BILL NUMBER: AB 2532	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 12, 2010

INTRODUCED BY   Assembly Member Bill Berryhill

                        FEBRUARY 19, 2010

   An act to amend Sections 1793.22 and 1793.23 of the Civil Code,
relating to consumer warranties.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2532, as amended, Bill Berryhill. Consumer warranties:
Automotive Consumer Notification Act.
   Existing law requires every manufacturer of consumer goods sold in
this state, including motor vehicles, to maintain sufficient service
and repair facilities to carry out the terms of its express
warranties. Existing law further provides that if a manufacturer or
its representative is unable to service or repair a new motor vehicle
to conform to the applicable express warranties after a reasonable
number of attempts, the manufacturer shall either promptly replace
the vehicle or make restitution to the buyer, at the buyer's option.
   The Tanner Consumer Protection Act defines "new motor vehicle" for
the purposes of those provisions as including, among other things, a
new motor vehicle with a gross vehicle weight under 10,000 pounds
that is bought or used primarily for business purposes by a person,
including a partnership, limited liability company, corporation,
association, or any other legal entity, to which not more than 5
motor vehicles are registered in this state.
   This bill would  delete that meaning and instead 
 additionally  include  in the definition of "new motor
vehicle"  a new  motor vehicle used by a farmer
exclusively in the transportation of his or her livestock, implements
of husbandry, and agricultural commodities or in the transportation
of supplies to his or her farm. "Motor vehicle" also includes a
 commercial motor vehicle or combination of  new 
vehicles that requires a class A or class B license, or a class C
license with a specified endorsement  , regardless of weight
.
   The Automotive Consumer Notification Act requires, among other
things, the manufacturer to retitle specified defective vehicles in
its name, request the Department of Motor Vehicles to inscribe the
ownership certificate with the notation "Lemon Law Buyback," affix a
specified decal to the left doorframe of the vehicle, deliver a
specified notice to the transferee of the vehicle as prescribed, and
obtain the transferee's acknowledgment.
   The bill would define "motor vehicle" for the purposes of that act
to include the resale of a new motor vehicle as defined in the
Tanner Consumer Protection Act.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


