PRINTER'S NO. 6
No. 4 Session of 1989
INTRODUCED BY D. R. WRIGHT, J. L. WRIGHT, LLOYD, FOX, WAMBACH,
FREEMAN, McCALL, McHALE, BILLOW, YANDRISEVITS, STEIGHNER,
BELFANTI, VEON, DeLUCA, MICHLOVIC, CALTAGIRONE, KUKOVICH,
LAUGHLIN, HALUSKA, BUNT, RYBAK, RAYMOND, MAIALE, HERMAN,
LaGROTTA, MAINE, JAROLIN, TIGUE, HAYDEN, HASAY, COWELL,
NAHILL, WASS, KENNEY, GIGLIOTTI, DALEY, TRELLO, MORRIS,
LASHINGER, STABACK, LEVDANSKY, JOSEPHS, E. Z. TAYLOR,
JOHNSON, CIVERA, RITTER, KOSINSKI, VAN HORNE, PISTELLA,
THOMAS, R. C. WRIGHT, J. TAYLOR, D. W. SNYDER AND MAYERNIK,
JANUARY 18, 1989
REFERRED TO COMMITTEE ON CONSUMER AFFAIRS, JANUARY 18, 1989
AN ACT
1 Amending the act of March 28, 1984 (P.L.150, No.28), entitled
2 "An act relating to the rights of purchasers of defective new
3 motor vehicles," extending the act to include leased vehicles
4 and vehicles used for business purposes; changing and adding
5 definitions; providing for the Office of Automobile Lemon Law
6 Actions; regulating new motor vehicle rustproofing; and
7 further providing for remedies under the act.
8 The General Assembly of the Commonwealth of Pennsylvania
9 hereby enacts as follows:
10 Section 1. The title and sections 2, 4(a), 6, 7 and 9 of the
11 act of March 28, 1984 (P.L.150, No.28), known as the Automobile
12 Lemon Law, are amended to read:
13 AN ACT
14 Relating to the rights of purchasers and lessees of defective
15 new motor vehicles.
16 Section 2. Definitions.
1 The following words and phrases when used in this act shall
2 have the meanings given to them in this section unless the
3 context clearly indicates otherwise:
4 "Collateral charges." Any sales-related charges, including,
5 but not limited to, sales tax, license fees, registration fees,
6 title fees, finance charges, transportation charges, dealer
7 preparation charges, or any other charges for service contracts,
8 undercoating, rustproofing or installed options.
9 "Dealer" or "motor vehicle dealer." A person in the business
10 of buying, selling, leasing or exchanging vehicles.
11 "Manufacturer." Any person engaged in the business of
12 constructing or assembling new and unused motor vehicles or
13 engaged in the business of importing new and unused motor
14 vehicles into the United States for the purpose of selling or
15 distributing new and unused motor vehicles to motor vehicle
16 dealers in this Commonwealth.
17 ["Manufacturer's express warranty" or "warranty." The
18 written warranty of the manufacturer of a new automobile of its
19 condition and fitness for use, including any terms or conditions
20 precedent to the enforcement of obligations under the warranty.]
21 "New motor vehicle." Any new and unused self-propelled,
22 motorized conveyance driven upon public roads, streets or
23 highways which is designed to transport not more than 15
24 persons, which was purchased [and is registered] or leased in
25 the Commonwealth [and is used or bought for use primarily for
26 personal, family or household purposes], including a vehicle
27 used by a manufacturer or dealer as a demonstrator or dealer car
28 prior to its sale. The term does not include motorcycles, [motor
29 homes or] off-road vehicles or that portion of a motor home
30 designated, used or maintained primarily as a mobile dwelling.
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1 "Nonconformity." A defect or condition which substantially
2 impairs the use, value or safety of a new motor vehicle and does
3 not conform to the manufacturer's express warranty or to any
4 other express or implied warranty applicable to the vehicle.
5 "Purchaser." A person, or his successors or assigns, who has
6 obtained ownership of a new motor vehicle by transfer or
7 purchase or who has entered into an agreement or contract for
8 the purchase or lease of a new motor vehicle [which is used or
9 bought for use primarily for personal, family or household
10 purposes].
