BILL ANALYSIS �
SENATE JUDICIARY COMMITTEE
Senator Noreen Evans, Chair
2011-2012 Regular Session
AB 817 (Gatto)
As Amended May 12, 2011
Hearing Date: June 21, 2011
Fiscal: Yes
Urgency: No
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SUBJECT
Vehicle Rental Contracts
DESCRIPTION
This bill would require the California Law Revision Commission
(CLRC) to study whether the laws regulating rental car companies
and their customers would benefit from greater clarity and
concision and report its findings and recommendations to the
Legislature by December 31, 2012.
BACKGROUND
Created in 1953, the California Law Revision Commission
identifies deficiencies in existing California law and
recommends needed reforms to the Legislature. Recent Commission
studies have reviewed trial court restructuring and the laws
relating to mechanics liens and common interest developments.
Currently, the Legislature has authorized the Commission to
study 22 specific topics.
This bill would require the CLRC to study whether the laws
regulating rental car companies and their consumers would
benefit from greater clarity and concision and report its
findings and recommendations to the Legislature by December 31,
2012.
CHANGES TO EXISTING LAW
Existing law regulates contracts between a rental car company
and its customers, including regulation of vehicle rental
charges and fees, disclosures, advertising, quotes, and
(more)
AB 817 (Gatto)
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apportionment of responsibility and liability. (Civ. Code Secs.
1936, 1936.01, 1936.015, 1936.05, 1936.1.)
This bill would require the CLRC to study whether the laws
regulating rental car companies and their consumers would
benefit from greater clarity and concision.
This bill would require the CLRC to report its findings and
recommendations to the Legislature by December 31, 2012.
COMMENT
1. Stated need for the bill
The author writes:
Civil Code Section 1936, relating to rental car transactions,
was first enacted in 1988. It relates to liability,
advertising, disclosure, damage waivers, specific fees not
included in base prices, electronic surveillance, authorized
drivers, special requirements for the rental of 15-passenger
vans, and other provisions related to rental car transactions.
Since 1988, . . . section 1936 has been amended numerous
times and further, sections 1936.01, 1936.015, 1936.05 and
1936.1 have all been enacted which includes many provisions
that are redundant to section 1936.
The cumulative effect of these amendments to section 1936
along with the adoption of the other sections has resulted in
a number of redundancies and a set of laws that is confusingly
organized and is excessively and unnecessarily long. This has
led to a lack of clarity for rental car companies and their
customers when they are faced with a question that pertains to
these code sections. Rental company personnel who are
involved in company operations continually seek legal
interpretations of the meanings of current law.
Supporter Avis Budget Group and the Hertz Corporation write that
". . . it would be beneficial to have the California Law
Revision Commission review these code sections and recommend any
changes that would benefit from greater clarity and concision."
2. California Law Revision Commission would be tasked with
studying whether laws applicable to rental car companies and
their customers would benefit from greater clarity and
concision
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In its present form, this bill would task the CLRC to study
whether the laws regulating rental car companies and their
consumers would benefit from greater clarity and concision and
would require that the CLRC report its findings and
recommendations to the Legislature by December 31, 2012.
This bill would specifically require the CLRC to study the
following specified sections of the Civil Code: Sections 1936,
1936.01, 1936.015, 1936.05, 1936.1. Those sections relate to,
among other things, the regulation of vehicle rental charges and
fees, disclosures, advertising, quotes, and apportionment of
responsibility and liability.
Over the years, changes to the regulations governing contracts
between rental car companies and their customers have often
raised important consumer protection issues which have been
hotly contested. The CLRC is well-suited to a review of the
rental car statutes described above in order to clarify,
reorganize, and revise the statute in a non-substantive manner.
In fact, the CLRC's Web site notes that it "intensively studies
complex and sometimes controversial subjects" in order to assist
the Legislature in ensuring that the law is up-to-date.
Support : Avis Budget Group; Hertz Corporation
Opposition : None Known
HISTORY
Source : Author
Related Pending Legislation : None Known
Prior Legislation : None Known
Prior Vote :
Assembly Floor (Ayes 79, Noes 0)
Assembly Appropriations Committee (Ayes 17, Noes 0)
Assembly Judiciary Committee (Ayes 10, Noes 0)
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