 of this title sold in this state must conform to all
applicable warranties.
(b) It shall be the manufacturer's obligation
under this chapter to insure that all new motor vehicles sold, leased or
registered in this state conform with manufacturer's express warranties.
The manufacturer may delegate responsibility to its agents or authorized
dealers provided, however, in the event the manufacturer delegates its
responsibility under this chapter to its agents or authorized dealers, it
shall compensate the dealer for all work performed by the dealer in
satisfaction of the manufacturer's responsibility under this chapter in
the manner set forth in chapter 108 of this title known as the "Motor
Vehicle Manufacturers, Distributors and Dealers' Franchising Practices
Act" as that act may be from time to time amended.
(c) If a new motor vehicle does not conform
to all applicable express warranties and the consumer reports the
nonconformity to the manufacturer, its agent or authorized dealer during
the term of the warranty, the manufacturer shall cause whatever repairs
are necessary to conform the vehicle to the warranties, notwithstanding
the fact that the repairs are made after the expiration of a warranty
term.
(d) A manufacturer, its agent or authorized
dealer shall not refuse to provide a consumer with a written repair order
and shall provide to the consumer each time the consumer's vehicle is
brought in for examination or repair of a defect, a written summary of the
complaint and a fully itemized statement indicating all work performed on
the vehicle including, but not limited to, examination of the vehicle,
parts and labor.
(e) If, after a reasonable number of
attempts, the manufacturer, its agent or authorized dealer or its delegate
is unable to conform the motor vehicle to any express warranty by
repairing or correcting any defect or condition covered by the warranty
which substantially impairs the use, market value, or safety of the motor
vehicle to the consumer, the manufacturer shall, at the option of the
consumer within 30 days of the effective date of the board's order,
replace the motor vehicle with a new motor vehicle from the same
manufacturer, if available, of comparable worth to the same make and model
with all options and accessories with appropriate adjustments being
allowed for any model year differences or shall accept return of the
vehicle from the consumer and refund to the consumer the full purchase
price or to the lessee in the case of leased vehicles, as provided in
subsection (i) of this section. In those instances in which a refund is
tendered, the manufacturer shall refund to the consumer the full purchase
price as indicated in the purchase contract and all credits and allowances
for any trade-in or downpayment, finance charges, credit charges,
registration fees and any similar charges and incidental and consequential
damages or in the case of leased vehicles, as provided in subsection (i)
of this section. Refunds shall be made to the consumer and lienholder, if
any, as their interests may appear or to the motor vehicle lessor and
lessee as provided in subsection (i) of this section. A reasonable
allowance for use shall be that amount directly attributable to use by the
consumer prior to his or her first repair attempt and shall be calculated
by multiplying the full purchase price of the vehicle by a fraction having
as its denominator 100,000 and having as its numerator the number of miles
that the vehicle traveled prior to the first attempt at repairing the
vehicle. If the manufacturer refunds the purchase price or a portion of
the price to the consumer, any Vermont motor vehicle purchase and use tax
paid shall be refunded by the state to the consumer in the proportionate
amount. To receive a refund, the consumer must file a claim with the
commissioner of motor vehicles within 90 days of the effective date of the
order.
(f) It shall be an affirmative defense to any
claim under this chapter that an alleged nonconformity does not
substantially impair the use, market value or safety or that the
nonconformity is the result of abuse, neglect, or unauthorized
modifications or alterations of a motor vehicle by a consumer.
(g) It shall be presumed that a reasonable
number of attempts have been undertaken to conform a motor vehicle to the
applicable warranties if:
(1) the same nonconformity as identified in
any written examination or repair order has been subject to repair at
least three times by the manufacturer, its agent or authorized dealer and
at least the first repair attempt occurs within the express warranty term
and the same nonconformity continues to exist, or
(2) the vehicle is out of service by reason
of repair of one or more nonconformities, defects or conditions for a
cumulative total of 30 or more calendar days during the term of the
express warranty. The term of any warranty and the 30-day period shall be
extended by any period of time during which repair services were not
available to the consumer because of war, invasion, strike, fire, flood or
other natural disaster. If an extension of time is necessitated due to
these conditions, the manufacturer shall cause provision for the free use
of a vehicle to the consumer whose vehicle is out of service. A vehicle
shall not be deemed out of service if it is available to the consumer for
a major part of the day.