11 Section 4. Repair obligations.
12 (a) Repairs required.--The manufacturer of a new motor
13 vehicle [sold and registered] which is sold or leased in the
14 Commonwealth shall repair or correct, at no cost to the
15 purchaser, a nonconformity which substantially impairs the use,
16 value or safety of said motor vehicle [which may occur within a
17 period of one year following the actual delivery of the vehicle
18 to the purchaser, within the first 12,000 miles of use or during
19 the term of the warranty, whichever may first occur] and first
20 occurs within the earlier of a period of two years following the
21 actual delivery of the vehicle to the purchaser, or the first
22 24,000 miles of use.
23 * * *
24 Section 6. [Presumption of a reasonable] Reasonable number of
25 attempts.
26 [It shall be presumed that a reasonable number of attempts] A
27 reasonable number of attempts shall be deemed to have been
28 undertaken to repair or correct a nonconformity if:
29 (1) the same nonconformity has been subject to repair
30 three times by the manufacturer, its agents or authorized
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1 dealers and the nonconformity still exists; or
2 (2) the vehicle is out-of-service by reason of [any
3 nonconformity] repair of one or more nonconformities for a
4 cumulative total of 30 or more calendar days.
5 Section 7. Itemized statement required.
6 The manufacturer or dealer shall provide to the purchaser
7 each time the purchaser's vehicle is returned from being
8 serviced or repaired a fully itemized statement indicating all
9 work performed on said vehicle including, but not limited to,
10 parts and labor. The statement shall also include the date and
11 the odometer reading when the vehicle was submitted for repair
12 and the date and odometer reading when the vehicle was returned
13 to the consumer. It shall be the duty of a dealer to notify the
14 manufacturer of the existence of a nonconformity within seven
15 days of the delivery by a purchaser of a vehicle subject to a
16 nonconformity when it is delivered to the same dealer for the
17 second time for repair of the same nonconformity. The
18 notification shall be by certified mail, return receipt
19 requested: Provided, however, That timely submission of
20 sufficiently detailed warranty claims to the manufacturer shall
21 constitute notice under this section.
22 Section 9. [Informal dispute settlement procedure.] Office of
23 Automobile Lemon Law Actions.
24 [If the manufacturer has established an informal dispute
25 settlement procedure which complies with the provisions of 16
26 CFR Pt. 703, as from time to time amended, the provisions of
27 section 8 shall not apply to any purchaser who has not first
28 resorted to such procedure as it relates to a remedy for defects
29 or conditions affecting the substantial use, value or safety of
30 the vehicle. The informal dispute settlement procedure shall not
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1 be binding on the purchaser and, in lieu of such settlement, the
2 purchaser may pursue a remedy under section 8.]
3 (a) Establishment and function.--There is hereby established
4 within the Office of Attorney General the Office of Automobile
5 Lemon Law Actions, which shall have original jurisdiction in
6 legal actions brought pursuant to the provisions of this act. It
7 shall be the duty of the Office of Automobile Lemon Law Actions
8 to conduct a hearing and make findings of fact and conclusions
9 of law upon the receipt of a complaint from a purchaser alleging
10 the failure of a manufacturer to comply with the provisions of
11 this act.
12 (b) Funding.--Commencing July 1, 1987, and on July 1 of each
13 year thereafter, each manufacturer who sells or distributes new
14 motor vehicles to new motor vehicle dealers in this Commonwealth
15 shall submit to the Office of Automobile Lemon Law Actions a
16 statement indicating the total number of new motor vehicles sold
17 or otherwise distributed by the manufacturer to new motor
18 vehicle dealers in this Commonwealth during the preceding
19 calendar year, together with a breakdown by make, model and
20 year, and shall pay to the Office of Automobile Lemon Law
21 Actions, as a condition of doing business in this Commonwealth,
22 an amount of $10 for each new motor vehicle sold or otherwise
23 distributed by the manufacturer to new motor vehicle dealers in
24 this Commonwealth during the preceding calendar year. The fees
25 collected pursuant to this section shall be deposited, through
26 the State Treasurer, in a restricted receipts account, the
27 proceeds of which are to be used exclusively to fund the Office
28 of Automobile Lemon Law Actions. If at the conclusion of any
29 fiscal year, the amount of the fees collected exceeds the amount
30 of the expenditures for this purpose during the fiscal year, the
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1 surplus shall be carried over into the succeeding fiscal year.
