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Same as: / Versions: S6872-2011 S6872A-2011 S6872B-2011

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S6872A-2011 Actions

• Jun 21, 2012: referred to codes
• Jun 21, 2012: DELIVERED TO ASSEMBLY
• Jun 21, 2012: PASSED SENATE
• Jun 18, 2012: AMENDED ON THIRD READING (T) 6872B
• May 21, 2012: AMENDED ON THIRD READING 6872A
• May 2, 2012: ADVANCED TO THIRD READING
• May 1, 2012: 2ND REPORT CAL.
• Apr 30, 2012: 1ST REPORT CAL.615
• Apr 2, 2012: REFERRED TO CONSUMER PROTECTION

S6872A-2011 Calendars

Floor Calendar: May 22, 2012 , Floor Calendar: May 23, 2012 , Floor Calendar: May 30, 2012 , Floor Calendar: May 31, 2012 , Floor Calendar: Jun 4, 2012 , Floor Calendar: Jun 5, 2012 , Floor Calendar: Jun 6, 2012 , Floor Calendar: Jun 11, 2012 , Floor Calendar: Jun 12, 2012 , Floor Calendar: Jun 13, 2012 , Floor Calendar: Jun 14, 2012 , Floor Calendar: Jun 18, 2012

S6872A-2011 Votes

S6872A-2011 Memo

BILL NUMBER:S6872A

TITLE OF BILL:
An act
to amend the general business law, in relation to the refund to a
consumer of money from a used car dealership for failing to correct a
malfunction or defect

PURPOSE OR GENERAL IDEA OF BILL:
To include within the Used Car Lemon
Law a similar provision to one that exists within the New Car Lemon
Law.

SUMMARY OF SPECIFIC PROVISIONS:
This bill amends paragraph 1 and
subparagraph f of paragraph 3 of subdivision c of Section 198-b of
the General Business Law to establish a mileage credit for cars that
qualify under the Used Car Lemon Law.

JUSTIFICATION:
On December 14, 2006 the Court of
Appeals issued a
decision in the combined cases of In the Matter of General Motors
Corporation v. James Warner and In the Matter of Daimler Chrysler
Corporation v. Eliot Spitzer. 7 N.Y.3d 653 that upheld the Attorney
General's revised interpretation of the New Car Lemon Law. The
Attorney General's new interpretation held that a consumer may be
entitled to relief if, within the prescribed periods, four or more
unsuccessful repair attempts were made or the vehicle was out of
service for 30 days, notwithstanding that the condition complained of
was subsequently repaired. Previously, a consumer would be eligible
for a refund or replacement vehicle only when the purchaser could
demonstrate that a defect still existed as of the date of
arbitration. Similar provisions exist under the Used Car Lemon Law,
except that only three or more repair attempts are required to
qualify. A consumer has four years in which to bring an action under
the Used Car Lemon law. At the oral arguments before the Court of
Appeals, the issue was raised that a consumer could drive the car for
significant period of time before filing an action, either because
the car was repaired prior to the commencement of the action
or because the defect which caused the car to qualify was not such
that the car was unsafe or undriveable, thereby significantly
altering the value of the vehicle once returned. The Attorney
General's office indicated that the mileage credit formula in the New
Car Lemon Law that reduces the amount which the consumer recoups upon
return of the vehicle was a significant tool to prevent any attempted
fraud. Such a mileage credit does not exist in the Used Car Lemon
Law. This legislation would include in the Used Car Lemon Law this
important anti-fraud measure that is necessary given the Court of
Appeals decision.

PRIOR LEGISLATIVE HISTORY:
2009-2010: A.4911 - Referred to Consumer Affairs and Protection.
2007-2008: A.9208 - Referred to Consumer Affairs and Protection.

FISCAL IMPLICATIONS:


None.

EFFECTIVE DATE:
Immediately.

S6872A-2011 Text

 S T A T E   O F   N E W   Y O R K
 
 6872--A
 Cal. No. 615
 I N  SENATE
 April 2, 2012
 
 Introduced  by  Sen.  ZELDIN -- read twice and ordered printed, and when
 printed to be committed to the Committee  on  Consumer  Protection  -
 reported  favorably  from  said committee, ordered to first and second
 report, ordered to a third reading,  amended  and  ordered  reprinted,
 retaining its place in the order of third reading
 

AN ACT to amend the general business law, in relation to the refund to a
 consumer  of money from a used car dealership for failing to correct a
 malfunction or defect
 THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section 1. Paragraph 1 of subdivision c of section 198-b of the gener
 al  business  law,  as  amended  by  chapter 444 of the laws of 1989, is
 amended and a new paragraph 5 is added to read as follows:

 1. If the dealer or his agent fails to correct a malfunction or defect
 as required by the warranty specified in this section which substantial
 ly impairs the value of the used motor vehicle to the consumer  after  a
 reasonable  period  of  time, the dealer shall accept return of the used
 motor vehicle from the consumer and refund  to  the  consumer  the  full
 purchase  price,  or  in  the case of a lease contract all payments made
 under the contract, including sales or compensating  use  tax,  less  AN
 AMOUNT  EQUAL  TO  A  MILAGE CREDIT, AS CALCULATED PURSUANT TO PARAGRAPH
 FIVE OF THIS SUBDIVISION, FOR EACH MILE IN EXCESS OF THE MILEAGE  APPLI
 CABLE TO THE VEHICLE CONTAINED IN SUBDIVISION B OF THIS SECTION THAT THE
 VEHICLE HAS BEEN DRIVEN SINCE THE CONSUMER PURCHASED OR LEASED THE VEHI
 CLE  FROM THE DEALER, AND LESS a reasonable allowance for any damage not
 attributable to normal wear or usage, and adjustment for  any  modifica
 tions  which either increase or decrease the market value of the vehicle
 or of the lease contract, and in the case of  a  lease  contract,  shall
 cancel  all  further  payments  due  from  the  consumer under the lease
 contract. In determining the purchase price to be refunded or in  deter
 mining  all  payments  made  under  a lease contract to be refunded, the
 purchase price, or all payments made under a lease  contract,  shall  be
 deemed  equal to the sum of the actual cash difference paid for the used
 motor vehicle, or for the lease contract, plus, if the dealer elects  to
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD00803-03-2
 
       S. 6872--A                          2
 not  return  any vehicles traded-in by the consumer, the wholesale value
 of any such traded-in vehicles as listed in the  National  Auto  Dealers
 Association  Used  Car Guide, or such other guide as may be specified in
 regulations  promulgated  by  the  commissioner  of  motor  vehicles, as
 adjusted for mileage, improvements, and any major physical or mechanical
 defects in the traded-in vehicle at the time  of  trade-in.  The  dealer
 selling  or leasing the used motor vehicle shall deliver to the consumer
 a written notice including conspicuous language indicating that  if  the
 consumer  should  be  entitled to a refund pursuant to this section, the
 value of any vehicle traded-in by the consumer, if the dealer elects  to
 not return it to the consumer, for purposes of determining the amount of
 such refund will be determined by reference to the National Auto Dealers
 Association  Used  Car Guide wholesale value, or such other guide as may
 be approved by the commissioner of motor vehicles, as adjusted for mile
 age, improvements, and any major physical or mechanical defects,  rather
 than  the  value  listed in the sales contract. Refunds shall be made to
 the consumer and lienholder, if any, as their interests  may  appear  on
 the  records  of  ownership kept by the department of motor vehicles. If
 the amount to be refunded to the  lienholder  will  be  insufficient  to
 discharge  the  lien, the dealer shall notify the consumer in writing by
 registered or certified mail that the consumer has thirty  days  to  pay
 the lienholder the amount which, together with the amount to be refunded
 by  the  dealer, will be sufficient to discharge the lien. The notice to
 the consumer shall contain conspicuous  language  warning  the  consumer
 that failure to pay such funds to the lienholder within thirty days will
 terminate  the  dealer's obligation to provide a refund. If the consumer
 fails to make such payment within thirty days, the dealer shall have  no
 further responsibility to provide a refund under this section.  Alterna
 tively,  the dealer may elect to offer to replace the used motor vehicle
 with a comparably priced vehicle, with such adjustment in price  as  the
 parties  may  agree  to. The consumer shall not be obligated to accept a
 replacement vehicle,  but  may  instead  elect  to  receive  the  refund
 provided  under  this section. It shall be an affirmative defense to any
 claim under this section that:

 (a) The malfunction or  defect  does  not  substantially  impair  such
 value; or
 (b)  The  malfunction  or  defect  is  the result of abuse, neglect or
 unreasonable modifications or alterations of the used motor vehicle.
 5. FOR THE PURPOSE OF CALCULATING THE MILEAGE CREDIT ALLOWANCE  ESTAB
 LISHED  BY  PARAGRAPH  ONE  OF  THIS  SUBDIVISION,  A  DEALER  SHALL  BE
 DISCOUNTED A DOLLAR FIGURE PURSUANT TO THE FOLLOWING TERMS:

 (A) IF THE USED MOTOR VEHICLE IS SOLD WITH THIRTY-SIX  THOUSAND  MILES
 OR  LESS,  THE  MILEAGE  CREDIT ALLOWANCE SHALL BE TWENTY-FIVE CENTS FOR
 EVERY MILE DRIVEN IN EXCESS OF THE FOUR THOUSAND MILE WARRANTY.
 (B) IF THE USED MOTOR VEHICLE IS SOLD WITH MORE THAN THIRTY-SIX  THOU
 SAND  MILES,  BUT  LESS  THAN  EIGHTY THOUSAND MILES, THE MILEAGE CREDIT
 ALLOWANCE SHALL BE TWENTY CENTS FOR EVERY MILE DRIVEN IN EXCESS  OF  THE
 THREE THOUSAND MILE WARRANTY.
 (C)  IF  THE  USED  MOTOR  VEHICLE  IS SOLD WITH EQUAL TO OR MORE THAN
 EIGHTY THOUSAND MILES, BUT LESS THAN ONE  HUNDRED  THOUSAND  MILES,  THE
 MILEAGE CREDIT ALLOWANCE SHALL BE FIFTEEN CENTS FOR EVERY MILE DRIVEN IN
 EXCESS OF THE ONE THOUSAND MILE WARRANTY.
 

S  2. Subparagraphs 5 and 6 of paragraph 1 of subdivision f of section
 198-b of the general business law, as separately amended by chapters 444
 and 609 of the laws of 1989, are amended to read as follows:

 
       S. 6872--A                          3
 5. If the  same  problem  cannot  be  repaired  after  three  or  more
 attempts,  you  are  entitled  to return the car and receive a refund of
 your purchase price or of all payments made under your  lease  contract,
 and  of sales tax and fees, minus THE MILAGE CREDIT ALLOWANCE APPLICABLE
 TO  THE  VEHICLE  DESCRIBED ABOVE THAT THE VEHICLE HAS BEEN DRIVEN SINCE
 THE CONSUMER PURCHASED OR LEASED THE VEHICLE FROM THE DEALER, AND LESS a
 reasonable allowance for any damage not attributable to normal usage  or
 wear,  and,  in  the  case  of  a  lease contract, a cancellation of all
 further payments you are otherwise required  to  make  under  the  lease
 contract.
 6.  If  your  car is out of service to repair a problem for a total of
 fifteen days or more during the warranty  period  you  are  entitled  to
 return  the  car  and  receive a refund of your purchase price or of all
 payments made under your lease contract, and  of  sales  tax  and  fees,
 minus  THE  MILAGE  CREDIT ALLOWANCE APPLICABLE TO THE VEHICLE DESCRIBED
 ABOVE THAT THE VEHICLE HAS BEEN DRIVEN SINCE THE CONSUMER  PURCHASED  OR
 LEASED  THE VEHICLE FROM THE DEALER, AND LESS a reasonable allowance for
 any damage not attributable to normal usage or wear, and, in the case of
 a lease contract, a cancellation of all further payments you are  other
 wise required to make under the lease contract.
 

S  3. Subparagraphs 7, 8, 9, 10 and 11 of paragraph 1 of subdivision f
 of section 198-b of the general business  law  are  renumbered  subpara
 graphs  8, 9, 10, 11 and 12 and a new subparagraph 7 is added to read as
 follows:

 7. THE MILEAGE CREDIT ALLOWANCE DESCRIBED IN PARAGRAPHS FIVE  AND  SIX
 OF THIS NOTICE WILL BE CALCULATED ACCORDING TO THE FOLLOWING TERMS:

 (A)  IF  YOUR USED CAR HAS MORE THAN EIGHTEEN THOUSAND MILES AND UP TO
 AND INCLUDING THIRTY-SIX THOUSAND MILES, THE  MILEAGE  CREDIT  ALLOWANCE
 WILL  BE  TWENTY-FIVE  CENTS FOR EVERY MILE DRIVEN IN EXCESS OF THE FOUR
 THOUSAND MILE WARRANTY.
 (B) IF YOUR USED CAR HAS MORE THAN THIRTY-SIX THOUSAND MILES BUT  LESS
 THAN  EIGHTY THOUSAND MILES, THE MILEAGE CREDIT ALLOWANCE WILL BE TWENTY
 CENTS FOR EVERY MILE DRIVEN IN EXCESS OF THE THREE THOUSAND MILE WARRAN
 TY.
 (C) IF YOUR USED CAR HAS EQUAL TO OR MORE THAN EIGHTY THOUSAND  MILES,
 BUT  LESS  THAN ONE HUNDRED THOUSAND MILES, THE MILEAGE CREDIT ALLOWANCE
 WILL BE FIFTEEN CENTS FOR EVERY MILE DRIVEN IN EXCESS OF THE  ONE  THOU
 SAND MILE WARRANTY.
 

S 4. This act shall take effect immediately.

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