(h) In order for an attempt at repair to
qualify for the presumptions of this section, the attempt at repair must
be evidenced by a written examination or repair order issued by the
manufacturer, its agent or its authorized dealer. The presumptions of this
section shall only apply to three attempts at repair evidenced by written
examination or repair orders undertaken by the same agent or authorized
dealer, unless the consumer shows good cause for taking the vehicle to a
different agent or authorized dealer.
(i) In cases in which the lessee elects a
replacement vehicle, a collateral change with appropriate adjustments for
any model year difference or excess mileage, or both, shall be
incorporated into an amended lease agreement. In cases in which a refund
is tendered by a manufacturer for a leased motor vehicle under subsection
(e) of this section, the refund and rights of the motor vehicle lessor,
lessee and manufacturer shall be in accordance with the following:
(1) The manufacturer shall provide to the
lessee, the aggregate deposit and rental payments previously paid to the
motor vehicle lessor by the lessee, and incidental and consequential
damages, if applicable, minus a reasonable allowance for use and allocated
payments for purchase and use tax. The aggregate deposit shall include,
but not be limited to, all cash payments and trade-in allowances tendered
by the lessee to the motor vehicle lessor under the lease agreement. The
reasonable allowance for use shall be calculated by multiplying the
aggregate deposit and rental payments made by the lessee on the motor
vehicle by a fraction having as its denominator the number of miles
allowed in the lease contract and having as its numerator the number of
miles that the vehicle traveled prior to the first attempt at repairing
the vehicle. Any miles in excess of those allowed in the lease contract
shall be added to the mileage at the first repair attempt or first day out
of service prior to calculating the reasonable allowance for use.
(2) The manufacturer shall provide to the
motor vehicle lessor the aggregate of the following:
(A) the lessor's actual purchase cost, less
payments made by the lessee;
(B) the freight cost, if applicable;
(C) the cost for dealer or
manufacturer-installed accessories, if applicable;
(D) any fee paid to another to obtain the
lease;
(E) an amount equal to five percent of the
lessor's actual purchase cost. The amount in this subdivision shall be
instead of any early termination costs as defined in § 4171(3) of this
chapter or as described in the lease agreement.
(3) Vermont motor vehicle purchase and use
tax shall be refunded by the state to whomever paid the tax. The party
must file a claim with the commissioner of the department of motor
vehicles within 90 days of the effective date of the order.
(4) The lessee's lease agreement with the
motor vehicle lessor and all contractual obligations shall be terminated
upon a decision of the board in favor of the lessee as of the effective
date of the order. The lessee shall not be liable for any further costs or
charges to the manufacturer or motor vehicle lessor under the lease
agreement.
(5) The motor vehicle lessor shall release
the motor vehicle title to the manufacturer upon payment by the
manufacturer under the provisions of this subsection.
(6) The board shall give notice to the motor
vehicle lessor of the lessee's filing of a request for arbitration under
this chapter and shall notify the motor vehicle lessor of the date, time
and place scheduled for a hearing before the board. The motor vehicle
lessor shall provide testimony and evidence necessary to the arbitration
proceedings. Any decision of the board shall be binding upon the motor
vehicle lessor.
Added 1983, No. 211 (Adj. Sess.), § 1; amended 1985, No. 260 (Adj. Sess.),
§ 2; 1987, No. 242 (Adj. Sess.),§§ 3, 4; 1989, No. 157 (Adj. Sess.), § 1,
eff. April 30, 1990; 1999, No. 18, § 28, eff. May 13, 1999.
§ 4173. PROCEDURE TO OBTAIN REFUND OR REPLACEMENT
(a) After reasonable attempt at repair or
correction of the nonconformity, defect or condition, or after the vehicle
is out of service by reason of repair of one or more nonconformities,
defects or conditions for a cumulative total of 30 or more calendar days
as provided in this chapter, the consumer shall notify the manufacturer
and lessor in writing, on forms to be provided by the manufacturer at the
time the new motor vehicle is delivered, of the nonconformity, defect or
condition and the consumer's election to proceed under this chapter. The
forms shall be made available by the manufacturer to any public or
nonprofit agencies that shall request them. Notice of consumer rights
under this chapter shall be conspicuously displayed by all authorized
dealers and agents of the manufacturer. The consumer shall in the notice,
elect whether to use the dispute settlement mechanism or the arbitration
provisions established by the manufacturer or to proceed under the Vermont
motor vehicle arbitration board as established under this chapter. The
consumer's election of whether to proceed before the board or the
manufacturer's mechanism shall preclude his or her recourse to the method
not selected.
(b) A consumer cannot pursue a remedy under
this chapter if he or she has discontinued financing or lease payments.