2 (c) Personnel.--The Office of Automobile Lemon Law Actions
3 shall employ such hearing examiners, automotive repair experts
4 and administrative and support personnel, and shall enter into
5 such contracts as are necessary to carry out the provisions of
6 this section.
7 (d) Procedure.--
8 (1) Any purchaser aggrieved by the failure of a
9 manufacturer to comply with the provisions of this act may
10 initiate an action by filing a complaint with the Office of
11 Automobile Lemon Law Actions on a form prescribed by the
12 Attorney General.
13 (2) Each manufacturer shall, within ten days of the
14 effective date of this act, notify the Office of Automobile
15 Lemon Law Actions of one address within this Commonwealth at
16 which it will receive service of complaints under this
17 section.
18 (3) The Office of Automobile Lemon Law Actions shall
19 promptly send a copy of each complaint to the manufacturer by
20 certified mail, return receipt requested. The Office of
21 Automobile Lemon Law Actions shall schedule a hearing upon
22 each complaint received, to be conducted by a hearing
23 examiner at a location within the county where the sale of
24 the vehicle occurred, within 20 days of the receipt of the
25 complaint by said office. A continuance of a scheduled
26 hearing shall be granted by the office only upon application
27 and good cause shown.
28 (4) The hearing examiner shall receive all relevant
29 evidence. Either party may submit the testimony of expert
30 witnesses, and expert witnesses employed by the office may be
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1 called by the hearing examiner to testify as to their
2 observations and opinions. The office shall have the power to
3 issue subpoenas for the attendance of witnesses at hearings
4 or the production of evidence. All hearings shall be
5 electronically recorded by the hearing examiner. Copies of
6 such recordings shall be made available to the parties at a
7 reasonable fee.
8 (5) If any person subpoenaed pursuant to paragraph(4)
9 shall neglect or refuse to obey the command of the subpoena,
10 any judge of any court of competent jurisdiction, upon
11 request of the Office of Lemon Law Actions and on proof of
12 service of the subpoena, payment or tender of any fees
13 required and of refusal or neglect by the person to obey the
14 command of the subpoena, may issue a warrant for the arrest
15 of said person to bring him before said judge, who is
16 authorized to proceed against said person for a civil
17 contempt of court.
18 (6) The hearing examiner shall, within ten days of the
19 hearing, issue an opinion and order containing findings of
20 fact and conclusions of law under this act, which shall be
21 sent by first class mail to the purchaser and the
22 manufacturer. A purchaser or manufacturer aggrieved by a
23 decision of a hearing examiner may, within 30 days of the
24 date of the decision, appeal the decision to the court of
25 common pleas of the county in which the hearing occurred.
26 Said appeal shall be a trial de novo in the court of common
27 pleas in accordance with the rules regarding appeals from
28 compulsory civil arbitration and the Pennsylvania Rules of
29 Civil Procedure. If no appeal is taken within 30 days, the
30 hearing examiner's decision shall be a final order and shall
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1 be filed as a final judgment in the appropriate court.
2 (7) The Office of Automobile Lemon Law Actions shall
3 take all appropriate action necessary to enforce a final
4 judgment rendered pursuant to paragraph (6).
5 (8) In any appeal taken from an opinion and order of a
6 hearing examiner, the findings of fact of the hearing
7 examiner shall be admissible in evidence. In any appeal taken
8 from an opinion and order of a hearing examiner awarding
9 relief pursuant to section 5, any final decision or order
10 awarding relief pursuant to section 5 shall include in said
11 relief, in addition to the provisions of section 8, an amount
12 representing the fair rental value of a motor vehicle
13 comparable to the vehicle in issue, computed from the date of
14 the opinion and order of the hearing examiner to the date the
15 relief pursuant to section 5 is provided to the purchaser.
16 The filing of a frivolous appeal shall constitute an unfair
17 trade practice under the act of December 17, 1968 (P.L.1224,
18 No.387), known as the Unfair Trade Practices and Consumer
19 Protection Law.
20 (e) Rules and regulations.--The Office of Attorney General
21 shall adopt such rules and regulations as may be necessary to
22 implement this section.