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

  SECTION 1.  Section 1793.22 of the Civil Code is amended to read:
   1793.22.  (a) This section shall be known and may be cited as the
Tanner Consumer Protection Act.
   (b) It shall be presumed that a reasonable number of attempts have
been made to conform a new motor vehicle to the applicable express
warranties if, within 18 months from delivery to the buyer or 18,000
miles on the odometer of the vehicle, whichever occurs first, one or
more of the following occurs:
   (1) The same nonconformity results in a condition that is likely
to cause death or serious bodily injury if the vehicle is driven and
the nonconformity has been subject to repair two or more times by the
manufacturer or its agents, and the buyer or lessee has at least
once directly notified the manufacturer of the need for the repair of
the nonconformity.
   (2) The same nonconformity has been subject to repair four or more
times by the manufacturer or its agents and the buyer has at least
once directly notified the manufacturer of the need for the repair of
the nonconformity.
   (3) The vehicle is out of service by reason of repair of
nonconformities by the manufacturer or its agents for a cumulative
total of more than 30 calendar days since delivery of the vehicle to
the buyer. The 30-day limit shall be extended only if repairs cannot
be performed due to conditions beyond the control of the manufacturer
or its agents. The buyer shall be required to directly notify the
manufacturer pursuant to paragraphs (1) and (2) only if the
manufacturer has clearly and conspicuously disclosed to the buyer,
with the warranty or the owner's manual, the provisions of this
section and that of subdivision (d) of Section 1793.2, including the
requirement that the buyer must notify the manufacturer directly
pursuant to paragraphs (1) and (2). The notification, if required,
shall be sent to the address, if any, specified clearly and
conspicuously by the manufacturer in the warranty or owner's manual.
This presumption shall be a rebuttable presumption affecting the
burden of proof, and it may be asserted by the buyer in any civil
action, including an action in small claims court, or other formal or
informal proceeding.
   (c) If a qualified third-party dispute resolution process exists,
and the buyer receives timely notification in writing of the
availability of that qualified third-party dispute resolution process
with a description of its operation and effect, the presumption in
subdivision (b) may not be asserted by the buyer until after the
buyer has initially resorted to the qualified third-party dispute
resolution process as required in subdivision (d). Notification of
the availability of the qualified third-party dispute resolution
process is not timely if the buyer suffers any prejudice resulting
from any delay in giving the notification. If a qualified third-party
dispute resolution process does not exist, or if the buyer is
dissatisfied with that third-party decision, or if the manufacturer
or its agent neglects to promptly fulfill the terms of the qualified
third-party dispute resolution process decision after the decision is
accepted by the buyer, the buyer may assert the presumption provided
in subdivision (b) in an action to enforce the buyer's rights under
subdivision (d) of Section 1793.2. The findings and decision of a
qualified third-party dispute resolution process shall be admissible
in evidence in the action without further foundation. Any period of
limitation of actions under any federal or California laws with
respect to any person shall be extended for a period equal to the
number of days between the date a complaint is filed with a
third-party dispute resolution process and the date of its decision
or the date before which the manufacturer or its agent is required by
the decision to fulfill its terms if the decision is accepted by the
buyer, whichever occurs later.
   (d) A qualified third-party dispute resolution process shall be
one that does all of the following:
   (1) Complies with the minimum requirements of the Federal Trade
Commission for informal dispute settlement procedures as set forth in
Part 703 of Title 16 of the Code of Federal Regulations, as those
regulations read on January 1, 1987.
   (2) Renders decisions which are binding on the manufacturer if the
buyer elects to accept the decision.
   (3) Prescribes a reasonable time, not to exceed 30 days after the
decision is accepted by the buyer, within which the manufacturer or
its agent must fulfill the terms of its decisions.
   (4) Provides arbitrators who are assigned to decide disputes with
copies of, and instruction in, the provisions of the Federal Trade
Commission's regulations in Part 703 of Title 16 of the Code of
Federal Regulations as those regulations read on January 1, 1987,
Division 2 (commencing with Section 2101) of the Commercial Code, and
this chapter.
   (5) Requires the manufacturer, when the process orders, under the
terms of this chapter, either that the nonconforming motor vehicle be
replaced if the buyer consents to this remedy or that restitution be
made to the buyer, to replace the motor vehicle or make restitution
in accordance with paragraph (2) of subdivision (d) of Section
1793.2.
   (6) Provides, at the request of the arbitrator or a majority of
the arbitration panel, for an inspection and written report on the
condition of a nonconforming motor vehicle, at no cost to the buyer,
by an automobile expert who is independent of the manufacturer.
   (7) Takes into account, in rendering decisions, all legal and
equitable factors, including, but not limited to, the written
warranty, the rights and remedies conferred in regulations of the
Federal Trade Commission contained in Part 703 of Title 16 of the
Code of Federal Regulations as those regulations read on January 1,
1987, Division 2 (commencing with Section 2101) of the Commercial
Code, this chapter, and any other equitable considerations
appropriate in the circumstances. Nothing in this chapter requires
that, to be certified as a qualified third-party dispute resolution
process pursuant to this section, decisions of the process must
consider or provide remedies in the form of awards of punitive
damages or multiple damages, under subdivision (c) of Section 1794,
or of attorneys' fees under subdivision (d) of Section 1794, or of
consequential damages other than as provided in subdivisions (a) and
(b) of Section 1794, including, but not limited to, reasonable
repair, towing, and rental car costs actually incurred by the buyer.
   (8) Requires that no arbitrator deciding a dispute may be a party
to the dispute and that no other person, including an employee,
agent, or dealer for the manufacturer, may be allowed to participate
substantively in the merits of any dispute with the arbitrator unless
the buyer is allowed to participate also. Nothing in this
subdivision prohibits any member of an arbitration board from
deciding a dispute.
   (9) Obtains and maintains certification by the Department of
Consumer Affairs pursuant to Chapter 9 (commencing with Section 472)
of Division 1 of the Business and Professions Code.
   (e) For the purposes of subdivision (d) of Section 1793.2 and this
section, the following terms have the following meanings:
   (1) "Nonconformity" means a nonconformity which substantially
impairs the use, value, or safety of the new motor vehicle to the
buyer or lessee.
   (2) "New motor vehicle" means a new motor vehicle that is bought
or used primarily for personal, family, or household purposes. "New
motor vehicle" also means a new motor vehicle  used by a