(c) Arbitration of the consumer's complaint,
either through the manufacturer's dispute settlement mechanism or the
board, must be held within 45 days of receipt by the manufacturer or the
board of the consumer's notice electing the remedy of arbitration unless
the consumer or the manufacturer has good cause for an extension of time,
not to exceed an additional 30-day period. If the extension of time is
requested by the manufacturer, the manufacturer shall provide free use of
a vehicle to the consumer if the consumer's vehicle is out of service. In
the event the consumer elects to proceed in accordance with the
manufacturer's dispute settlement mechanism and the arbitration of the
dispute is not held within 45 days of the manufacturer's receipt of the
consumer's notice and the manufacturer is not able to establish good cause
for the delay, the consumer shall be entitled to receive the relief
requested under this chapter.
(d) Within the 45-day period set forth in
subsection (c) of this section but at least five days prior to hearing,
the manufacturer shall have one final opportunity to correct and repair
the defect which the consumer claims entitles him or her to a refund or
replacement vehicle. Any right to a final repair attempt is waived if the
manufacturer does not complete it at least five days prior to hearing. If
the consumer is satisfied with the corrective work done by the
manufacturer or his delegate, the arbitration proceedings shall be
terminated without prejudice to the consumer's right to request
arbitration be recommenced if the repair proves unsatisfactory for the
duration of the express warranty.
(e) The vehicle must be presented at the
hearing site for an inspection or test drive, or both, by members of the
board.
(f) The manufacturer shall refund the amounts
provided for in section 4172(e) or (i) of this chapter within 30 days of
the facsimile transmission confirmation receipt of a decision of the board
or within 15 days of final adjudication. The consumer shall receive an
additional 10 percent of the total award if the manufacturer fails to
complete the transaction by the effective date of the order.
Added 1983, No. 211 (Adj. Sess.), § 1; amended 1985, No. 260 (Adj. Sess.),
§ 3; 1987, No. 242 (Adj. Sess.), §§ 5, 6; 1999, No. 18, § 29, eff. May 13,
1999.
§ 4174.
VERMONT MOTOR VEHICLE ARBITRATION BOARD
(a) There is created a Vermont motor vehicle
arbitration board consisting of five members and three alternate members
to be appointed by the governor for terms of three years. Board members
may be appointed for two additional three-year terms. One member of the
board and one alternate shall be new car dealers in Vermont, one member
and one alternate shall be persons active as automobile technicians, and
three members and one alternate shall be persons having no direct
involvement in the design, manufacture, distribution, sales or service of
motor vehicles or their parts. Board members shall be compensated in
accordance with the provisions of 32 V.S.A. § 1010. The board shall be
attached to the transportation board and shall receive administrative
services from the transportation board.
(b) The board shall promulgate rules under
the provisions of 3 V.S.A. chapter 25 to implement the provisions of this
chapter.
(c) The board may issue subpoenas to compel
the attendance of witnesses to testify under oath and to produce
documents.
(d) The board shall render a decision within
30 days of the conclusion of a hearing and has authority to issue any and
all damages as are provided by this chapter.
Added 1983, No. 211 (Adj. Sess.), § 1; amended 1985, No. 260 (Adj. Sess.),
§ 4; 1987, No. 123 (Adj. Sess.), eff. Jan. 29, 1988; 1989, No. 157 (Adj.
Sess.), § 2, eff. April 30, 1990; 1999, No. 18, § 30, eff. May 13, 1999.
§ 4175. FEES
AND COSTS
There shall be no filing fee or costs assessed against the consumer for
using the Vermont motor vehicle arbitration board or the manufacturer's
dispute settlement mechanism. In the event an authorized franchise dealer
or any of its employees including technicians or service personnel are
called upon to testify or produce documents, repair orders or other
materials in any arbitration held before the Vermont motor vehicle
arbitration board or the manufacturer's dispute settlement mechanism, the
person who requests the participation of the authorized franchise dealer
or requests the production of documents must make arrangements in advance
to reasonably compensate the dealer for the actual expense involved. Where
a conflict arises as to actual expenses, the board shall make that
determination. In the event the consumer prevails, these costs shall be
reimbursed to the consumer by the manufacturer.
Added 1983, No. 211 (Adj. Sess.), § 1; amended 1999, No. 18, § 31, eff.
May 13, 1999.