23 Section 2. The act is amended by adding a section to read:
24 Section 9.1. Compilation of statistics.
25 The Office of Automobile Lemon Law Actions shall maintain
26 records of each complaint filed with the Office of Automobile
27 Lemon Law Actions, including an index of new motor vehicles by
28 year, make and model. The Office of Automobile Lemon Law Actions
29 shall compile aggregate annual statistics for all complaints
30 filed with the Office of Automobile Lemon Law Actions, and
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1 annual statistics for each manufacturer which shall include, but
2 not be limited to, for each complaint filed with the Office of
3 Automobile Lemon Law Actions, the number and percent of:
4 (1) replacement motor vehicle requests;
5 (2) purchase price refund requests;
6 (3) replacement motor vehicles obtained in prehearing
7 settlements;
8 (4) purchase price refunds obtained in prehearing
9 settlements;
10 (5) replacement motor vehicles awarded;
11 (6) purchase price refunds awarded;
12 (7) decisions neither complied with during the required
13 period, nor petitioned for appeal within the 30-day period;
14 (8) decisions appealed; and
15 (9) results of decisions appealed.
16 The statistical compilations, pursuant to this section, shall be
17 public information and shall be published in an annual report.
18 Section 3. Section 10(a) of the act is amended to read:
19 Section 10. Resale of returned motor vehicle.
20 (a) Vehicles may not be resold.--If a motor vehicle has been
21 returned under the provisions of this act or a similar statute
22 of another state, it may not be resold in this State unless:
23 (1) The manufacturer provides the same express warranty
24 it provided to the original purchaser, except that the term
25 of the warranty need only last for 12,000 miles or 12 months
26 after the date of resale, whichever is earlier.
27 (2) The manufacturer provides the consumer with a
28 written statement on a separate piece of paper, in ten point
29 all capital type, in substantially the following form:
30 "IMPORTANT: THIS VEHICLE WAS RETURNED TO THE MANUFACTURER
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1 BECAUSE IT DID NOT CONFORM TO THE [MANUFACTURER'S EXPRESS
2 WARRANTY] WARRANTIES APPLICABLE TO THE VEHICLE, AND THE
3 NONCONFORMITY WAS NOT CURED WITHIN A REASONABLE TIME AS
4 PROVIDED BY THE PENNSYLVANIA AUTOMOBILE LEMON LAW."
5 The statement shall also be conspicuously printed on the
6 motor vehicle's certificate of title or noted by the word
7 "lemon."
8 The provisions of this section apply to the resold motor vehicle
9 for the full term of the warranty required under this
10 subsection.
11 * * *
12 Section 4. The act is amended by adding a section to read:
13 Section 10.1. Rustproofing.
14 (a) General rule.--Whenever a motor vehicle dealer offers to
15 rustproof a new motor vehicle which he is offering for sale at
16 retail, the motor vehicle dealer shall:
17 (1) inform the person who is buying the vehicle that
18 rustproofing by the dealer is optional; and
19 (2) inform that person if the vehicle has been
20 rustproofed by the manufacturer and what, if any,
21 manufacturer's warranty is applicable to that rustproofing.
22 (b) Exception.--Subsection (a) shall not be applicable and a
23 motor vehicle dealer shall have no duty to inform a person
24 pursuant to subsection (a) if the motor vehicle dealer
25 rustproofed a new motor vehicle before offering it for sale to
26 that person.
27 (c) Enforcement and regulations.--The Office of Attorney
28 General is authorized to enforce this section and may adopt such
29 regulations as may be necessary for the enforcement and
30 administration of this section.
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1 (d) Nonapplicability.--This section shall not be applicable
2 to any new motor vehicle which has been rustproofed by a motor
3 vehicle dealer prior to the effective date of this section.
4 Section 5. Section 12 of the act is amended to read:
5 Section 12. Rights preserved.
6 Nothing in this act shall limit the purchaser from pursuing
7 any other rights or remedies under any other law, contract or
8 warranty. No purchaser shall be required to pursue any procedure
9 under any manufacturer arbitration process or otherwise prior to
10 pursuing the remedies provided for in this act.
11 Section 6. This act shall take effect in 60 days.
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