farmer exclusively in the transportation of his or her livestock,
implements of husbandry, and agricultural commodities or in the
transportation of supplies to his or her farm. "Motor vehicle" also
includes a   with a gross vehicle weight under 10,000
pounds that is bought or used primarily for business purposes by a
person, including a partnership, limited liability company,
corporation, association, or any other legal entity, to which not
more than five motor vehicles are registered in this state. "New
motor vehicle" also includes a new  commercial motor vehicle or
combination of  new  vehicles that requires a class A or
class B license, or a class C license with an endorsement issued
pursuant to paragraph (5) of subdivision (a) of Section 15278 of the
Vehicle Code  , regardless of weight  . "New motor vehicle"
includes the chassis, chassis cab, and that portion of a motor home
devoted to its propulsion, but does not include any portion designed,
used, or maintained primarily for human habitation, a dealer-owned
vehicle and a "demonstrator" or other motor vehicle sold with a
manufacturer's new car warranty but does not include a motorcycle or
a motor vehicle which is not registered under the Vehicle Code
because it is to be operated or used exclusively off the highways. A
demonstrator is a vehicle assigned by a dealer for the purpose of
demonstrating qualities and characteristics common to vehicles of the
same or similar model and type.
   (3) "Motor home" means a vehicular unit built on, or permanently
attached to, a self-propelled motor vehicle chassis, chassis cab, or
van, which becomes an integral part of the completed vehicle,
designed for human habitation for recreational or emergency
occupancy.
   (f) (1) Except as provided in paragraph (2), no person shall sell,
either at wholesale or retail, lease, or transfer a motor vehicle
transferred by a buyer or lessee to a manufacturer pursuant to
paragraph (2) of subdivision (d) of Section 1793.2 or a similar
statute of any other state, unless the nature of the nonconformity
experienced by the original buyer or lessee is clearly and
conspicuously disclosed to the prospective buyer, lessee, or
transferee, the nonconformity is corrected, and the manufacturer
warrants to the new buyer, lessee, or transferee in writing for a
period of one year that the motor vehicle is free of that
nonconformity.
   (2) Except for the requirement that the nature of the
nonconformity be disclosed to the transferee, paragraph (1) does not
apply to the transfer of a motor vehicle to an educational
institution if the purpose of the transfer is to make the motor
vehicle available for use in automotive repair courses.
  SEC. 2.  Section 1793.23 of the Civil Code is amended to read:
   1793.23.  (a) The Legislature finds and declares all of the
following:
   (1) That the expansion of state warranty laws covering new and
used cars has given important and valuable protection to consumers.
   (2) That, in states without this valuable warranty protection,
used and irrepairable motor vehicles are being resold in the
marketplace without notice to the subsequent purchaser.
   (3) That other states have addressed this problem by requiring
notices on the title of these vehicles or other notice procedures to
warn consumers that the motor vehicles were repurchased by a dealer
or manufacturer because the vehicle could not be repaired in a
reasonable length of time or a reasonable number of repair attempts
or the dealer or manufacturer was not willing to repair the vehicle.
   (4) That these notices serve the interests of consumers who have a
right to information relevant to their buying decisions.
   (5) That the disappearance of these notices upon the transfer of
title from another state to this state encourages the transport of
"lemons" to this state for sale to the drivers of this state.
   (b) This section and Section 1793.24 shall be known, and may be
cited as, the Automotive Consumer Notification Act.
   (c) Any manufacturer who reacquires or assists a dealer or
lienholder to reacquire a motor vehicle registered in this state, any
other state, or a federally administered district shall, prior to
any sale, lease, or transfer of the vehicle in this state, or prior
to exporting the vehicle to another state for sale, lease, or
transfer if the vehicle was registered in this state and reacquired
pursuant to paragraph (2) of subdivision (d) of Section 1793.2, cause
the vehicle to be retitled in the name of the manufacturer, request
the Department of Motor Vehicles to inscribe the ownership
certificate with the notation "Lemon Law Buyback," and affix a decal
to the vehicle in accordance with Section 11713.12 of the Vehicle
Code if the manufacturer knew or should have known that the vehicle
is required by law to be replaced, accepted for restitution due to
the failure of the manufacturer to conform the vehicle to applicable
warranties pursuant to paragraph (2) of subdivision (d) of Section
1793.2, or accepted for restitution by the manufacturer due to the
failure of the manufacturer to conform the vehicle to warranties
required by any other applicable law of the state, any other state,
or federal law.
   (d) Any manufacturer who reacquires or assists a dealer or
lienholder to reacquire a motor vehicle in response to a request by
the buyer or lessee that the vehicle be either replaced or accepted
for restitution because the vehicle did not conform to express
warranties shall, prior to the sale, lease, or other transfer of the
vehicle, execute and deliver to the subsequent transferee a notice
and obtain the transferee's written acknowledgment of a notice, as
prescribed by Section 1793.24.
   (e) Any person, including any dealer, who acquires a motor vehicle
for resale and knows or should have known that the vehicle was
reacquired by the vehicle's manufacturer in response to a request by
the last retail owner or lessee of the vehicle that it be replaced or
accepted for restitution because the vehicle did not conform to
express warranties shall, prior to the sale, lease, or other
transfer, execute and deliver to the subsequent transferee a notice
and obtain the transferee's written acknowledgment of a notice, as
prescribed by Section 1793.24.
   (f) Any person, including any manufacturer or dealer, who sells,
leases, or transfers ownership of a motor vehicle when the vehicle's
ownership certificate is inscribed with the notation "Lemon Law
Buyback" shall, prior to the sale, lease, or ownership transfer of
the vehicle, provide the transferee with a disclosure statement
signed by the transferee that states:


   "THIS VEHICLE WAS REPURCHASED BY ITS MANUFACTURER DUE TO A DEFECT
IN THE VEHICLE PURSUANT TO CONSUMER WARRANTY LAWS. THE TITLE TO THIS
VEHICLE HAS BEEN PERMANENTLY BRANDED WITH THE NOTATION "LEMON LAW
BUYBACK'."


   (g) The disclosure requirements in subdivisions (d), (e), and (f)
are cumulative with all other consumer notice requirements and do not
relieve any person, including any dealer or manufacturer, from
complying with any other applicable law, including any requirement of
subdivision (f) of Section 1793.22.
   (h) For purposes of this section, the following definitions have
the following meanings:
   (1) "Dealer" means any person engaged in the business of selling,
offering for sale, or negotiating the retail sale of, a used motor
vehicle or selling motor vehicles as a broker or agent for another,
including the officers, agents, and employees of the person and any
combination or association of dealers.
   (2) "Motor vehicle" includes the resale of a new motor vehicle, as
defined in Section 1793.22.