BILL NUMBER: AB 2410	CHAPTERED
	BILL TEXT

	CHAPTER   1063
	FILED WITH SECRETARY OF STATE   SEPTEMBER 30, 1998
	APPROVED BY GOVERNOR   SEPTEMBER 30, 1998
	PASSED THE ASSEMBLY   AUGUST 18, 1998
	PASSED THE SENATE   AUGUST 12, 1998
	AMENDED IN SENATE   AUGUST 6, 1998
	AMENDED IN SENATE   JULY 6, 1998

INTRODUCED BY   Assembly Member Shelley
   (Principal coauthor: Senator Calderon)

                        FEBRUARY 20, 1998

   An act to add Section 1793.26 to the Civil Code, relating to motor
vehicles.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2410, Shelley.  Motor vehicles:  reacquisition agreements.
   Existing law provides that certain contracts are null and void as
against public policy, as specified.
   This bill would provide that any automobile manufacturer,
importer, or distributor who reacquires, or who assists a dealer or
lienholder in reacquiring, a motor vehicle, whether by judgment,
decree, arbitration award, settlement agreement, or voluntary
agreement, shall be prohibited from either requiring, as a condition
of the reacquisition of the motor vehicle, that a buyer or lessee who
is a resident of this state agree not to disclose the problems with
the vehicle experienced by the buyer or lessee or the nonfinancial
terms of the reacquisition, or including, in any release or other
agreement for signature by the buyer or lessee, a confidentiality
clause, gag clause, or similar clause prohibiting the buyer or lessee
from disclosing information to anyone about the problems with the
vehicle, or the nonfinancial terms of the reacquisition of the
vehicle; and would declare any such confidentiality clause, gag
clause, or similar clause in such a release or other agreement to be
null and void as against the public policy of this state.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 1793.26 is added to the Civil Code, to read:
   1793.26.  (a) Any automobile manufacturer, importer, or
distributor who reacquires, or who assists a dealer or lienholder in
reacquiring, a motor vehicle, whether by judgment, decree,
arbitration award, settlement agreement, or voluntary agreement, is
prohibited from doing either of the following:
   (1) Requiring, as a condition of the reacquisition of the motor
vehicle, that a buyer or lessee who is a resident of this state agree
not to disclose the problems with the vehicle experienced by the
buyer or lessee or the nonfinancial terms of the reacquisition.
   (2) Including, in any release or other agreement, whether prepared
by the manufacturer, importer, distributor, dealer, or lienholder,
for signature by the buyer or lessee, a confidentiality clause, gag
clause, or similar clause prohibiting the buyer or lessee from
disclosing information to anyone about the problems with the vehicle,
or the nonfinancial terms of the reacquisition of the vehicle by the
manufacturer, importer, distributor, dealer, or lienholder.
   (b) Any confidentiality clause, gag clause, or similar clause in
such a release or other agreement in violation of this section shall
be null and void as against the public policy of this state.
   (c) Nothing in this section is intended to prevent any
confidentiality clause, gag clause, or similar clause regarding the
financial terms of the reacquisition of the vehicle.