§ 4176. APPEAL
FROM BOARD
(a) The decision of the board shall be final
unless a motion for reconsideration is filed within 30 days of the
consumer's receipt of decision accompanied by new evidence. The board
shall allow the opposing party to respond and may reconvene the hearing if
deemed necessary. The decision shall then be final and shall not be
modified or vacated unless, on appeal to the superior court a party to the
arbitration proceeding proves, by clear and convincing evidence, that:
(1) the decision was procured by corruption,
fraud or other undue means;
(2) there was evident partiality by the board
or corruption or misconduct prejudicing the rights of any party by the
board;
(3) the board exceeded its powers;
(4) the board refused to postpone a hearing
after being shown sufficient cause to do so or refused to hear evidence
material to the controversy or otherwise conducted the hearing contrary to
the rules promulgated by the board so as to prejudice substantially the
rights of a party.
An application to vacate or modify a decision shall be made within 30 days
after delivery of a copy of the final decision to the applicant except
that if predicated upon corruption, fraud or other undue means, it may be
made within 30 days after such grounds are known or should have been
known. In the event a decision is confirmed, the party who prevails shall
be awarded the attorney's fees incurred in obtaining confirmation of the
decision together with all costs.
(b) When a judgment of the superior court
affirms a decision of the board, permission of the presiding judge shall
be required for review. Review may be conditioned upon the appellant
paying appellee's appellate attorney's fees, giving security for costs,
expenses and financial loss resulting from the passage of time for review.
Added 1983, No. 211 (Adj. Sess.), § 1; amended 1985, No. 260 (Adj. Sess.),
§ 5; 1999, No. 18, § 32, eff. May 13, 1999.
§ 4177. UNFAIR
AND DECEPTIVE ACTS AND PRACTICES
Failure of the manufacturer, its agents, authorized dealers, or motor
vehicle lessors to comply with a decision of the board shall constitute an
unfair or deceptive act or practice under 9 V.S.A. chapter 63.
Added 1983, No. 211 (Adj. Sess.), § 1; amended 1987, No. 242 (Adj. Sess.),
§ 7.
§ 4178.
LIMITATIONS
Nothing in this chapter shall be construed as imposing any liability on a
manufacturer's authorized dealers or creating a cause of action by a
manufacturer against its authorized agents or dealers. It shall be a
violation of 9 V.S.A. chapter 108 for a manufacturer to engage in
reprisals or threats of reprisals, directly or indirectly, against any
authorized dealer arising out of the dealer's efforts to repair a motor
vehicle under the provisions of this chapter.
Added 1983, No. 211 (Adj. Sess.), § 1.
§ 4179.
EFFECTIVE DATE; LIMITATIONS
(a) This chapter shall apply to motor
vehicles beginning with the model year following July 1, 1984. Any
proceedings initiated under this chapter shall be commenced within one
year following the expiration of the express warranty term.
(b) Nothing in this chapter shall in any way
limit the rights or remedies which are otherwise available to a consumer
under any other law.
Added 1983, No. 211 (Adj. Sess.), § 1; amended 1999, No. 18, § 33, eff.
May 13, 1999.
§ 4180.
NOTIFICATION TO CONSUMERS
The manufacturer of every motor vehicle sold in this state beginning with
the model year following July 1, 1984 shall provide a clear and
conspicuous written notice of the consumer's rights under this chapter and
at the time of the delivery of every new motor vehicle in this state
beginning with the model year following July 1, 1984 shall provide the
consumer with a stamped self-addressed notice in a form satisfactory to
the Vermont motor vehicle arbitration board sufficient to notify the
manufacturer of the consumer's election to proceed under this chapter. The
manufacturer shall not delegate this responsibility to its authorized
dealers. The manufacturer of every new motor vehicle sold in this state
beginning with the effective date of this chapter shall also provide a
clear and conspicuous notice that informs consumers of their rights under
this chapter.
Added 1983, No. 211 (Adj. Sess.), § 1.
§ 4181. SALE
OF DEFECTIVE MOTOR VEHICLES
Any manufacturer, its agent or authorized dealer who attempts to resell a
motor vehicle after final determination, adjudication or settlement,
pursuant to the provisions of this chapter or after final determination,
adjudication or settlement under similar laws of any other state shall
apprise prospective buyers in Vermont by means of a clearly visible window
sticker and such manufacturers are prohibited from reselling in Vermont
any vehicle determined or adjudicated as having a serious safety defect.
Notice that a vehicle has been returned pursuant to such law shall also be
conspicuously printed on the motor vehicle certificate of title.
Added 1983, No. 211 (Adj. Sess.), § 1
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